-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WYxAqTLQ+HdNSwH454zeAXpQ2RB3+D4vhFh61ISKyhxBLYeSdkVxNPj2lbojDJr9 bXSSg/COy9sQug/39IN2fw== 0001108017-02-000185.txt : 20020415 0001108017-02-000185.hdr.sgml : 20020415 ACCESSION NUMBER: 0001108017-02-000185 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20011231 FILED AS OF DATE: 20020306 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ADVA INTERNATIONAL INC CENTRAL INDEX KEY: 0000807732 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 161284228 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-16341 FILM NUMBER: 02568367 BUSINESS ADDRESS: STREET 1: BTC 454 S ANDERSON RD STREET 2: SUITE 214 CITY: ROCK HILL STATE: SC ZIP: 29730 BUSINESS PHONE: 8033276790 MAIL ADDRESS: STREET 1: BTC 454 S ANDERSON RD STREET 2: SUITE 214 CITY: ROCK HILL STATE: SC ZIP: 29730 FORMER COMPANY: FORMER CONFORMED NAME: ADVANCED MEDICAL PRODUCTS INC DATE OF NAME CHANGE: 19920703 10QSB 1 adva10q3.htm Form 10-QSB ADVA International Inc.

                       SECURITIES AND EXCHANGE COMMISSION
                                 Washington D.C.

                                   FORM 10-QSB


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

         For the quarterly period ended December 31, 2001

                                       OR

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

         For the transition period from________to________

                         Commission file number 0-16341


                             ADVA International Inc.
                 (Name of small business issuer in its charter)


          Delaware                                               16-1284228
  (State or other jurisdiction                                 (I.R.S. Employer
 of incorporation or organization)                           Identification No.)



                             454 South Anderson Road
                         Rock Hill, South Carolina 29730
                                  803.327.6790
 (Address and phone number of principal executive offices and place of business)

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

Check whether the issuer filed all documents and reports required to be filed by
section q2, 13 or 15(d) of the Exchange Act after the distribution of securities
under a plan confirmed by a court. Yes X   No __

                         APPLICABLE TO CORPORATE ISSUERS

The number of shares outstanding of the issuer's common stock as of February 28,
2002 is 13,185,194.





                     ADVA INTERNATIONAL INC. AND SUBSIDIARY

                                   FORM 10-QSB

                                      INDEX

                                                                            Page
PART I. FINANCIAL INFORMATION

Item 1. Financial Statements:
   Consolidated Balance Sheet as of December 31, 2001
     and March 31, 2001.....................................................   3
   Consolidated Statements of Operations for the Three
     Months Ended September 30, 2001 and 2000, the Nine
     Months ended December 31, 2001 and 2000, and the
     cumulative period April 2, 1998 (inception) through
     December 31, 2001......................................................   5
   Consolidated Statements of Changes in Stockholders'
     Equity (Deficiency)....................................................   6
   Consolidated Statements of Cash Flows for the Three
     Months Ended September 30, 2001 and 2000 and the
     cumulative period April 2, 1998 (inception) through
     December 31, 2001......................................................   7
   Notes to Consolidated Financial Statements...............................   8

