**UNITED        STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

 

**FORM        10-K**

 

*(Mark        One)*

þ          Annual        report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the        fiscal year ended**December 31,        2007**.

o       Transition report pursuant to        Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period        from      to. 

 

Commission file number:**000-27735**

 

**ASIA8, INC.**

(Exact        name of registrant as specified in its charter)

 

| **Nevada**

(State or other jurisdiction of

incorporation or organization) | **77-0438927** 

(I.R.S. Employer

Identification No.) |
|-----------------------------------------------------------------------------|-------------------------------------------------------------|

 

**2465 West 12th Street, Suite 2 Tempe, Arizona        85281**

(Address        of principal executive offices) (Zip Code)

 

**(480) 505-0070**

(Issuer’s telephone number, including area code)

 

Securities registered under Section 12(b) of the Exchange Act:        none.

Securities registered under Section 12(g) of the Exchange Act: common stock        (title of class), $0.001 par value.

Indicate        by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of        the Securities Act of 1933: Yeso     Noþ.

Indicate        by check mark if the registrant is not required to file reports pursuant to Section 13 or        Section 15(d) of the Exchange Act: Yeso     Noþ.

Indicate        by check mark whether the registrant: (1) filed all reports required to be filed by Section        13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that        the registrant was required to file such reports), and (2) has been subject to such filing        requirements for the past 90 days: Yesþ     Noo.

Indicate        by check mark if disclosure of delinquent filers in response to Item 405 of Regulation S-K        is not contained herein, and will not 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-K or any amendment to this Form 10-Ko.

Indicate        by check mark whether the registrant is a large accelerated filer, an accelerated filer, a        non-accelerated filer, or a smaller reporting company as defined by Rule 12b-2 of the        Exchange Act: smaller reporting companyþ.

Indicate        by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the        Exchange Act): Yeso     Noþ.

The        aggregate market value of the registrant's common stock, $0.001 par value (the only class        of voting stock), held by non-affiliates (18,198,250 shares) was approximately $2,911,720        as of April 9, 2008 based on the price of $0.16 at which the common stock was sold in        September of 2007.

At April 9,        2008, the number of shares outstanding of the registrant's common stock, $0.001 par value        (the only class of voting stock), was 23,071,835.

 

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**TABLE OF CONTENTS**

**           **Page**    
**PART I.**
     Item       1.                           Business  3  Item       1A.                         Risk Factors  19  Item       1B.                         Unresolved Staff Comments  24  Item       2.                           Properties  24  Item       3.                           Legal Proceedings  24  Item       4.                           Submission of Matters to a Vote of                    Security Holders  24 
**PART II.**
     Item       5.                           Market for Registrant's Common                    Equity, Related Stockholder Matters, and Issuer Purchases of Equity                    Securities  24  Item       6.                           Selected Financial Data  26  
Item       7.                               Management's Discussion and                        Analysis of Financial Condition and Results of Operations
  26  Item       7A.     Quantitative                    and Qualitative Disclosures about Market Risk  32  Item       8.                           Financial Statements and Supplementary Data  32  Item       9.                           Changes in and Disagreements with Accountants on Accounting and Financial                    Disclosure  33  Item       9A.     Controls                    and Procedures (Item 9A (T))  33  Item       9B.     Other                    Information  33 
**PART III.**
     Item     10.                         Directors, Executive Officers and Corporate                    Governance  34  Item     11.                         Executive Compensation  37  Item     12.                         Security Ownership of Certain Beneficial Owners                    and Management and Related Stockholder Matters  37  Item     13.                         Certain Relationships and Related Transactions,                    and Director Independence  38  Item     14.                         Principal Accountant Fees and Services  39  Item     15.                         Exhibits and Financial Statement                    Schedules  40                                            Signatures  41    **
**            2        **

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**PART        I**

 

| **ITEM 1.** | **BUSINESS** |
|-------------|--------------|

 

***As        used herein the terms “Company,” “we,” “our,” and        “us” refer to Asia8, Inc., its subsidiaries, and its predecessors, unless        context indicates otherwise.***

 

**Corporate History**

 

The        Company, a Nevada corporation, was incorporated in September of 1996 as H&L        Investments, Inc. On December 22, 1999 our name changed to Asia4sale.com, Inc. in        connection with our acquisition of Asia4Sale.com, Ltd., a Hong Kong registered software        development company. Asia4Sale.com developed a web based system for business to business        and business to consumer selling, bartering, and auctioning of consumer goods and services        to the Asian market place. Unfortunately, the system was not widely accepted and our        introduction corresponded with a general downturn in business to business and business to        consumer e-commerce which conditions caused us to abandon e-commerce software operations.        We eventually sold Asia4Sale.com, Ltd. to an unrelated party in January of 2005.

 

On June 30,        2000, we acquired 49% of World Wide Auctioneers, Inc., a Nevada registered corporation,        holding 100% of British Virgin Island registered company World Wide Auctioneers, Ltd        (“WWA”), an international equipment auction company. World Wide Auctioneers,        based in the United Arab Emirates (U.A.E.), holds unreserved auctions for the sale of        construction, industrial and transportation equipment on a consignment basis. On August 8,        2003, World Wide Auctioneers, Inc. sold 100% of World Wide Auctioneers, Ltd., to a Nevada        registered company, WWA Group, Inc., in a stock for stock transaction. The exchange caused        us to acquire a minority equity investment in WWA Group which is accounted for using the        equity method. As of April 9, 2008, the Corporation holds 7,291,516 shares of the common        stock of WWA Group, which is equal to approximately 40% of WWA Group’s issued and        outstanding shares.

 

On May 31,        2007 we acquired the exclusive rights to distribute Unic Cranes in the U.A.E., manufactured        in Japan by the Furukawa Co., Ltd. We have since commenced sales of Unic Cranes and have        sold 26 Unic Cranes to date. On June 30, 2007, we also acquired the exclusive right to sell        Atomix Boats in the U.A.E. We have since sold four Atomix Boats. In November, 2007, we were        granted the exclusive right to distribute the Renhe Mobile House products, re-branded by        Asia8 as “Wing House” mobile shelter systems, in the Middle East region. We        have sold 6 units as of April 9, 2008. In 2007 we also acquired exclusive distributorship        rights to 20 countries for sales of Trident 3-wheeled CNG powered vehicles. We did sell by        contract two sub-dealerships for the vehicles in 2007, but were unable to collect fees due        for the sale. In April 2008 we discontinued our efforts to market the Trident vehicles due        to price, quality and competition issues.

 

The        Company’s business office is located at 2465 West 12th Street, Suite 2, Tempe,        Arizona, 85281, and our telephone number is (480) 505-0070. Our registered statutory office        is located at the Corporation Trust Company of Nevada, 6100 Neil Road, Suite 500, Reno,        Nevada, 89511.

 

**DESCRIPTION OF BUSINESS OPERATIONS**

 

***Minority Interest in WWA Group, Inc.***

 

As of April        9, 2008, the Company holds 7,291,516 shares of the common stock of WWA Group, which is        equal to approximately 40% of WWA Group’s issued and outstanding shares.

 

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The        relationship between the Company and WWA Group is one of common control, as the chief        executive officer of both companies is the same person. The Company benefits from the        contacts and business development opportunities generated by WWA Group’s business        activities and infrastructure in the U.A.E. We intend to provide additional financial and        business support to WWA Group to help grow the value of our equity interest, and to provide        us opportunities for acquisition and development that are related to or generated by WWA        Group.

 

***WWA’s Business***

 

WWA Group,        through its wholly owned subsidiary WWA, is a diversified auction and trading company        focused on heavy equipment sales and shipping, with an investment into a limestone mining        venture. WWA operations are focused on the high-growth, underserved region of the Middle        East that is transforming into a luxury tourism and international economic center. Since        its inception in 2001 through the end of 2007, WWA has auctioned approximately $600 million        worth of vehicles and equipment. WWA also manages unreserved auctions in Australia through        a joint venture partner.

 

WWA is        further distinguished as the largest seller of second-hand construction equipment in the        Arab Gulf Cooperation Council (GCC) countries -- Saudi Arabia, Kuwait, the United Arab        Emirates, Qatar, Bahrain and Oman. Auctions are conducted on location in Dubai, and through        the WWA BIDLive online bidding system. This is one of the most dynamic construction markets        in the world: the authoritative Middle East Economic Digest (MEED) is tracking regional        projects currently valued at over $2 trillion.

 

WWA’s        primary auctioned items include mobile and stationary earthmoving and construction        equipment such as crawler tractors, excavators, wheel loaders, cranes, trucks and trailers,        generators, compressors, agricultural tractors, and forklifts. Much of the equipment can be        used in multiple industries and in diverse geographic locations. We also sell light        vehicles and other related items such as boats and motorcycles. WWA Group also generates        commission and service income from these auctions.

 

WWA is now        beginning the execution of its expanded operations plan to leverage its dominant equipment        auction and trading base into a diversified business including activities in the Gulf        region that are related to heavy equipment. During 2006 WWA acquired a shipping vessel        known as the M/V Iron Butterfly that is now under charter to provide transportation        services, and a 35% minority interest in Marena Industries Ltd. a mining company that        operates a limestone quarry in the U.A.E.

 

WWA Group        is subject to the informational requirements of the Securities Exchange Act of 1934, as        amended and as such files reports, proxy statements and other information with the        Commission. Filings can be viewed on the Internet at www.sec.gov.

 

We account        for our minority interest in WWA Group using the equity method, whereby our percentage of        the net income of WWA Group is accounted for as other income of the Company.

 

 

 

 

 

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**Wholly owned and operated Business Divisions**

 

***Unic        Crane Distribution***

 

On May 1,        2007, the Company entered into an agreement with Peter Prescott to acquire the exclusive        right to distribute Unic Cranes in the U.A.E., manufactured in Japan by the Furukawa Co.,        Ltd in exchange for assuming ownership of Mr. Prescott’s equipment assets in the        U.A.E., and associated liabilities. The Unic Distribution Agreement called for the Company        to take over ownership of $415,000 worth of equipment at book value, along with $415,000 of        associated liabilities, and the rights to the exclusive distributorship appointment by        Unic, in return for 800,000 shares of our common stock. The agreement closed on May 31,        2007.

 

***Products***

 

Unic Cranes        are among the world’s most popular and highly regarded products within their market        niche that have achieved a dominant market position in Japan and several other        markets.Unic        produces a range of innovative light lifting equipment products, which are noted for        flexibility, easy operation, safety, and economy. Unic Cranes feature remote        radio-controlled operation, flexile booms with multiple lifting and grabbing attachments        for handling different types of loads, and a variety of features designed to enhance safety        and efficiency. Unic’s unique crawler cranes can gain access to work sites and other        locations that cannot be reached by wheeled vehicles.

 

The Unic        A094CR mini-crane won the “best Tools and Access Product” award at the recent        Interbuild exhibition at the United Kingdom, and the product’s ability to move inside        buildings and work in spaces inaccessible to other cranes is attracting attention        throughout the industry. The URW A295CR mini crawler crane was featured on Discovery        Channel’s “Mean Machines” series as one of the most useful, innovative        products in its category in the world.

 

Unic        products are compact, efficient, and easy to maneuver, characteristics ideally suited to        the busy, confined, urban construction environments that are typical of the        U.A.E.

 

***Markets***

 

The rapidly        accelerating U.A.E. construction market creates enormous potential demand for the Unic        lifting products that the Company is now distributing. Much of the country’s        developments are now in dense, crowded urban environments, and the compact, efficient Unic        products are ideally suited to loading, unloading, and on-site handling of construction        materials under these conditions, and to ongoing finishing and maintenance work. As the        overall economy matures in the country and more in-fill land is developed, the trend is        expected to move toward more use of light, efficient handling machinery rather than manual        labor and large multi-purpose lifting equipment.

 

In Japan        and Southeast Asian markets where development is dense, Unic has sold over 5,000 cranes        over the last 5 years. Unic has sold over 1,500 cranes in Taiwan alone in the last 5 years.        As the U.A.E. becomes more developed and dense, we expect the market demand for Unic        products to reach levels of established Southeast Asian countries.

 

In the        table below are export figures provided by Unic for 2004 – 2006. The 2006 Middle East        figures include cranes sold by the U.A.E. dealership acquired by the Company.

 

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***Unic        Exports***

|   | 2004            2005                                  2006___ | 2007 |
|--------|----------------------------------------------------------------------------------------------------------------------|------|

| Middle-East                                    | 60 units        50 units                             130 units | 195 units |
|------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------|-----------|

| North America         | 60 units       165 units                            | 50 units | 76 units |
|-------------------------------------------|------------------------------------------------------------------------------|----------|----------|

| Europe                                          | 70 units       120 units                            160 units | 200 units |
|----------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------|-----------|

| Australia                                        | 80 units         60 units                              45 units | 50 units |
|------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------|----------|

| Taiwan                                          | 310 units     300 units   | 300 units | 300 units |
|----------------------------------------------------------------------------------------------|------------------------------------------|-----------|-----------|

 

The above        quantities do not include the exported cranes which were mounted on trucks in Japan and        sold as a package. Unic Thailand reports that the total market for truck mounted cranes of        2 - 15 ton size is about 400 units per year. Unic sells approximately 100 of these units        per year, with Tadano also selling 100 and the balance distributed amongst Palfinger, Hiab,        and several other lesser known brands. The markets in Thailand and Taiwan are good        comparisons to the U.A.E.’s potential.

 

Japanese        industrial products are well received in the U.A.E., and Unic’s pricing and features        compare favorably with competing products. Our extensive research and experience in the        U.A.E. gives us reason to believe that we can create a significant market share in the        U.A.E. for these products. More than 30 units were sold in the U.A.E. from March 2006        through April 2007, at an average gross margin of about 15%, or $4,500 per unit. We have        sold 26 cranes at a gross margin of $4,500 each from May 1, 2007 up to the date of this        report. With our expanded network of customers in the U.A.E. and our sales channels we        expect to increase these sales figures to over 100 units per year by 2009.

 

**The        Atomix Distribution Agreement**

 

On May 1,        2007, the Company entered into an agreement with Peter Prescott to acquire the rights to        the exclusive distributorship agreement for Atomix Boats in the U.A.E., manufactured in        China by the Atomix Boats Co. Ltd. Zhejiang, in exchange for 600,000 shares of our common        stock. The agreement closed on June 30, 2007.

 

***Products***

 

Atomix        Boats has established a new composite boat manufacturing facility in China. Atomix Boats        include a range of 8 designs from 4 to 10 meters including bow riders, cabin cruisers,        sports cruisers, fisherman, centre consoles and RIB's (rigid hull inflatable). Other Atomix        products include a selection of inflatable boats and trailers including boat trailers and        general purpose trailers.

 

Atomix        China is owned by New Zealand nationals. Expertise and experience is drawn from other New        Zealand companies to ensure the quality and reliability of all Atomix products having been        carefully selected from the best in the world. Among these companies are Bakewell White        Yacht Design, and High Modulus, who have been providing technical assistance and        support both on and off site. The New Zealand marine industry, built on a strong domestic        market, has developed into an internationally credible supplier of innovative products        and some of the finest boats in the world.

 

Atomix        Boats products are all 100% hand-laid to achieve maximum quality and consistency. High        Modulus supplies engineering expertise to ensure that all products are built to meet CE        requirements and to achieve optimum strength to weight ratios. There is no structural        timber used in any Atomix products and all reinforcing is done with high density foam using        foam sandwich construction techniques. Quality assurance is provided by a        team of New Zealand boat builders that remain onsite both to train staff and monitor        production.

 

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Atomix        Boats are designed to achieve the critical balance between style, safety, comfort and        performance. With an original and unmatched hull design, a proven high-tech construction,        Atomix yachts bring together all the ingredients of comfort and ease of handling. The boats        are equipped with Volvo or Mercruiser diesel and gasoline engines made outside of China.        The boats are priced well below the competitors in the 4 to 10 meter range, due to lower        manufacturing costs.

 

***Markets***

 

In an        article published in April 2007 in the Gulf News by Erwin Bamps, Executive Manager of        local market leader Gulf Craft, he stated that there are 13,000 boats in U.A.E. at the        moment and the market can expect another 10,000 to 30,000 pleasure boats once new marinas        are built. He estimated that currently one out of 350 people owns a boat in the U.A.E.,        while in Australia & New Zealand one out of 10 people owns a boat.

 

As many as        30,000 to 50,000 boats are predicted to be moored in Dubai within the next five years,        according to projections by Dubai Maritime City (DMC). DMC said boat ownership levels in        Dubai will increase 15 per cent within the next year as a result of the increased        availability of berthing space and better maritime facilities.

DMC is        making final preparations to complete the first phase of its marina berth project, and        showcase its facilities as the main supply, service and refit centre for leisure boats and        yachts in the region. A March 2008 news article quoted “Although much of the maritime        infrastructure is still being developed, the sector is now growing by more than 10 per        cent," said Amer Ali, chief executive of DMC. [It is] a strong indication of the increasing        confidence in the local market and Dubai's enormous potential in this industry. With more        berths, better marine facilities, and more suppliers, we expect boat ownership to really        take off in the near future, especially in the leisure boats and yachts categories," he        said.

According        to the*Gulf Boating Market Report*, a        strong increase in marina leisure is projected for the U.A.E., Kuwait and Qatar. Around the        Gulf, their estimate is one boat for every 423 residents. The report states that leisure        fishing is one of the main drivers for boating in the Gulf, due to the traditional aspect        of fishing and pearl-diving in the past. However, with the increasing number of overseas        property purchasers in Dubai, imported boats from leading European and US builders are on        the increase.

 

The annual        Dubai International Boat Show is one of the top 5 most visited boat shows in the world,        with than 25,000 visitors and 800 exhibitors reported for 2008. The Company was an        exhibitor of Atomix boats at the show.

