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

FORM 10-QSB

(Mark One)

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended  May 31, 2002

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from  to

Commission file number  0-32525

3W CYBER LOGISTICS, INC.
(Exact name of small business issuer as specified in its charter)

Nevada
(State or other jurisdiction of incorporation or organization) 88-0409155
(I.R.S. Employer Identification No.)

1208 - 808 Nelson Street, Vancouver, BC, Canada, V6Z 2S1
(Address of principal executive offices)

(604) 683-8018
(Issuer's telephone number)

not applicable
(Former name, former address and former fiscal year, if changed since last report)

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS

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

APPLICABLE ONLY TO CORPORATE ISSUERS

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

8,000,000 common shares issued and outstanding as at July 1, 2002

Transitional Small Business Disclosure Format (Check one):      Yes [ ]     No [X]

Part I - FINANCIAL INFORMATION

Item 1. Financial Statements.

Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.

DISCLOSURE

To: The Shareholders of 3W Cyber Logistics, Inc.

It is the opinion of management that the interim financial statements for the quarter ended May 31, 2002 include all adjustments necessary in order to ensure that the financial statements are not misleading.

Vancouver, British Columbia
Date: July 22, 2002

/s/ signed
Director of 3W Cyber Logistics, Inc.

3W CYBER LOGISTICS, INC.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS

AS OF MAY 31, 2002

3W CYBER LOGISTICS, INC.
(A DEVELOPMENT STAGE COMPANY)

CONTENTS

PAGE	1	BALANCE SHEETS AS OF MAY 31, 2002 (UNAUDITED) AND AUGUST 31, 2001
PAGE	2	STATEMENTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED MAY 31, 2002 AND 2001 AND FOR THE PERIOD FROM APRIL 10, 1995 (INCEPTION) TO MAY 31, 2002 (UNAUDITED)
PAGE	3	STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED MAY 31, 2002 AND 2001 AND FOR THE PERIOD FROM APRIL 10, 1995 (INCEPTION) TO MAY 31, 2002 (UNAUDITED)
PAGE	4	NOTES TO FINANCIAL STATEMENTS (UNAUDITED) AS OF MAY 31, 2002

3W CYBER LOGISTICS, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS

ASSETS
		May 31, 2002 (Unaudited)		August 31, 2001
Current assets
Cash	$	1,187		14,515
Total Current Assets		1,187		14,515
PROPERTY AND EQUIPMENT		34,890		50,749
TOTAL ASSETS	$	36,077	$	65,264
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
CURRENT LIABILITIES
Accounts payable	$	12,246		10,009
Deferred revenue		15,000	$	15,000
Loan payable - stockholder		175,222		159,619
Total Liabilities		202,468		184,628
STOCKHOLDERS' DEFICIENCY
Common stock, $.001 par value, 100,000,000 shares authorized, 8,000,000 shares issued and outstanding		8,000		8,000
Additional paid in capital		16,325		16,325
Accumulated deficit during development stage		(190,716)		(143,689)
Total Stockholders' Deficiency		(166,391)		(119,364)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY	$	36,077	$	65,264

See accompanying notes to financial statements.

3W CYBER LOGISTICS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
(UNAUDITED)

		For The Three Months Ended May 31, 2002		For The Three Months Ended May 31, 2001		For The Nine Months Ended May 31, 2002		For The Nine Months Ended May 31, 2001		For The Period From April 10, 1995 (Inception) To May 31, 2002
OPERATING EXPENSES
Software development	$	-	$	-	$	-	$	-	$	25,000
Depreciation expense		634		5,286		15,859		15,858		70,836
Professional fees		7,552		18,476		31,027		26,252		66,794
Other general and administrative		48		54		193		196		29,379
Total Operating Expenses		8,234		23,816		47,079		42,306		192,009
OTHER INCOME
Interest income		4		1,079		52		1,431		1,293
Total Other Income		4		1,079		52		1,431		1,293
NET LOSS		(8,230)		(22,737)		(47,027)	$	(40,875)	$	(190,716)
NET LOSS PER SHARE - BASIC AND DILUTED	$	-	$	-	$	-	$	-	$	(.03)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - BASIC AND DILUTED		8,000,000		8,000,000		8,000,000		7,223,443		6,407,678

See accompanying notes to financial statements.

3W CYBER LOGISTICS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
(UNAUDITED)

		For The Nine Months Ended May 31, 2002		For The Nine Months Ended May 31, 2001		For The Period From April 10, 1995 (Inception) To May 31, 2002
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss	$	(47,027)	$	(40,875)	$	(190,716)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation		15,859		15,858		70,836
Changes in operating assets and liabilities
Increase in accounts payable		2,237		5,699		9,721
Increase in deferred revenue		-		-		15,000
Net Cash Provided By (Used In) Operating Activities		(28,931)		(19,318)		(95,159)
CASH FLOWS FROM INVESTING ACTIVITIES
Cash acquired in the merger		-		2,525		2,525
Proceeds from loan to shareholder		-		41,200		-
Net Cash Used In Investing Activities		-		43,725		2,525
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from loan payable - stockholder		15,603		-		69,496
Proceeds from issuance of common stock		-		-		24,325
Net Cash Provided By Financing Activities		15,603		-		93,821
NET INCREASE (DECREASE) IN CASH		(13,328)		24,407		1,187
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		14,515		- -		- -
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	1,187	$	24,407	$	1,187

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING ACTIVITIES:

During 2000, the Company acquired equipment totaling $105,726 which was paid for directly by a shareholder.

See accompanying notes to financial statements.

3W CYBER LOGISTICS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF MAY 31, 2002
(UNAUDITED)

NOTE 1 BASIS OF PRESENTATION

The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles and the rules and regulations of the Securities and Exchange Commission for the interim financial information. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position and results of operations.

It is management's opinion, however, that all adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statements presentation. The results for the interim period are not necessarily indicative of the results to be expected for the year.

For further information, refer to the financial statements and footnotes included in the Company's Form 10-KSB for the year ended August 31, 2001.

NOTE 2 LOAN PAYABLE - STOCKHOLDER

During the nine months ended May 31, 2002, a stockholder of the Company paid $15,603 for operating expenses on behalf of the Company. The total loan of $175,222 is payable on demand, non-interest bearing and unsecured.