Item 2. Plan of Operation...................................................  11

PART II. OTHER INFORMATION

Item 2. Changes in Securities...............................................  12

Item 6. Exhibits and Reports on Form 8-K....................................  12

SIGNATURES..................................................................  12

Forward Looking Statements

When used in this Form 10-QSB, the words "may", "might", "will", "should",
"could", "expect(s)", "plan(s)", "intend(s)", "anticipate(s)", "believe(s)",
"estimate(s)", "predicts", "potential", or "continue(s)" or the negative of such
terms and other comparable terminology are intended to identify "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such statements are subject to certain risks and uncertainties,
including but not limited to economic conditions, changes in laws or
regulations, our history of operating losses, limited access to capital, demand
for our products and services, dilution from issuance of additional shares,
newly developing technologies, loss of permits, conflicts of interests in
related party transactions, regulatory matters, the occurrence of events not
covered by insurance, a substantial increase in interest rates, protection of
technology, lack of industrial standards, raw material commodity pricing, the
ability to receive bid awards, the inability to implement our growth strategy,
the inability to maintain key employees, the effects of competition and our
ability to obtain additional financing. Such factors, which are discussed in
"The Plan Of Operation" and the notes to condensed consolidated financial
statements, could affect the Company's financial performance and could cause the
Company's actual results for future periods to differ materially from any
opinions or statements expressed with undue reliance on any such forward-looking
statements, which speak only as of the date made. Although we believe the
expectations reflected in the forward-looking statements are reasonable, we
cannot and do not guarantee future results, levels of activity, performance or
achievements. See "Plan of Operation".




Item 1.     Financial information



                        ADVA INTERNATIONAL AND SUBSIDIARY
                        (A Development Stage Enterprise)

                           Consolidated Balance Sheet


                                                       Dec. 31,      March 31,
                                                         2001          2001
- --------------------------------------------------- ------------   ------------
                                                     (Unaudited)
Assets

Current assets
   Cash and cash equivalents                        $     18,664   $    961,483
   Accounts receivable, other                                 46           -
   Prepaid expenses                                       33,167         56,500
- --------------------------------------------------- ------------   ------------

Total current assets                                      51,877      1,017,983

Furniture and equipment, net
   of accumulated depreciation
   of $1,863                                              22,099           -

Software                                                 320,436        200,000

Deferred financing costs, net of
  accumulated amortization
  of $312,958 and $221,155                               558,641        696,345

Deposit                                                    2,979          2,979
- --------------------------------------------------- ------------   ------------

Total assets                                        $    956,032   $  1,914,328
- --------------------------------------------------- ------------   ------------



                                      -3-




                        ADVA INTERNATIONAL AND SUBSIDIARY
                        (A Development Stage Enterprise)

                           Consolidated Balance Sheet

                                                      Dec. 31,       March 31,
                                                        2001           2001
- --------------------------------------------------- ------------   ------------
                                                     (Unaudited)

Liabilities and Stockholders' (Deficiency)

Current liabilities
   Accrued transaction and creditor payables        $        560   $    300,000
   Accrued professional fees                             312,234        147,267
   Accrued interest                                      125,086         49,400
   Accounts payable and accrued expenses, other           50,537         27,742
   Due to officer                                         37,882         33,515
- --------------------------------------------------- ------------   ------------

Total current liabilities                                526,299        557,924

Long-term debt                                         1,585,000      1,500,000
- --------------------------------------------------- ------------   ------------

Total liabilities                                      2,111,299      2,057,924

Commitments (Note 3, 4)

Stockholders' (deficiency)
   Class A preferred stock, no par value
      Authorized 4,000 shares, none issued                  -              -
   Class B preferred stock, no par value
      Authorized 6,000 shares, none issued                  -              -
   Common stock, $.001 par value
      Authorized 20,000,000 shares
      Issued and outstanding 13,185,194 shares            13,185         13,185
   Additional paid-in capital                          1,937,815      1,937,815
   (Deficit) accumulated during the development
     stage                                            (3,106,267)    (2,094,596)

Total stockholders' (deficiency)                      (1,155,267)      (143,596)
- --------------------------------------------------- ------------   ------------

Total liabilities and stockholders' (deficiency)    $    956,032   $  1,914,328
- --------------------------------------------------- ------------   ------------


           See accompanying notes to consolidated financial statements

                                      -4-





                        ADVA INTERNATIONAL AND SUBSIDIARY
                        (A Development Stage Enterprise)

                      Consolidated Statement of Operations


                                                                                             Cumulative
                                                                                                 Period
                                                                                               April 2,
                                                                                                   1998
                                                                                            (Inception)
                                       Three Months Ended           Six Months Ended            through
                                            Dec. 31,                    Dec. 31,               Dec. 31,
                                       2001          2000          2001          2000              2001
- ---------------------------------- ------------  ------------  ------------  ------------  ------------
                                    (Unaudited)                 (Unaudited)                 (Unaudited)