 

State owned        Nakheel, the largest oceanfront property developer in the U.A.E., has signed a management        agreement with Island Global Yachting to build and operate marinas in all their        developments in the U.A.E. Andrew Farkas, chief executive officer of Island Capital Group        said, "We are excited about the expansion of our partnership with Nakheel, whose visionary        projects and renowned developments have established Dubai as a new world-class destination        for business and luxury tourism. Our partnership will pave the way for potentially more        than 40,000 new marina berths, which will establish Dubai as a global yachting destination        and facilitate the growth of the marina industry in the Middle East." This partnership will        create an extraordinary opportunity for worldwide marina manufacturers, developers and        service providers to contribute their expertise to and benefit from this unparalleled        waterfront development in Dubai. Nakheel currently has $30 billion worth of projects under        development, which will add 1,500 km (approximately 932 miles) of waterfront        property to Dubai once they are completed. There are currently only 2,500 boat berths in        Dubai. Industry leader Septech, which controls 75% of Dubai’s market for berth        construction, has increased the production of its existing marine factory from 250 berths        to 5,000 berths per year, and is targeting a capacity of 25,000 berths by year end        2009.

 

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Local and        international banks have been quick to realize the opportunity for growth in pleasure boat        sales, offering a range of financing options for potential boat owners. UK-based HSBC        requires a 30 per cent down payment and a valid boat and life insurance. The National Bank        of Abu Dhabi (NBAD) also offers two types of boat financing loans for any person who makes        more than $5,000 per month in salary. The estimates from all sources range from 25,000 new        marina berths in Dubai, to 40,000 berths coming on line in Nakheel projects alone. These        estimates do not include the thousands of berths and waterfront housing units coming on        line in Abu Dhabi, Umm al Quwain, and the increasingly popular Ras al Khaimah.

 

We believe        that there is potential for sales of at least 40,000 boats in the under-10-meter, motor        powered category in the next 5 years in the U.A.E. While we have yet to determine the        marketability of the Atomix product, our research indicates that we can sell the boats at a        significant profit but at less than the average local market price for the category. We        have sold four units at an average gross profit of 20% since May 15, 2007.

 

| **The Wing House Mobile Shelter System**  |
|------------------------------------------------|

 

In        December, 2007, the Company entered into an agreement with Renhe Manufacturing China to        become the exclusive distributorship agreement for the Wing House Mobile Shelter in the        U.A.E. We paid no considerations for this agreement, but we did purchase one test unit to        display in the UAE market.

 

***Products***

 

The Wing        House Mobile Shelter System was specifically designed to meet the need for an efficient,        cost-effective mobile structure capable of serving as an office, residence, or storage        space. Each Wing House unit is delivered as a standard 40 foot container with all ISO        fittings in place for easy transport. This unit can be placed anywhere with a swinglift and        opened into an 80sqm living or working environment within 4 to 5 hours. The Wing House is        an ideal solution for any application requiring low cost rapidly mobile living or office        space. Wing House units are suitable for a wide range of applications, including living        space, office space, on-site showrooms, dining facilities, and worker accommodations. The        units are effectively insulated and carry a 5-star energy use rating, making them ideal for        use in the hot climate conditions of the Middle East.

 

The units        are pre-wired for telephone, internet, and television, and can be ordered with        pre-installed air conditioning and blinds. All units are delivered complete with all        electrical wiring including lighting, sockets and switches, complete plumbing and hot water        system, external lighting, built-in cabinetry in the kitchen and bathroom, fully fitted        bathroom including toilet, shower cubicle, basin and vanity, and smoke detectors. The Wing        House retails at approximately $65,000 and faces virtually no equivalent        competition.

 

*Markets*

 

The        regional construction boom has generated ideal market conditions for the Wing House        product. Thousands of construction projects are in progress, most of which require,        temporary mobile housing and offices. While the Wing House prices are above the market for        temporary office and labor housing cabins, the superior quality, easy mobility and long        life of the Wing House system makes it ideal for these projects. The project market is        increasing dramatically in the UAE and the GCC, low price housing and office space        is becoming very scarce, and government safety policies for temporary camps        and offices are becoming more restrictive. All of these factors make the Wing Houses more        attractive to this market than any other similar product offered in the region. The        distribution agreement for Wing House products was closed too late in 2007 to allow        effective marketing during that year, but the first quarter of 2008 saw 6 units sold and        another 20 units quoted for potential sale. The Company believes that Wing House will see        rapidly increasing sales and will emerge as a substantial contributor of        revenue.

 

 

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**General Market Conditions**

 

The        Company’s business plan is built around selling into the sustainable economic boom        that is now underway in the Arabian Gulf region. WWAG’s business is built on the        rapidly expanding demand for equipment trading services that has been generated by the        extremely high level of regional construction activity. The Company’s existing and        prospective distributorship agreements are aimed at supplying selected Asian-made projects        to high demand niches in this import-oriented economy.

 

***The        Gulf Region Market***

 

*Oil        and Gas*

 

The US        Energy Information Agency, using OPEC data, reports that oil export receipts for the UAE,        Qatar, Kuwait, and Saudi Arabia reached $300 billion in 2006 and grew to $323 billion in        2007. Natural gas represented an additional revenue source, with leading producer Qatar        generating over $12 billion in gas export revenues in 2007; Saudi Arabia and the UAE also        reported substantial natural gas revenues.

The        continuing environment of high oil prices has driven rapid economic growth. Nations of the        Gulf Cooperation Council ( GCC) have seen a cumulative expansion in nominal GDP of 74% over        the last three years. For the GCC as a whole, GDP per capita has risen over the last three        years to over $17,000 from below $11,000. This trend is expected to continue, with non-oil        GDP showing marked expansion as large sums invested in construction, tourism, trade,        infrastructure, and industry begin generating returns. The UAE’s non-oil nominal GDP        growth has been averaging16 per cent for the period 2002-2006 and is expected to go up to        21 per cent in 2008. Total nominal GDP is expected to increase by 16 per cent from $188        billion to $218 billion, driven primarily by growth in sectors like manufacturing,        construction, financial services and tourism. Analysts with the Kuwait Financial Center        report that the GCC as a whole is expected to witness an expansion of 14 per cent in 2008,        compared to 11 per cent in 2007. The aggregate fiscal surplus of the GCC region is expected        to reach $162 billion in 2008, the highest ever in the history of the GCC region. The        aggregate GCC current account surplus is expected to grow at a rate of 16 per cent to reach        $212 billion, the highest ever in GCC.

Oil        producing nations in the Gulf region saw an unexpected windfall in 2007. Income projections        for the year were based on relatively conservative projections. Qatar, for example, based        its 2007 budget on an assumed average oil price of $40/barrel. The actual average price for        the year reached $72, generating billions of dollars in unanticipated revenue: Qatar had a        budget surplus of $2 billion for the year. Budget projections are based on an anticipated        2008 average oil price of $55, and with oil prices for the first quarter of 2008 averaging        over $90/barrel, regional budget surpluses are set to remain very high, providing ample        resources for the completion of current development projects and the initiation of new        efforts.

 

The        prevailing environment of high energy prices is expected to prevail for a number of years.        Oil price booms in the past have been driven primarily by political instability in the        Middle East. While this is a factor in today’s boom, it is by no means the only        factor. Surging energy demand from China and India has become a significant influence on        energy markets, and even with OPEC production at full capacity, the supply/demand equation        still favors sustained high prices. The large ongoing investments in new        production will eventually raise current supply ceilings, but demand is        increasing as fast or faster than supply, and virtually all forecasts suggest that high oil        prices – and correspondingly high income for the OPEC nations in general and the GCC        in particular — will break out of the boom/bust cycle and move to an extended period        at the high end of historical price ranges. Brad Bourland, economist with the Saudi        American Bank, has predicted that even at a very conservative average oil price of $50/        barrel, GCC oil revenues over the next 20 years will reach $24 trillion.

 

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The        beneficiaries of the oil price boom are investing the proceeds in new infrastructure,        catching up from a decade of neglect during the oil glut of the 1990s. MEED Projects, the        project-tracking venture of the authoritative Middle East Economic Digest, announce on        March 31, 2008 that projects now being tracked in the GCC region are valued at over $2        trillion, a 40% increase in one year. Since the threshold for inclusion in the MEED        Projects database is $50 million, thousands of smaller but still significant projects are        not included in this figure: review of project announcements in regional publications        suggest that the total value of these smaller projects totals between 30% and 50% of the        value of the large projects tracked by MEED.

 

This        expanding business environment appears set to continue for years. The IMF report cited        above comments that “Envisaged spending plans imply continued prudent management of        oil revenue in the region as a whole”, and adds that “The increased spending        can be financed easily, even if oil prices were to decline significantly... Middle Eastern        and Central Asian oil-exporting countries, in aggregate terms, will be able to undertake        their envisaged spending plans and still set aside substantial savings for the        future.” MEED’s announcement of the $2 trillion figure includes the comment        that of the total projects tracked by the index, however, only one quarter are currently        under construction, which implies a further three to five years of “intensive        construction activity to come”, at a minimum.

 

GCC nations        are rapidly diversifying their economies with large domestic investments in non-oil        industries: Dubai's non-oil foreign trade reached $185 billion in 2007 compared to $139        billion in 2006 a 33 per cent increase. The regions oil producers are also investing        heavily in foreign assets: a December 2007 report by RGE Monitor comments that:

 

*By the        end of 2007, GCC Sovereign Wealth Funds (SWFs) will manage over $1 trillion.*

*GCC        central banks – counting the non-reserve foreign assets of the Saudi        Arabian*

*Monetary        Agency (SAMA) -- will manage another $460 billion. Their combined*

*portfolio will thus approach China’s $1.7-1.8 trillion portfolio in        size... total Gulf investment abroad would far exceed $2 trillion.*

 

The        combination of increasing oil income, prudent management of that income, domestic        diversification and extensive investment in productive foreign assets indicates that the        Gulf economies will have the means to complete and expand their spending plans, and that        the regional equipment market will remain in an expansionary mode for years to come. Many        of the major construction projects referred to below are in the earliest phases of        development, and many are phased projects that will be generating demand for materials and        equipment for many years to come.

 

*Dubai* 

 

The Emirate        of Dubai has led the UAE construction boom for years. Dubai has minimal oil reserves, but        has successfully diversified its economy and emerged as the regional trade and transport        hub, a favored location for corporate headquarters in the region, and as a major center for        tourism and real estate investment. Dubai is the region’s leading equipment trading        center, combining demand from projects within the emirate with extensive purchases of        equipment destined for use elsewhere in the UAE or in neighboring countries.

 

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Demand        within Dubai is driven by an enormous surge in construction spending, spanning a wide range        of investment in tourism, real estate, infrastructure, transport, and industry. A partial        list of major projects now under construction in Dubai includes:

 

|   | **•** | the $8 billion Burj Dubai complex, including the                        world’s tallest building; |
|--------|------------|---------------------------------------------------------------------------------------------------------|

|   | **•** | the $4.2 billion Dubai Mall |
|--------|------------|-----------------------------|

|   | **•** | the $4.2 billion expansion of the Dubai International                        Airport; |
|--------|------------|---------------------------------------------------------------------------------------|

|   | **•** | the $1.6 billion Dubai Festival City; |
|--------|------------|---------------------------------------|

|   | **•** | the $10 billion Dubai Marina; |
|--------|------------|-------------------------------|

|   | **•** | the $1.4 billion Jumeirah Islands development; |
|--------|------------|------------------------------------------------|

|   | **•** | the $5 billion Dubailand theme park; |
|--------|------------|--------------------------------------|

|   | **•** | the $3.4 billion Dubai Mountain City; |
|--------|------------|---------------------------------------|

|   | **•** | the $2.7 billion Dubai International Chess City; |
|--------|------------|--------------------------------------------------|

|   | **•** | the Dubai World Central airport complex, a 6-runway airport                        and surrounding commercial center, with cost estimates over $32                        billion; |
|--------|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | the $10 billion Dubai Waterfront, the most ambitious                        reclamation effort ever undertaken; |
|--------|------------|-----------------------------------------------------------------------------------------------------------------|

|   | **•** | the $1 billion Dubai Maritime City; |
|--------|------------|-------------------------------------|

|   | **•** | the $1.8 billion Golf City; |
|--------|------------|-----------------------------|

|   | **•** | the $3.8 billion Legends theme park; |
|--------|------------|--------------------------------------|

|   | **•** | the $27 billion Bawadi Hospitality Project; |
|--------|------------|---------------------------------------------|

|   | **•** | the Dubai Business Bay, with $54 billion in committed                        investment; and |
|--------|------------|----------------------------------------------------------------------------------------------|

|   | **•** | the Palm Deira, a new 80km/sq city (larger than Manhattan)                        on a man-made island. Dredging and reclamation work is already underway, at                        a cost of $4.37 billion. The development is expected to include 8,000                        villas, hotels, clubs, shopping malls, and other luxury                        facilities. |
|--------|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | The $61 billion Arabian Canal complex |
|--------|------------|---------------------------------------|

 

The Emirate        of Dubai has committed itself to massive infrastructure development, with Roads and        Transport Authority Chairman Mattar Al-Tayer announcing om March 31, 2008 that the        Authority plans to invest at least 75 billion dirhams ($20 billion) over the next five        years on transport infrastructure. Literally thousands of smaller private-sector projects        are underway, focused on providing residential, office, commercial, and leisure space for        the emirate’s population, which is surging at a rate of over 6% per year.

 

Dubai’s building boom remains in its early stages. Several of the        largest projects are in the earliest stages and work on the ground has barely begun, and        their impact on markets for machinery and construction materials has yet to be felt. The        Dubai Waterfront project, the most ambitious reclamation project ever undertaken, is set to        begin operations in 2008. The Arabian Canal, involving the movement of 1 billion cubic        meters of earth, is one of the most ambitious earthmoving projects ever undertaken,        requiring a minimum of 2500 heavy machines. This project will also be initiated in 2008 and        will have a major impact on regional equipment demand.

 

*Abu        Dhabi*

 

The        oil-rich emirate of Abu Dhabi has seen its income soar in the last two years, and is        investing in a series of projects that rivals those of Dubai. Abu Dhabi Chamber of Commerce        and Industry Chairman Salah

 

11

 

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Salem bin        Omair Al Shamsi reported on June 14, 2006 that the Emirate planned to spend $163.4 billion        within 5 years, of which $87 billion will go to the construction sector, $32.7 billion will        be spent on development and expansion of the tourism sector, $9.5 billion will be devoted        to new power and water projects and $21.8 billion will be poured into expanding the oil and        gas sector.

 

A partial        list of Abu Dhabi’s leading works in progress includes:

 

|   | **•** | the $6 billion Taweelah aluminum smelter; |
|--------|------------|-------------------------------------------|

|   | **•** | the $2.7 Abu Dhabi Exhibition Complex; |
|--------|------------|----------------------------------------|

|   | **•** | the $8 billion Najmat Abu Dhabi project; |
|--------|------------|------------------------------------------|

|   | **•** | the $27.2 billion Saadiyat Island development; |
|--------|------------|------------------------------------------------|

|   | **•** | the $9.5 billion Al Reem island development; |
|--------|------------|----------------------------------------------|

|   | **•** | the $6.8 billion Shams Abu Dhabi mixed-use                        development |
|--------|------------|-------------------------------------------------------------------------------|

|   | **•** | the $2.17 billion Abu Dhabi exhibition complex |
|--------|------------|------------------------------------------------|

|   | **•** | the $6.7 billion Abu Dhabi Airport expansion; |
|--------|------------|-----------------------------------------------|

|   | **•** | the $4 billion Fujairah oil refinery; |
|--------|------------|---------------------------------------|

|   | **•** | the $2.2 billion Taweelah port development; |
|--------|------------|---------------------------------------------|

|   | **•** | the $9.5 billion Emirates Pearl mixed-use development;                        and |
|--------|------------|-----------------------------------------------------------------------------------|

|   | **•** | the Al-Raha Beach Development, a $14.5 billion new city for                        120,000 people, envisioned as the new gateway to the emirate. |
|--------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | A $15 billion renewable energy research                        initiative |
|--------|------------|---------------------------------------------------------------------------|

|   | **•** | The $40 billion Yas Island project |
|--------|------------|------------------------------------|

|   | **•** | The $9 billion Danet Abu Dhabi project |
|--------|------------|----------------------------------------|

|   | **•** | The $2 billion Capital Centre |
|--------|------------|-------------------------------|

         

*The        Rest of the UAE*

 

The        UAE’s smaller Emirates have jumped in with large projects of their own, including:        Ras al Khaimah’s $5.5 billion Sanctuary Gardens, $5 billion Marjan Islands/Al Hamra        Village, $3 billion Al Jais Mountain Resort and $2.7 billion Mina al Arab: Um al        Quwain’s $2.72 billion White Islands and $3.3 billion Um al Quwain Marina; and        Sharjah’s $5 billion Nujoom Islands project.

 

*Qatar* 

 

Qatar,        another GCC member in close proximity to Dubai, holds the world’s 3rd largest natural        gas reserves, and currently exports 14 million metric tons per annum (mmta) of natural gas.        This figure is expected to rise to 77 mmta by 2010, which would make Qatar the largest        natural gas exporter in the world, supplying as much as one third of global gas        consumption. Qatar now has the world’s third-highest per-capita income, and as gas        exports rise, the country is expected to become the world’s wealthiest        nation.

