UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549




Form 10-Q/A


(Amendment No. 1)




xQuarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934




For the quarterly period ended June 30, 2013




or




oTransitional Report under Section 13 or 15(d) of the Securities Exchange Act of 1934




000-27795 (Commission file number)




AVWORKS AVIATION CORP.
 (Exact name of registrant as specified in its charter)


Florida

98-0427526(State ofincorporation)

(IRS EmployerIdentification Number)




3901 SW 47TH AVENUE
 Suite 415
 Davie, Florida 33314


(Address of principal executive offices)




(954) 792-8450


(Registrant's telephone number)


Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes o No x




Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Not Applicable.




Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. (Check one):




Large accelerated filer
o
Accelerated filer
oNon-accelerated filer
o
Smaller Reporting Company
x




Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes o No x




The number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date was:





Common Stock, $0.001 par value 270,020,145 shares outstanding on January 13, 2014




Series A Preferred Stock, $0.001 par value 1,000,000 shares outstanding on January 13, 2014




EXPLANATORY NOTE
  The purpose of this  Amendment No. 1 to the Company's  Quarterly  Report on Form 10-Q for the quarterly  period ended June 30, 2013,  filed with the  Securities and Exchange  Commission on March 31, 2014 (the "Form 10-Q"), is solely to state that this Form 10-Q has been reviewed by the Company’s independent accountant, Terry L. Johnson, CPA, who, per the 8-K/A, dated November 27, 2013 and filed January 31, 2014, was engaged by the Company on January 9, 2014 as the Company's independent accountant to audit the Company’s financial statements and to perform reviews of its interim financial statements.
  No other changes have been made to this Form 10-Q.  This  Amendment No. 1 to the Form 10-Q  continues to speak as of the  original  filing date of the Form 10-Q, does not reflect events that may have occurred subsequent to the original filing date, and does not modify or update in any way disclosures  made in the original Form 10-Q




DOCUMENTS INCORPORATED BY REFERENCE:
  None













FORWARD-LOOKING STATEMENTS




CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS





This Quarterly Report on Form 10-Q contains both historical and forward-looking statements. The forward-looking statements in this quarterly report are not based on historical facts, but rather reflect the current expectations of our management concerning future results and events. These forward-looking statements include, but are not limited to, statements concerning our plans to continue the marketing, commercialization and sale of our services and planned future products and product candidates; address certain markets; and evaluate additional product candidates for subsequent sales. In some cases, these statements may be identified by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," or "continue," or the negative of such terms and other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements contained herein are reasonable, we cannot guarantee future results, the outcome of an ongoing contractual dispute in connection with our accounts receivable factoring arrangement, levels of business activity, performance, or achievements. These statements involve known and unknown risks and uncertainties that may cause our or our industry's results, levels of activity, performance or achievements to be materially different from those expressed or implied by forward-looking statements.





Management's Discussion and Analysis ("MD&A") should be read together with our financial statements and related notes included elsewhere in this quarterly report. This quarterly report, including the MD&A, contains trend analysis and other forward-looking statements. Any statements in this quarterly report that are not statements of historical facts are forward-looking statements. These forward-looking statements made herein are based on our current expectations, involve a number of risks and uncertainties and should not be considered as guarantees of future performance.




2





Other factors that could cause actual results to differ materially include without limitation:




·
our ability to continue to finance our business;


·
an inability to arrange debt or equity financing;


·
the outcome of potential disputes that could arise with labor unions;


·
the impact of new technologies on our services and our competition;


·
adverse changes in laws or rules or regulations of governmental agencies;


·
interruptions or cancellation of existing contracts;


·
impact of competitive services and pricing;


·
continued availability of adequately skilled labor at the current prices;


·
the ability of management to execute plans and motivate personnel in the execution of those plans;


·
the presence of competitors with greater financial resources;


·
our ability to maintain our current pricing model and/or decrease our cost of sales;


·
the adoption of new, or changes in, accounting principles;


·
the costs inherent with complying with new statutes and regulations applicable to public reporting companies, such as the Sarbanes-Oxley Act of 2002




These factors are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in the forward-looking statements in this quarterly report. Other unknown or unpredictable factors also could have material adverse effects on our future results. The forward-looking statements in this quarterly report are made only as of the date of this quarterly report, and we do not have any obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances. See also Item 1A, "RISK FACTORS"




3




AVWORKS AVIATION CORP.