Sales, license fees                $       -     $       -     $       -     $       -     $      8,484

Operating expenses
   Salary and employee related           63,995        29,998       179,329        85,060       527,059
   General and administrative           110,027        88,540       591,709       170,663     1,127,866
   Expenses related to merger             5,000        84,411        30,336       266,174       995,278
- ---------------------------------- ------------  ------------  ------------  ------------  ------------

Total operating expenses                179,022       202,949       801,374       521,897     2,650,203
- ---------------------------------- ------------  ------------  ------------  ------------  ------------

(Loss) from operations                 (179,022)     (202,949)     (801,374)     (521,897)   (2,641,719)
- ---------------------------------- ------------  ------------  ------------  ------------  ------------

Other income (expense)
   Miscellaneous income                    -             -             -             -            1,305
   Interest (expense), Officer           (1,558)         -           (4,366)         -          (12,587)
   Interest (expense), debt             (71,429)      (57,276)     (213,390)     (166,181)     (485,355)
   Interest income                            7         6,139         7,460        14,840        32,089
- ---------------------------------- ------------  ------------  ------------  ------------  ------------

Total other (expense)                   (72,980)      (51,137)     (210,296)     (151,291)     (464,547)
- ---------------------------------- ------------  ------------  ------------  ------------  ------------

Net (loss)                             (252,002)     (254,086)   (1,011,670)     (673,188)   (3,106,267)
- ---------------------------------- ------------  ------------  ------------  ------------  ------------

Basic and diluted loss per share          (0.02)        (0.02)        (0.08)        (0.05)        (0.28)
- ---------------------------------- ------------  ------------  ------------  ------------  ------------

Weighted average shares
  outstanding                        13,185,194    12,468,750    13,185,194    12,376,266    11,155,081
- ---------------------------------- ------------  ------------  ------------  ------------  ------------

           See accompanying notes to consolidated financial statements

                                      -5-





                        ADVA INTERNATIONAL AND SUBSIDIARY
                        (A Development Stage Enterprise)

     Consolidated Statements of Changes in Stockholders' Equity (Deficiency)


                                                                                  (Deficit)                  Total
                                                                                 Accumulated                 Stock
                                                                     Additional  During the     Stock        Holders'
                          Preferred Stock         Common Stock         Paid-In   Development Subscription    Equity
                          Shares   Amount      Shares      Amount      Capital     Stage      Receivable  (Deficiency)
- ------------------------ -------- --------  ------------ ---------- ------------ ----------- ------------ ------------

Balance, April 2, 1998
  (inception)                 -   $    -            -    $     -    $       -    $      -    $       -    $       -

Common stock issued,
  May 14, 1998                -        -           1,000         10      300,990        -         (1,000)      300,000

Net (loss)                    -        -            -          -            -       (287,851)        -        (287,851)
- ------------------------ -------- --------  ------------ ---------- ------------ ----------- ------------ ------------

Balance, March 31, 1999       -        -           1,000         10      300,990    (287,851)     (1,000)       12,149

Original issue discount
  arising from options
  granted in connection
  with debt, Jan. 14,
  1998                       -         -            -          -         900,000        -            -         900,000
  2000

Net (loss)                   -         -            -          -            -       (339,034)        -        (339,034)
- ------------------------ -------- --------  ------------ ---------- ------------ ----------- ------------ ------------

Balance, March 31, 2000      -         -           1,000         10    1,200,990    (626,885)     (1,000)      573,115

Common stock issued,
  May 17, 2000               -         -              13       -         300,000        -            -         300,000

Stock options exercised,
  May 17, 2000               -         -             176          2      449,998        -            -         450,000

Recapitalization,
  March 2, 2001              -         -      13,184,005     13,173      (13,173)       -            -            -

Receipt of stock
  subscription, March 2,
  2001                       -         -            -          -            -           -          1,000         1,000