 

Qatar has        embarked on a massive construction spree, with $57 billion in oil and gas projects and $23        billion in other construction. Qatar has budgeted US$15 billion dollar for tourism and        hotel projects, US $1.6 billion dollars for water and electricity projects and US $7        billion for the modernization of Qatar’s infrastructure. A partial listing of        projects now underway includes:

 

|   | **•** | a $3 billion aluminum smelter, a joint venture between Qatar                        Petroleum (QP) and Norsk Hydro of

Norway; |
|--------|------------|--------------------------------------------------------------------------------------------------------------------------------|

         

12

 

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|   | **•** | the $4 billion Qatargas II project; |
|--------|------------|-------------------------------------|

|   | **•** | a $6 billion gas-to-liquids plant being built by Royal Dutch                        Shell; |
|--------|------------|--------------------------------------------------------------------------------------------|

|   | **•** | the $8.16 billion Lusail residential/commercial real estate                        project; |
|--------|------------|---------------------------------------------------------------------------------------------|

|   | **•** | a $4.77 billion causeway linking Qatar and                        Bahrain; |
|--------|------------|----------------------------------------------------------------------------|

|   | **•** | the $5.5 billion new Doha international airport; |
|--------|------------|--------------------------------------------------|

|   | **•** | the $2.5 billion Pearl of the Gulf man-made island                        project; |
|--------|------------|------------------------------------------------------------------------------------|

|   | **•** | the $14.5 billion Ras Laffan port and Gas processing                        facility; and |
|--------|------------|-------------------------------------------------------------------------------------------|

|   | **•** | the $7 billion Dolphin natural gas development                        project; |
|--------|------------|--------------------------------------------------------------------------------|

|   | **•** | A $20 billion downstream petrochemical                        development |
|--------|------------|---------------------------------------------------------------------------|

|   | **•** | A $3.9 billion power and desalination project |
|--------|------------|-----------------------------------------------|

|   | **•** | The $5 billion Al Khor tourism project |
|--------|------------|----------------------------------------|

         

*Saudi        Arabia*

 

Leading oil        producer Saudi Arabia, with $194 billion in oil revenues in 2006, is another leading        construction market. Spending allocated for new development projects nearly doubled in        2007, with emphasis on programs for educational facilities, hospitals, and the ambitious        new economic cities, notably the $26.6 billion King Abdullah Economic City, a state-of-the        art residential and industrial complex. $26 billion has been allocated for education and        manpower development including building 2,000 new schools and universities for Tabuk,        Najran, Al Baha, and Riyadh. Nearly 400 primary health care centers and 13 new hospitals        are planned in addition to more than 60 other hospitals in various stages of development.        These are aimed to provide almost 10,000 new beds for the health service. 8,000 kilometers        of new highway are planned in addition to 16,000 kilometers already under construction,        along with projects aimed at doubling desalination capacity and increasing electrical        generation and distribution. Some 600,000 new homes are to be built in the next four years        with many more planned.

 

*Kuwait*

 

Kuwait’s handling of its oil revenues has been relatively conservative        to date, but a number of major projects were announced in 2007, including the $77 billion        City of Silk project, a new rail system costing $11 billion, and a $2.1 billion        international airport expansion. Kuwait is expected to be a rapidly growing focus of demand        for equipment and construction materials.

 

*Positioning and Expansion* 

 

The        enormous volume of ongoing construction and infrastructure projects in the Gulf region has        led to huge demand for industrial equipment. In early 2008 the Abu Dhabi-based Al Jaber        group placed a single order for 720 Caterpillar machines valued at approximately $220        million, one of the largest single equipment orders in history. The huge volume of projects        and the imminent completion of many first wave projects have generated large and growing        demand for equipment trading services: contractors and managers of completed projects need        to dispose of surplus equipment, which is in extremely high demand.

 

Our early        decision to invest in Dubai and the Middle East, made before the current boom began, has        left us in an ideal position to benefit from this sustained acceleration in regional        business. In 2004 WWA outsold global auction giant Ritchie Brothers Auctioneers for the        first time to become the leading player in the regional industrial auction market, a lead        that has continued through 2007. WWA intends to continueresearch into        opening new auction sites in the region in the next 18 months. Other auction sites have the        potential to yield auction turnovers, revenues, and earnings equal to those WWA is now        gaining from its Dubai auctions.

 

We also intend to continue to apply WWA’s huge database        and intimate knowledge of regional buyers, sellers, users, traders, prices, sources, trends        and industry needs to our entry into other businesses in the region. The provision of        needed supplies and services, including machinery and equipment, shipping, materials,        labor, and expertise to the main contractors who control the most important projects in the        GCC region – is among the fastest-growing businesses in this booming        region.

 

 

 

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With an        established base, a leading market position, and an extensive network of regional industry        contacts, The Company believes that WWA Group’s prospects for rapid growth in the        used, industrial equipment market over the next two years are excellent.

 

Twenty four        per cent of the world's 125,000 construction cranes are currently operating in Dubai,        according to the organizers of the Conmex construction machinery exhibition. Saif Al Midfa,        director-general of the Expo Centre Sharjah, the organizers of Conmex, the exhibition for        construction machinery and equipment, said “demand for construction related        machinery, equipment and vehicles is expected to continue rising in the Middle East,        especially in the UAE, due to the continuing construction and real estate boom...        Construction activity in the region is currently at its peak as a result of which the        demand for related machinery, equipment and vehicles is experiencing a sharp rise. The        indications are that there will be no let-up in this trend".

 

The        Company’s primary investment WWA Group, serves this equipment market. The upward        trend in equipment demand is positive for WWA Group’s business.

 

WWA Group        also stands to benefit substantially from an ongoing transition in the composition of        Dubai’s construction market. The Saudi American Bank’s Brad Bourland has        commented that “The first phase of the regional boom is large-scale infrastructure        and real estate projects”, and predicted that the second phase will be        “explosive private sector growth.” Field observation in Dubai, the starting        point and epicenter of the regional boom, confirms this observation. Spending on basic        infrastructure development, dominated by giant state-owned firms, has drawn a second wave        of private sector spending of far greater proportions. For example, the $5 billion spent on        infrastructure for the Dubailand development has drawn over $60 billion in private sector        spending commitments, with the $300 million Dubai Business Bay pulling in over $50 billion        in downstream investments.

 

This shift,        which will be repeated throughout the region as major projects in Abu Dhabi, Qatar, and        other leading economies reach maturity, will fundamentally change the construction        equipment and supply business in the region. During the infrastructure phase the regional        construction market was dominated by a few extremely large and well connected companies,        often government-owned. This produced market distortions, as large consumers used their        leverage to force suppliers to drop prices, negatively impacting margins. This situation is        rapidly changing, with a much wider range of purchasers actively entering the market and        driving a transition to a more mature market-driven pricing structure. Many new private        sector projects are managed by international contractors and construction management firms,        creating a more open, dynamic marketplace and a highly beneficial business environment for        the equipment auction and material supply operations of the WWA Group. As the focus of the        regional construction business moves from small numbers of massive publicly financed        infrastructure projects to numerous privately financed projects built on top of the        developed infrastructure, the Company anticipates rapidly escalating demand for compact and        highly mobile equipment capable of cost-effective operation in high density        urban environments. The Unic cranes distributed by us are ideally suited to this working        environment.

 

The U.A.E. has adopted extremely liberal policy on        immigration, allowing residence to virtually anyone who invests, purchases property, or        finds employment in the country. These policies, combined with minimal taxation, a clean,        safe living environment, and extremely tolerant social policies, have driven a surge of        qualified immigrants, which drives demand for goods, services, and housing, which in turn        drives further immigration. Robert Tindall of Callison Architecture, a global firm with        exposure in many regional real estate projects, points out that over 4 billion people live        within a 6 hour flight of Dubai and over 1.7 billion live within a 4 hour flight. The        prospect of relocation to a safe, tolerant city with abundant opportunity is a considerable        attraction to many of them.

 

14

 

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Between        2000 and 2006, Dubai’s population grew at a compounded annual rate of 9%. Over the        same period, real per capita income increased 4%, suggesting that Dubai’s economy is        capable of sustaining growth rates that would be catastrophic in most countries. The key to        the sustainability of Dubai and the U.A.E.’s population growth is that the growth is        driven not by birth rates or by an influx of unskilled migrants. Migrants to the country        must have employment, or be able to invest in businesses or property. Employee immigrants        must leave when employment is concluded. By attracting productive immigrants, the U.A.E.        has avoided the problems of unemployment, poverty, and social stress that have        traditionally accompanied rapid population growth and high immigration rates. The RSP        Group, a Middle East real estate investment advisor, predicts a doubling of the local        population in Dubai alone to two million over the next decade. This projection is likely to        be conservative, given the number of new real estate projects now under construction: giant        developer Nakheel projects that Dubai’s Palm Jebel Ali and Dubai Waterfront projects        alone will house 1.7 million people by 2020. The $33 billion Dubai World Central complex,        built around what will be the world’s largest aviation complex, is expected to house        an additional 750,000.

 

The        U.A.E.’s population mix is also changing as the economy matures. Saudi American        Bank’s Bourland comments that the U.A.E. banking and insurance sectors have grown at        over 50% in the last three years. Dubai is emerging as a major world financial center,        particularly through the establishment of the Dubai Mercantile Center’s commodity        exchanges, and other well-funded financial centers. This trend, together with the rapid        influx of corporate headquarters and production facilities, is shifting the balance of        population, with well paid management and technical personnel rapidly replacing low-salary        construction workers. The rapidly expanding U.A.E. economy has generated a new class of        largely expatriate managers, who enjoy some of the world’s best salary packages: the        Hay Group’s 2007 World Pay report places managers in the U.A.E. and Saudi Arabia at        the top of the world’s compensation list, with average salary buying power in excess        of $220,000.

 

The rapid        growth in the region’s professional and managerial class and the very high        compensation enjoyed by these individuals are driving very high and rapidly growing demand        for lifestyle-oriented products. Feeding into this demand is an enormous number of        waterfront marina and real estate developments catering to this high-end resident clientele        and to the rapidly growing influx of affluent tourists: Dubai attracted 6.5 million        tourists in 2006, and is targeting 15 million arrivals per year by 2010. Both tourists and        the growing local consuming class focus much of their attention on a waterfront lifestyle.        Island Global Yachting, which provides comprehensive design, development and management        services to all marina properties and developments built by Dubai real estate giant        Nakheel, points out that Nakheel projects alone will add 1500km of developed waterfront        property to Dubai, and predicts that up to 40,000 new marina berths will be built in Dubai        alone. Coupled with tens of billions of dollars in waterfront developments in emirates of        Abu Dhabi, Ras al Khaimah, and Umm al Quwain, this suggests an enormous potential demand        for pleasure craft. Some of these berths will be filled by high-end yachts, but our        management believes that far more will ultimately contain reasonably priced pleasure craft,        and that the Atomix Boat products distributed by us are very well suited to        meet this demand.

 

The strong consumer market conditions will contribute to the        growth of the Company’s business. We intend to continue seeking out and pursuing        distribution agreements for products that are likely to be well received in this market.        The U.A.E. led GCC has become the world second largest consumer of oil and gas next to        China, and is expected to become one of the world’s largest importers of goods in the        next few years. Merchandise imports in the region have grown from $89 billion in 2002 to        almost $200 billion in 2006. As an importer of merchandise, the Company is projecting solid        growth in its revenues.

 

 

15

 

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**Competition**

 

***WWA        Group***

 

WWA Group        competes with numerous auction and trading companies throughout the world, but the Gulf        Region is its primary market. The used equipment auction market in the Gulf Region has only        two significant participants, WWA Group and Ritchie Brothers Auctioneers, Inc.        (“RBA”). RBA, the world’s largest un-reserved equipment auctioneer,        reports over $2.7 billion dollars in gross auction sales from 90 locations throughout in        North America and 18 other countries, and holds a dominant position in certain geographic        locations. While RBA is still much larger and much better-financed than WWA Group, it has        gradually increased its market share in Dubai to 64%, and has effectively outperformed RBA        in terms of market share since 2004.

 

***Unic        Cranes***

 

We compete        with Tadano, Palfinger, and Hiab in our market. The U.A.E. Tadano dealer does not stock or        service new and used truck cranes, but buyers can order new cranes through them. Unic        cranes are slightly cheaper than Tadano, and we have the advantage of having units in stock        and serviced. Unic has a 50% market share of all telescopic truck crane sales in Japan, and        Tadano has the other 50%. Other track crane manufacturers build “knuckle boom”        cranes, which are not as precise to operate as the Unic and Tadano models and not as        popular. We estimate that we can capture up to 30% of the total market share of hydraulic        truck cranes in the U.A.E.

 

***Atomix Boats***

 

The market        leader in the supply of leisure boats in the Gulf is the U.A.E.-based Gulf Craft, which has        built some 4,500 boats in twenty years of production and has a boat market share of 16 per        cent. Bayliner and Searay, members of the UK Brunswick Boat Group, have the largest share        of the imported boat park with an estimated market share of 5 per cent.

 

Italian        based manufactures Azimut, Ferretti and Pershing and Princess and Fairline from the UK are        the most established brands in the region in the larger categories. There are numerous        other competitors to Atomix in our range, but our research shows that our pricing and        quality is very competitive. We are targeting a market share of 1% to 3% of all 25”        to 30” motor powered boats sold in the U.A.E. in the next decade.

 

***Wing        House***

 

The Wing        House mobile shelter faces no direct competition as a prefabricated expandable        container-based mobile shelter system, though a variety of site-built shelter options        provides indirect competition. Typical portable cabins used for temporary office in the        region are much cheaper than the Wing Houses, but have a life span of less        than half that of a Wing House; cannot be moved and re-used without virtually rebuilding        the units; can only be trucked as 35 square meters of cabin space per truck (as opposed to        Wing House 80 square meter per truck folded in); and have inferior wiring, lighting, bath        fixtures, and insulation.

 

**Marketability**

 

The marketability of each of our products is detailed in our        description of business above. We believe all of our products are marketable, based on WWA        Group’s performance and our own proven ability to sell cranes, boats and temporary        office cabins at acceptable gross margins.

 

16

 

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**Patents, Trademarks, Licenses, Franchises,**

**Concessions, Royalty Agreements and Labor Contracts**

 

We neither        own nor have applied for any patents or trademarks. We do not license any of our technology        from other companies. However, we have exclusive distribution agreements with Unic, Atomix        and Renhe for our target markets.

 

WWA has no        patents or trademarks, but holds various Internet domain names and auction licenses in        Dubai and other locations. WWA has received protection for exclusive use of the name        “WWA” and our logo in the U.A.E. by the U.A.E. Ministry of Economy.

 

Unic has        several patents and trademarks on its brand name, certain model names and numbers, and        certain technologies that are used in the manufacture of cranes. Atomix and Wing House are        pursuing patent protection for their brand names.

 

**Marketing and Advertising Methods**

 

WWA Group        markets its services through all of the major media including direct marketing and the        internet.

 

We have        started marketing our crane, boat and office cabin products through traditional media,        internet web sites and emails.

 

We have        also entered into informal commission based agreements with real estate agents to sell        Atomix Boats to new waterfront home buyers.

 

We promote        Unic Cranes and Wing Houses at WWA Group auctions and in cooperation with the WWA Group        sales department.

 

**Dependence on Major Customers or Suppliers**

 

We are not        dependent on one or a few customers, as we have a wide range of products targeted to a wide        range of buyers. We have sold four Atomix Boats and twenty-six Unic Cranes from May 15,        2007 through September 28, 2007 to twelve different customers.

 

WWA Group        has several thousand customers and suppliers and is not dependent on major customers or        suppliers.

 

**Governmental and Environmental Regulation**

***Environment***

 

The        Company’s operations are currently subject to the general corporate laws and        regulations of the United States, and the laws of the Ras Al Khaimah Port Authority        relating to, among other things, imports and exports of equipment, worker safety and the        use, storage, discharge and disposal of environmentally sensitive materials. Opening of        other facilities in other locations may subject us to a variety of national, federal,        provincial, state and local laws, rules and regulations relating to, among other things,        the auction business, imports and exports of equipment, worker safety and the use, storage,        discharge and disposal of environmentally sensitive materials. The development or expansion        of auction sites depends upon the receipt of required licenses, permits and other        governmental authorizations. Further, we may be subject to various local zoning        requirements with regard to the location of our auction sites, which may vary from location        to location.

 

 

17

 

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Under some        of the laws regulating the use, storage, discharge and disposal of environmentally        sensitive materials, an owner or lessee of real estate may be liable for the costs of        removal or remediation of certain hazardous or toxic substances located on or in, or        emanating from, such property, as well as related costs of investigation and property        damage. Laws of this nature often impose liability without regard to whether the owner or        lessee knew of, or was responsible for, the presence of hazardous or toxic        substances.

 

***Doing        Business with Nationals of Countries identified by the U.S. as State Sponsors of        Terrorism***

 

The U.S        State Department and the U.S. Treasury Department of Foreign Assets Control        (“OFAC”) have identified Iran, Sudan and Syria as state sponsors of terrorism,        and forbid the sale of goods or services by U.S. persons or companies to these countries or        to agents of the respective governments of these countries.

 

On April        27, 2007 WWA Group received a “cease and desist” order from OFAC proscribing        the sale of equipment or services, or facilitating the sale of equipment or services to        persons with registered addresses in Iran, Syria or Sudan.

 

WWA Group        has never sold equipment at auction or delivered equipment to countries or to agents of the        respective governments of these countries which OFAC has identified as state sponsors of        terrorism However, the Company (WWA) has in the past sold equipment to private individuals        or companies resident in Iran, Sudan or Syria who may have, on their own accord, exported        such purchased equipment to their countries of residence.

 

Since        May of 2007, in compliance with the OFAC “cease and desist” order, WWA has        enforced a policy of prohibiting the sale of equipment to any persons or companies that        register to bid using addresses in Iran, Sudan or Syria. The Company does not sell any        product to any persons or companies that have addresses in Iran, Sudan or Syria.

 

We believe        that WWA Group is in compliance in all material respects with all laws, rules, regulations        and requirements that affect its business, including but not limited to, the “cease        and desist” order delivered to WWA Group on April 27, 2007 by OFAC. Further, we        believe that compliance with such laws, rules, regulations and requirements does not impose        a material impediment on WWA Group’s ability to conduct business.

 

There are        no governmental and environmental regulations that have been, or are expected to be        barriers to the Company’s efforts to conduct its business.

 

 

**Employees**

         

The Company        has 2 employees, both of whom are officers. Our chief executive officer spends        approximately 20 hours per week on our business. Our executive vice president, from whom we        acquired the Unic and Atomix distribution rights prior to his appointment, has experience        with our products and is acting as full time operations manager. We use sales consultants,        brokers, attorneys, and accountants as necessary to assist in the development of our        business and do intend to engage full-time employees in the near future.