NOTE 3 RELATED PARTIES

A stockholder of the Company paid $15,603 of operating expenses on behalf of the Company (See Note 2).

NOTE 4 GOING CONCERN

As reflected in the accompanying financial statements, the Company's recurring losses, lack of revenue, working capital deficiency of $201,281 and stockholders' deficiency of $166,391 raise substantial doubt about its ability to continue as a going concern. The Company has not generated any revenues since inception. The ability of the Company to continue as a going concern is dependent on the Company's ability to raise additional capital and implement its business plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.

Item 2. Plan of Operation.

FORWARD-LOOKING STATEMENTS

This quarterly report contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "will", "should", "expects", "plans", "anticipates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors", that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, level of activity, performance or achievements expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

As used in this quarterly report, the terms "we", "us", "our", and "3W Cyber" mean 3W Cyber Logistics, Inc. unless otherwise indicated. All dollar amounts refer to US dollars unless otherwise indicated. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report.

General

We are a software development company specializing in the development of an internet-based cargo logistics system. In an attempt to resolve the logistics problems presently encountered by freight forwarding companies and logistics companies, we continue to develop our internet-based cargo logistics system. Our cargo logistics system will enable each of the entities involved in the shipping process to access a common, centralized database and to utilize a standardized user interface when entering, tracking or receiving shipments. Our cargo logistics system will utilize a centralized database that will be accessible through the internet on our website at "www.3wcyberlogistics.com". This centralized database architecture will enable remote users to access real time information from any location in the world. Users will access the database through cargo logistics "modules" using a personal computer or mobile device with an internet browser and internet connection. Security will be pr ovided through a combination of secure connections and password protected user accounts.

During the three months ended May 31, 2002, operating expenses totaled $8,234, and we experienced a net loss of $8,230 against no revenues, as compared to a net loss of $22,737 against no revenues for the three months ended May 31, 2001. The decrease in operating expenses was a result of decreased professional fees, coupled with an adjustment in depreciation expenses. Also during the three months ended May 31, 2002, we saw progress in our AirLogistics System, which moved from the development stage to the deployment stage. The AirLogistics System is currently undergoing testing and trial programs conducted in Hong Kong and New York. In terms of overall timetable, we are on target for completing the development of the system by September 30, 2002.

The earnings per share (fully diluted) was a net loss of $0.001 for the three month period ended May 31, 2002, compared to a net loss of $0.003 for the three month period ended May 31, 2001.

Nine Months Ended February 28, 2002 and 2001

Operating expenses for the nine months ended May 31, 2002, totaled $47,079 and we experienced a net loss of $47,027 against no revenues, as compared to a net loss of $40,875 against no revenues for the nine months ended May 31, 2001. A slight increase in operating expenses was a result of increased professional fees.

The earnings per share (fully diluted) was a net loss of $0.006 for the nine month period ended May 31, 2002 compared to a net loss of $0.006 for the nine month period ended May 31, 2001.

Liquidity and Capital Resources

Historically, we have financed our cash flow and operations from the sale of stock and advances from shareholders. Our total cash and cash equivalent position as at May 31, 2002 was $1,187 and as at August 31, 2001 was $14,515.

For the nine months ended May 31, 2002, net cash used in operating activities was ($28,931) compared to cash used in operating activities of ($19,318) for the same period in 2001. Net cash used in operating activities for 2002 consisted mostly of loss from operations and increases in accounts payable.

Net cash provided by financing activity was $15,603 for the nine months ended May 31, 2002 and nil for the same period in 2001. Financing activity for 2002 resulted from advances from shareholders.

Working capital deficiency as of May 31, 2002 and August 31, 2001 was ($201,281) and ($170,113) respectively.

We have no external sources of liquidity in the form of credit lines from banks. Management believes that our available cash will not be sufficient to fund our working capital requirements through December 31, 2002 and therefore, another advance from a shareholder is being arranged.

Marketing

We will market our cargo logistics system to corporations operating in the freight forwarding and cargo industries. We are currently developing a sales and marketing program outlining four phases of operation. We intend to offer our primary services, which are services that we have determined to be essential to the daily operations of commercial logistics operators. We will charge fees for the primary services that we offer to such logistics operators. We also intend to offer complimentary services which are not essential to the daily operations of commercial logistics operators but which will add value those who utilize our website, thus encouraging such operators to visit our website. We will offer these complimentary services at no charge with the aim of establishing our cargo logistics system as the industry standard for logistics information. Descriptions and examples of each of these service offerings are described below.

The first phase of our marketing plan will involve the distribution of our cargo logistics system to an initial corporate user group. The second phase will involve rapid development of our corporate base clients through a process of network marketing. The third phase will involve expanding our corporate base clients by using marketing methods such as trade shows and targeted advertising. These first three phases focus on the implementation, deployment and sale of our primary services. The fourth phase will involve the introduction of our complimentary services.

We intend to adopt the following strategies with respect to the direct marketing of our cargo logistics software:

1. advertising in international shipping and trade magazines such as Pacific Shipper and Shipping Gazette, and offering in each advertisement a 60 day free trial membership;

2. promoting our software at road shows by conducting seminars in major cities and ports, and by demonstrating our software to freight forwarders, customs brokers and cargo carriers at their place of business;

3. creating incentives for existing members (including usage fee discounts, commission or bonus point accumulation) based on the number of referrals they make, with the hope of inducing new memberships; and

4. promoting our software through strategic relationships within the freight forwarding industry, including airlines, ocean carriers and distribution warehouses, pursuant to which relationships we may agree to posting a link to one another's websites or interfacing cargo information and tracking.

Our Project Manager will head our sales and marketing group under the supervision of our President during Phase One. We intend to hire a second person to assist our Project Manager during Phase Two.

We intend to utilize the following pricing strategy at least through Phase One of the implementation of our cargo logistics software:

1. one time membership set up fee of $500.00;

2. documentation module fee of $0.50 per module;

3. annual data storage fee of $0.10 per module; and

4. program modification fee (optional) of $5.00 per item.

