UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-SB\A

 

GENERAL FORM FOR REGISTRATION OF SECURITIES OF

SMALL BUSINESS ISSUERS

Under Section 12(b) or (g) of the Securities Exchange Act of 1934

 


 

WORLDTRADESHOW.COM, INC.

(Name of small business issuer in its charter)

 

                Nevada                            88-0355407

(State or other jurisdiction of     (I.R.S. Employer

incorporation or organization)       Identification No.)

 

9449 BALBOA AVENUE, SUITE 114, SAN DIEGO, CALIFORNIA 92123

(Address of principal executive offices) (Zip Code)

 

Issuer's telephone number:

(858) 292-9637

 

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

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


Common Stock, $0.0001 par value per share


 






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 TABLE OF CONTENTS


ITEM

PAGE

PART I

 

   Item 1.  Description of Business

3

   Risk Factors Related to Our Business

9

   Item 2.  Management’s Discussion and Analysis – Plan of Operation

10

   Item 3.  Description of Property

14

   Item 4.  Security Ownership of Certain Beneficial Owners and Management

14

   Item 5.  Directors, Executive Officers, Promoters and Control Persons

15

   Item 6.  Executive Compensation

16

   Item 7.  Certain Relationships and Related Transactions

17

   Item 8.  Description of Securities

19

Part II

 

   Item 1.  Market Price and Dividends on the Registrant’s Securities

20

   Item 2.  Legal Proceedings

21

   Item 3.  Changes in and Disagreements with Accountants

21

   Item 4.  Recent Sales of Unregistered Securities

21

   Item 5.  Indemnification of Directors and Officers

21

Part III

 

   Item 1.  Exhibits, List and Reports in Form 8-K


22

      (a) Exhibits

22

      (b) Reports of Form 8-k

22

   Item 2. Principal Accountant Fees and Services

22

   Signatures

23

Part F/S

 

   Report of Independent Registered Public Accounting Firm

25

   Financial Statements for Fiscal Year Ended April 30, 2005

28

    Notes to  Financial Statements for Fiscal Year Ended April 30, 2005

40

   Financial Statements for Quarter Ended July 31, 2005

56

   Notes to Financial Statements for Quarter Ended July 31, 2005

60

Exhibits

73

Code of Ethics

112





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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS



The following are factors that could cause actual results or events to differ materially from those anticipated, and include, but are not limited to general economic, financial and business conditions, changes in and compliance with governmental laws and regulations, our ability to obtain additional financing from outside investors and / or bank and mezzanine lenders; and our ability to generate sufficient revenues to cover operating losses and position us to achieve positive cash flow.


Readers are cautioned not to place undue reliance on the forward-looking statements contained herein, which speak only as of the date hereof.  We believe the information contained in this Form 10-SB to be accurate as of the date hereof.  Changes may occur after that date.  We will not update that information except as required by law in the normal course of its public disclosure practices.


Additionally, the following discussion regarding our financial condition and results of operations should be read in conjunction with the financial statements and related notes.


PART I


ITEM 1. DESCRIPTION OF BUSINESS

 

BACKGROUND

 

Unless the context otherwise requires, the terms "we", "our" "us" or “WTS” refers to WorldTradeShow.com, Inc.


WorldTradeShow.com, Inc. (the “Company”) was originally formed on September 15, 1995 as Interactive Processing, Inc., a Nevada corporation, to market high-tech consumer electronics through television home-shopping networks, retail stores, catalog companies and their website remotecontrols.com.  In March 1999, the Company changed its name to WorldTradeShow.com, Inc.  During the same month, the Company acquired intellectual property rights to a database and business plan and significantly changed its business plan to develop tradeshow software and market both physical and virtual tradeshow space through the Company’s website.  The Company has not yet commenced operations and therefore, is considered to be a development stage enterprise.


Business development:  We began with a business plan and business model that has been put into a CD Rom presentation.  In 1999 we acquired a database of over 11,000 tradeshow managers, complete with contact information for the majority of all tradeshows in North America.  This database was purchased from Chaiisai Tora, Inc., a non affiliate of the Company. The database will be used when WTS completes its Virtual Trade Show.  