 

 

18

 

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**Reports to Security Holders**

 

The        Company’s annual report contains audited financial statements. We are not required to        deliver an annual report to security holders and will not automatically deliver a copy of        the annual report to our security holders unless a request is made for such delivery. We        file all of our required reports and other information with the Commission. The public may        read and copy any materials that are filed by uswith the Securities and Exchange Commission        (the “Commission”) at the Commission’s Public Reference Room at 450 Fifth        Street, N.W., Washington, D.C. 20549. The public may obtain information on the operation of        the Public Reference Room by calling the Commission at 1-800-SEC-0330. The statements and        forms filed by us with the Commission have also been filed electronically and are available        for viewing or copy on the Commission maintained Internet site that contains reports, proxy        and information statements, and other information regarding issuers that file        electronically with the Commission. The Internet address for this site can be found        at*http://www.sec.gov*.

 

| **ITEM 1A.** | **RISK FACTORS** |
|--------------|------------------|

 

Since our        future operating results are highly uncertain you should carefully consider the risks        described below, in addition to the other information contained in this current report. If        any of these risks actually impact the Company, our business, financial condition or        results of operations could be seriously harmed and you could lose all or part of any        investment in our business.

 

**Risks        Related to the Company’s Business** 

 

*WE        HAVE A HISTORY OF LOSSES AND MAY CONTINUE TO INCUR LOSSES IN THE FORESEEABLE        FUTURE*

 

Since        inception, our expenses have substantially exceeded our income, resulting in continuing        losses and an accumulated deficit of $72,598 at December 31, 2007. We may continue to incur        operating losses as we pursue our plan of operation. Our expectation for future        profitability is dependent on our ability to generate cash revenue from the Unic        Distribution Agreement, the Atomix Distribution Agreement, the Wing House distribution        agreement, and sales of part of our equity interest in WWA Group. Should we be unable to        generate revenue in this manner, the Company will continue to incur losses.

 

*IF THE        COMPANY DOES NOT GENERATE SUFFICIENT CASH FLOW FROM OPERATIONS AND IS UNABLE TO OBTAIN        ADDITIONAL CAPITAL TO OPERATE ITS BUSINESS, IT MAY NOT BE ABLE TO EFFECTIVELY CONTINUE        OPERATIONS*

 

As of        December 31, 2007, the Company had a working capital deficit of $1,035,486. We do not        expect to generate sufficient cash flow from operations to cover our expenditures until mid        2008. Until the point at which cash flow from operations match’s expenditures we will        have to obtain additional working capital from debt or equity placements to effectively        continue our operations. Although, we have a commitment for the provision of additional        working capital, this commitment may prove to be insufficient. Should we be        unable to secure additional capital to cover any short fall in cash flow,        such condition would cause us to reduce expenditures which could have a material adverse        effect on our business.

 

 

19

 

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*THE        CONSTRUCTION CRANE INDUSTRY, THE MOBILE SHELTER INDUSTRY AND THE BOAT INDUSTRY ARE SUBJECT        TO RAPID TECHNOLOGICAL CHANGE AND THEREFORE THE PRODUCTS WHICH WE ARE ENTITLED TO        DISTRIBUTE COULD BECOME OBSOLETE AT ANY TIME*

 

Evolving        technology, updated industry standards, and frequent new product and service introductions        characterize the construction crane industry, the boat industry, and the mobile shelter        industry, as a result the products which we are entitled to distribute could become        obsolete at any time. Competitors have developed products similar to or competitive with        our own and continue to develop new products, any of which may displace our products in the        marketplace and limit our prospects for success.

 

*MARKET        ACCEPTANCE OF THE PRODUCTS WE INTEND TO DISTRIBUTE IS CRITICAL TO OUR GROWTH*

 

The Company        intends to generate revenue from the sale of construction cranes, boats, and mobile        shelters, therefore market acceptance of our products is critical. If our prospective        customers do not accept or purchase these products, then our revenue, cash flow and/or        operating results will be negatively impacted.

 

*WE WILL        COMPETE WITH LARGER AND BETTER-FINANCED CORPORATIONS*

 

Competition        within the international market for construction cranes, boats, and mobile shelters is        intense. While the products we are entitled to distribute are distinguished by        next-generation innovations that are more sophisticated, flexible and cost effective than        many competitive products currently in the market place, a number of entities offer        construction cranes, boats, and mobile shelters and new competitors may enter the market in        the future. Some of our existing and potential competitors have longer operating histories,        greater name recognition, larger customer bases and significantly greater financial,        technical and marketing resources than we do, including well known multi-national        corporations.

 

*AS A        DISTRIBUTOR WE DEPEND ON THE PERFORMANCE OF THIRD PARTY MANUFACTURERS*

 

The Company        relies on Japan-based Furukawa Unic , to procure construction cranes for distribution,        China-based Atomix Boats Co. Ltd to procure boats for distribution, and Renhe China to        procure Wing House mobile shelters. Our business plan is reliant on the delivery of        products from these respective manufacturers, which reliance reduces the level of control        we have and exposes us to significant risks such as inadequate capacity, late delivery,        substandard quality and higher prices, all of which could adversely affect the        Company’s performance.

 

*OUR        CHIEF EXECUTIVE OFFICER WILL NOT BE ABLE TO OFFER HIS UNDIVIDED ATTENTION TO THE COMPANY        DUE TO HIS DUAL RESPONSIBILITIES*

 

Our chief        executive officer does not offer his undivided attention to our business as he also serves        as the chief executive officer of WWA Group. His responsibilities cause him to divide his        time, the majority of which is dedicated to the management and operation of WWA Group. The        division of time however does not necessarily indicate a division of interests as the        Company owns approximately 40% of the outstanding shares of WWA Group. His dual        responsibilities may compromise our ability to successfully implement our plan of        operation.

 

20

 

----

 

 

*THE        COMPANY’S SUCCESS DEPENDS ON OUR ABILITY TO ATTRACT AND RETAIN KEY        PERSONNEL*

 

The        Company’s future success will depend substantially on the continued services and        performance of Eric Montandon and Peter Prescott in addition to the engagement of other key        personnel. The loss of the services of Eric Montandon or Peter Prescott could have a        material adverse effect on our business prospects, financial condition and results of        operations. Our future success also depends on the Company’s ability to identify,        attract, hire, train, retain and motivate technical, managerial and sales personnel.        Competition for such personnel is intense, and we cannot assure that we will succeed in        attracting and retaining such personnel. Our failure to attract and retain the necessary        technical, managerial and sales personnel could have a material adverse effect on our        business prospects, financial condition and results of operations.

 

*OUR        BUSINESS IS SUBJECT TO GOVERNMENTAL REGULATIONS*

 

International, national and local standards set by governmental regulatory        authorities set the regulations by which products are certified across respective        territories. The products which we intend to distribute are subject to such regulation in        addition to national, state and local taxation. Although we believe that we can        successfully distribute our products within current governmental regulations it is possible        that regulatory changes could negatively impact our operations and cause us to diminish or        cease operations.

 

**Future        Risks Related to the Company’s Stock**

 

*THE        COMPANY MAY NEED TO RAISE ADDITIONAL CAPITAL TO FUND OPERATIONS WHICH COULD ADVERSELY        AFFECT OUR SHAREHOLDERS*

 

The Company        may need to raise additional capital to fund operations until such time as revenues match        expenditures. We expect that revenue will match expenditures in full year 2008. Until the        point at which cash flow matches expenditures we may have to realize up to $150,000 in        additional capital for operations. Capital realized would be used for marketing costs and        general and administrative expenses. However, we have a commitment to provide us with this        necessary additional capital. Such commitment will obligate us to issue additional shares        of preferred stock which may result in dilution to our shareholders.

 

*THE        COMPANY INTENDS TO APPLY TO HAVE ITS STOCK QUOTED ON THE OTCBB*

 

The Company        has no public trading market for its shares, and we cannot represent to you that a market        will ever develop. Nonetheless, we do intend to seek a quotation on the OTCBB. However,        there can be no assurance that we will obtain a quotation on the OTCBB or that obtaining a        quotation will generate a public trading market for our shares.

 

Further, if        we obtain a quotation on the OTCBB, this may limit our ability to raise money in an equity        financing since many institutional investors do not consider OTCBB stocks for their        portfolios. Therefore, an investors’ ability to trade our stock might be restricted        as only a limited number of market makers quote OTCBB stock. Trading volumes in OTCBB        stocks are historically lower, and stock prices for OTCBB stocks tend to be more volatile,        than stocks traded on an exchange or the NASDAQ Stock Market. We may never qualify for        trading on an exchange or the NASDAQ Stock Market.

 

 

21

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*THE        COMPANY’S STOCK PRICE COULD BE VOLATILE*

 

Should a        public market for our shares develop, the future market price could be subject to        significant volatility and trading volumes could be low. Factors affecting our market price        will include:

 

**•**

perceived prospects;

**•**

negative variances in our operating results, and achievement                        of key business targets;

**•**

limited trading volume in shares of our common stock in the                        public market;

**•**

sales or purchases of large blocks of our stock;

**•**

changes in, or our failure to meet, earnings                        estimates;

**•**

changes in securities analysts’ buy/sell                        recommendations;

**•**

differences between our reported results and those expected                        by investors and securities analysts;

**•**

announcements of new contracts by us or our                        competitors;

**•**

announcements of legal claims against us;

**•**

market reaction to any acquisitions, joint ventures or                        strategic investments announced by us;

**•**

developments in the financial markets;

**•**

general economic, political or stock market                        conditions.

 

In        addition, our future stock price may fluctuate in ways unrelated or disproportionate to our        operating performance. The general economic, political and stock market conditions that may        affect the market price of our common stock are beyond our control. The market price of our        common stock at any particular time may not remain the market price in the future. In the        past, securities class action litigation has been instituted against companies following        periods of volatility in the market price of their securities. Any such litigation, if        instituted against us, could result in substantial costs and a diversion of        management’s attention and resources.

 

*THE        COMPANY’S STOCK IS A PENNY STOCK AND, THEREFORE OUR SHAREHOLDERS MAY FACE SIGNIFICANT        RESTRICTIONS ON THEIR STOCK*

 

The        Company’s stock differs from many stocks in that it is a "penny stock." The        Commission defines a penny stock in Rule 3a51-1 of the Exchange Act as, generally speaking,        those securities which are not listed on either NASDAQ or a national securities exchange        and are priced under $5, excluding securities of issuers that (a) have net tangible assets        greater than $2 million if they have been in operation at least three years, (b) have net        tangible assets greater than $5 million if in operation less than three years, or (c)        average revenue of at least $6 million for the last three years. OTCBB securities are        considered penny stocks unless they qualify for one of the exclusions.

 

The        Commission has adopted a number of rules to regulate penny stocks. These rules include, but        are not limited to, Rules 3a5l-l, 15g-1, 15g-2, 15g-3, 15g-4, 15g-5, 15g-6 and 15g-9 under        the Exchange Act. Since our securities constitute a "penny stock" within the meaning of the        rules, the rules would apply to us and our securities. The rules may further affect the        ability of owners of shares to sell their securities in any market that may develop for        them. There may be a limited market for penny stocks, due to the regulatory burdens on        broker-dealers. The market among dealers may not be active. Investors in penny stock often        are unable to sell stock back to the dealer that sold them the stock. The mark-ups or        commissions charged by the broker-dealers may be greater than any profit a seller may make.        Because of large dealer spreads, investors may be unable to sell the stock immediately back        to the dealer at the same price the dealer sold the stock to the investor. In some cases,        the stock may fall quickly in value. Investors may be unable to reap any profit        from any sale of the stock, if they can sell it at all.

 

22

 

 

Shareholders should be aware that, according to the Commission Release No.        34-29093, the market for penny stocks has suffered in recent years from patterns of fraud        and abuse. These patterns include:  

 

                         

**•**

control of the market for the security by one or a few                        broker-dealers that are often related to the promoter or issuer;

                         

**•**

manipulation of prices through prearranged matching of                        purchases and sales and false and misleading press releases;

                         

**•**

"boiler room" practices involving high pressure sales                        tactics and unrealistic price projections by inexperienced sales                        persons;

                         

**•**

excessive and undisclosed bid-ask differentials and markups                        by selling broker-dealers; and

                         

**•**

the wholesale dumping of the same securities by promoters                        and broker-dealers after prices have been manipulated to a desired level,                        along with the inevitable collapse of those prices with consequent investor                        losses.

 

*OUR        INTERNAL CONTROLS OVER FINANCIAL REPORTING MAY NOT BE CONSIDERED EFFECTIVE, WHICH COULD        RESULT IN A LOSS OF SHAREHOLDER CONFIDENCE IN OUR DISCLOSURE*

 

Pursuant to        Section 404 of the Sarbanes-Oxley Act of 2002, beginning with our annual report for the        year ending December 31, 2007, we are required to prepare a report by our management on our        internal controls over financial reporting. Such report will contain, among other matters,        an assessment of the effectiveness of our internal controls over financial reporting as of        the end of the year, including a statement as to whether or not our internal controls over        financial reporting are effective. This assessment must include disclosure of any material        weaknesses in our internal controls over financial reporting identified by management. If        we are unable to assert that our internal controls are effective as of December 31, 2007,        shareholders could lose confidence in the accuracy and completeness of our financial        reports.

 

*THERE IS        NO PUBLIC TRADING MARKET FOR OUR STOCK, SO YOU MAY BE UNABLE TO SELL YOUR SHARES, OR IF A        PUBLIC TRADING MARKET DEVELOPS, THE MARKET PRICE COULD DECLINE BELOW THE COST OF YOUR        INVESTMENT.*

 

Although        management intends to apply for quotation on the Over the Counter Bulletin Board, currently        there is no public trading market for the Company’s common stock, and we cannot        represent to you that a market will ever develop. If a public trading market for our stock        does not develop, it will be very difficult, if not impossible, for you to resell your        shares in a manner that will allow you to recover, or realize a gain on, your investment.        Even if a public trading market does develop, the market price could trade below the amount        you paid for your investment.

 

23

 

 

 

 

*WE MAY        INCUR SIGNIFICANT EXPENSES IN THE EVENT THAT WE ARE QUOTED ON THE OVER THE COUNTER BULLETIN        BOARD, WHICH EXPENSES MAY NEGATIVELY IMPACT OUR FINANCIAL PERFORMANCE.*

 

Should the        Company’s application for quotation on the Over the Counter Bulletin Board be        accepted, we may incur significant legal, accounting and other expenses as a result of        being quoted on the Over the Counter Bulletin Board. The Sarbanes-Oxley Act of 2002, as        well as related rules implemented by the Commission has required changes in corporate        governance practices of public companies. We expect that compliance with these laws, rules        and regulations, including compliance with Section 404 of the

 

Sarbanes-Oxley Act of 2002 as discussed in a prior risk factor, may        substantially increase our expenses, including our legal and accounting costs, and make        some activities more time-consuming and costly. As a result, there may be a substantial        increase in legal, accounting and certain other expenses in the future, which would        negatively impact our financial performance and could have a material adverse effect on our        results of operations and financial condition.

 

**ITEM 1B.**

**UNRESOLVED STAFF                        COMMENTS**

 

Not        applicable.

 

**ITEM 2.**

**PROPERTIES**

 

The Company        currently maintains offices at 2465 West 12th Street, Suite 2 Tempe, Arizona        85281 which it shares on an informal basis with WWA Group. The office space is comprised of        2,500 square feet for which WWA Group pays $1,600 on a monthly basis.

 

The Company        has also entered into a sublease with Fastcraft Marine FZE to occupy 50% of a 2,000 square        meter shop and warehouse in Ras al Khaimah port, U.A.E., which will serve as our service        and logistics center. We have agreed to pay rent of $40,000 per year for a 5-year term for        use of this building space and quayside space.

 

**ITEM 3.**

**LEGAL PROCEEDINGS**

 

The Company        is not a party to material pending legal proceedings. To the best of our knowledge, no        governmental authority or other party has threatened or is contemplating the filing of any        material legal proceeding against us.

 

**ITEM 4.**

**SUBMISSION OF MATTERS TO A VOTE OF SECURITY                        HOLDERS**

 

No matter        was submitted to a vote of the security holders, through the solicitation of proxies or        otherwise, during the fourth quarter ended December 31, 2007.

 

**PART        II**

 

**ITEM 5.**

**MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS,                        AND ISSUER PURCHASES OF EQUITY SECURITIES**

 

As of the        date of this filing, there is no public market for our securities. The Company has future        plans to file for trading on the OTC Bulletin Board which is sponsored by the National        Association of Securities Dealers (the "NASD"). However, there can be no assurance that the        Company will ever be accepted for trading by the NASD. As there is currently no public        trading of our securities, there is no high or low bid pricing to report.

 

 

24

 

 

 

**Capital Stock**

 

The        following is a summary of the material terms of the Company’s capital stock. This        summary is subject to and qualified by our articles of incorporation and bylaws.

 

***Common Stock***

 

As of April        9, 2008, there were 1,641 shareholders of record holding a total of 23,071,835 shares of        fully

 

paid and        non-assessable common stock of the 50,000,000 shares of common stock, par value $0.001,        authorized. The board of directors believes that the number of beneficial owners is        substantially greater than the number of record holders because a portion of our        outstanding common stock is held in broker “street names” for the benefit of        individual investors. The holders of the common stock are entitled to one vote for each        share held of record on all matters submitted to a vote of stockholders. Holders of the        common stock have no preemptive rights and no right to convert their common stock into any        other securities. There are no redemption or sinking fund provisions applicable to the        common stock.

 

***Preferred Stock***

 

As of April        9, 2008, there were 1,000 shares of Series 1 preferred issued and outstanding of the        25,000,000 shares of preferred stock authorized. The par value of the preferred stock is        $0.001 per share. The Company’s preferred stock may have such rights, preferences and        designations and may be issued in such series as determined by the board of        directors.

 

***Warrants***

 

As of April        9, 2008, the Company had no outstanding warrants to purchase shares of our common        stock.

 

***Stock        Options***

 

As of April        9, 2008, the Company had no outstanding stock options to purchase shares of our common        stock.

 

***Dividends***

 

The Company        has not declared any cash dividends since inception and does not anticipate paying any        dividends in the foreseeable future. The payment of dividends is within the discretion of        the board of directors and will depend on our earnings, capital requirements, financial        condition, and other relevant factors. There are no restrictions that currently limit the        Company's ability to pay dividends on its common stock other than those generally imposed        by applicable state law.