Net (loss)                   -         -            -          -            -     (1,467,711)               (1,467,711)
- ------------------------ -------- --------  ------------ ---------- ------------ ----------- ------------ ------------

Balance, March 31, 2001      -         -      13,185,194     13,185    1,937,815  (2,094,596)        -        (143,596)

Net (loss) (unaudited)       -         -                                          (1,011,671)               (1,011,671)
- ------------------------ -------- --------  ------------ ---------- ------------ ----------- ------------ ------------

Balance, September 30,
  2001                       -    $    -      13,185,194 $   13,185 $  1,937,815  (3,106,267)        -      (1,115,267)
- ------------------------ -------- --------  ------------ ---------- ------------ ----------- ------------ ------------
          See accompanying notes to consolidated financial statements.

                                      -6-




                                         ADVA INTERNATIONAL AND SUBSIDIARY
                                         (A Development Stage Enterprise)

                                       Consolidated Statement of Cash Flows

                                                                                 Cumulative
                                                                                     Period
                                                                                   April 2,
                                                                                       1998
                                                                                (Inception)
                                                      Nine Months Ended             through
                                                          Dec. 31,                 Dec. 31,
                                                     2001           2000               2001
- ------------------------------------------------ ------------  -------------   -------------
                                                  (Unaudited)                   (Unaudited)
Cash Flows from operating activities
   Net (loss)                                    $ (1,011,671) $    (673,188)  $  (3,106,267)
   Adjustments to reconcile net (loss) to
    net cash (used in)
     Operating activities
       Amortization of deferred finance costs         137,703        137,441         358,859
       Depreciation                                     3,578           -              3,578
     Changes in assets and liabilities
       Accounts receivable                                (46)          -                (46)
       Prepaid expenses                                23,333        (29,000)        (33,167)
       Deposits                                        (2,979)          -             (2,979)
       Accrued transaction and creditor              (299,440)          -                560
       Accounts payable and accrued expenses          263,449       (272,850)        487,857
- ------------------------------------------------ ------------  -------------   -------------

Net cash (used in) operating expenses                (886,073)      (837,597)     (2,291,605)
- ------------------------------------------------ ------------  -------------   -------------

Cash flows from investing activities
   Software and related costs                        (120,436)          -           (320,436)
   Purchase of furniture and equipment                (25,677)          -            (25,677)
   Replacement from (loan to) officer                   4,367         (7,379)         37,882
- ------------------------------------------------ ------------  -------------   -------------

Net cash (used in) investing activities              (141,746)        (7,379)       (308,231)
- ------------------------------------------------ ------------  -------------   -------------

Cash flows from financial activities
   Proceeds from long-term debt, net of
     finance fees                                      85,000        390,000       1,567,500
   Proceeds from stock issuance and subscription         -           750,000       1,051,000
- ------------------------------------------------ ------------  -------------   -------------

Net cash provided by financing activities              85,000      1,140,000       2,618,500
- ------------------------------------------------ ------------  -------------   -------------

Net (decrease) increase in cash
  and cash equivalents                               (942,819)       295,024          18,664

Cash and cash equivalents at the beginning
  of the period                                       961,483        183,492            -
- ------------------------------------------------ ------------  -------------   -------------

Cash and cash equivalents at the end of period         18,664        478,516          18,664
- ------------------------------------------------ ------------  -------------   -------------

Non cash activity
   During the year ended March 31, 2000, the Company incurred $900,000 in
   non-cash deferred finance charges from options for common stock issued with
   debt. The amount was credited to additional paid-in capital.
- --------------------------------------------------------------------------------

           See accompanying notes to consolidated financial statements

                                      -7-




                        ADVA INTERNATIONAL AND SUBSIDIARY
                        (A Development Stage Enterprise)

                       Notes to Consolidated Balance Sheets

1.    Basis of         The consolidated Financial statements are unaudited and
      Presentation     include the accounts of ADVA International Inc. ("ADVA")
                       and its wholly owned subsiderary Global Information Group
                       USA, Inc. ("GIG").  All significant inter-company
                       accounts and transactions have been eliminated in
                       consolidation.