In mid 2000, WorldTradeShow.com (“WTS”), acquired DudeSmart.com The Company accepted a proposal to exchange 1,200,000 shares of common stock for 100% of the outstanding common stock of Dudesmart.com, Inc.  At the time of the transaction, the shares were valued at $.22 per share (estimated value $264,000), and WTS had about 12.3 million shares outstanding at that time.  The common stock issued as consideration for the purchase of DudeSmart.com was valued based on accordance with paragraph 18 of SFAS 142.

DudeSmart.com is an entertainment portal. WTS has received a business plan (“Business Plan” an interactive CD Rom presentation format. DudeSmart.com will be the entertainment division providing discounts on restaurants, travel/tours discounts, golf tours using the WTS Discount Card.  We are unaware of (or do not believe there is) any other company currently doing business in Vietnam utilizing any kind of discount card or entertainment book. We plan to market the Discount Card through the following websites Hotels.com.vn, MyBajaGuide.com, and WorldTradeShow.com.  We plan to introduce the Discount Card to travel agents, travel tour companies, rental car companies, restaurants, in Vietnam, as well as Mexico.

The WTS Discount Card will be marketed with our partners, affiliates, alliances, both online and offline, and is expected to be introduced into the Mexican market during the second quarter of 2006.

WTS seeks to penetrate into Vietnam as an online vehicle for Vietnamese companies to promote themselves. We have an opportunity to market, www.hotels.com.vn, the largest travel and tourism online website in the country of Vietnam, as well as being recognized as the official travel/tourism website of Vietnam.  

In February of 2003, WTS signed a license agreement with Hi-Tek Multimedia, Inc., a California-based software company owned by Thomas and Lee Johnson, our controlling shareholders, for the reservation engine.  The consideration paid for the license was 27.5 million shares of our common stock.  We utilized an historical stock price analysis to determine that $0.01 was a fair price for the shares issued to the licensor in this transaction.  We reviewed the illiquidity of our shares trading in the Pink Sheets and the daily closing market price and trading volume of the shares for the sixty day period prior to the transaction.  During this time, the pricing ranged $0.005 to $0.015 per share.  We concluded that the trading of our stock in the Pink Sheets may not reflect the ‘fair price’ of the stock because of the thin trading market, wide bid-ask spread and large volatility in historical stock prices.  Additionally, we considered the fact that the shares being issued to Hi-Tek are restricted securities that are unregistered, and which cannot be traded in the public marketplace.  Based on this analysis, the consideration price of $0.01 per share was determined to be fair.

The reservation engine software is the key to many of the functions for our online e-commerce.  WTS collects revenue online with back-end accounting functions.  WTS also signed a service agreement with Hi-Tek, enabling WTS to move forward without any significant expenditure of funds.  Hi-Tek is obligated to pay for everything until WTS obtains necessary private placement funding.  WTS will be seeking a private placement upon trading on the NASD OTC BB.  

Since 2003, Hi-Tek has introduced WTS to the Vietnamese government, various Mexican hotel associations, and other top travel agencies.  WTS has signed contracts and memorandum of understandings with Business.com.vn, a Vietnamese company, Dot.vn, Hotels.com.vn, MyBajaGuide.com, Maxsima Discount Card, the Vietnam Technology Information Center (VTIC), and the Hanoi Business Association.  As a result, WTS has formed a network, enabling it to operate in both Vietnam and Mexico.  

Currently, WTS is marketing Hotels.com.vn, and will also market, MyBajaGuide.com, a Mexican hotel web portal with up to 700 hotels, golf courses, resorts conventions, and tours throughout Baja California in the spring of 2006.  The launch is expected to be during the spring of 2006, and will enable WTS to generate revenue through sales, reservations and discount cards.  

WTS is currently designing templates, functionalities, colors, fonts and other add-ins in a Flash Presentation of a Virtual Booth.  WTS has previous designs, which can be viewed on the WTS CD Rom presentation.