FORM 10-Q


June 30, 2013




TABLE OF CONTENTS




PART I - FINANCIAL INFORMATION


F-1Item 1 -
Condensed Consolidated Financial Statements


F-1Condensed Consolidated Balance Sheets


F-1Condensed Consolidated Statements of Operations


F-2Condensed Consolidated Statements of Cash Flows


F-4Notes to Condensed Consolidated Financial Statements


F-5 - F-12Item 2 -
Management's Discussion and Analysis of Financial Condition and Results of Operations


5Item 3 -
Quantitative and Qualitative Disclosures about Market Risk


7Item 4 -
Controls and Procedures


7PART II - OTHER INFORMATION


9ITEM 1 -
LEGAL PROCEEDINGS


9ITEM 1A -
RISK FACTORS


9ITEM 2 -
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS


9ITEM 3 -
DEFAULTS UPON SENIOR SECURITIES


9ITEM 4 -
(REMOVED AND RESERVED)


9ITEM 5 -
OTHER INFORMATION


9ITEM 6 -
EXHIBITS


10
 Unless the context requires otherwise, references in this quarterly report to "Avworks Aviation”," “Avworks,” "the Company," "we," "our" and "us" refer to Avworks Aviation Corp. This quarterly report contains trademarks and trade names of other parties.
  
 4




PART I - FINANCIAL INFORMATION




Item 1 – Condensed Consolidated Financial Statements




AVWORKS AVIATION LLC
 Balance Sheet Standard
 As of June 30, 2013
  Jun 30, '13


Dec 31, '12ASSETSCurrent AssetsChecking/SavingsCash and Cash equivalents


(442
)Total Checking/Savings


(442
)Total Current Assets


(442
)Fixed AssetsProperty, Plant and Equipment net of Depreciation


2,000



3,000Total Fixed Assets


2,000



3,000TOTAL ASSETS


1,558



3,000LIABILITIES & EQUITYLiabilitiesCurrent LiabilitiesOther Current LiabilitiesCash Overdraft






400Accrued Expenses


110,864



82,204Notes Payable


150,593



150,593Total Other Current Liabilities


261,457



233,197Total Current Liabilities


261,457



233,197Total Liabilities


261,457



233,197EquityCapital StockStockholder's DeficitPreferred stock, 0.001 par value, 10,000,000 shares authorized, none issued and outstandingCommon stock, 0.001 par value, 500,000,000 shares authorized, 270,020,145, issued and outstanding at June 30, 2013 and December 31, 2012


270,020



270,020Adiditional Paid-in-Capital


1,005,966



1,005,966Accumulated Deficit


(1,535,885
)


(1,506,183
)Total Stockholders' Deficit


(259,899
)


(230,197
)Total Liabilities and Stockholders Deficit


1,558



3,000
 F-1
 AVWORKS AVIATION LLC
 Profit and Loss Standard
 
 For the three months ended

June 30,


For the six months ended

June 30,2013


2012


2013


2012Ordinary Income/ExpenseIncomeSales


27,875



4,150



62,731



40,496Total Income


27,875



4,150



62,731



40,496Cost of Goods SoldCost of Sales


(22,150
)


(8,855
)


(44,802
)


(28,467
)Total COGS


(22,150
)


(8,855
)


(44,802
)


(28,467
)Gross Profit


5,725



(4,705
)


17,929



12,029ExpenseDepreciation Expense


(500
)


(500
)


(1,000
)


(1,000
)General Administrative


(12,347
)


(3,200
)


(40,531
)


(69,630
)Interest Expense


(3,535
)


(2,363
)


(7,071
)


(4,830
)Selling & Marketing


(62
)


(25
)


(99
)


(9,586
)Accounting






(7,282
)






(7,282
)Attorney






(500
)






(500
)Auto






(329
)






(329
)Bank charge






(360
)






(360
)Insurance






(234
)






(234
)Meals and entertainment






(272
)






(272
)Miscellaneous






3,872







3,872Office






(364
)






(364
)Payroll






(10,312
)






(10,312
)Petty cash






(1,142
)






(1,142
)Profesisonal fee






(2,920
)






(2,920
)Rent






(4,601
)






(4,601
)Shipping






(150
)






(150
)Tax and license






(181
)






(181
)Telephone






(2,063
)






(2,063
)Total Expense


(16,444
)


(32,926
)


(48,700
)


(111,884
)Net Ordinary Income


(10,719
)


(37,631
)


(30,771
)


(99,855
)Adjustment from previous year







1,070Net Income


(10,719
)


(37,631
)


(29,701
)