                       In the opinion of management, all adjustments (consisting
                       of normal recurring accruals) have been made which are
                       necessary to present fairly the financial position of the
                       company as of December 31, 2001, and the results of its
                       operations for the three months period ended December 31,
                       2001 and 2000. The results of operations experienced for
                       the three month period ended December 31, 2001 are not
                       necessarily indicative of the results to be experienced
                       for the fiscal year ending March 31, 2002.

                       The statements and related notes have been prepared
                       pursuant to the rules and regulations of the Securities
                       and Exchange Commission. Accordingly, certain information
                       and footnote disclosures normally included in financial
                       statements prepared in accordance with generally accepted
                       accounting principles have been omitted pursuant to such
                       rules and regulations. The accompanying notes should
                       therefore be read in conjunction with the Company's March
                       31, 2001 annual financial statements. The Company may
                       find it necessary to amend certain information after
                       auditing of the consolidated Financial Statements is
                       performed.

2.    Business         From April 2, 1998 (inception) to March 31, 2000, the
      Operations       Company maintained operations in the Netherlands and in
                       April 2000 moved all operations to the United States. The
                       Company is in the development stage and planned principle
                       operations have only commenced since June 30, 2001.

                       The Company develops and markets 3D graphics applications
                       software running on the Linux and UNIX operating systems.
                       The Company's present software product believed to be the
                       only complete 3D solid modeling, animation and rendering
                       system currently available on the Linux OS. The Company's
                       software has been designed for use by digital media
                       professionals in the production of film and video special
                       effects, animation, computer-aided design and scientific
                       visualization, Internet web site and print graphics, game
                       development and virtual television. Since acquiring the
                       software and the underlying source code in February 2000,
                       the Company has been enhancing the software, performing
                       market research and developing marketing plans for sales
                       of the software to users in the 3D graphics applications
                       market.

                       The Company's success will depend in part on its ability
                       to obtain patents and product license rights, maintain
                       trade secrets, and operate without infringing on the
                       proprietary rights of others, both in the United States
                       and other countries. There can be no assurance that
                       patents issued to or licensed by the Company will not be
                       challenged, invalidated, or circumvented, or that the
                       rights granted there under will provide proprietary
                       protection or competitive advantages to the Company.

                       The Company has no significant operating history and,
                       from April 2, 1998 (inception) to December 31, 2001, has
                       generated a net loss of $3,106,267. This loss has been
                       financed by proceeds from equity and debt issuances.


                                      -8-


                        ADVA INTERNATIONAL AND SUBSIDIARY
                        (A Development Stage Enterprise)

                       Notes to Consolidated Balance Sheets


                       New debt and equity issuances are expected to provide
                       near term working capital until earnings from operations
                       can support the company. There can be no assurance that
                       management will be successful in its efforts to attract
                       such capital.

                       An interest payment to investors due in August 2001 was
                       not made. Negotiations to revise the terms of this loan
                       and future interest payments have been undertaken and are
                       currently ongoing. There is no assurance the Company will
                       be successful in these negotiations and failure to do so
                       may result in a default of the terms of the loan
                       agreements. For more details on the loan agreements,
                       please refer to the Form 8K filed on March 2, 2001.

                       On November 27, 2001, an aggregate total of $85,000 was
                       advanced to the Company in the form of a simple loan by
                       private lenders. The instrument bears an interest rate of
                       7.5% compounded annually. The Board of Directors approved
                       the terms of the loan on February 23, 2002.


3.    Employment       In January 2000, GIG entered into an employment agreement
      and              with the Chief Executive Officer that provides for
      Consulting       payments of $110,000 per year along with certain other
      Agreements       benefits in exchange for defined services to be performed
                       by the employee.  The agreement is not for a specific
                       term and may be terminated by either party at any time.