WTS has rapidly moved forward in implementing its Business Plan from 2003 to -2006, through software agreements, Hi-Tek service agreements, contacts, marketing agreements, and databases.  WTS anticipates it will require approximately $1,350,000 to complete Phase I of the Business Plan which will include, hiring sales and marketing staff, create an, e-commerce, multiple language software, and completing the entertainment division.


WTS Milestones

Date

Cost

Staff

Expansion Cost

Completion

WTS acquires 11,000 trade show database

04/15/1999

50,000 shares

0

Sales and tech staff

Not implemented / need funding

WTS acquires Dudesmart.com -

WTS Discount Card

06/30/2000

1.2m. shares

0

10-20 staff in USA –Vietnam

Spring 2006

WTS signs software license agreement with Hi-Tek, Inc.

02/03/03

27.5M. Shares

3-5

5-10 further tech staff in USA / VN 2006

Completed

WTS expands to Asia with Business.com.vn partnership

06/26/03

Alliance

3-5

5-10 full time staff with 2-3 tech in Vietnam

On Going

WTS signs agreement to market Mexican MASXIMA Discount Card

11/12/03

Marketing costs and staff

3-5

3-5 full time sales staff and 2-3 tech in Mexico

Not implemented

WTS  signs exclusive marketing agreement with travel/tourism website in Vietnam- Hotels.com.vn

02/19/04

As per marketing agreement

30

Hire 10- 20 staff. marketing - $200k in Vietnam

On going and expanding later in 2006

 

WTS and Mexican Tourism Bureaus Partner to Produce the Official Baja California, Mexico Travel/Tourism Website

03/24/04

$300,000 – Hi-Tek paid

5

5-10  full time sales staff and 2-3 tech in Mexico

Phase I and is being beta tested.  Early 2006 completed, Phase II – Spring 2006

WTS to produce and manage Mexican Associations of hotels and motels for Tijuana, Mexico website, exclusively

05/27/04

$250,000 –Hi-Tek paid

5

5-10  full time sales staff and 2-3 tech in Mexico

Phase I and is being beta tested.  Early 2006 completed, Phase II – Spring 2006

WTS launches E-Commerce Travel /Tourism website

01/19/06

Marketing costs

1

Sales and Marketing

completed


 

Utilizing the latest broadband technologies, WTS will deliver a real-time Virtual Tradeshow experience via the Internet. Its web portal contains a comprehensive database of updated tradeshows, conventions and expositions worldwide.

WTS’s “Travel Booking Engine” will enable it to generate revenue through the reservation of hotel rooms, airline flights, tee times, and limousines targeting the trade show industry.

To date, WTS has prepared its business plan; designed and launched the FLASH Animation web page (WWW.WORLDTRADESHOW.COM); and designed and launched the front-end website (Alpha stage).

 

Management has focused its resources on the development of the website and the reservation engine that supports the WTS’s business plan. Phase I of the development has been successfully begun. Secondly, with agreements in place with Business.com.vn and Hotels.com.vn, WTS has implemented a soft launch of the website to begin the marketing of hotels and tourism in Vietnam.  In the third and fourth quarters of 2004, the website went live and started to generate revenue.  


To date, management has financed the growth of WTS through loans from management, shareholders and from its major vendor and majority shareholder, Hi-Tek Multimedia, Inc. ("Hi-Tek").


WTS has retained Hi-Tek to design, program and implement the following:

 

Corporate and promotional websites.

Initial module of the WorldTradeShow.com reservation engine.

Preliminary offline and online marketing plan, including designing and producing all supporting marketing and promotional materials (CD-ROM, media kit, web slide presentation and corporate literature).

Consultations with WTS’s management on an as needed basis.

 

Management projects launching the WorldTradeShow.com web portal in strategic phases. Phase I began with hotel reservation sales in Vietnam. Phase I will also include Mexican hotel marketing through mybajaguide.com in summer of 2006; Phase II in other parts of Asia;  and Phase III in Latin America and Europe.