(99,855
)
 F-2
 AVWORKS AVIATION LLC
 Statement Of Cash Flows
 For the three months ended

June 30,


For the six months ended

June 30,2013


2012


2013


2012OPERATING ACTIVITIESNet Income


(10,719
)


(37,631
)


(30,771
)


(99,855
)Adjustments to reconcile Net Income to net cash provided by operations:Accounts Receivable














2,158Inventories














(33,738
)Other Current Assets














19,250Accrued Expenses


7,452



(28,911
)


110,864



(28,911
)Notes Payable










150,593Net cash provided by Operating Activities


(3,267
)


(66,542
)


230,685



(141,096
)INVESTING ACTIVITIESAccumulated Depreciation


500



500







1,000Net cash provided by Investing Activities


500



500



(2,000
)Net cash provided by Financing Activities






52,911



(229,127
)


129,787Net cash increase for period


(2,767
)


(13,131
)


(442
)


(10,309
)Cash at beginning of period


2,325



6,945







4,123Cash at end of period


(442
)


(6,186
)


(442
)


(6,186
)
 
 F-3
 AVWORKS AVIATION LLC
 Statements of Changes in Stockholder's Deficit
 
 For the Three Months Ended June 2012 and the Period from June 1, 2003 (inception) to June 2013
 Common Stock


Additional

Paid-in-Capital


Total Stockholders'Shares


Par Value




Accum (Deficit)


Equity (Deficit)BALANCE AT DECEMBER 31, 2009


153,250,000


$
153,250


$
1,035,516


$
(1,225,409
)

$
(36,643
)Net income














33,702



33,702Distributions














(16,181
)


(16,181
)BALANCE AT DECEMBER 31, 2010


153,250,000



153,250



1,035,516



(1,207,888
)


(19,122
)Common stock cancelled pursuant to Share Exchange Agreement


(67,000,000
)


(67,000
)


67,000Common stock issued pursuant to Share Exchange Agreement


165,000,000



165,000



(165,000
)Common stock issued for Offering


440,000



440



21,560







22,000Common stock issued for services


10,000,000



10,000











10,000Common stock issued for conversion of Notes Payable


620,000



620



30,380







31,000Interest payment by shareholder










167







167Net loss














(62,582
)


(62,582
)BALANCE AT DECEMBER 31, 2011


262,310,000



262,310


$
989,623


$
(1,270,470
)

$
(18,537
)Return to authorized #1605 and 1606


(10,000,000
)Common Stock issued for services


10,000,000Cmmon stock issued for conversion of note payable


7,710,145



7,710



16,343







24,053Net (loss)














(235,713
)


(235,713
)BALANCE, DECEMBER 31, 2012


270,020,145



270,020



1,005,966



(1,506,183
)


(230,197
)Net loss for the three months ended March 2013














(18,983
)


(18,983
)Net loss for the three months endedJune 2013














(10,719
)


(10,719
)BALANCE, JUNE 30, 2013


270,020,145



270,020



1,005,966



(1,535,885
)