 

**Transfer Agent and Registrar**

 

The        Company’s transfer agent and registrar is Interwest Transfer Company, 1981 E.        Murray-Holladay Road, Holladay, Utah, 84117–5164. Interwest’s phone number is        (801) 272-9294.

 

**Purchases of Equity Securities made by the Issuer and Affiliated        Purchasers**

 

None.

**Recent        Sales of Unregistered Securities**

 

None.

 

 

 

 

25

 

 

**ITEM 6.**

**SELECTED FINANCIAL DATA**

 

Not        required.

 

**ITEM 7.**

**MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL                        CONDITION AND RESULTS OF OPERATIONS**

 

This*Management’s Discussion and Analysis of Financial Condition        and**Results of Operations*and other        parts of this prospectus contain forward-looking statements that involve risks and        uncertainties. Forward-looking statements can also be identified by words such as        “anticipates,” “expects,” “believes,”        “plans,” “predicts,” and similar terms. Forward-looking statements        are not guarantees of future performance and our actual results may differ significantly        from the results discussed in the forward-looking statements. Factors that might cause such        differences include but are not limited to those discussed in the subsection        entitled*Forward-Looking Statements and Factors That May Affect        Future Results and Financial Condition*below. The following        discussion should be read in conjunction with our financial statements and notes thereto        included in this prospectus. Our fiscal year end is December 31.

 

**Discussion and Analysis**

 

**General**

 

The        Company’s current focus is to work together with WWA Group in Dubai to increase the        value of our investment and to leverage that relationship to develop the distribution of        Unic Cranes, Atomix boats, and Wing House shelters pursuant to the respective distribution        agreements. We anticipate that the Company may require additional capital to develop our        respective businesses and does have a commitment in place to provide additional capital as        necessary to develop our sales infrastructure.

 

**Business Strategy**

 

***WWA Group***

 

WWA Group        operates auctions of heavy equipment in Dubai, U.A.E. and elsewhere. The auctions have        developed a significant customer base and have achieved consistent revenue and profits that        have lead to a dominant market share in Dubai, its primary operating market. The Company        invested in WWA Group in 2000, anticipating potential future value appreciation in that        investment, and possible synergies our management’s experience in Asian product        sourcing and WWA Group’s core auction and selling business.

 

Since the        relationship between the Company and WWA Group is one of common control, we benefit from        the contacts and business development opportunities generated by its business activities.        We intend to provide additional financial and business support to WWA Group to help grow        the value of our equity interest, and to provide us opportunities for acquisition and        development that are related to and generated by WWA Group.

 

The value        of our investment in WWA Group has appreciated and we believe that it has the potential for        further appreciation. We also believe that our working relationship with WWA Group combined        with our access to its selling channels and customers will assist us in the marketing Asian        manufactured crane, boat and mobile shelter products.

 

 

26

 

 

***Furukawa Unic Cranes***

 

The Unic        cranes are in the same category of commercial and construction equipment that WWA is a        U.A.E. market leader in selling, and many prospective buyers of the Unic products are WWA        customers. We do not have to spend significant amounts on advertising, sales staff, or        administrative matters to sell Unic cranes. We have sold 26 cranes from May 1, 2007 through        March 31, 2008, at a total gross profit margin of approximately $110,000. We had only one        sales consultant working with the operations manager during his period, and no other        staff.

 

Our current        focus is to sell the remaining stock of Unic crane inventory acquired in connection with        the Unic Distribution Agreement, and use the gross sales to pay down debt associated with        the cranes and to order new stock. Gross profit margins will be used to pay general and        administrative expenses.

 

Japanese        industrial products are well received in the U.A.E., and Unic’s pricing and features        compare favorably with competing products. Our extensive research and experience in the        U.A.E. gives us reason to believe that we can create a significant market share in the        U.A.E. for these products.

 

We plan to        purchase used Unic cranes from Asian markets to add to our Dubai inventory, in order to        service a broader market of buyers with shorter lead time on delivery.

 

***Atomix Boats***

 

For us to        sell Atomix boats without building an in-house retail sales team, we are in the process of        formalizing relationships with real estate agents involved in selling marina and waterfront        property throughout the U.A.E. These agents will act as commission agents to sell boats        along with housing units they sell on a regular basis. Two boats were sold in the current        quarter by these agents. We are also planning to work in a joint venture with Emirates Boat        Share Ltd. to co-market Atomix boats.

 

***Wing        House Mobile Shelters***

 

We are        displaying and using Wing House office units at the WWA auction yard, and actively        marketing the unit to the thousands of visitors to this yard each year. We are offering the        units for sale or rental on a 60 day delivery schedule from order date. We are negotiating        finance with the manufacturer to spur future sales efforts.

 

***Related Operations***

 

The Company        has also entered into a sublease with Fastcraft Marine FZE to occupy 50% of a 2,000 square        meter shop and warehouse in Ras al Khaimah port, U.A.E., which will serve as our service        and logistics center. We have agreed to pay rent of $40,000 per year for a 5-year term for        use of this building space and quayside space. We have also engaged Fastcraft Marine FZE to        service, warranty, manage and deliver all boats and Unic cranes we import to the U.A.E. By        contracting a well established company in a shared facility, and passing the costs onto the        buyers, we believe we can avoid growing our own overhead and salary costs long into the        future.

 

**Results of Operations**

 

During the        year ending December 31, 2007, the Company sold several units of each of its product lines        to a total of 13 customers. We expect to generate revenue from increased sales of these        products in 2008 and onwards.

 

27

 

 

 

 

***Revenue***

 

Revenue for        the year ended December 31, 2007 was $815,743 as compared to revenue of $0 for the twelve        month periods ended December 31, 2006 and December 31, 2005. The realization of revenue        since May 1, 2007 can be attributed to the sale of Unic Cranes, Atomix boats, two        sub-distributorships for Trident cars, and 4 Wing Houses. We expect that revenue will        increase in future periods as the Company focuses on building sales from its        distributorship agreements.

 

***Gross        Profit***

 

Gross        profit was $133,251 for the year ended December 31, 2007, compared to $0 for the years        ended December 31, 2006 and December 31, 2005. Gross profit is the difference between the        gross sale prices of our products and the total direct costs of purchasing them and selling        them. The gross margin for 2007 equates to 16% of gross revenue. We expect that margins        will improve with an increase in exposure of our products.

 

***Expenses***

 

Expenses        for the year ended December 31, 2007 were $355,983 as compared to expenses of $235,842 for        the year ended December 31, 2006. The increase in expenses over the comparative periods can        be attributed mainly to the addition of salaries, rent, and marketing costs that we did not        incur prior to our commencing sales operations for our products. We also incurred        extraordinary non-recurring expenses incurred in connection with our Special Stockholders        Meeting in April 2007 that included legal and transfer agent expenses in connection with        our preparation for the meeting. The Company expects that general and administrative        expenses will increase in relation to our efforts to build each of our        businesses.

 

Depreciation and amortization expenses for the year ended December 31, 2007        and December 31, 2006 were $35,323 and $6,674 respectively. Depreciation and amortization        expenses are expected to increase as we acquire additional assets in the process of        expanding the operation of our distribution activities.

 

***Other        Income***

 

Other        income for the year ended December 31, 2007 was $587,549 as compared to other income of        $500,223 in the twelve month period ended December 31, 2006. Other income in the current        and prior periods can be attributed to a gain on equity investments tied to our interest in        WWA Group. We expect that other income related to the business operations of WWA Group will        continue to increase as WWA Group continues to outperform historical results.

 

***Net        Income/Losses***

 

Net income        for the ended December 31, 2007 was $364,817 as compared to net income of $264,381 for the        year ended December 31, 2006. The increase in net income in the current period can be        attributed both to the realization of gross profit on sales revenue in the current year and        an increase in other income recognized as a gain on our equity investment. We do expect to        continue to realize net income from operations.

 

 

28

 

 

***Capital Expenditures***

 

The Company        expended no amounts on capital expenditures for the period from July 9, 1999 (inception) to        December 31, 2007 except to acquire distribution rights for Unic, Atomix and Trident        vehicles pursuant to which we paid $65,000 and common stock valued at $224,000 of goodwill        in the second quarter of 2007. We also purchased a company vehicle and inventory for resale        in 2007.

 

***Income Tax Expense (Benefit)***

 

The Company        has an income tax benefit resulting from net operating losses to offset any future        operating profit. However, the Company has not recorded this benefit in the financial        statements because it cannot be assured that it will utilize the net operating losses        carried forward in future years.

 

***Impact of Inflation***

 

The Company        believes that inflation has had a negligible effect on operations over the past three years        and that it has offset any inflationary increases by improving operating efficiencies.        However, inflation has had a negative impact on the net income of WWA Group over the past        24 months which impact has affected the performance of our equity investment. Further, as        we add additional sales and administrative staff in the U.A.E. and other countries with        high inflation, management will re-evaluate the impact of inflation on our business and        operations.

 

***Liquidity and Capital Resources***

 

Cash flow        used in operating activities for the year ended December 31, 2007 was $342,500 as compared        to cash flow used in operating activities of $662,450 for the year ended December 31, 2006.        The decrease in cash flow used in operating activities in the current period can be        attributed to the realization of net income and an increase in accounts payable. We expect        that cash flow used in operating activities will continue to decrease as net income        increases.

 

Cash flow        used in investing activities for the year ended December 31, 2007 was $152,393 as compared        to cash flow used in investing activities of $6,480 for the year ended December 31, 2006.        Cash flow used in investing activities in the current period was used on the purchase of        fixed assets connected to our distribution agreements. We expect to continue to use cash        flow in investing activities as we build inventories to sell products through our        distribution agreements.

 

Cash flow        provided by financing activities for the year ended December 31, 2007 was $526,795 as        compared to $663,857 for the year ended December 31, 2006. Cash flow provided by financing        activities in the current twelve month period can be attributed primarily to the sale of        common and preferred stock, and cash received against a note payable.

 

As of        December 31, 2007, the Company had a working capital deficit of $1,035,486. However, we        collected a note receivable for $900,000 in March 2008 that was applied against current        liabilities. This resulted in a decrease in our working capital deficit to $135,486 as of        the date of this report. We do not expect to generate sufficient cash flow from operations        to cover our expenditures until mid 2008. Until the point at which cash flow from        operations match’s expenditures we will have to obtain additional working capital        from debt or equity placements to effectively continue our operations. Although we have a        commitment for the provision of additional working capital, this commitment may prove to be        insufficient.  Should we be unable to secure additional capital to        cover any short fall in cash flow, such condition would cause us to reduce expenditures        which could have a material adverse effect on our business.

 

 

29

 

 

The Company        is holding shares of WWA Group as an equity investment. The current face market value of        these shares is approximately $4.4 million. The shares are restricted common stock in a        publicly traded company. As the market allows and in accordance with the limits of Rule        144, we may sell a portion of the shares as a source of operating funds if needed. Any        sales proceeds could be used to fund the payment of ongoing operational        expenses.

 

In April of        2007 we reached an agreement to obtain up to $500,000 from an investor in exchange for        shares of Series 1 preferred stock on an as needed basis secured by 500,000 shares of our        WWA Group common stock. The Series 1 preferred shares are convertible to common stock in        the Company at $0.40 per share, bear interest at 9% per annum, and have no redemption        provision. The investor has subscribed to 1,000 Series 1 preferred shares in exchange for        $100,000 as of the date of this report. We have the option of selling another $400,000        worth of preferred stock to the same investor on the same terms and conditions. We have yet        to exercise this option, as we have sufficient cash flow to meet obligations.

 

The Company        has no current plans for the purchase or sale of any plant or equipment.

 

The Company        has no defined benefit plan or contractual commitment with any of its officers or        directors.

 

**Off        Balance Sheet Arrangements** 

 

As of        December 31, 2007, the Company has no significant off-balance sheet arrangements that have        or are reasonably likely to have a current or future effect on our financial condition,        changes in financial condition, revenues or expenses, results of operations, liquidity,        capital expenditures, or capital resources that is material to stockholders.

**Critical Accounting Policies**

 

In the        notes to the audited financial statements for the year ended December 31, 2007, included in        our Form 10-K, the Company discusses those accounting policies that are considered to be        significant in determining the results of operations and our financial position. The        Company believes that the accounting principles we utilized conform to accounting        principles generally accepted in the United States of America.

 

The        preparation of financial statements requires our management to make significant estimates        and judgments that affect the reported amounts of assets, liabilities, revenues and        expenses. By their nature, these judgments are subject to an inherent degree of        uncertainty. On an on-going basis, we evaluate estimates. We base our estimates on        historical experience and other facts and circumstances that are believed to be reasonable,        and the results form the basis for making judgments about the carrying value of assets and        liabilities. The actual results may differ from these estimates under different assumptions        or conditions. With respect to revenue recognition, we apply the following critical        accounting policies in the preparation of our financial statements.

 

***Revenue Recognition***

 

The Company        generates revenue through the sale of its products on a private, commercial, and industrial        basis. Revenue from product sales is recognized at the time the product is shipped and        invoiced and collectibility is reasonably assured. The Company believes that certain        revenue should be recognized at the time of shipment as title passes to the customer at the        time of shipment.

 

30

 

 

***Forward Looking Statements and Factors That May Affect Future        Results and Financial Condition***

 

The        statements contained in the section titled “*Results of        Operations”*and*“Description        of Business”*, with the exception of historical facts, are        forward looking statements within the meaning of Section 27A of the Securities Act. A        safe-harbor provision may not be applicable to the forward looking statements made in this        prospectus because of certain exclusions under Section 27A (b). Forward looking statements        reflect our current expectations and beliefs regarding our future results of operations,        performance, and achievements. These statements are subject to risks and uncertainties and        are based upon assumptions and beliefs that may or may not materialize. These statements        include, but are not limited to, statements concerning:

 

**•**

our anticipated financial performance;

**•**

the sufficiency of existing capital resources;

**•**

our ability to fund cash requirements for future                        operations;

**•**

uncertainties related to the growth of our business and the                        acceptance of our products and services;

**•**

our ability to achieve and maintain an adequate customer                        base to generate sufficient revenues to maintain and expand                        operations;

**•**

the volatility of the stock market and;

**•**

general economic conditions.

 

We wish to        caution readers that our operating results are subject to various risks and uncertainties        that could cause our actual results to differ materially from those discussed or        anticipated, including the factors set forth in the section entitled        “*Risk Factors*” included        elsewhere in this report. We also wish to advise readers not to place any undue reliance on        the forward looking statements contained in this report, which reflect our beliefs and        expectations only as of the date of this report. We assume no obligation to update or        revise these forward looking statements to reflect new events or circumstances or any        changes in our beliefs or expectations, other than is required by law.

**Stock-Based Compensation**

 

On January        1, 2006, we adopted SFAS No. 123 (revised 2004) (SFAS No. 123R), Share-Based Payment, which        addresses the accounting for stock-based payment transactions in which an enterprise        receives employee services in exchange for (a) equity instruments of the enterprise or (b)        liabilities that are based on the fair value of the enterprise’s equity instruments        or that may be settled by the issuance of such equity instruments. In January 2005, the        Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin (SAB) No. 107,        which provides supplemental implementation guidance for SFAS No. 123R. SFAS No. 123R        eliminates the ability to account for stock-based compensation transactions using the        intrinsic value method under Accounting Principles Board (APB) Opinion No. 25, Accounting        for Stock Issued to Employees, and instead generally requires that such transactions be        accounted for using a fair-value-based method. We use the Black-Scholes-Merton        (“BSM”) option-pricing model to determine the fair-value of stock-based awards        under SFAS No. 123R, consistent with that used for pro forma disclosures under SFAS No.        123, Accounting for Stock-Based Compensation. We have elected the modified prospective        transition method as permitted by SFAS No. 123R and accordingly prior periods have not been        restated to reflect the impact of SFAS No. 123R. The modified prospective transition method        requires that stock-based compensation expense be recorded for all new and unvested stock        options, restricted stock, restricted stock units, and employee stock purchase plan shares        that are ultimately expected to vest as the requisite service is rendered beginning on        January 1, 2006, the first day of our fiscal year 2006. Stock-based compensation expense        for awards granted prior to January 1, 2006 is based on the grant date fair-value as        determined under the pro forma provisions of SFAS No. 123.

 

31

 

 

Prior to        the adoption of SFAS No. 123R, we measured compensation expense for our employee        stock-based compensation plans using the intrinsic value method prescribed by APB Opinion        No. 25. We applied the disclosure provisions of SFAS No. 123 as amended by SFAS No. 148,        Accounting for Stock-Based Compensation – Transition and Disclosure, as if the        fair-value-based method had been applied in measuring compensation expense. Under APB        Opinion No. 25, when the exercise price of the Company’s employee stock options was        equal to the market price of the underlying stock on the date of the grant, no compensation        expense was recognized.

 

We account        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 (“EITF”) in Issue No. 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, whichever is more reliably measurable. The value of equity        instruments issued for consideration other than employee services is determined on the        earliest of a performance commitment or completion of performance by the provider of goods        or services as defined by EITF 96-18.

 

**Recent Accounting Pronouncements**

 

In December        2007, the FASB issued SFAS 160, “Noncontrolling interests in Consolidated Financial        Statements – an amendment of ARB No. 51”. This Statement amends ARB 51 to        establish accounting and reporting standards for the noncontrolling interest in a        subsidiary and for the deconsolidation of a subsidiary. It clarifies that a noncontrolling        interest in a subsidiary is an ownership interest in the consolidated entity that should be        reported as equity in the consolidated financial statements. This Statement is effective        for fiscal years beginning on or after December 15, 2008. Early adoption is not permitted.        Management is currently evaluating the effects of this statement, but it is not expected to        have any impact on WWA Group’s financial statements.