We anticipate that our services will be utilized in numerous international markets. In order to facilitate this complex process, we will concentrate on particular markets in a sequential fashion. This will allow us to successfully implement the standards and the practices of a particular country and to align these standards with existing universal standards and the practices of the United States. When developing the software for a particular market, we will consider issues including market specific port customs regulations, market specific duty tariffs, delivery orders and cargo releases. In order to ensure that the procedures and standards of a particular market are implemented, we intend to work closely with freight forwarding and cargo companies with extensive operations in the specific market under development. This partnership approach will greatly improve the likelihood of creating a software product that satisfies the requirements of clients operating within a particular region . Our existing partners and clients are presently assisting in the development of cargo logistics system software modules that will serve markets in the United States, Canada and a number of Asian countries.

Primary Services

Phase One

To date, a total of 36 companies worldwide have expressed an interest in utilizing our cargo logistics system. A third generation mobile communication technology has been incorporated into our software, and as a result, our cargo logistics software will be accessible not only by computer but also by third generation mobile phone and Palm Pilot users. Although we originally anticipated that several or all of the 36 companies would be utilizing our cargo logistics software by September, 2001, we decided to conduct an internal assessment of our cargo logistics software against other software being developed so that we can further enhance our software to meet the needs of the companies involved in the cargo industry and provide a comprehensive product once our software is publicly released. During this assessment, we reviewed software being developed by Traxon, C-Team Systems Inc. and Capstan Systems Inc. This assessment was conducted by our software developers with the assistance of r epresentatives from Wice Marine Services and Wice Freight Services, companies involved in the freight forwarding industry.

Our assessment revealed that the companies currently developing software similar to our software will offer their customers services similar to those offered by our cargo logistics systems, although much narrower in scope and only within each company's respective network. These companies are building software modules, such as a shipping software and warehouse software modules, as opposed to a fully integrated system. In contrast, our cargo logistics system will be available to anyone with a personal computer or mobile device with an Internet connection and browser regardless of which shipping company or carrier the user chooses to utilize. In addition, our cargo logistics system is a fully integrated system, rather than a group of unconnected software modules. We have discovered, however, that we should design our cargo logistics software to be more user friendly and have a quicker response time as users move from screen to screen within the system. We have also discovered that our ca rgo logistics software should be able to link with or provide data to other independent accounting software packages currently used in the freight forwarding and cargo industries.

In addition to our assessment of other software currently being developed, in September 2001, we installed our cargo logistics software on a test basis in the offices of Wice Marine Services (Hong Kong) and Wice Freight Services (New York). We are using this installation to test our software with the view to uncovering any problems and to improving system flexibility, which may require modifications and upgrades.

System Development Status

Our system consists of the AirLogistics System and OceanLogistic System.

During this quarter, our AirLogistics System has progressed from the development stage to the deployment stage. In order to enable users to enjoy the complete web-based logistics solution, we have further enhanced our system with more features such as online booking control reports. We have also completed the integration between our accounting system and a third party financial management system. The AirLogistics System is currently undergoing testing and a trial program in Hong Kong and New York. In terms of overall time table, we are on target for completing the development of this system by September 30, 2002.

Our OceanLogistic System is still in the development stage but we have established the basic procedure and infrastructure concept based on our research. We currently have completed the basic administrative modules, sailing schedule module and booking module. We are now working with sample data to test the modules in order to determine what further development is required for our OceanLogistic system.

At this time, we anticipate that our AirLogistics System testing program will be completed by September 30, 2002, and, depending on the results of the testing and trial program, we may be in a position to publicly release our software at that time.

Phase Two

As noted, to date none of the initial 36 companies have executed agreements. We anticipate that we will not enter into any such agreements until we have received feedback and have further developed our cargo logistics software. We expect to complete our AirLogistics System by September 30, 2002, and then, depending on the nature of the feedback, to further develop our cargo logistics software. After we have completed the further development of our software, we intend to approach the 36 companies with the view to having them commence utilizing our software. After several of these 36 companies begin using our cargo logistics software, we intend to initiate the second phase of our sales and marketing plan, which will be a progression of our phase one marketing, and which will target additional corporations within the freight forwarding and cargo industries using a "network marketing" strategy. The "network marketing" strategy will directly engage partners and associates of these init ial 36 companies. Freight forwarding and logistics companies typically utilize a network of 15 to 20 agents. We feel that if properly motivated, these initial 36 companies could become an effective and influential sales tool for the cargo logistics system. We estimate that these initial 36 companies will provide access to between 500 - 700 potential clients, and that those potential clients could increase the usage of our cargo logistics system by between 27,500,000 to 38,500,000 module usages per year, calculated using the industry standard of approximately 55,000 module usages per client per year. Our phase two benchmark is based upon 500 new clients and transaction volume of 30,000,000 per year. To ensure that we have adequate technical support, and for hardware safety reasons, we have divided our phase two benchmark into two stages:

- Stage One: 250 new clients with a resultant transaction volume of 15,000,000 module usages per year by September, 2002; and

- Stage Two: 500 new clients with a resultant transaction volume of 30,000,000 module usages per year by March, 2003.

Our estimations for our phase two benchmarks are based upon a projection of 1,000 transactions (either air or ocean) for each small to mid-sized freight forwarder per month. Each such transaction would induce the use of at least five modules of our cargo logistics software. Therefore, over the course of a year, each small to mid-sized freight forwarder will potentially generate 60,000 module usages. We estimate that by phase two (Stage One), we will have 250 clients who as a group will generate approximately 15,000,000 module usages annually. Our estimate that we will have 250 clients by phase two (Stage One) is based on our projection that each of the initial 36 companies will have at least eight active agents within its business network.

We intend to elicit and review feedback from existing users and to enhance our software design and database hardware accordingly. This customer-focussed approach to business will ensure that companies utilizing our cargo logistics system continue to receive a valuable, high quality service. We intend to ensure that existing clients have received all necessary support services prior to the launch of the next benchmark.

Phase Three

Shortly after initiating our phase two network marketing campaign but prior to achieving all of the phase two benchmarks, we intend to initiate the third phase of the sales and marketing program, which will involve the pursuit of additional clients not necessarily associated with these initial 36 companies or their business contacts. We intend to employ the following sales and marketing techniques in the third phase:

- promoting our cargo logistics system on the internet with a 60 day free trial membership;

- advertising our website in all major shipping and trade magazines;

- conducting seminars in major cities and ports; and

- developing and releasing products that will provide "complimentary services"(as set out below).