(259,899
)
  F-4


AVWORKS AVIATION CORP.
 NOTES TO FINANCIAL STATEMENTS
 AS OF JUNE 30, 2013
 (UNAUDITED)
  CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
  Certain statements in this quarterly report contain or may contain forward-looking statements that are subject to known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements were based on various factors and were derived utilizing numerous assumptions and other factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, our ability to increase our revenues, develop our brands, implement our strategic initiatives, economic, political and market conditions and fluctuations, government and industry regulation, U.S. and global competition, and other factors. Most of these factors are difficult to predict accurately and are generally beyond our control.
  You should consider the areas of risk described in connection with any forward-looking statements that may be made in our previous reports as filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements and readers should carefully review this quarterly report in its entirety, except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. These forward-looking statements speak only as of the date of this quarterly report, and you should not rely on these statements without also considering the risks and uncertainties associated with these statements and our business. When used in this quarterly report, the terms the "Company," "we," and "us" refers to AvWorks Aviation Corp.
  Note 1 - Nature and Description of Business
  We had been originally incorporated under the laws of Canada on January 15, 1990, under the name "Creemore Star Printing, Inc." We changed our name on June 15, 2003 to "Smitten Press: Local Lore and Legends, Inc." We domesticated in the State of Nevada by filing Articles of Incorporation in Nevada on May 8, 2007, and we were incorporated in the State of Nevada on May 8, 2007, as Smitten Press: Local Lore and Legends, Inc. On April 30, 2010, our Board of Directors approved a change in our name to DataMill Media Corp., effective at the close of business on June 30, 2010. In June 2011, we completed our initial public offering of 5,000,000 shares of Common Stock and received $100,000 in proceeds from the offering.
  F-5
  AVWORKS AVIATION CORP.
 NOTES TO FINANCIAL STATEMENTS
 AS OF JUNE 30, 2013
 (UNAUDITED)
  We were a management consulting firm that planned to educate and assist small businesses to improve their management, corporate governance, regulatory compliance and other business processes, with a focus on capital market participation. However, after we completed our initial public offering, we explored a couple of opportunities to acquire operating companies in order to enhance shareholder value. On September 2, 2011, we entered into a Share Exchange Agreement with Young Aviation, LLC. On September 19, 2011, we amended our Articles of Incorporation to (i) increase our authorized capital stock to 500,000,000 shares of Common Stock and (ii) effect a 10 shares for one share forward stock split. On October 3, 2011, we closed the Share Exchange Agreement, which resulted in Young Aviation, LLC becoming a wholly-owned subsidiary. On November 10, 2011, a majority of our shareholders approved a change in our name to AvWorks Aviation Corp., effective November 30, 2011, to reflect our new business focus.
  Young Aviation, founded in 2004, is currently a diversified broker and supplier of parts, components and products to the general aviation and aerospace markets of the U.S., Europe and Asia. "General aviation" is defined as all aviation other than military and scheduled commercial airlines. Over 20% of our sales revenue has been derived from international sales for the period from January 1, 2009 to date.
  Young Aviation services a broad range of clients such as aircraft leasing companies, major airlines, repair stations, fixed-base operators, leasing companies and after market suppliers.
  As a result of the Share Exchange Agreement, the Company acquired Young Aviation and Joel A. Young became the President, Chief Executive Officer and sole Director of the Company on October 3, 2011, when our prior management officials resigned.
  The acquisition of Young Aviation, considered a reverse merger, resulted in a change in control at the Company and new management decided to abandon our former business of management consulting and focus solely on the business of Young Aviation.
  The Company accounted for the share exchange transaction as a recapitalization of Young Aviation, LLC, as the members of the LLC obtained a majority interest and management control of the Company. As a recapitalization of Young Aviation, LLC, it is considered the accounting acquirer.
  The Company is carrying on the business of Young Aviation, LLC as its sole line of business. Young Aviation is a diversified broker and supplier of parts, products and services to the worldwide aviation, aerospace, government and defense markets. Young Aviation services a broad range of clients such as aircraft leasing companies, major airlines, repair stations, fixed-base operators, leasing companies and after market suppliers.
  F-6
 
 AVWORKS AVIATION CORP.
 NOTES TO FINANCIAL STATEMENTS
 AS OF JUNE 30, 2013
 (UNAUDITED)
  Note 2 - Summary of Significant Accounting Policies
  This summary of significant accounting policies is provided to assist the reader in understanding the Company's financial statements. The financial statements and notes thereto are representations of the Company's management. The Company's management is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements.
  Basis of Presentation - The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for complete financial statements.
  Use of estimates - In preparing financial statements, management is required to make estimates and assumptions that effect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the periods presented. Actual results may differ from these estimates.
  Significant estimates in the periods included in the accompanying consolidated financial statements include an estimate of the deferred tax asset valuation allowance, valuation of shares issued for services, and valuation of contributed services.
  Principles of Consolidation - The consolidated financial statements include the accounts of AvWorks Aviation Corp. (f/k/a Datamill Media Corp.) as of the date the Share Exchange Agreement closed, October 3, 2011, and its wholly-owned subsidiary, Young Aviation, LLC. All material intercompany balances and transactions have been eliminated in consolidation. All financial and related data has been retroactively adjusted in the accompanying consolidated financial statements and footnotes to reflect the effect of the recapitalization of Young Aviation and the presentation of consolidated historical financial data.
  The acquisition of Young Aviation, considered a reverse merger, resulted in a change in control at the Company and new management decided to abandon our former business of management consulting and focus solely on the business of Young Aviation. The Company accounted for the share exchange transaction as a recapitalization of Young Aviation, LLC, as the members of the LLC obtained a majority interest and management control of the Company. As a recapitalization of Young Aviation, LLC, it is considered the accounting acquirer.
  F-7
  AVWORKS AVIATION CORP.
 NOTES TO FINANCIAL STATEMENTS
 AS OF JUNE 30, 2013
 (UNAUDITED)
  Reclassifications - Certain reclassifications have been made to prior year amounts to conform to the current year presentation.
  As of June 30, 2013, the Company's significant accounting policies and estimates, which are detailed in the Company's Annual Report on Form 10-K for the year ended December 31, 2012, have not changed materially.
  Selling and Marketing Expenses - Selling and marketing expenses are expensed as incurred. These expenses were $62 and $25, respectively, for the three months ended June 30, 2013 and 2012.
  General and Administrative Expenses - General and administrative expenses are expensed as incurred. These expenses were $12,347 and $3,200, respectively, for thethree months ended June 30, 2013 and 2012.
  Note 3 - Balance Sheet Information
  The Company had cash of $0 at June 30, 2013 and December 31, 2012.
  Accounts Receivable - When products are shipped to our large customers, the invoice amounts are normally factored with our factoring agent, Paragon Financial Group, Inc. We are immediately advanced 80% of the amount of factored invoices with the remaining 20% paid to us when collected by our agent.
  Property and equipment are stated at cost, net of accumulated depreciation. Expenditures for maintenance and repairs are expensed as incurred; additions, renewals and betterments are capitalized. Depreciation of property and equipment is provided using the straight-line method with estimated lives ranging from 3 to 5 years. Property and equipment is as follows as of June 30, 2013 and December 31, 2012:
  2013