         

In February        2007, the FASB issued SFAS 159, “The Fair Value Option for Financial Assets and        Financial Liabilities. SFAS 159 creates a fair value option allowing an entity to        irrevocably elect fair value as the initial and subsequent measurement attribute for        certain financial assets and financial liabilities, with changes in fair value recognized        in earnings as they occur. SFAS 159 also requires an entity to report those financial        assets and financial liabilities measured at fair value in a manner that separates those        reported fair values from the carrying amounts of assets and liabilities measured using        another measurement attribute on the face of the statement of financial position. Lastly,        SFAS 159 requires an entity to provide information that would allow users to understand the        effect on earnings of changes in the fair value on those instruments selected for the fair        value election. SFAS 159 is effective for fiscal years beginning after November 15, 2007        with early adoption permitted. WWA Group is continuing to evaluate SFAS 159 and to assess        the impact on our results of operations and financial condition if an election is made to        adopt the standard.

 

**ITEM 7A.**

**QUANTITATIVE AND QUALITATIVE                        DISCLOSURES ABOUT MARKET RISK**

         

Not required.

         

**ITEM 8.**

**FINANCIAL STATEMENTS AND SUPPLEMENTARY                        DATA**

 

Our audited        financial statements for the years ended December 31, 2007 and 2006 are attached hereto as        F-1 through F-15.

 

 

32

 

 

ASIA8,        INC. AND SUBSIDIARIES

Years        Ended December 31, 2007 and 2006

 

INDEX

 

                         

Page

         

                         

Report of Independent Registered Public Accounting                        Firm

F-2

         

                         

Balance Sheets

F-3

         

                         

Statements of Operations

F-4

         

                         

Statements of Stockholders’ Equity                        (Deficit)

F-5

         

                         

Statements of Cash Flows

F-6

         

                         

Notes to Financial Statements

F-7

         

 

F-1

 

 

**MOORE        & ASSOCIATES, CHARTERED**

                         

*ACCOUNTANTS AND ADVISORS*

                         

*PCAOB REGISTERED*

 

 

**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING        FIRM**

 

**To        the Board of Directors**

**Asia8, Inc.**

 

We have        audited the accompanying balance sheets of Asia8, Inc. as of December 31, 2007 and        2006 and the related statements of operations, stockholders’ equity and cash        flows for the years ended December 31, 2007 and  2006. These financial statements are        the responsibility of the Company’s management. Our responsibility is to express an        opinion on these financial statements based on our audits.

 

We        conducted our audits in accordance with standards of the Public Company Accounting        Oversight Board (United States). Those standards require that we plan and perform the        audits to obtain reasonable assurance about 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 audits provide        a reasonable basis for our opinion.

 

In our        opinion, the financial statements referred to above present fairly, in all material        respects, the financial position of Asia8, Inc. as of December 31, 2007 and 2006 and        the related statements of operations, stockholders’ equity and cash flows for the        years ended December 31, 2007 and  2006, in conformity with accounting principles        generally accepted in the United States of America.

 

 

***/s/ Moore & Associates, Chartered***

 

Moore        & Associates Chartered

Las        Vegas, Nevada

April 5,        2008

 

 

 

 

 

*2675 S. Jones Blvd. Suite 109, Las Vegas, NV 89146 (702) 253-7499 Fax        (702) 253-7501*

 

 

F-2

 

**ASIA8, Inc.,**

Balance Sheets

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

ASSETS

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

December 31,

                         

                         

                         

                         

                         

                         

2007

                         

2006

CURRENT ASSETS

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Cash

                         

                         

                         

                         

$

32,447

                         

$

545

                         

Accounts receivable, net

                         

                         

                         

207,518

                         

                         

-

                         

Inventory

                         

                         

                         

                         

233,183

                         

                         

-

                         

Other current assets

                         

                         

                         

10,840

                         

                         

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Total Current Assets

                         

                         

                         

483,988

                         

                         

545

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

FIXED ASSETS, Net

                         

                         

                         

                         

58,580

                         

                         

1,530

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

OTHER ASSETS

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Investments

                         

                         

                         

                         

3,073,608

                         

                         

2,446,256

                         

Note receivable, related party

                         

                         

                         

900,000

                         

                         

900,000

                         

Other non-current assets

                         

                         

                         

234,000

                         

                         

105,860

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Total Other Assets

                         

                         

                         

4,207,608

                         

                         

3,452,116

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

TOTAL ASSETS

                         

                         

$

4,750,176

                         

$

3,454,191

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

LIABILITIES AND STOCKHOLDERS' EQUITY                        (DEFICIT)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

CURRENT LIABILITIES

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Accounts payable and accrued expenses

                         

$

449,079

                         

$

44,706

                         

Notes payable - related party

                         

                         

                         

1,070,395

                         

                         

948,400

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Total Current Liabilities

                         

                         

1,519,474

                         

                         

993,106

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

TOTAL LIABILITIES

                         

                         

                         

1,519,474

                         

                         

993,106

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

STOCKHOLDERS' EQUITY (DEFICIT)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Preferred stock: 25,000,000 shares authorized;

                         

                         

                         

                         

                         

                         

                         

$100 par value; 1,000 shares issued and                        outstanding

                         

                         

100,000

                         

                         

-

                         

Common stock: 100,000,000 shares authorized;

                         

                         

                         

                         

                         

                         

                         

$0.001 par value; 23,071,835 and 20,947,585

                         

                         

                         

                         

                         

                         

                         

shares issued and outstanding, respectively

                         

                         

23,072

                         

                         

20,948

                         

Additional paid-in capital

                         

                         

                         

3,180,228

                         

                         

2,877,552

                         

Accumulated deficit

                         

                         

                         

(72,598)

                         

                         

(437,415)

 

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Total Stockholders' Equity (Deficit)

                         

                         

3,230,702

                         

                         

2,461,085

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

TOTAL LIABILITIES AND STOCKHOLDERS'

                         

                         

                         

                         

                         

                         

                         

                         

EQUITY (DEFICIT)

                         

                         

$

4,750,176

                         

$

3,454,191

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

The accompanying notes are an integral part of these                        consolidated financial statements.

 

 

 

F-3

 

 

 

**ASIA8, Inc.**

Statements of Operations

                         

                         

                         

                         

                         

                         

                         

                         

                         

For the Years Ended

                         

                         

                         

                         

December 31,

                         

                         

                         

                         

2007

                         

2006

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

REVENUES

                         

$

815,743

                         

$

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

COST OF GOODS SOLD

                         

                         

682,492

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

GROSS PROFIT

                         

                         

133,251

                         

                         

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

OPERATING EXPENSES

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Depreciation and amortization

                         

                         

35,323

                         

                         

6,674

                         

General and administrative

                         

                         

320,660

                         

                         

229,168

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Total Operating Expenses

                         

                         

355,983

                         

                         

235,842

                         

                         

                         

                         

                         

                         

                         

                         

                         

LOSS FROM OPERATIONS

                         

                         

(222,732)

                         

                         

(235,842)

                         

                         

                         

                         

                         

                         

                         

                         

                         

OTHER INCOME

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Gain on sale of investments

                         

                         

-

                         

                         

-

                         

Other income

                         

                         

20,217

                         

                         

-

                         

Interest income

                         

                         

-

                         

                         

-

                         

Income from equity investment

                         

                         

567,332

                         

                         

500,223

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Total Other Expenses

                         

                         

587,549

                         

                         

500,223

                         

                         

                         

                         

                         

                         

                         

                         

                         

INCOME (LOSS) FROM CONTINUING OPERATIONS

$

364,817

                         

$

264,381

                         

                         

                         

                         

                         

                         

                         

                         

                         

LOSS FROM DISCONTINUED

                         

                         

                         

                         

                         

                         

OPERATIONS

                         

                         

-

                         

                         

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

NET INCOME (LOSS)

                         

$

364,817

                         

$

264,381

                         

                         

                         

                         

                         

                         

                         

                         

                         

INCOME PER COMMON SHARE

                         

$

0.02

                         

$

0.01

                         

                         

                         

                         

                         

                         

                         

                         

                         

WEIGHTED AVERAGE NUMBER OF COMMON

                         

                         

                         

                         

                         

SHARES OUTSTANDING

                         

                         

21,478,929

                         

                         

20,947,858

 

 

 

 

The        accompanying notes are an integral part of these consolidated financial        statements.

 

F-4

 

 

 

**ASIA8, Inc.**

Statements of Stockholders' Equity (Deficit)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Additional

                         

                         

                         

                         

Preferred Stock

                         

Common Stock

                         

Paid-In

                         

Accumulated

                         

                         

Shares

                         

Amount

                         

Shares

                         

Amount

                         

Capital

                         

Deficit

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Balance, January 1, 2006

                         

-

                         

$

-

                         

16,201,188

                         

$

16,201

                         

$

2,266,842

                         

$

(701,796)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Common stock issued for cash and

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

conversion of debt at $0.06 to $0.08 per share

-

                         

                         

-

                         

4,746,397

                         

                         

4,747

                         

                         

610,710

                         

                         

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Net income for the year ended

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

December 31, 2006

                         

-

                         

                         

-

                         

-

                         

                         

-

                         

                         

-

                         

                         

264,381

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Balance, December 31, 2006

                         

-

                         

                         

-

                         

20,947,585

                         

                         

20,948

                         

                         

2,877,552

                         

                         

(437,415)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Common stock issued for cash at $0.08

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

per share

                         

-

                         

                         

-

                         

435,000

                         

                         

435

                         

                         

34,365

                         

                         

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Common stock issued for cash at $0.125

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

per share

                         

-

                         

                         

-

                         

8,000

                         

                         

8

                         

                         

992

                         

                         

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Common stock issued for cash at $0.16

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

per share

                         

-

                         

                         

-

                         

1,681,250

                         

                         

1,681

                         

                         

267,319

                         

                         

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Preferred stock issued for cash at

                         

1,000

                         

                         

100,000

                         

-

                         

                         

-

                         

                         

-

                         

                         

-

$100.00 per share

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Net income for the year ended

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

December 31, 2007

                         

-

                         

                         

-

                         

-

                         

                         

-

                         

                         

-

                         

                         

364,817

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Balance, December 31, 2007

                         

1,000

                         

$

100,000

                         

23,071,835

                         

$

23,072

                         

$

3,180,228

                         

$

(72,598)

 

 

The        accompanying notes are an integral part of these consolidated financial        statements.

 

F-5

 

 

 

**ASIA8, Inc.**

Statements of Cash Flows

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

For the Years Ended

                         

                         

                         

                         

                         

                         

December 31,

                         

                         

                         

                         

                         

                         

2007

                         

2006

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

CASH FLOWS FROM OPERATING ACTIVITIES

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Net income

                         

$

364,817

                         

$

264,381

                         

Adjustments to reconcile net income to net cash                        used

                         

                         

                         

                         

                         

                         

by operating activities:

                         

                         

                         

                         

                         

                         

Depreciation expense

                         

                         

35,323

                         

                         

6,675

                         

Common stock issued for services and fees

                         

-

                         

                         

-

                         

Gain on sale of intellectual property

                         

-

                         

                         

-

                         

Gain on equity investments

                         

(567,332)

                         

                         

(500,223)

                         

Changes in operating assets and liabilities:

                         

                         

                         

                         

                         

                         

Increase in accounts receivable

                         

(106,018)

                         

                         

                         

                         

Increase in other current assets

                         

(10,840)

                         

                         

589

                         

Increase in inventory

                         

                         

(233,183)

                         

                         

-

                         

Decrease in other non-current assets

                         

(5,640)

                         

                         

                         

                         

Increase in accounts payable and accrued expenses

                         

180,373

                         

                         

(433,872)

                         

                         

                         

Net Cash Used by Operating Activities

                         

(342,500)

                         

                         

(662,450)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

CASH FLOWS FROM INVESTING ACTIVITIES

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Purchase of other investments

                         

(60,020)

                         

                         

(6,480)

                         

Purchase of fixed assets

                         

                         

(92,373)

                         

                         

-

                         

                         

                         

Net Cash Provided (Used) by Investing Activities

                         

(152,393)

                         

                         

(6,480)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

CASH FLOWS FROM FINANCING ACTIVITIES

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Cash paid on note receivable

                         

-

                         

                         

(900,000)

                         

Cash received on note payable

                         

121,995

                         

                         

948,400

                         

Common and preferred stock issued for cash

                         

404,800

                         

                         

615,457

                         

                         

                         

Net Cash Provided by Financing Activities

                         

526,795

                         

                         

663,857

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

NET INCREASE IN CASH

                         

31,902

                         

                         

(5,073)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

CASH AT BEGINNING OF PERIOD

                         

545

                         

                         

5,618

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

CASH AT END OF PERIOD

$

32,447

                         

$

545

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

CASH PAID FOR

                         

                         

                         

                         

                         

                         

                         

Interest

$

-

                         

$

-

                         

                         

Taxes

$

-

                         

$

-

                         

                         

                         

                         

                         

                         

                         

                         

 

                         

                         

SCHEDULE OF NON-CASH FINANCING AND

INVESTING ACTIVITIES

$

-

                         

$

-

 

 

The        accompanying notes are an integral part of these consolidated financial        statements.

 

F-6

 

 

**ASIA8,        INC**.

(Formerly        Asia4Sale.com, Inc.)

Notes to        the Financial Statements

December        31, 2007 and 2006

 

NOTE 1 -        ORGANIZATION AND HISTORY

 

Asia8, Inc. (formerly Asia4sale.com, Inc.), a Nevada corporation, was        incorporated in September of 1996. The Company was formerly known as H&L Investments,        Inc. The name of the corporation was changed to Asia4sale.com, Inc., on December 22, 1999        and a Certificate of Amendment of Articles of Incorporation duly filed with the Office of        the Secretary of State for the State of Nevada on December 29, 1999.

         

The Company changed its name on December 22, 1999 with the intent to acquire        Asia4Sale.com, Ltd., a Hong Kong registered software development company        (“LTD”) which was incorporated in March of 1999. At that time the Company had        1,000,000 shares of common stock outstanding and no assets or liabilities. The acquisition        of LTD took place in February 2000, when the Company issued 9,000,000 common shares to        acquire LTD. On December 11, 2000, the Company executed a 1 for 1 stock        dividend.

         

The Company thus became a software development company in the process of        designing and building a web based system for B2B and B2C selling, bartering, and        auctioning of consumer goods and services to the Asian market place.

         

In 2000 the Company spent significant funds developing its software and        attempting to market its software through various media channels. The development and        marketing operations, handled through wholly owned subsidiary LTD., were ceased in mid 2000        due to lack of acceptance of the Company’s products and an overall downturn in the        popularity of emerging B2C and B2B products. The Company eventually sold Asia4Sale.com,        Ltd. to an unrelated party in January of 2005.

         

During June of 2000, the Company paid $970,000 to acquire 49% of World Wide        Auctioneers, Inc., a Nevada registered corporation, holding 100% of British Virgin Island        registered company World Wide Auctioneers, Ltd. In August of 2003, World Wide Auctioneers,        Inc. sold 100% of its subsidiary World Wide Auctioneers, Ltd., to a Nevada registered        company WWA Group, Inc. (“WWA”), in a stock for stock transaction whereby WWA        stock was issued to owners of World Wide Auctioneers, Inc. in exchange for ownership of        World Wide Auctioneers, Ltd. The exchange caused the Company to acquire a minority equity        investment in WWA.

         

On April 20, 2007, the Company held a special meeting of shareholders to        amend its articles of incorporation to change the name to “Asia8, Inc.”, to        amend its articles of incorporation to create a preferred class of shares of 25,000,000        shares par value $0.001 and to authorize the board of directors to effect a one share for        two shares reverse split of its common stock effective April 27, 2007.

         

The shareholders approved the proposed amendments to the Company’s        articles of incorporation and authorized the board of directors to effect a one share for        two shares reverse split of its common stock. All references to common stock in these        financial statements have been retroactively restated so as to incorporate the effect of        the reverse stock-split.

         

The Company was funded by a group of several non-US investors that invested        $2,280,558 cash into the Company’s treasury during 2000 through 2002. The Company        issued 6,200,960 (post April 2007 reverse-stock split) shares of its common stock in 2000        through 2002 in return for this investment.

 

F-7

 

 

**ASIA8,        INC**.

(Formerly        Asia4Sale.com, Inc.)

Notes to        the Financial Statements

December        31, 2007 and 2006

 

 

NOTE 2 -        SIGNIFICANT ACCOUNTING POLICIES

 

a.        Accounting Method

 

The Company’s financial statements are prepared using the accrual        method of accounting. The Company has elected a December 31 year-end.

 

b. Basic        Loss Per Share

                         

For the Year Ended December 31, 2007

 

                         

Income

Shares

Per-Share

                         

(Numerator)

(Denominator)

Amount

 

                         

$

364,817

23,071,835

$

0.01

 

                         

For the Year Ended December 31, 2006

 

                         

Income

Shares

Per Share

                         

(Numerator)

(Denominator)

Amount

 

                         

$

264,381

20,947,585

$

0.01

 

The computations of basic loss per share of common stock are based on the        weighted average number of shares outstanding at the date of the financial statements.        There are no common stock equivalents outstanding.

 

c.        Provision for Taxes

 

Deferred taxes are provided on a liability method whereby deferred tax        assets are recognized for deductible temporary differences and operating loss and tax        credit carryforwards and deferred tax liabilities are recognized for taxable temporary        differences. Temporary differences are the differences between the reported amounts of        assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation        allowance when, in the opinion of management, it is more likely that not that some portion        or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities        are adjusted for the effects of changes in tax laws and rates on the date of        enactment.

 

Net deferred tax assets consist of the following components as of December        31, 2007 and 2006:

                         

2007

2006

                         

Deferred tax assets

                         

NOL Carryover

$

759,436

$

680,456

 

                         

Valuation allowance

(759,436)

(680,456)

 

                         

Net deferred tax asset

$

-

$

-

 

F-8

 

 

**ASIA8, INC**.

(Formerly Asia4Sale.com, Inc.)