MARKETING

 

HOTELS.COM.VN. WTS has a marketing agreement with Business.comVN to market Vietnam’s largest hotel web portal.  It is anticipated that as many as 3,000 hotels and over 200 tour companies will be listed to promote tourism in Vietnam.  This agreement has the support of the Vietnam Tourism Association (VITA) (www.VietnamTourism.com ), directly under Vietnam National Administration of Tourism (VNAT), whose members include various Vietnamese enterprises, commercial organizations and individuals in the travel/tourism industry.  

BUSINESS.COM.VN and WTS have the exclusive e-commerce global business platform to promote, market and sell products and services of qualified Vietnamese companies. WTS is currently working with the Vietnamese government to produce a comprehensive business to business directory (“B2B”) and business to consumer directory (“B2C”) for companies throughout Vietnam.

WWW.DOT.VN. WTS is working closely with Dot.vn to market and distribute these domains on its business web portal. WTS anticipates receiving proceeds from the partnership agreement in spring of 2006.  In addition WTS is currently working with Dot.vn and Business.com.vn to cross-market through their respective databases.

WTS plans to use established traditional venues, as well as Internet channels to establish WorldTradeShow.com as an international online tradeshow "brand".

ADVERTISING.  WTS plans to initiate an aggressive print, billboard, television, radio, and event sponsorship campaign to attract target markets and to penetrate new markets and lead customers to its website.  Print media advertsing will include a variety of publications. Radio and televisions advertising will include both domestic and international markets. WTS also anticipates exchanging advertising space its WorldTradeShow.com website for space on other sites.

VIRAL MARKETING.  WTS plans to brand its name worldwide using an innovative email technique known as “viral marketing”, which describes any strategy that encourages individuals to pass on a marketing message to others, creating the potential for exponential growth in the message's exposure and influence. Like viruses, these strategies take advantage of rapid multiplication to “explode” the message to thousands and possibly millions of others. Viral marketing is the ability to get consumers to tell each other about your product, service or Website so you can spend less money on advertising. It's also known as "pass-along," "friend-tell-a-friend," and "evangelism" marketing.  This form of marketing is for opt-in subscribers only.

WORLDWIDE BANNER PLACEMENT.  WTS plans to place hyper-linked advertising banners in highly visible locations on the World Wide Web for its target audience.

SEARCH ENGINE OPTIMIZATION. WTS plans to design its homepage in a multi-lingual format with country-specific indexes to attract potential visitors from other countries utilizing major search engines. The WorldTradeShow.com homepage will contain keywords in various languages in order that search engines will place the WorldTradeShow.com. website at the top of the search engine listings when a search associated with trade shows or conventions is requested in other languages.

STRATEGIC LINKING.  WTS plans to pursue strategic website partnering to develop long-term traffic to WorldTradeShow.com.  Through web rings, partners, alliances and affiliates, WTS will can offer strategic linking on multiple websites to target specific advertising.

INTERNET (CYBER) CAFES.  Internet “cyber cafes” are emerging as one of the easiest, convenient and fastest growing methods to access the Internet.   Providing an alternative Internet access point to home or office computers, cyber cafes are especially popular in Asia.  WTS plans to establish strategic alliances with these cafes to penetrate the Asian regions.

AFFILIATE PARTNER MARKETING PROGRAMS. WTS plans to use affiliate partner marketing programs to attract traffic to its website. A person or entity with a website signs up to be an affiliate of WorldTradeShow.com, placing a banner or text link on its website directing visitors to the WorldTradeShow.com website. As a visitor clicks-through, a cookie (a small text file containing the referring affiliate's identification number assigned by WTS) will be placed on the visitor's browser. If the visitor purchases reservations from WorldTradeShow.com's website, the ordering system and affiliate's software work together to attach the referring affiliate's identification number held in the cookie to the sale, using that information to credit the affiliate with the agreed commission for the referral.

RESELLER PROGRAM WTS also plans to use a reseller program for major established distribution networks to resell WorldTradeShow.com reservations through an existing large network of websites. The reseller program would be sold through WTS's business development direct sales efforts to select distribution networks.