2012Furniture and fixtures

$
147


$
147Office equipment


165



165Computer software


2,675



2,675Motor vehicle


10,000



10,00012,987



12,987Accumulated depreciation


10,987



9,987Net property and equipment

$
2,000


$
3,000
 
 F-8
 AVWORKS AVIATION CORP.
 NOTES TO FINANCIAL STATEMENTS
 AS OF JUNE 30, 2013
 (UNAUDITED)
 Depreciation expense for the three months ended June 30, 2013 and 2012 was $500. The use of our property and equipment determines if the depreciation is recorded as cost of goods sold or as general and administrative expenses.
  Notes Payable - The Company had notes payable totaling $150,593 at June 30, 2013.
  $20,000 Note: On August 15, 2011, an individual loaned the Company $20,000 in exchange for a Promissory Note bearing interest at 5% for a term of six months. As a result of the recapitalization and presentation of the Share Exchange Agreement on the Company's financial statements, this note is presented at December 31, 2011. In lieu of paying interest on the note, restricted shares of the Company's common stock will be issued to the note-holder. The Note was paid in full in April 2012.
  $4,716 Note: On November 22, 2011, an individual loaned the Company $6,000 in exchange for a Promissory Note bearing interest at 10% for a term of six months. The accrued interest payable balance on this note was $714 at June 30, 2013 and is included in the Accrued Interest section of the Company's balance sheet.
  $50,000 Note: On December 5, 2011, an individual loaned the Company $50,000 in exchange for a Promissory Note bearing interest at 12% for a term of one month, renewable each month if agreed upon by the parties. To date, the parties have agreed to renew and extend the note each month. The accrued interest payable balance on this note was $9,083 at June 30, 2013 and is included in the Accrued Interest section of the Company's balance sheet.
  $42,500 Note: On February 2, 2012, an entity loaned the Company $42,500 in exchange for a Promissory Note bearing interest at 8% for a term of nine months, convertible after nine months at 50% of the market price of our shares. In May 2012, the Company repaid 28,000 of this notetogether with accrued interest thereon. As a result, the balance of the note amounted to $14,500.The accrued interest payable balance on this note was $1,273 at June 30, 2013 and is included in the Accrued Interest section of the Company's balance sheet.
  F-9
 
 AVWORKS AVIATION CORP.
 NOTES TO FINANCIAL STATEMENTS
 AS OF JUNE 30, 2013
 (UNAUDITED)
  On April 11, 2012, the Company borrowed funds from Asher Enterprises in the amount of $32,500 bearing interest at the rate of 8% per year. The accrued interest payable balance on this note was $3,207 at June 30, 2013 and is included in the Accrued Interest section of the Company's balance sheet.
  On June 1 2012, the Company’s director converted accrued expense and / or loaned the Company a total of $40,000. The accrued interest payable balance on this note was $3,200 at June 30, 2013 and is included in the Accrued Interest section of the Company's balance sheet.
  On June 1, 2012, the Company borrowed $8,877 from Sunny Boyd Williams LLC. The accrued interest payable balance on this note was $728 at June 30, 2013 and is included in the Accrued Interest section of the Company's balance sheet.
  All of the above notes are now due on demand and are uncollateralized.
  As a result of the above, the balance of the notes payable is $150,593 and the accrued interest thereon is $18,205.
  Other Current Liabilities - The Company had other current liabilities consisting of the following at June 30, 2013 and December 31, 2012:
  2013