Complimentary Services

Phase Four

The fourth phase involves the introduction of a number of complimentary services that we will provide at no charge. These complimentary services are designed to encourage both new and established users to access our website on a frequent basis. Most of the services will be provided free of charge, with the intention of establishing our website as the standard for information and services relating to the freight shipping and logistics industry. Some of the free information and services that we intend to offer include:

- a purchase order tracking system that will allow our clients to provide shipment information to actual exporters/ importers through our website;

- international port regulations that will provide our clients with information with respect to all major port customs clearance procedures, port regulations, duty tariffs and work calendars;

- carrier flight and shipping schedules that will show the monthly sailing schedules of all major ocean carriers and the international flight schedules of all major airlines;

- international shipping standards that will serve as a "mini-dictionary" defining common industrial standards such as weight and dimension regulations, oversize handling, overweight handling and dangerous goods and hazardous material handling;

- quota utilization update that will enable the user to review and update the status of all quota restricted merchandise; and

- an agency directory and enquiry that will allow our clients to search for working agents or partners among fellow clients on our website.

The development and release of these complimentary services will expand our original role as an "internet e-commerce provider" to that of an "internet presence provider". Following the anticipated utilization of these free services by both established and new users, we intend to implement a highly targeted web-based advertising service. Advertisement space will be sold to corporations wishing to access industry specific users who visit our website. We believe that because our website will be highly industry specific, we will be in a position to sell advertising space at a premium rate, thereby generating additional revenues.

The trading and shipping industries are dependent upon one another, and as a result, must work together closely. Based upon the level of our future internet presence provider development, we intend to implement the next project phase by segregating our internet presence provider sector into shipping-related profiles and trade-related profiles. The shipping-related internet presence provider profile will be located on our website and the trade-related internet presence provider profile will be located at a new website, "www.3wcyberlogistics.com".

Cash Requirements

Over the twelve months ending May 31, 2003, we will require approximately $1,000,000 to accomplish our plans. We intend to use those funds as follows:

- to continue the research and development of our cargo logistics system ($100,000);

- to begin a marketing/advertising campaign for our cargo logistics system ($150,000);

- to cover further hardware and software acquisition costs ($250,000);

- to hire software engineers to assist in developing our cargo logistics system ($200,000);

- to cover legal and patent application costs in connection with our cargo logistics system ($150,000);

- to cover general and administrative expenses ($100,000); and

- to cover other miscellaneous general corporate costs ($50,000).

We intend to obtain the above-noted funds through the sale of our equity securities or by obtaining debt financing. At present, we have no agreements in place and have not taken any steps to raise such funds. There can be no assurance that we will be able to raise such funds or that such funds will be available on terms that are acceptable to us.

Product Research and Development

We acquired the rights to our existing cargo logistics system technology through a Purchase Agreement dated July 11, 2000 with Farrington International Inc. The acquisition was accounted for as a reverse acquisition by Farrington of our company. As at May 31, 2002, together with Farrington, we have expended a total of $25,000 on the research and development of the cargo logistics software technology. We anticipate that we will expend approximately $1,000,000 on further research and development through the twelve months ending May 31, 2003.

Research and Development Activities

We are committed to investing in product research and development and intend to undertake future activities using revenue generated exclusively from sales of our products and services. Over the twelve months ending May 31, 2003, we intend to spend approximately 20% of our revenue on research and development activities in order to ensure that we remain competitive. In the event that gaps in our existing products are identified, the above-noted proposals will be modified as necessary.

Purchase of Significant Equipment

We intend to purchase approximately $200,000 worth of new computer equipment through the twelve months ending May 31, 2003.

Employees

Over the twelve months ending May 31, 2003, we anticipate an increase in the number of employees we retain, as we intend to hire one qualified accountant, one person to perform clerical and administrative tasks, two software engineers and two sales and marketing personnel. These employees will be in addition to our current staff of three software engineers.

New Accounting Pronouncements

In June 1998, the United States Financial Accounting Standards Board issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities". SFAS No. 133 requires companies to recognize all derivatives contracts as either assets or liabilities in the balance sheet and to measure them at fair value. If certain conditions are met, a derivative may be specifically designated as a hedge, the objective of which is to match the timing of gain or loss recognition on the hedging derivative with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk or hedged forecasted transaction. For a derivative not designated as a hedging instrument, the gain or loss is recognized in income in the period of change. SFAS No. 133 is effective for all fiscal quarters of fiscal years beginning after June 15, 2000.

Historically, we have not entered into derivatives contracts either to hedge existing risks or for speculative purposes. Accordingly, adoption of the new standards did not affect our consolidated financial statements.

In June 2001, the Financial Accounting Standards Board finalized FASB Statements No. 141, Business Combinations (SFAS 141), and No. 142, Goodwill and Other Intangible Assets (SFAS 142). SFAS 141 requires the use of the purchase method of accounting and prohibits the use of the pooling-of-interests method of accounting for business combinations initiated after June 30, 2001. SFAS 141 also requires that we recognize acquired intangible assets apart from goodwill if the acquired intangible assets meet certain criteria. SFAS 141 applies to all business combinations initiated after June 30, 2001 and for purchase business combinations completed on or after July 1, 2001. It also requires, upon adoption of SFAS 142, that we reclassify the carrying amounts of intangible assets and goodwill based on the criteria in SFAS 141.

SFAS 142 requires, among other things, that companies no longer amortize goodwill, but instead test goodwill for impairment at least annually. In addition, SFAS 142 requires that we identify reporting units for the purposes of assessing potential future impairments of goodwill, reassess the useful lives of other existing recognized intangible assets, and cease amortization of intangible assets with an indefinite useful life. An intangible asset with an indefinite useful life should be tested for impairment in accordance with the guidance in SFAS 142. SFAS 142 is required to be applied in fiscal years beginning after December 15, 2001 to all goodwill and other intangible assets recognized at that date, regardless of when those assets were initially recognized. SFAS 142 requires us to complete a transitional goodwill impairment test six months from the date of adoption. We are also required to reassess the useful lives of other intangible assets within the first interim quarter after adopti on of SFAS 142.