Notes to the Financial Statements

December 31, 2007 and 2006

 

 

 

NOTE 2 -        SIGNIFICANT ACCOUNTING POLICIES (Continued)

 

c. Provision for Taxes (Continued)

 

The income tax provision differs from the amount of income tax determined by        applying the U.S. federal income tax rate of 39% to pretax income from continuing        operations for the years ended December 31, 2007 and 2006 due to the following:

 

                         

2007

2006

 

                         

Book income (loss)

$

  142,279

$

  140,313

                         

Income from equity investment

 (221,259)

 (195,087)

                         

Valuation allowance

78,980

54,774

 

                         

$

-

$

-

 

         

At December 31, 2007, the Company had net operating loss carryforwards of        approximately $1,460,000 that may be offset against future taxable income through the year        2027. No tax benefit has been reported in the December 31, 2006 financial statements since        the potential tax benefit is offset by a valuation allowance of the same amount.

         

Due to the change in ownership provisions of the Tax Reform Act of 1986, net        operating loss carryforwards for Federal income tax reporting purposes are subject to        annual limitations. Should a change in ownership occur, net operating loss carryforwards        may be limited as to use in the future.

 

d.        Estimates

 

The preparation of financial statements in conformity with accounting        principles generally accepted in the United States of America requires management to make        estimates and assumptions that affect the reported amounts of assets and liabilities and        disclosure of contingent assets and liabilities at the date of the financial statements and        the reported amounts of revenues and expenses during the reporting period. Actual results        could differ from those estimates.

         

e. Fair        Value of Financial Instruments

 

As at December 31, 2006, the fair value of cash and accounts and advances        payable, including amounts due to and from related parties, approximate carrying values        because of the short-term maturity of these instruments.

 

F-9

 

 

**ASIA8, INC**.

(Formerly Asia4Sale.com, Inc.)

Notes to the Financial Statements

December 31, 2007 and 2006

 

 

 

NOTE 2 -        SIGNIFICANT ACCOUNTING POLICIES (Continued)

 

f. Newly        Issued Accounting Pronouncements

 

*Newly Issued Accounting Pronouncements*

During the year ended December 31, 2007, the Company adopted the following        accounting pronouncements:

         

SFAS No. 157,*Fair Value        Measurements***-**This Statement        does not require any new fair value measurements, but rather, it provides enhanced guidance        to other pronouncements that require or permit assets or liabilities to be measured at fair        value. However, the application of this Statement may change how fair value is determined.        The Statement is effective for financial statements issued for fiscal years beginning after        November 15, 2007, and interim periods within those fiscal years. As of December 1, 2007        the FASB has proposed a one-year deferral for the implementation of the Statement for        nonfinancial assets and nonfinancial liabilities that are recognized or disclosed at fair        value in the financial statements on a nonrecurring basis.

         

SFAS No. 158,*Employers’ Accounting for        Defined Benefit Pension and Other Postretirement Plans – an amendment of FASB        Statements No. 87, 88, 106, and 132(R)**-*This Statement requires that employers measure plan assets and obligations        as of the balance sheet date. This requirement is effective for fiscal years ending after        December 15, 2008. The other provisions of the Statement were effective as of the end of        the fiscal year ending after December 15, 2006, for public companies.

         

SFAS No. 159,*The Fair Value Option for        Financial Assets and Financial Liabilities – Including an amendment of FASB Statement        No. 115**-*This Statement provides        all entities with an option to report selected financial assets and liabilities at fair        value. The Statement is effective as of the beginning of an entity’s first fiscal        year beginning after November 15, 2007, with early adoption available in certain        circumstances.

         

SOP No. 07-01,*Clarification of the Scope of the        Audit and Accounting Guide “Investment Companies” and Accounting by Parent        Companies and Equity Method Investors for Investments in Investment        Companies**-*SOP 07-01 provides        guidance for determining whether an entity is within the scope of the AICPA Audit and        Accounting Guide*Investment Companies.*The provisions of the SOP are effective for fiscal years beginning on or        after December 15, 2007, with earlier application encouraged. As of December 1, 2007 the        FASB has proposed an indefinite deferral of this SOP.

         

*EITF Issue No. 06-1, Accounting for Consideration Given by a Service        Provider to a Manufacturer or Reseller of Equipment Necessary for an End-Customer to        Receive Service from the Service Provider***-**This consensus concludes that if the consideration given by a service        provider to a manufacturer or reseller (that is not a customer of the service provider) can        be linked contractually to the benefit received by the service provider's customer, the        service provider should account for the consideration in accordance with EITF Issue 01-9.        The consensus is effective for the first annual reporting period beginning after June 15,        2007.

         

         

 

 

F-10

 

 

 

 

**ASIA8,        INC**.

(Formerly        Asia4Sale.com, Inc.)

Notes to        the Financial Statements

December        31, 2007 and 2006

 

NOTE 2 -        SIGNIFICANT ACCOUNTING POLICIES (Continued)

 

f. Newly        Issued Accounting Pronouncements (Continued)

         

*EITF Issue No. 06-4, Accounting for Deferred Compensation and        Postretirement Benefit Aspects of Endorsement Split-Dollar Life Insurance        Arrangements***-**This consensus        concludes that for a split-dollar life insurance arrangement within the scope of this        Issue, an employer should recognize a liability for future benefits in accordance with FASB        Statement No. 106 (if, in substance, a postretirement benefit plan exists) or APB Opinion        No. 12 (if the arrangement is, in substance, an individual deferred compensation contract)        based on the substantive agreement with the employee. The consensus is effective for fiscal        years beginning after December 15, 2007, with early application permitted.

         

*EITF Issue No. 06-8, Applicability of the Assessment of a Buyer's        Continuing Investment under FASB Statement No. 66, “Accounting for Sales of Real        Estate”, for Sales of Condominiums***-**This consensus concludes that an entity is required to evaluate the adequacy        of a buyer’s initial and continuing investment for purposes of determining whether it        is appropriate to recognize profit from a real estate sale involving a condominium unit or        time-sharing interest under the percentage-of-completion method under Statement No. 66. The        consensus is effective for the first annual reporting period beginning after March 15,        2007.

         

*EITF Issue No. 06-10, Accounting for Collateral Assignment        Split-Dollar Life Insurance Arrangements***-**In this Issue, a consensus was reached that an employer should recognize a        liability for the postretirement benefit related to a collateral assignment split-dollar        life insurance arrangement in accordance with either FASB Statement No. 106 or APB Opinion        No. 12, as appropriate, if the employer has agreed to maintain a life insurance policy        during the employee's retirement or provide the employee with a death benefit based on the        substantive agreement with the employee. A consensus also was reached that an employer        should recognize and measure an asset based on the nature and substance of the collateral        assignment split-dollar life insurance arrangement. The consensuses are effective for        fiscal years beginning after December 15, 2007, including interim periods within those        fiscal years, with early application permitted.

         

*EITF Issue No. 06-11, Accounting for Income Tax Benefits of Dividends        on Share-Based Payment Awards***-**In this Issue, a consensus was reached that a realized income tax benefit        from dividends or dividend equivalents that are charged to retained earnings and are paid        to employees for equity-classified nonvested equity shares, nonvested equity share units,        and outstanding equity share options should be recognized as an increase in additional        paid-in capital. This Issue should be applied prospectively to the income tax benefits that        result from dividends on equity-classified employee share-based payment awards that are        declared in fiscal years beginning after December 15, 2007, and interim periods within        those fiscal years. Early application is permitted.

         

*EITF Issue No. 07-3, Accounting for Nonrefundable Advance Payments for        Goods or Services Received for Use in Future Research and        Development****Activities*****-**In this Issue, a consensus was reached that*nonrefundable*advance payments for future        research and development activities should be deferred and capitalized. This Issue is        effective for financial statements issued for fiscal years beginning after December 15,        2007, and interim periods within those fiscal years. Early application is not        permitted.

         

 

F-11

 

 

**ASIA8,        INC**.

(Formerly        Asia4Sale.com, Inc.)

Notes to        the Financial Statements

December        31, 2007 and 2006

 

NOTE 2 -        SIGNIFICANT ACCOUNTING POLICIES (Continued)

 

f. Newly        Issued Accounting Pronouncements (Continued)

         

*FSP No. FAS 158-1, Conforming Amendments to the Illustrations in FASB        Statements No. 87, No. 88, and No. 106 and to the Related Staff Implementation        Guides***-**This FSP provides        conforming amendments to the illustrations in FASB Statements No. 87, 88, and 106 and to        related staff implementation guides as a result of the issuance of FASB Statement No. 158.        The conforming amendments made by this FSP are effective as of the effective dates of        Statement No. 158. The unaffected guidance that this FSP codifies into Statements No. 87,        88, and 106 does not contain new requirements and therefore does not require a separate        effective date or transition method.

         

*FSP No. FIN 39-1, Amendment of FASB Interpretation No.        39**-*This FSP amends FASB        Interpretation (FIN) No. 39,*Offsetting of Amounts Related to        Certain Contracts,*to permit a reporting entity to offset fair        value amounts recognized for the right to reclaim cash collateral or the obligation to        return cash collateral against fair value amounts recognized for derivative instruments        executed with the same counterparty under the same master netting arrangement that have        been offset in accordance with paragraph 10 of FIN 39. The guidance in this FSP is        effective for fiscal years beginning after November 15, 2007, with early application        permitted.

         

*FSP No. FIN 46(R)-7, Application of FASB Interpretation No. 46(R) to        Investment Companies***-**This FSP        addresses the application of FASB Interpretation (FIN) No. 46 (revised December        2003),*Consolidation of Variable Interest        Entities*, by an entity that accounts for its investments in        accordance with the specialized accounting guidance in the AICPA Audit and Accounting        Guide,*Investment Companies*. The        provisions of the FSP are effective when the entity adopts SOP 07-01.

         

*SEC Staff Accounting Bulletin No. 109, Written Loan Commitments        Recorded at Fair Value Through Earnings****-***SAB 109 expresses the current view of the staff that the expected net future        cash flows related to the associated servicing of the loan should be included in the        measurement of all written loan commitments that are accounted for at fair value through        earnings.  SEC registrants are expected to apply the views in Question 1 of SAB 109 on        a prospective basis to derivative loan commitments issued or modified in fiscal quarters        beginning after December 15, 2007.

 

g. Fixed        Assets

 

Fixed assets are recorded as cost. Major additions and improvements are        capitalized. Minor replacements, maintenance and repairs that do not extend the useful life        of the assets are expensed as incurred. Depreciation of property and equipment is        determined using the straight-line method over their useful lives, primarily 5 years. The        components of the fixed assets are as follows:

Computer equipment

$ 16,991

Furniture and fixtures

38,258

Other

38,470

Vehicle

44,500

Accumulated depreciation

(79,640)

                         

                         

Net

$58,580

 

 

F-12

 

 

**ASIA8,        INC**.

(Formerly        Asia4Sale.com, Inc.)

Notes to        the Financial Statements

December        31, 2007 and 2006

 

NOTE 2 -        SIGNIFICANT ACCOUNTING POLICIES (Continued)

 

h.        Concentration of Risk

 

                         

The Company does not rely on any one or a few major                        customers for its sales revenues.

 

i. Revenue Recognition   

 

Revenues consist of revenues earned in the Company’s capacity as        seller of certain products by direct and brokered sale. All revenue is recognized when the        sale is complete and the Company has determined that the proceeds are        collectible.

         

All costs of goods sold are accounted for under Costs of Goods        Sold.

         

j. Cash and        Cash Equivalents

 

For purposes of the Statement of Cash Flows, the Company considers all        highly liquid instruments purchased with a maturity of three months or less to be cash        equivalents to the extent the funds are not being held for investment purposes.

 

k.        Accounts Receivable

 

Accounts receivable are carried at original invoice amount less an estimate        made for doubtful receivables based on a review of all outstanding amounts on a monthly        basis. Specific reserves are estimated by management based on certain assumptions and        variables, including the customer’s financial condition, age of the customer’s        receivables, and changes in payment histories. Trade receivables are written off when        deemed uncollectible. Recoveries of trade receivables previously written off are recorded        when received.

         

A trade receivable is considered to be past due if any portion of the        receivable balance has not been received by the contractual pay date. Interest is not        charged on trade receivables that are past due.

 

NOTE 3 -        SIGNIFICANT EVENTS

 

On May 1, 2007 the Company entered into an agreement to acquire the        exclusive distribution rights to sell Furukawa Unic Cranes in the U.A.E., along with        ownership of $415,000 of the seller’s equipment assets in the U.A.E. As per the        agreement, the Company committed to seller 800,000 shares of its common stock, and assumed        associated liabilities totaling $415,000.

         

On May 1, 2007 the Company entered into an agreement to acquire the first        right of refusal to acquire the exclusive rights to sell Trident Tri-Car vehicles in 20        countries chosen by the Company. The agreement required the Company to pay $65,000 in cash        consideration to the seller for a 2-year first right of refusal for the 20 countries, plus        additional cash commitments for each country when test vehicles are sent to the country and        the Company commits to becomes the exclusive distributor in that country.

         

On May 1, 2007, the Company entered into an agreement to acquire the rights        to the exclusive distributorship agreement for Atomix Boats in the U.A.E., manufactured in        China by the Atomix Boats Co. Ltd. Zhejiang, in exchange for 600,000 shares of the        Company’s common stock.

 

F-13

 

 

**ASIA8,        INC**.

(Formerly        Asia4Sale.com, Inc.)

Notes to        the Financial Statements

December        31, 2007 and 2006

 

NOTE 3 -        SIGNIFICANT EVENTS (Continued)

         

During the year ended December 31, 2007, the Company issued 2,124,250 shares        of common stock for cash at prices ranging from $0.08 to $0.16 per share. Total cash        received from these issuances was $304,800. In addition, the Company issued 1,000 shares of        preferred stock at $100 per share.

         

On April 27, 2007 the Company elected to reverse-split its common stock on a        one-share-for-two-share basis. All references to common stock within these financial        statements have been retroactively restated to reflect this reverse stock-split.

         

NOTE 4-        EQUITY INVESTMENT

 

In August 2000 the Company paid $970,000 cash to acquire 49% of WWA World        Wide Auctioneers, Inc., a Nevada registered company holding 100% of British Virgin Island        registered company World Wide Auctioneers, Ltd. In August 2003 WWA World Wide Auctioneers,        Inc. sold 100% of its subsidiary World Wide Auctioneers, Ltd. to Nevada registered company        WWA Group, Inc. (“WWA”), in a stock for stock transaction whereby the stock of        WWA Group, Inc. was issued directly to owners of WWA World Wide Auctioneers, Inc. The        Company was issued 7,525,000 shares of WWA Group, Inc. in 2003, comprising 47.5% of the        issued and outstanding stock of WWA Group, Inc. At December 31, 2007, the Company owned 40%        of the issued and outstanding WWA Group, Inc. common stock.

 

Condensed financial information of WWA:

                         

For the Years Ended

December 31,

2007

2006

                         

                         

                         

Cash

$ 5,283,399

$ 2,624,570

Receivables

3,209,792

2,388,091

Other current assets

7,101,236

3,961,940

Fixed assets

5,407,063

4,274,616

Other assets

1,799,955

1,562,500

                         

                         

                         

Total Assets

$ 22,801,445

$ 14,812,717

                         

                         

                         

Auction payables

$ 7,941,866

$ 6,904,236

Other current liabilities

6,017,013

3,577,611

Long-term debt

1,995,327

89,412

Common stock

18,432

16,671

Additional paid-in capital

2,812,045

1,537,998

Retained earnings

4,016,762

2,686,789

                         

                         

                         

Total Liabilities and Stockholders' Equity

$ 22,801,445

$ 14,812,717

 

 

 

F-14

 

 

**ASIA8,        INC**.

(Formerly        Asia4Sale.com, Inc.)

Notes to        the Financial Statements

December        31, 2007 and 2006

 

NOTE 4-        EQUITY INVESTMENT (Continued)

         

Condensed financial information of WWA:

               

                         

For the Years Ended

December 31,

                         

2007

2007

                         

                         

                         

Net revenues

$ 26,841,630

$ 17,622,383

Direct costs

19,246,292

12,102,525

Operating expenses

5,901,530

4,630,545

Other income (expense)

(363,835)

290,458

Income taxes

-

-

                         

                         

                         

Net Income

$ 1,329,973

$ 1,179,771

 

 

F-15

 

 

**ITEM 9.**

**CHANGES IN AND DISAGREEMENTS WITH                        ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE**

 

None.

 

**ITEM 9A.**

**CONTROLS AND PROCEDURES (ITEM 9A (T))**

 

**Management's Annual Report on Internal Control over Financial        Reporting**

 

The        Company’s management, including our chief executive officer and chief financial        officer, is responsible for establishing and maintaining adequate internal control over our        financial reporting. Internal control over financial reporting is a process designed by, or        under the supervision of, our chief executive and chief financial officers and implemented        by our board of directors, management and other personnel, to provide reasonable assurance        regarding the reliability of financial reporting and the preparation of financial        statements for external purposes in accordance with generally accepted accounting        principles and includes those policies and procedures that: (i) pertain to the        maintenance of records that, in reasonable detail, accurately and fairly reflect the        transactions and dispositions of our assets; (ii) provide reasonable assurance that        transactions are recorded as necessary to permit preparation of financial statements in        accordance with generally accepted accounting principles, and that our receipts and        expenditures are being made only in accordance with authorizations of our management and        directors; and (iii) provide reasonable assurance regarding prevention or timely        detection of unauthorized acquisition, use or disposition of our assets that could have a        material effect on the financial statements. Because of their inherent limitations,        internal control over financial reporting may not prevent or detect misstatements. Also,        projections of any evaluation of effectiveness to future periods are subject to the risk        that controls may become inadequate because of changes in conditions, or that the degree of        compliance with the policies or procedures may deteriorate.

 

Under the        supervision and with the participation of our management, including our principal executive        officer and principal financial officer, we conducted an evaluation of the effectiveness of        our internal control over financial reporting based on the framework in*Internal Control* *— Integrated Framework*issued by the        Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation,        our management concluded that our internal control over financial reporting was effective        as of December 31, 2007.

 

This annual        report does not include an attestation report of our registered public accounting firm        regarding internal control over financial reporting. Management's report was not subject to        attestation by our registered public accounting firm pursuant to temporary rules of the        Commission that permit us to provide only the management’s report in this Form        10-K.