2012Accrued Payroll

$
96,659


$
70,000Accrued interest payable


18,205



12,204Total Accrued expense

$
110,864


$
82,204
  
 F-10
 
 
 AVWORKS AVIATION CORP.
 NOTES TO FINANCIAL STATEMENTS
 AS OF JUNE 30, 2013
 (UNAUDITED)
  Note 4 - Stock
  Preferred stock
  The Company is authorized to issue 10,000,000 shares of preferred stock at a par value $0.001. No shares were issued as of June 30, 2013 and December 31, 2012, respectively
  Common stock
  The Company is authorized to issue up to 500,000,000 shares of common stock with a par value of $0.001, under terms and conditions established by the Board of Directors.
  The Company had 270,020,145 issued and outstanding common stock shares as of June 30, 2013 and December 31, 2012, respectively.
  Prior to the closing of the Share Exchange Agreement, AvWorks Aviation Corp. (f/k/a Datamill Media Corp.) had 153,250,000 shares of common stock outstanding on a post forward split basis. As a condition to the closing of the Share Exchange Agreement, Vincent Beatty, Datamill's President, on October 3, 2011, surrendered 67,000,000 (post forward split) shares of common stock held by Mr. Beatty for cancellation and such shares were cancelled by their transfer agent.
  On October 3, 2011, Datamill acquired 100% of Young Aviation's member's interests, pursuant to the Share Exchange Agreement in exchange for the issuance by Datamill of 165,167,165 shares of restricted common stock shares and the issuance by Datamill of 620,000 shares of restricted common stock shares for the conversion of notes payable. Following the closing of the Share Exchange Agreement, Datamill had 252,037,165 shares of common stock issued and outstanding. Young Aviation became a wholly-owned subsidiary of Datamill. The Shares were issued to ten individuals with the majority share (165,000,000 shares) issued to Joel A. Young, who is now the President and Chief Executive Officer and our sole Director of the surviving entity
  On October 5, 2011, the Company issued an aggregate of 10,000,000 restricted common stock shares pursuant to one year agreements with two individuals in exchange for consulting and advisory services in relation to the Company's accounting and compliance requirements and the provision of federal securities advice to the Company and the preparation of required filings.
  In addition, on October 5, 2011, the Company approved and adopted the Corporation's 2011 Employee and Consultant Stock Incentive Plan ("Plan") and reserved 12,000,000 shares of its common stock for issuance under the Plan.
  F-11
 
 AVWORKS AVIATION CORP.
 NOTES TO FINANCIAL STATEMENTS
 AS OF JUNE 30, 2013
 (UNAUDITED)
  Note 5 - Going Concern
  As reflected in the accompanying consolidated financial statements, the Company had a net loss of $10,719, respectively, for the three months ended June 30, 2013. In addition, the Company had a working capital deficit of $259,899 at June 30, 2013. These matters raise substantial doubt about the Company's ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company's ability to raise additional capital, further implement its business plan and to generate additional revenues.
  Management believes that the actions presently being taken provide the opportunity for the Company to continue as a going concern. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
  Note 6 - Legal Matters
  The Company is not aware of any pending or threatened legal matters that would have a material impact on our financial condition.
  F-12
  Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations




General




Organization and Background





We had been originally incorporated under the laws of Canada on January 15, 1990, under the name "Creemore Star Printing, Inc." We changed our name on June 15, 2003 to "Smitten Press: Local Lore and Legends, Inc." We domesticated in the State of Nevada by filing Articles of Incorporation in Nevada on May 8, 2007, and we were incorporated in the State of Nevada on May 8, 2007, as SmittenPress: Local Lore and Legends, Inc. On April 30, 2010, our Board of Directors approved a change in our name to DataMill Media Corp., effective at the close of business on June 30, 2010. In June 2011, we completed our initial public


offering of 5,000,000 shares of Common Stock and received $100,000 in proceeds from the offering




We were a management consulting firm that planned to educate and assist small businesses to improve their management, corporate governance, regulatory compliance and other business processes, with a focus on capital market participation. However, after we completed our initial public offering, we explored a couple of opportunities to acquire operating companies in order to enhance shareholder value. On September 2, 2011, we entered into a Share Exchange Agreement with Young Aviation, LLC. On September 19, 2011, we amended our Articles of Incorporation to (i) increase our authorized capital stock to 500,000,000 shares of Common Stock and (ii) effect a 10 shares for one share forward stock split. On October 3, 2011, we closed the Share Exchange Agreement, which resulted in Young Aviation, LLC becoming a wholly-owned subsidiary. On November 10, 2011, a majority of our shareholders approved a change in our name to AvWorks Aviation Corp., effective November 30, 2011, to reflect the Company’s


business focus.