The implementation of SFAS No. 141 and 142 is not expected to have a material effect on our consolidated financial statements.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets". SFAS No. 144 requires that those long-lived assets be measured at the lower of carrying amount or fair value less cost to sell, whether reported in continuing operations or in discontinued operations. Therefore, discontinued operations will no longer be measured at net realizable value or include amounts for operating losses that have not yet occurred. SFAS No. 144 is effective for financial statements issued for fiscal years beginning after December 15, 2001 and, generally, is to be applied prospectively. The implementation of this new standard is not expected to have a material effect on our consolidated financial statements.

RISK FACTORS

Much of the information included in this quarterly report includes or is based upon estimates, projections or other "forward-looking statements". Such forward-looking statements include any projections or estimates made by us and our management in connection with our business operations. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions, or other future performance suggested herein. We undertake no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of such statements.

Such estimates, projections or other "forward-looking statements" involve various risks and uncertainties as outlined below. We caution readers of this quarterly report that important factors in some cases have affected and, in the future, could materially affect actual results and cause actual results to differ materially from the results expressed in any such estimates, projections or other "forward-looking statements". In evaluating us, our business and any investment in our business, readers should carefully consider the following factors.

WE ARE A DEVELOPMENT STAGE COMPANY WITH A LIMITED OPERATING HISTORY WHICH MAKES IT DIFFICULT TO EVALUATE WHETHER WE WILL OPERATE PROFITABLY

We are a development stage software company which is primarily involved in the development, manufacture and marketing of an internet-based cargo logistics system. As a relatively new company, we do not have a historical record of sales and revenues nor an established business track record. We have not earned any revenues since our incorporation.

Unanticipated problems, expenses and delays are frequently encountered in ramping up sales and developing new products. Our ability to successfully develop, produce and sell our cargo logistics system and any future software products and to eventually generate operating revenues will depend on our ability to, among other things:

- successfully develop and market our cargo logistics system;

- successfully enhance our cargo logistics system to keep pace with changes in technology and changes demanded by users of our products;

- attract, retain and motivate qualified personnel; and

- obtain the necessary financing to implement our business plan.

We cannot be sure that we will be successful in addressing these risks and uncertainties, and our failure to do so could have a materially adverse effect on our financial condition and continued operations. In addition, our operating results are dependent to a large degree upon factors outside of our control, including among other things, increased competition and the acceptance and continued use of our cargo logistics system specifically and other internet-based technology generally. There are no assurances that we will be successful in addressing these risks, and failure to do so may adversely affect our business and financial condition.

WE HAVE A HISTORY OF NET LOSSES AND A LACK OF ESTABLISHED REVENUES, AND AS A RESULT, WE EXPECT TO INCUR NET LOSSES IN THE FUTURE

We have had a history of losses and expect to continue to incur losses, and may never achieve or maintain profitability. We have incurred losses since we began operations as an internet-based cargo logistics software development company, including a loss of approximately $8,230 for the three months ended May 31, 2002. As of May 31, 2002, we have an accumulated deficit of approximately $190,716. We expect to have net losses and negative cash flow at least through May 31, 2003, and expect to spend significant amounts of capital to enhance our products and technologies, develop international sales and operations, and fund research and development. As a result, we will need to generate significant revenue to break even or achieve profitability. Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. If we do not achieve and maintain profitability, the market price for our common stock may decline, perhaps substantially.

Although we anticipate that revenues will increase, we also expect that development costs and operating costs will increase as well. Consequently, we expect to incur operating losses and negative cash flow until our existing software product gains sufficient market acceptance to generate a commercially viable and sustainable level of sales, and/or additional software products are developed and commercially released and sales of such products made so that we are operating in a profitable manner. These circumstances raise substantial doubt about our ability to continue as a going concern as described in an explanatory paragraph to our independent auditor's opinion with respect to the financial statements for the year ended August 31, 2001, which form part of our annual report on Form 10-KSB (filed on February 14, 2002). To the extent that such expenses are not followed in a timely manner by increased revenues, our business, results of operations, financial condition and prospects would be materially adversely affected.

WE ARE UNCERTAIN THAT WE WILL BE ABLE TO OBTAIN ADDITIONAL CAPITAL THAT MAY BE NECESSARY TO ESTABLISH OUR BUSINESS

We incurred a loss of $8,230 for the three months ended May 31, 2002. As a result of these losses and negative cash flows from operations, our ability to continue operations will be dependent upon the availability of capital from outside sources unless and until we achieve profitability.

Our future capital requirements will depend on many factors, including cash flow from operations, progress in developing new products, competing knowledge and market developments and an ability to successfully market our products. Our recurring operating losses and growing working capital needs will require us to obtain additional capital to operate our business before we have established that our business will generate significant revenue. We predict that we will require approximately $1 million over the period ending May 31, 2003 in order to accomplish our goals. However, there is no assurance that actual cash requirements will not exceed our estimates. In particular, additional capital may be required in the event that:

- we incur unexpected costs in completing the development of our cargo logistics system or encounter any unexpected technical or other difficulties;

- we incur delays and additional expenses as a result of technology failure;

- we are unable to create a substantial market for our software products; or

- we incur any significant unanticipated expenses.

The occurrence of any of the aforementioned events could adversely affect our ability to meet our business plans.

We will depend almost exclusively on outside capital to pay for the continued development of our cargo logistics system. Such outside capital may include the sale of additional stock and/or commercial borrowing. There can be no assurance that capital will continue to be available if necessary to meet these continuing development costs or, if the capital is available, that it will be on terms acceptable to us. The issuance of additional equity securities by us would result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

If we are unable to obtain financing in the amounts and on terms deemed acceptable to us, our business and future success may be adversely affected.

IF WE FAIL TO EFFECTIVELY MANAGE OUR GROWTH OUR FUTURE BUSINESS RESULTS COULD BE HARMED AND OUR MANAGERIAL AND OPERATIONAL RESOURCES MAY BE STRAINED

As we proceed with the development of our cargo logistics system, we expect to experience significant and rapid growth in the scope and complexity of our business. We will need to add staff to market our products, manage operations, handle sales and marketing efforts and perform finance and accounting functions. We will be required to hire a broad range of additional personnel in order to successfully advance our operations. This growth is likely to place a strain on our management and operational resources. The failure to develop and implement effective systems, or to hire and retain sufficient personnel for the performance of all of the functions necessary to effectively service and manage our potential business, or the failure to manage growth effectively, could have a materially adverse effect on our business and financial condition.