                       On May 1, 2001, GIG entered into an employment agreement
                       with George Down to serve as President of GIG for a
                       minimum of one year, providing payments of $125,000 per
                       year along with certain other benefits.

                       On April 23, 2001, the Board of Directors granted an
                       Incentive Stock Option (see Note 4) to the President of
                       GIG who is also a Director of both ADVA and GIG to
                       purchase 100,000 shares of ADVA common stock in
                       connection with the employment agreement with GIG. ADVA's
                       Board of Directors approved the option on April 23, 2001.
                       The incentive stock option will vest annually in four
                       equal increments commencing on April 23, 2001. The
                       exercise price, $1.75 per share, was set at the closing
                       price of the common stock on the grant date.

                       On May 1, 2001, the Company entered into a one-year
                       contractual agreement with a consultant to act as Chief
                       Financial Advisor to the Company. The agreement provides
                       for payment of $4,300. monthly, and is cancelable on
                       thirty days notice by the consultant or the Company. The
                       Company also granted an Incentive Stock Option (see note
                       4) to acquire 25,000 shares of common stock which vests
                       in equal quarterly increments beginning August 1, 2001.
                       This agreement was ratified by the ADVA Board of
                       Directors on August 17, 2001

                       On December 1, 2001, the Chief Financial Advisor resigned
                       his position on thirty days notice as per his contract.
                       As of January 1, 2001 the Company has no forma CFO. The
                       former Chief Financial Advisor has remained available for
                       consultation and continues to work for the Company on a
                       limited basis.

                       On September 1, 2001 the Company entered into an
                       agreement with a consultant to become Director of
                       Software Development for GIG at an annual salary of
                       $85,000. On December 1, 2001, the employee terminated his
                       employment with the Company and continues to work for GIG
                       as a consultant.


                                      -9-




                        ADVA INTERNATIONAL AND SUBSIDIARY
                        (A Development Stage Enterprise)

                       Notes to Consolidated Balance Sheets

4.    ADVA             On August 17, 2001, the Board of Directors in
      Outside          consideration for advisory and consultant services
      Director         rendered to Global Information Group USA Inc., granted
      Options          Ruud A.M. Pruijm a Non-Qualified Stock Option for 10,000
                       shares for an option price of $1.25 per share.

                       Outside Directors of ADVA, in lieu of other compensation
                       received stock option grants for Board Meeting attendance
                       as follows:
                       Ronald G Moyer                    1,500
                       Ruud A.M. Pruijm                    750
                       Philip L. van Wijngaarden           750
                       C. Roger Jones                      750
                       Michael Tolson                   *2,000

                       * Options granted as newly elected board member.

5.    ADVA             The Company, at its August 17, 2001 Board of Directors
      Stock Option     meeting "authorized the 2001 ADVA Stock Option Plan and
      Plan             further authorized to set aside 1,400,000 shares of the
                       common stock of the Company for sale and issuance to the
                       executives and key employees of the Company and its
                       subsidiaries and affiliates in accordance with the terms
                       of the Plan".

                       Options granted under the plan are Incentive Stock
                       Options or Non-Qualified Stock Options and are granted at
                       a price equal to the fair market value of the Company's
                       common stock at the date of grant. In addition, no
                       Incentive Stock Option may be granted to an employee
                       owning directly or indirectly stock having more than 10%
                       of the total combined voting power of all classes of
                       stock of the Company unless the exercise price is set at
                       not less than 110% of the fair market value of the shares
                       subject to such Incentive Stock Option on the date of the
                       grant and such Incentive Stock Option expires not later
                       than five years from the date of grant.

                       Generally, the Incentive Stock Options and Non-Qualified
                       Stock Options have terms of ten years from the date of
                       grant. On each anniversary date of grant, the options
                       vest in increments of 20%. The options become fully
                       vested and exercisable four years from the date of grant.
                       Notwithstanding the preceding, the board of directors
                       determines the terms of options granted on a case-by-case
                       basis. See Note 3, 4 for options granted during the
                       quarter ended September 30, 2001, and options
                       subsequently expected to be approved.