Young Aviation, founded in 2004, is currently a diversified broker and supplier of parts, components and products to the general aviation and aerospace markets of the U.S., Europe and Asia. "General aviation" is defined as all aviation other than military and scheduled commercial airlines. Over 20% of our sales revenue has been derived from international sales for the period from January 1, 2009 to date.





Young Aviation services a broad range of clients such as aircraft leasing companies, major airlines, repair stations, fixed-base operators, leasing companies and after market suppliers.





As a result of the Share Exchange Agreement, the Company acquired Young Aviation and Joel A. Young became the President, Chief Executive Officer and sole Director of the Company on October 3, 2011, when our prior management officials resigned. In addition, as a result of acquiring Young Aviation, we ceased being a "shell company" as that term is defined in Section 12b-2 of the Securities Exchange Act of 1934.




The acquisition of Young Aviation, considered a reverse merger, resulted in a change in control at the Company and new management decided to abandon our former business of management consulting and focus solely on the business of Young Aviation. In early, 2013 the Company decided to seek other business opportunities and as result the Company is investigating certain opportunities and has decided to abandon the activities of Young Aviation.





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Effective on August 1, 2013, the Board of Directors of the Company, accepted the resignation of Joel Young as the President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer and a member of the Board of Directors. Simultaneously, the Board of Directors accepted the consent of Michael Zoyes, as a member of the Board of Directors, the President/Chief Executive Officer, Secretary, Treasurer and Chief Financial Officer of the Company. Therefore, as of the date of this Current Report, the member of the Board of Directors is Michael Zoyes.





Mr. Young did not resign as a result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.





Effective on September 23, 2013, the Board of Directors of the Company, accepted the resignation of Michael Zoyes as the President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer and a member of the Board of Directors. Simultaneously, the Board of Directors accepted the consent of Joe Eccles, as a member of the Board of Directors, the President/Chief Executive Officer, Secretary, Treasurer and Chief Financial Officer of the Company. Therefore, as of the date of this Current Report, the member of the Board of Directors is Joe Eccles.





Mr. Zoyes did not resign as a result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.





Members of the Board of Directors and stockholders owning or having voting authority for 165,000,000 shares of outstanding Common Stock and 1,000,000 shares of our Series A Preferred Stock have voted in favor of an amendment to our Articles of Incorporation to affect a reverse stock split of all of the outstanding shares of Common Stock, at a ratio of one-for-thirty. The reverse split is currently is currently being re-evaluated by Management and a decision to either complete the reverse split or abandon it is currently pending.





RESULTS OF OPERATIONS




THREE MONTHS ENDED JUNE 30, 2013 COMPARED TO THE THREE MONTHS ENDED JUNE 30, 2012




NET REVENUES - Net revenues for the three months ended June 30, 2013 increased by $23,725 or approximately 600% to $27,875 from $4,150 in the comparable period in 2012.




COST OF SALES - Cost of sales for the three months ended June 30, 2013 increased by $13,295 or approximately 66% to $22,150 from $8,855 in the comparable period in 2012.




GENERAL AND ADMINISTRATIVE - General and administrative costs for the three months ended June 30, 2013 increased by approximately $9,147 or 285% to $12,347 from $3,200 in the comparable period in 2012.




DEPRECIATION - Depreciation for the three months ended June 30, 2013 was $500 which was the same amount for the comparable period in 2012.




INTEREST, NET OF INTEREST INCOME - Interest expense for the three months ended June 30, 2013 increased by $1,068 or approximately 47% to $3,535 from $2,363 in the comparable period in 2012.




NET INCOME – Net income (loss) for the three months ended June 30, 2013 was ($10,719) compared to ($37,631) for the comparable period in 2012.




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LIQUIDITY AND CAPITAL RESOURCES




At June 30, 2013, we had approximately ($442) in cash and total current assets of ($442) as of the same we had approximately $261,457 of current liabilities and a working capital deficit of approximately $259,899.