UNLESS WE CAN ESTABLISH SIGNIFICANT SALES OF OUR CARGO LOGISTICS SYSTEM, OUR POTENTIAL REVENUES MAY BE SIGNIFICANTLY REDUCED

We expect that a substantial portion, if not all, of our future revenue will be derived from the sale of our cargo logistics system. We expect that this product and its extensions and derivatives will account for a majority, if not all, of our revenue for the foreseeable future. Broad market acceptance of this system is, therefore, critical to our future success and our ability to generate revenues. Failure to achieve broad market acceptance of this system, as a result of competition, technological change, or otherwise, would significantly harm our business. Our future financial performance will depend primarily on the successful introduction and market acceptance of our cargo logistics system, and on the development, introduction and market acceptance of any future enhancements. There can be no assurance that we will be successful in marketing the cargo logistics system or any new software programs, applications or enhancements, and any failure to do so would significantly harm our b usiness.

IF WE ARE UNABLE TO ACHIEVE MARKET ACCEPTANCE FOR OUR PRODUCTS, WE WILL BE UNABLE TO BUILD OUR BUSINESS

To date, we have entered into only two licensing agreements with respect to our cargo logistics system. Our success will depend on the acceptance of our cargo logistics system by the freight forwarding and cargo logistics industry, as well as by related businesses and the general public. Achieving such acceptance will require significant marketing investment. Internet-based technology generally, and our cargo logistics system specifically, may not achieve widespread acceptance by businesses in general, or by freight carriers, freight forwarders or freight agents specifically, which could limit our ability to develop and expand our business. The market for internet-based cargo logistics systems is relatively new and is evolving. Our ability to generate revenue in the future depends on the acceptance by both our customers, and internet-based cargo logistics technology in general. The adoption of our cargo logistics system could be hindered by the perceived costs of this new technology, as well as by the reluctance of businesses that have invested substantial resources in existing document management systems to replace their current systems with this new technology. Accordingly, in order to achieve commercial acceptance, we will have to educate prospective customers, including large, established freight forwarding companies, about the uses and benefits of our cargo logistics system. If these efforts fail, or if our cargo logistics system does not achieve commercial acceptance, our business could be harmed.

The current and future development of the market for our cargo logistics system is also dependent upon:

- the widespread deployment of internet-based cargo logistics applications, which is driven by consumer demand for services having an internet-based cargo logistics component;

- the demand for new uses and applications of internet-based cargo logistics technology; and

- continuing improvements in technology that may reduce the costs of internet-based cargo logistics solutions and improve their efficiency.

RAPID TECHNOLOGICAL CHANGES IN THE COMPUTER SOFTWARE AND HARDWARE INDUSTRY COULD RENDER OUR PRODUCTS NON-COMPETITIVE OR OBSOLETE AND CONSEQUENTLY AFFECT OUR ABILITY TO GENERATE REVENUES AND BECOME OR REMAIN PROFITABLE

The development and sales of our current and future software programs are exposed to risks because of the rapidly changing technology in the computer software and hardware industry. Although we will engage software engineers and developers who are experienced in the software program market, we only have limited experience in developing and marketing such software programs.

Specifically, the cargo logistics and freight forwarding industry within which we operate is subject to technological change. The development of new technology by companies with products similar to those offered by us may render our cargo logistics system obsolete. Our success will depend upon our ability to continually enhance and support our cargo logistics system, and to develop and introduce new products that keep pace with technological developments and that address the changing needs of the marketplace. Although we expect to devote significant resources to research and development activities, there can be no assurance that these activities will result in the successful development of new internet-based cargo logistics technologies and internet-based cargo logistics software products or the enhancement of existing technologies and products. In addition, future advances in the computer software and hardware industry could lead to new technologies or software programs competitive wi th the software programs provided by us. Those technological advances could also lower the costs of other software programs that compete with our software programs resulting in pricing or performance pressure on our software programs, which could adversely affect our results of operations.

UNSCHEDULED DELAYS IN DEVELOPMENT OF OUR SOFTWARE PRODUCTS OR THE IMPLEMENTATION OF OUR SALES PROGRAM COULD RESULT IN LOST OR DELAYED REVENUES

Delays and related increases in costs in the further development or improvement of our cargo logistics system or the implementation of our sales and marketing program could result from a variety of causes, including:

- delays in the development, testing and commercial release of our cargo logistics system and any future systems;

- delays in hiring or retaining experienced software developers and engineers;

- delays in locating and hiring experienced sales and marketing professionals; and

- delays caused by other events beyond our control.

There can be no assurance that we will successfully develop further enhancements to our cargo logistics system on a timely basis or that we will implement our sales and marketing program in a timely manner. A significant delay in the development, testing and commercial release of our software programs or a delay in the implementation of our sales and marketing program could result in increased costs and could have a materially adverse effect on our financial condition and results in operations.

COPYRIGHTS, PATENTS, TRADE SECRETS AND PROTECTION OF PROPRIETARY TECHNOLOGY

Our cargo logistics system is not protected by any patents, nor do we intend to seek such protection. We do treat our software programs and their associated technology as proprietary and own all copyrights in such programs.

Any inability to adequately protect our proprietary technology could harm our ability to compete. Our future success and ability to compete depends in part upon our proprietary technology, which we attempt to protect with a combination of patent, copyright, trademark and trade secret laws, as well as with our confidentiality procedures and contractual provisions. These legal protections afford only limited protection and may be time-consuming and expensive to obtain and/or maintain. Further, despite our efforts, we may be unable to prevent third parties from infringing upon or misappropriating our intellectual property.

In the event that we do file patent applications, there is no guarantee that patents will be issued. Any patents that are issued could be invalidated, circumvented or challenged. If challenged, our patents might not be upheld or their claims could be narrowed. All of our employees are required to sign confidentiality agreements with respect to the work they do for us and with respect to the fact that rights to technology created by such employees in the course of their employment are retained by us.