                       The 2001 ADVA Stock Option Plan was approved by a
                       majority of shareholders at the annual meeting on
                       September 26, 2001.

6.    Director         On September 26, 2001, the slate of Directors proposed by
      Changes          management was approved by a majority of the shareholders
                       of ADVA International Inc. to include Anthony E. Mohr,
                       George L. Down, Ruud AM Pruijm, C. Roger Jones and
                       Michael Tolson. Earlier the same day, Philip van
                       Wijngaarden resigned as a Director of ADVA International
                       citing a lack of adequate time needed to devote to his
                       responsibilities as Director. The Board has not yet moved
                       to fill the vacancy left by his departure.


                                      -10-




Item 2.     Plan of Operations

The following information should be read in conjunction with the consolidated
financial statements and notes thereto appearing elsewhere in this Form 10-QSB.

Our short-term objectives are to raise additional operating funds through a
mixture of paid in capital and loans. With anticipated additional funding we
expect to continue further software development on Linux, Unix and other
software platforms. We further anticipate executing multiple software licensing
and joint venture agreements in the 3D graphics technology space.

Our long- term objectives are to generate increasing revenues in four areas: the
Linux end user market; the 3D animation and production markets through software
licensing and joint venture partnerships; The licensing of the Company's
technology to developers of Computer-Aided Design (CAD) tools and finally, sales
of 3D tools to CAD end users.

During the Quarter ended December 31, 2001, ADVA suffered a loss from operations
of $179,022. We funded our operating losses during this period through a
combination of long-term debt and the private sale of shares of our common
stock.

During the year ended March 31, 2001, we generated operating losses of
$1,253,445. We funded these operating losses during this period through a
combination of low interest long-term debt and the private sale of shares of our
common stock.

We do not have available credit, bank financing or other external sources of
funding. Due to historical operating losses, our operations have not generated
positive cash flow. In order to obtain capital we may need to sell additional
shares of common stock and/ or borrow funds through loan agreements from private
lenders, some of which may take the form of a Convertible loan. There is no
assurance if we do receive a convertible loan we will be able to pay this money
back to the lender prior to its due date, thus having to convert the loan to
stock. The Company is actively seeking fresh capital from a pool of accredited
investors, some of which are existing investors.

Based upon the anticipated combination of an infusion of capital through low
interest loans, convertible to stock after one year, paid in capital raised
through the sale of additional stock plus anticipated revenue from joint venture
agreements with hardware and software manufacturers in the 3D, Animation and CAD
marketplaces, we believe we will have adequate funds to meet our projected cash
needs through 2003.

However, should we not receive an anticipated infusion of capital, and or not
execute anticipated agreements with hardware and software manufacturers, the
Company will incur additional revenue losses and may be forced to cease
operations. No assurances can be given at this time as to the availability of
the new funding, the terms thereof, or the execution of revenue generating
agreements.

Going forward, we have reduced our total number of employees to two, now relying
on outside vendors and consultants for many of the Company's operations. Should
new operating capital becomes available, the Company anticipates the immediate
re-hiring or contracting of certain former employees.

ADVA recently changed its fiscal year to March 31 to coincide with GIG.

ADVA and GIG recently relocated their corporate headquarters from Columbia,
South Carolina and New York, respectively, to Rock Hill, SC in order to reduce
costs.

                                      -11-




                           PART II. OTHER INFORMATION

Item 2. Changes in Securities

The information required to be included in item 2 of Part II of this Form 10-QSB
was previously reported in ADVA's most current report on Form 10-QSB filed June
30, 2001

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

(a)     Exhibits

        None.

(b)     Reports on Form 8-K

        No reports on 8-K have been filed during the quarter covered by this
        report.







                                   Signatures

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


                                                 /s/ Anthony E. Mohr
                                                 ----------------------
                                                 Anthony E. Mohr
                                                 CEO and President




Date: 03/01/02


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