Our ability to continue our business activities as a going concern including continuation of our existing business service lines and funding our strategic growth plans will depend upon, among other things, raising capital from third parties or receiving net cash flows from our existing business operations.




The Company plans to meet its financial obligations and commitments for the next 12 months by raising additional capital in the form of debt or equity instruments. In furtherance of that goal, the Company is currently engaged in ongoing discussions with potential investors, however presentations to and discussions with those potential investors in an attempt to provide important funds to the Company have been unsuccessful to date. We are uncertain whether we will be able to obtain any financing, or if we are able to obtain financing that it will be on commercially favorable terms. There can be no assurance that we will be able to obtain financing on any terms. Without these funds, we will be unable to repay our outstanding debt and other current and long-term liabilities.




To the extent we are able, if we are able, to obtain additional financing, the proceeds will be applied to pay our current liabilities and for working capital purposes.




To the extent that we raise additional capital through the sale of equity or convertible debt securities, dilution of the interests of existing shareholders may occur. If we raise additional funds through the issuance of debt securities, these securities may have rights, preferences and privileges senior to holders of common stock and the terms of such debt could impose restrictions on our operations. Regardless of whether our assets prove to be adequate to meet our operational needs, we may seek to compensate providers of services by issuance of stock in lieu of cash, which may also result in dilution to existing shareholders.




Item 3 - Quantitative and Qualitative Disclosures about Market Risk




Not applicable.




Item 4 - Controls and Procedures




Evaluation of Disclosure Controls and Procedures




As of the end of the period covered by this quarterly report, our Chief Executive Officer and Chief Financial Officer (the "Certifying Officer") conducted evaluations of our disclosure controls and procedures. As defined under Sections 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, (the “1934 Act”), the term "disclosure controls and procedures" means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer's management, including the Certifying Officer, to allow timely decisions regarding required disclosure. Based on this evaluation, the Certifying Officer has concluded that our disclosure controls and procedures are not effective to ensure that all material information is recorded, processed, summarized and reported by our management on a timely basis in order to comply with our disclosure obligations under the 1934 Act, and the rules and regulations promulgated there-under.




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Based upon this evaluation the Certifying Officer has concluded that the following material weaknesses in our disclosure controls and procedures existed as of the end of the period covered by this quarterly report:




·
Lack of reliance upon independent financial reporting consultants for review of critical accounting areas and disclosures and material non-standard transactions.




·
Lack of sufficient accounting staff which results in a lack of segregation of duties necessary for a good system of internal control.





Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting for the Company as defined in Rule 13a-15(f) under the 1934 Act. The Company's internal control over financial reporting is designed to provide reasonable assurance to the Company's management and board of directors regarding the preparation and fair presentation of published financial statements and the reliability of financial reporting. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Management assessed the effectiveness of the Company's internal control over financial reporting as of June 30, 2013. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") in Internal Control - Integrated Framework. Based on our assessment, we believe that, as of June 30, 2013, the Company's internal control over financial reporting is not effective based on those criteria. This quarterly report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management's report in this quarterly report. Further, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.





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PART II - OTHER INFORMATION




ITEM 1 – LEGAL PROCEEDINGS




In the ordinary course of business, we may from time to time be involved in various threatened or actual legal proceedings which the company will vigorously defend. The litigation process is inherently uncertain and it is possible that the outcome of such matters may result in a material adverse effect on the financial condition and/or results of operations of the Company. In the opinion of the management, matters currently pending or threatened against the Company are not expected to result in a material adverse effect on our financial position or result of operations.




ITEM 1A – RISK FACTORS




Not applicable.




ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS




None.




ITEM 3 – DEFAULTS UPON SENIOR SECURITIES




None.




ITEM 4 – (REMOVED AND RESERVED)




ITEM 5 – OTHER INFORMATION




None.




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ITEM 6 – EXHIBITS




Exhibit 31.1

Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.Exhibit 31.2

Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.Exhibit 32.1

Certification of the Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.




101.INS **

XBRL Instance Document101.SCH **

XBRL Taxonomy Extension Schema Document101.CAL **

XBRL Taxonomy Extension Calculation Linkbase Document101.DEF **

XBRL Taxonomy Extension Definition Linkbase Document101.LAB **

XBRL Taxonomy Extension Label Linkbase Document101.PRE **

XBRL Taxonomy Extension Presentation Linkbase Document
 
 ** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.




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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.






Avworks Aviation Corp.

(Registrant)Date: March 31, 2014
By:
/s/ Dror SvoraiDror SvoraiPresident and Treasurer

















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