As a precautionary measure, we have documented the entire architecture of our cargo logistics system chronologically, including but not limited to the database structure, design logic, systems architecture, data flow, information exchange and research. Despite precautions taken to protect our software program, unauthorized parties may attempt to reverse engineer, copy or obtain and use information we regard as proprietary. Policing unauthorized use of our products and infringement of our copyrights is difficult and software piracy is expected to be a persistent problem. Additionally, the laws of some foreign countries do not protect our proprietary rights, including our copyrights, to the same extent as do the laws of the United States.

We are not aware that our proprietary technology infringes the proprietary rights of third parties. However, from time to time, we may receive notices from third parties asserting that we have infringed their patents or other intellectual property rights. In addition, we may initiate claims or litigation against third parties for infringement of our proprietary rights or to establish the validity of our proprietary rights. Any such claims could be time-consuming, result in costly litigation, cause product shipment delays or lead us to enter into royalty or licensing agreements rather than disputing the merits of such claims. As the number of software products in the industry increases and the functionality of such products further overlap, we believe that software developers may become increasingly subject to infringement claims. Any such claims, with or without merit, can be time consuming and expensive to defend. An adverse outcome in litigation or similar proceedings could subject us to significant liabilities to third parties, require expenditure of significant resources to develop non-infringing technology, require disputed rights to be licensed from others or require that we cease the marketing or use of certain products, any of which could have a materially adverse effect on our business, operating results and financial condition.

INFRINGEMENT BY OUR PRODUCTS ON OTHER INTELLECTUAL PROPERTY

Our products may inadvertently infringe upon the intellectual property rights of others, and resulting claims against us could be costly and require that we enter into disadvantageous license or royalty arrangements. The software industry is characterized by the existence of a large number of patents and frequent litigation based on allegations of patent infringement and the violation of intellectual property rights. Although we attempt to avoid infringing known proprietary rights of third parties, we may be subject to legal proceedings and claims for alleged infringement by of third-party proprietary rights, such as patents, trade secrets, trademarks or copyrights, from time to time in the ordinary course of business. Any claims relating to the infringement of third-party proprietary rights, even if not successful or meritorious, could result in costly litigation, divert resources and management's attention or require that we enter into royalty or license agreements which are not advan tageous to us. In addition, parties making these claims may be able to obtain injunctions, which could prevent us from selling our products.

OUR ABILITY TO FORECAST OUR QUARTERLY RESULTS IS LIMITED

Our ability to accurately forecast our quarterly sales is limited, as a result of which, our quarterly operating results may fluctuate significantly. We expect that our results will vary significantly from quarter to quarter in the future. These quarterly variations may be caused by a number of factors, including:

- delays in customer orders of our cargo logistics system;

- timing of completion of project phases;

- our ability to develop, introduce and support new and enhanced products in a timely manner, such as new versions of our cargo logistics system, in response to changing technology trends, as well as our ability to manage product transitions; and

- the amount and timing of increases in expenses associated with our growth.

Due to these and other factors, and because the market for internet-based cargo logistics systems is new and evolving, our ability to accurately forecast our quarterly sales is limited. In addition, in the near future, most of our costs will be related to personnel, facilities, and research and development, which are relatively fixed in the short term. If we do not generate significant revenue in relation to our expenses, we may be unable to reduce our expenses quickly enough to avoid lower quarterly operating results. We do not know whether our business will grow rapidly enough to absorb the costs of our future employees and facilities. As a result, our quarterly operating results could fluctuate and this fluctuation could adversely affect the market price of our common stock in the future.

IN CONVERTING POTENTIAL CLIENTS TO OUR CARGO LOGISTICS SYSTEM WE MAY EXPERIENCE LENGTHY SALES AND IMPLEMENTATION CYCLES, AND AS A RESULT, LICENSE AND SERVICES REVENUE AND OPERATING RESULTS MAY FLUCTUATE QUARTER TO QUARTER, WHICH MAY CAUSE OUR STOCK PRICE TO BE VOLATILE OR DECLINE

Converting a potential client to our cargo logistics system will a require significant commitment from and organizational restructuring by that client. Accordingly, the decision to convert a business from an in-house system to a system utilizing our cargo logistics system will typically involve a significant evaluation and analysis period. During the sales cycle, we may spend significant time and effort educating and providing information to our prospective customers and their agents. As a result of the lengthy sales and implementation cycles, we may not be able to immediately generate any licence and service revenues and our operations may be adversely affected if we are unable to generate such revenues.

Additionally, if we are performing significant professional services in connection with the implementation of our cargo logistics system, we will not recognize revenue until after acceptance of our cargo logistics system. We may, in the future, experience unexpected delays in recognizing revenue. Consequently, the length of our sales and implementation cycles and the varying order amounts for our cargo logistics system make it difficult to predict the quarter in which revenue recognition may occur and may cause license and services revenue and operating results to vary significantly from period to period. These factors could, in the future, cause our stock price to be volatile or to decline.

RESPONSE TO CHANGES IN THE INTERNET-BASED CARGO LOGISTICS SYSTEM MARKET

In the event that we fail to respond to changes in the market for internet-based cargo logistics systems, we may experience a loss of revenues. The internet-based cargo logistics system industry is relatively new and is evolving. Our success will depend substantially upon our ability to enhance our proposed products and to develop and introduce, on a timely and cost-effective basis, new products and features that meet changing end-user requirements and incorporate technological advancements. If we are unable to develop new products and enhanced functions or technologies to adapt to these changes, or if we cannot offset a decline in revenue from existing products with sales of new products, our business will likely suffer.

Among other things, commercial acceptance of our cargo logistics system and its applications will depend on:

- the ability of our products and technologies to meet and adapt to the needs of our target markets;

- the performance and price of our cargo logistics system and any future enhancements as compared to our competitors' products; and

- our ability to deliver customer service directly and through our website.