 

**Changes in Internal Controls over Financial Reporting**

 

During the        period ended December 31, 2007, there has been no change in internal control over financial        reporting that has materially affected, or is reasonably likely to materially affect our        internal control over financial reporting.

 

**9B.**

**OTHER INFORMATION**

 

None.

 

 

33

 

 

**PART        III**

 

**ITEM 10.**

**DIRECTORS, EXECUTIVE OFFICERS, AND                        CORPORATE GOVERNANCE**

 

**Officers and Directors**

 

The        following table sets forth the name, age and position of each director and executive        officer of the Company:

 

***Name***

***Age***

***Year Appointed***

***Position(s) and Office(s)***

Eric Montandon

42

2000

chief executive officer, chief financial officer, principal                        accounting officer, and director

Alfredo “Alex” Cruz

48

2006

secretary and director

Brian Hodgson

45

2000

director

 

***Eric        Montandon***has served as director since April 2000, and served        as chief executive officer and chief financial officer since May 2000.

 

Mr.        Montandon graduated from Arizona State University in 1988 with a Bachelor's Degree in        Business Finance. After graduation he worked for Winius-Montandon, Inc. as a commercial        real estate consultant and appraiser in Phoenix, Arizona from 1988 until 1992. He was        subsequently involved in forming Momentum Asia, Inc., a design and printing operation in        Subic Bay, Philippines in 1994. Mr. Montandon operated this company as its chief executive        office until the middle of 2000. Mr. Montandon joined the board of directors in of        Asia4Sale.com, Inc. in February 2000 and was instrumental in Asia4Sale.com, Inc.’s        acquisition and development of World Wide Auctioneers, Ltd. He also currently serves as an        officer and director of WWA Group, Inc. and Net Telecommunications, Inc.

 

***Alfredo Cruz***has served as director        since January of 2006 and as corporate secretary since 2000 through the present.

 

Mr. Cruz        graduated from the University of the Philippines in 1982 with a Bachelor's Degree in        Economics. He continued on at the University of the Philippines and received his law degree        in 1986. Mr. Cruz has an established corporate legal practice, Cruz & Reyes Law        Offices, in Manila, the Philippines, and is currently its managing partner. He has 15 years        of experience in corporate law. Mr. Cruz’s vast experience in corporate work focuses        on the legal management of both domestic and foreign investments. His concentration is on        mergers and acquisitions, joint ventures, incorporations, administrative licensing, and        corporate housekeeping; he also has general exposure in trial and appellate litigation in        Contract, Corporate, Domestic Relations, Entertainment, Insurance, Injunction, and Libel        Law.

 

***Brian        Hodgson***served as chief executive officer from February 2000        until May 2001. He also has served as director since February of 2000.

 

Mr. Hodgson        graduated from the UK Chartered Institute of Marketing in 1987 with a Bachelor's Degree in        Business Finance. While in school he was working as a sale executive for the Guardian        Newspaper in London and since has lived in several different countries across the world        gaining twenty years experience in upper level management in a variety of industries        particularly in technology development and software design and implementation fields. Mr.        Hodgson has been the managing director of World Wide Auctioneers since 2000 and in 2006 he        received a certificate from the WorldWide College of Auctioneering in Iowa. Further, he has        been the managing director of Hong Kong Auctions Ltd. since 2006.

 

34

 

 

***Term        of Office***

 

Our        directors are appointed for a one (1) year term to hold office, until the next annual        meeting of our shareholders, or until removed from office in accordance with our bylaws.        Our executive officers are appointed by our Board of Directors and hold office until        removed by the board.

 

***Family Relationships***

 

There are        no family relationships between or among the directors or executive officers

 

***Compensation***

 

Directors        receive no compensation for their services as directors. We do not anticipate adopting a        provision for compensating directors in the foreseeable future.

 

***Director Independence***

 

Our common        stock is listed on the OTC Bulletin Board inter-dealer quotation system, which does not        have director independence requirements. For purposes of determining director independence,        we have applied the definitions set out in NASDAQ Rule 4200(a)(15). Under NASDAQ Rule        4200(a)(15), a director is not considered to be independent if he or she is also an        executive officer or employee of the corporation. Accordingly, we consider each of Alfredo        “Alex” Cruz and Brian Hodgson to be independent directors.

 

***Involvement in Certain Legal Proceedings***

 

To the best        of our knowledge, during the past five years, none of the following occurred with respect        to a present or former director, executive officer, or employee: (1) any bankruptcy        petition filed by or against any business of which such person was a general partner or        executive officer either at the time of the bankruptcy or within two years prior to that        time; (2) any conviction in a criminal proceeding or being subject to a pending criminal        proceeding (excluding traffic violations and other minor offences); (3) being subject to        any order, judgment or decree, not subsequently reversed, suspended or vacated, of any        court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending        or otherwise limiting his or her involvement in any type of business, securities or banking        activities; and (4) being found by a court of competent jurisdiction (in a civil action),        the Commission or the Commodities Futures Trading Commission to have violated a federal or        state securities or commodities law, and the judgment has not been reversed, suspended or        vacated.

 

**Compliance with Section 16(A) of the Exchange Act**

 

Based        solely upon a review of Forms 3, 4 and 5 furnished to the Company, we are aware of the        following persons or entities which, during the period ended December 31, 2007, failed to        file, on a timely basis, reports required by Section 16(a) of the Securities Exchange Act        of 1934.

 

                         

**•**

Adderley Davis & Associates, Ltd failed to file a Form 3                        or Form 5 despite holding in excess of 10% of the Company’s common                        shares.

                         

**•**

Eric Montandon failed to file a Form 3 or Form 5 despite                        being our chief executive officer, chief financial officer, principal                        accounting officer and a director of the Company.

                         

**•**

Alfredo Cruz failed to file a Form 3 or Form 5 despite being                        a director of the Company

                         

**•**

Brian Hodgson failed to file a Form 3 or Form 5 despite                        being a director of the Company.

 

35

 

 

***Code        of Ethics***

 

The Company        has adopted a Code of Ethics within the meaning of Item 406(b) of Regulation S-B of the        Securities Exchange Act of 1934. The Code of Ethics applies to directors and senior        officers, such as the principal executive officer, principal financial officer, controller,        and persons performing similar functions. The Company has attached a copy of its Code of        Ethics by reference as Exhibit 14 to this Form 8-K. Further, the Company’s Code of        Ethics is available in print, at no charge, to any security holder who requests such        information by contacting the Company.

 

**Board        of Directors Committees**

 

The board        of directors has not yet established an audit committee or a compensation committee. An        audit committee typically reviews, acts on and reports to the board of directors with        respect to various auditing and accounting matters, including the recommendations and        performance of independent auditors, the scope of the annual audits, fees to be paid to the        independent auditors, and internal accounting and financial control policies and        procedures. Certain stock exchanges currently require companies to adopt a formal written        charter that establishes an audit committee that specifies the scope of an audit        committee’s responsibilities and the means by which it carries out those        responsibilities. In order to be listed on any of these exchanges, the Company will be        required to establish an audit committee.

 

The board        of directors has not yet established a nominating committee because the board of directors        has determined that the board of directors, consisting of only three individuals, can        efficiently and effectively fulfill this function by using a variety of methods for        identifying and evaluating nominees for director, including candidates that may be referred        by the Company’s stockholders. Stockholders who desire to recommend candidates for        evaluation may do so by contacting the Company in writing, identifying the potential        candidate and providing background information. Candidates may also come to the attention        of the board of directors through current members of the board of directors, professional        search firms and other persons. In evaluating potential candidates, the board of directors        takes into account a number of factors, including among others, the        following: 

 

                         

**•**

independence from management;

                         

**•**

whether the candidate has relevant business                        experience;

                         

**•**

judgment, skill, integrity and reputation;

                         

**•**

existing commitments to other businesses;

                         

**•**

corporate governance background;

                         

**•**

financial and accounting background, to enable the board of                        directors to determine whether the candidate would be suitable for audit                        committee membership; and

                         

**•**

the size and composition of the board of                        directors.

 

The Company        plans to establish a nominating committee once more than three directors have been        appointed or elected to the board. At such time, the nominating committee will develop a        charter.

 

 

 

 

 

 

36

 

 

**ITEM 11.**

**EXECUTIVE COMPENSATION**

 

**Compensation Discussion and Analysis**

 

The        objective of the Company’s compensation program is to provide compensation for        services rendered by our sole executive officer. Since the Company is in the development        stage company no salary is paid to retain the services of our executive officer. Should        that determination change, the amount we deem appropriate to compensate our executive        officer will be determined in accordance with market forces; since we have no specific        formula to determine compensatory amounts at this time. While we have deemed that our        current lack of a compensatory program and the decisions regarding compensation are        appropriately suited for our current objectives, we may adopt a compensation program in the        future to include a salary for our executive officer and any additional future executive        employees, which compensation may include options and other compensatory        elements.

 

**Table**

 

The        following table provides summary information for 2007 and 2006 concerning cash and non-cash        compensation paid or accrued by the Company to or on behalf of (i) the chief executive        officer and the chief financial officer and (ii) any other employee to receive compensation        in excess of $100,000.

 

***Summary Compensation Table***

Name and Principal Position

Year

Salary

($)

                         

Bonus

($)

                         

Stock Awards

($)

                         

Option

Awards

($)

Non-Equity Incentive Plan Compensation

($)

                         

Change in Pension Value and Nonqualified Deferred                        Compensation

($)

                         

All Other Compensation

($)

                         

Total

($)

                         

Eric Montandon,

CEO

2007

2006

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

 

The Company        has no “Grants of Plan-Based Awards”, “Outstanding Equity Awards at        Fiscal Year-End”, “Option Exercises and Stock Vested”, “Pension        Benefits”, or “Nonqualified Deferred Compensation” to employees to        report. Nor does the Company have any “Post Employment Payments” to        report.

         

**ITEM 12.**

**SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND                        MANAGEMENT AND RELATED STOCKHOLDER MATTERS**

 

The        following table sets forth certain information concerning the ownership of the        Company’s common stock as of April 9, 2008, with respect to: (i) all directors; (ii)        each person known by us to be the beneficial owner of more than five percent of our common        stock; and (iii) our directors and executive officers as a group.

 

 

 

 

 

 

37

 

 

 

***Title of Class***

***Names and Addresses of Directors, Officers and                        Beneficial Owners***

***Number of Shares***

***Percent of Class***

Common

Eric Montandon

Chief Executive Officer, Chief Financial Officer and                        Director, 2465 West 12th Street, Suite # 2, Tempe, AZ                        85281

210,316

0.91%

Common

Alfredo Alex S. Cruz III

Director and Secretary

2465 West 12th Street, Suite # 2, Tempe, AZ                        85281

135,934

0.59%

Common

Brian Hodgson, Director

2465 West 12th Street, Suite # 2, Tempe, AZ                        85281

100,000

0.43%

Common

Peter Prescott

P.O. Box 73268

Dubai, U.A.E.

1,400,000

6.08%

Common

Terrano                        Investments, Ltd.

12th Floor, 152 Queens Road Central Hong                        Kong

2,083,334

9.04%

Common

Adderley                        Davis & Associates, Ltd.

Suite Z12, P.O. Box 8497, SAIF Zone, Sharjah,United Arab                        Emirates

4,427,335

19.22%

Common

All executive officers and directors as a group                        (3)

446,250

1.93%

 

 

**ITEM 13.**

**CERTAIN RELATIONSHIPS AND RELATED                        TRANSACTIONS**

 

None of our        directors or executive officers, nor any proposed nominee for election as a director, nor        any person who beneficially owns, directly or indirectly, shares carrying more than 5% of        the voting rights attached to all of our outstanding shares, nor any members of the        immediate family (including spouse, parents, children, siblings, and in-laws) of any of the        foregoing persons has any material interest, direct or indirect, in any transaction since        the beginning of our last fiscal year or in any presently proposed transaction which, in        either case, has or will materially affect us, except as follows:

 

On February        1, 2007, the Company authorized the issuance of 92,500 pre reverse split shares (reverse        split effected April 27, 2007) of the Company’s restricted common stock to Eric        Montandon, our chief executive officer and a director, pursuant to the exemptions from        registration provided by Section 4(2) and Regulation D of the Securities Act of 1933, as        amended valued at $0.08 a share in settlement of debt in the amount of $7,400.

 

 

 

 

 

38

 

 

**ITEM 14.**

**PRINCIPAL ACCOUNTANT FEES AND                        SERVICES**

 

***Audit        Fees***

 

The        following is a summary of the fees billed to us by Moore & Associates for professional        services rendered for the past two fiscal years:

 

***Auditors’ Fees and Services***

                         

**2007**

**2006**

                         

Audit fees

$15,000

$2,500

                         

Audit-related fees

$0

$0

                         

Tax fees

$0

$0

                         

All other fees.

$0

$0

Total fees paid or accrued to our principal                        accountants

$15,000

$2,500

 

Audit Fees        consist of fees billed for professional services rendered for the audit of our financial        statements and review of the interim financial statements included in quarterly reports and        services that are normally provided by Moore & Associates in connection with statutory        and regulatory filings or engagements.

 

***Policy on Audit Committee Pre-Approval of Audit and Permissible        Non-Audit Services of Independent Auditors***

 

The Audit        Committee’s policy is to pre-approve all audit and permissible non-audit services        provided by the independent auditors. These services may include audit services,        audit-related services, tax services, and other services. Pre-approval is generally        provided for up to one year, and any pre-approval is detailed as to the particular service        or category of services and is generally subject to a specific budget. The independent        auditors and management are required to periodically report to the Audit Committee        regarding the extent of services provided by the independent auditors in accordance with        this pre-approval and the fees for the services performed to date. The Audit Committee may        also pre-approve particular services on a case-by-case basis.

 

Moore &        Associates performed all work only with their permanent full time employees.

 

 

 

 

 

 

 

39

 

 

**ITEM 15.**

**EXHIBITS AND FINANCIAL STATEMENT                        SCHEDULES**

 

***(a)        Consolidated Financial Statements***

 

The        following documents are filed under “*Item 8. Financial        Statements and Supplementary Data,*” pages F-1 through F-15,        and are included as part of this Form 10-K:

         

                         

Financial Statements of the Company for the years ended                        December 31, 2007 and 2006:

                         

Report of Independent Registered Public Accounting                        Firm

Balance Sheets

Statements of Income

Statementsof Stockholders’ Equity

Statements of Cash Flows

                         

Notes to Financial Statements

         

***(b)        Exhibits***

         

The        exhibits required to be attached by Item 601 of Regulation S-B are listed in the Index to        Exhibits on page 42 of this Form 10-K, and are incorporated herein by this        reference.

         

***(c)        Financial Statement Schedules***

 

We are not        filing any financial statement schedules as part of this Form 10-K because such schedules        are either not applicable or the required information is included in the financial        statements or notes thereto.

 

 

 

40

 

 

**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, this        9th day of April, 2008.

                

***Asia8, Inc.***

                         

                         

/s/ Eric Montandon 

By: Eric Montandon

Its: Chief Executive Officer, Chief Financial Officer and                        Principal Accounting Officer

 

 

In        accordance with the Exchange Act, this report has been signed below by the following        persons on behalf of the registrant and in the capacities and on the dates        indicated.

 

***Signature***

***Title***

***Date***

                         

                         

/s/ Eric Montandon

Eric Montandon

                         

                         

Director

                         

                         

April 9, 2008

                         

                         

/s/ Alfredo “Alex” Cruz

Alfredo “Alex” Cruz

                         

                         

Director

                         

                         

April 9, 2008

                         

                         

/s/ Brian Hodgson

Brian Hodgson

                         

                         

Director

                         

                         

April 9, 2008

 

41

 

 

**INDEX        TO EXHIBITS**

 

***Exhibit***

***Description***

         

3(i)(a)*

Articles of Incorporation dated September 23, 1996                        (incorporated by reference to the Form 10-12G filed with the Commission on                        October 20, 1999).

3(i)(b)*

Amended Articles of Incorporation dated July 9, 1999                        (incorporated by reference from Form 10-QSB filed with the Commission on                        October 20, 1999).

3(i)(c)*

Amended Articles of Incorporation dated December 22, 1999                        (incorporated by reference from Form 10-QSB filed with the Commission on                        May 15, 2007).

3(i)(d)*

Amended Articles of Incorporation dated April 20, 2007                        (incorporated by reference from Form 10-QSB filed with the Commission on                        May 15, 2007).

3(ii)(a)*

By-Laws dated May 6, 1999 (incorporated by reference Form                        10-12G filed with the Commission on October 20, 1999).

3(ii)(b)*

Amended Bylaws dated January 22, 2007 (incorporated by                        reference to the Form 8-K filed with the Commission on January 29,                        2007).

10(i)*

Share Purchase Agreement dated June 2000 between                        Asia4Sale.com, Inc. and World Wide Auctioneers, Inc. (incorporated by                        reference to the Form 8-K filed with the Commission on October 3,                        2007).

10(ii)*

Unic Distribution Agreement dated May 1, 2007 between Asia8,                        Inc. and Peter Prescott (incorporated by reference to the Form 8-K filed                        with the Commission on October 3, 2007).

10(iii)*

Tri-car Distribution Agreement dated May 1, 2007 between                        Asia8, Inc. and Asian Dragon Entertainment and Gaming Corporation                        (incorporated by reference to the Form 8-K filed with the Commission on                        October 3, 2007).

10(iv)*

Atomix Distribution Agreement dated May 1, 2007 between                        Asia8, Inc. and Peter Prescott (incorporated by reference to the Form 8-K                        filed with the Commission on October 3, 2007).

14*

Code of Ethics (Code of Conduct) (incorporated by reference                        to the Form 8-K filed with the Commission on October 3, 2007).

21

Subsidiaries of the                        Company.

31

Certification of the Chief Executive                        Officer and Chief Financial Officer pursuant to Rule 13a-14 of the                        Securities and Exchange Act of 1934, as amended, as adopted pursuant to                        Section 302 of the Sarbanes-Oxley Act of 2002.

32

Certification of the Chief Executive                        Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as                        adopted pursuant to Section 906 of the Sarbanes-Oxley Act of                        2002.

         

              *Incorporated by reference to previous filings of the        Company.

42