BECAUSE SALES TO CUSTOMERS OUTSIDE OF CANADA AND THE UNITED STATES MAY ACCOUNT FOR A SIGNIFICANT PORTION OF OUR REVENUES IN THE FUTURE, WE MAY BE SUBJECT TO A VARIETY OF RISKS ASSOCIATED WITH CONDUCTING BUSINESS INTERNATIONALLY

Sales to customers outside the United States and Canada may account for a significant portion of our revenues in the future, which would expose us to risks inherent in international operations. We would be subject to a variety of risks associated with conducting business internationally, any of which could have a materially adverse effect on our business. These risks include:

- difficulties in establishing and maintaining effective international customer service;

- the burden of complying with a wide variety of foreign laws, particularly with respect to intellectual property and license requirements;

- political and economic instability outside the United States and Canada;

- import or export licensing and product certification requirements;

- tariffs, duties, price controls or other restrictions on foreign currencies or trade barriers imposed by foreign countries;

- potential adverse tax consequences, including higher marginal rates;

- unfavorable fluctuations in currency exchange rates; and

- limited ability to enforce agreements, intellectual property rights and other rights in some foreign countries.

We intend to focus on our international sales, which will require the investment of significant resources to create and refine different language models for each particular language or dialect. These language models are required to create versions of our products that allow end users in a variety of non-English speaking countries to communicate using the local language or dialect, as well as English. If we fail to develop localized versions of our products, our ability to address international market opportunities and to develop our international business will be limited.

GOVERNMENTAL REGULATION OF CARGO LOGISTICS SOFTWARE

To the best of our knowledge, as a software development company specializing in the development of an internet-based cargo logistics system, we are not currently subject to direct federal, state or local regulation in the United States, other than regulations applicable to businesses generally.

If any laws or regulations are enacted that we must comply with and are applicable to the development and sale of our cargo logistics software, then there can be no assurance that any such laws or regulations, if enacted, will not adversely affect or limit our current or future operations.

LOSS OF SERVICES OF KEY EMPLOYEES

As at July 1, 2002, our key personnel included Paul Dunn (President), Wai Yip Chu (Manager of Research and Development), Gim Choon Teoh (Chief Engineer), and Walter Wong (Project Manager). The loss of the services of Mr. Dunn or the other key employees, or the services of any future key employees for any reason may have a materially adverse effect on our prospects. There can be no assurance that we would be able to find a suitable replacement in the event that the services of any of these key employees, or of a future key employee, is lost. Furthermore, we do not presently maintain "key man" life insurance on the lives of our key personnel. We rely upon the continued service and performance of a relatively small number of key senior management personnel, and our future success depends on our retention of these key employees whose knowledge of our business and technical expertise would be difficult to replace. At this time, none of our key personnel are bound by employment agreements, and as a result, any of these employees could leave with little or no prior notice. If we lose any of our key personnel, our business may be adversely affected.

If we are unable to hire and retain technical, sales and marketing and operational personnel, our business could be materially adversely affected. We intend to hire a significant number of additional personnel, including software engineers, sales and marketing personnel and operational personnel in the future. Competition for these individuals is intense, and we may not be able to attract, assimilate, or retain additional highly qualified personnel in the future. The failure to attract, integrate, motivate and retain these employees could harm our business.

TRADING OF OUR STOCK MAY BE RESTRICTED BY THE SEC'S PENNY STOCK REGULATIONS WHICH MAY LIMIT A STOCKHOLDER'S ABILITY TO BUY AND SELL OUR STOCK

The U.S. Securities and Exchange Commission has adopted regulations which generally define "penny stock" to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and "accredited investors". The term "accredited investor" refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the SEC which provides information about penny stocks and the nature and level of risks in th e penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market fo r the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of, our common stock.

SINCE A RELATIVELY SMALL GROUP OF SHAREHOLDERS OWN A LARGE PERCENTAGE OF OUR OUTSTANDING SHARES, THEY ARE ABLE TO SIGNIFICANTLY INFLUENCE MATTERS REQUIRING SHAREHOLDER APPROVAL

Shareholders owning a majority (i.e. 51%) of our outstanding voting stock represent the ultimate control over our affairs. Four shareholders currently control approximately 84% of the outstanding shares of our common stock. As a result of this ownership, these shareholders will likely be able to approve any major transactions including the election of directors without the approval of the other shareholders.

WE DO NOT EXPECT TO DECLARE OR PAY ANY DIVIDENDS.

We have not declared or paid any dividends on our common stock since our inception, and we do not anticipate paying any such dividends for the foreseeable future.

VOLATILITY OF STOCK PRICE

Our common shares are not currently publicly traded. In the future, the trading price of our common shares may be subject to wide fluctuations. Trading prices of the common shares may fluctuate in response to a number of factors, many of which will be beyond our control. In addition, the stock market in general, and the market for software technology companies in particular, has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of such companies. Market and industry factors may adversely affect the market price of the common shares, regardless of our operating performance.

In the past, following periods of volatility in the market price of a company's securities, securities class-action litigation has often been instituted. Such litigation, if instituted, could result in substantial costs and a diversion of management's attention and resources.

Part II - OTHER INFORMATION

Item 1. Legal Proceedings.

We are not a party to any pending legal action, suit, or proceeding nor is any of our property the subject of any legal proceeding. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 2. Changes in Securities.

Recent Sales of Unregistered Shares

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Submission of Matters to a Vote of Security Holders.

None.

Item 5. Other Information.

None.

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

Exhibits Required by Item 601 of Regulation S-B

(3) Articles of Incorporation and By-laws

3.1 Articles of Incorporation dated September 24, 1996 (incorporated by reference from our Form 10-SB/A filed on January 8, 2002)

3.2 By-laws, effective as of September 24, 1996 (incorporated by reference from our Form 10-SB/A filed on January 8, 2002)

3.3 Corporate Charter, dated September 24, 1996 (incorporated by reference from our Form 10-SB/A filed on January 8, 2002)

3.4 Certificate of Amendment of Articles of Incorporation, dated June 15, 2000 (incorporated by reference from our Form 10-SB/A filed on January 8, 2002)

3.5 Certificate of Correction, dated January 23, 2001 (incorporated by reference from our Form 10-SB/A filed on January 8, 2002)

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

3W CYBER LOGISTICS, INC.

By: /s/ Paul Dunn
Paul Dunn, President and Director
Date: July 22, 2002

By: /s/ Li Ying Yan
Li Ying Yan, Secretary and Director
Date: July 22, 2002

By: /s/ Brian Hall
Brian Hall, Director
Date: July 22, 2002