COMPETITION


WTS expects competition for online hotel reservations from companies such as Expedia and Travelocity.  However, WorldTradeShow.com’s unique combination of features (which includes online tradeshows, travel/tourism and meeting/conventions) distinguishes it from all others.    Because of this combination of features, WTS believes it currently has no direct competition.  



RESEARCH AND DEVELOPMENT


WTS has not directly engaged in research and development activities. Hi-Tek has developed and deployed WorldTradeShow.com's promotional website with FLASH animation technology. WTS will retain the proprietary rights to the website content and related technology.  



PATENTS, LICENSES, TRADEMARKS, FRANCHISES, CONCESSIONS, ROYALTY AGREEMENTS OR LABOR CONTRACTS


WordTradeShow.com ‘s Partners & Strategic Alliances


Hi-Tek.  

Hi-Tek, WTS’s largest shareholder, is a private corporation with offices in San Diego, U.S.A., Tijuana, Mexico, and Hanoi and Ho Chi Minh City in Vietnam.  This world-class technology company has been a leading visionary in providing Internet services and multimedia productions since 1992. Through strong values and technological performance, Hi-Tek has formed strong alliances with and obtained the cooperation of major Vietnamese ISP’s (Internet Service Providers) such as Netsoft, VDC, and FPT, in order to commercialize Vietnam’s Internet services.

Hi-Tek (www.Hi-Tek.com) employs the latest Internet technologies to market and manage .VN domain name registration, website design/hosting, email systems, e-commerce and e-marketing to Vietnam, and the rest of the world, for the first time.  


Hi-Tek, Inc. staffed with highly experienced graphic designers, programmers, network engineers and web marketing specialists, has produced effective, engaging and result- oriented communication products on CD-ROM and DVD, and enhanced internet website content for Fortune 500 companies worldwide.


Business.com.vn:

Business.com.vn (www.Business.com.vn) is a leading Vietnamese internet technology and marketing company, which is developing an exclusive e-commerce global business platform to promote, market and sell products and services of qualified Vietnamese companies. WTS is currently working with the government of Vietnam to produce a comprehensive business to business directory (B2B) and a business to consumer directory (B2C) portal listing various companies throughout Vietnam.


Currently, Business.com.vn has over 3,000 companies in its database with the potential of expanding to over 30,000 companies within Vietnam's 64 separate provinces. Vietnam, with a population of over 83 million people, is the second fastest growing economy in the world, according to the Vietnam Ministry of Trade.  Vietnam signed the Bilateral Trade Agreement with the United States to expand business opportunities for both countries, and then Decree No. 33/2002/QD-TTg dated February 08, 2002 by Vietnam's Prime Minister was approved to begin implementing Vietnam Internet development plan for 2001-2005. Both of these significant events marked the beginning of great economic opportunities for WTS. to participate and capitalize in the countries' growth for online business tradeshows.  There are over 6 million current Internet users in Vietnam, representing only 7.4% of the population, a number expected to increase significantly each year as the economy grows


 "WTS plans to work closely with Business.com.vn as a strategic marketing partner in Asia to help Vietnamese companies showcase their products, services and investment opportunities online.   Businesses will receive instant worldwide exposure through the WTS portal. WTS will be the business tradeshow solution provider, and a vehicle to provide them exposure to import/export, travel and tourism companies, both inside and outside of Vietnam."


Hotels.com.vn

Hotels.com.vn (www.HOTELS.com.vn) with over 258 Hotels being advertised is a comprehensive travel/tourism site.   Worldwide travelers use this officially sanctioned Vietnam Tourism Association website as the ultimate online resource to review, select, and book hotel rooms, golf tee times (coming soon), purchase airline tickets, rent cars and conduct other travel related transactions. WTS has an opportunity to generate recurring revenue from over 3,000 major hotels, 200 travel companies, and others in the Vietnamese tourism industry.

Hotels.com.vn is the only hotel web portal that officially recognized by Vietnam National Administration of Tourism (VNAT), the governmental agency exercising he state management function over tourist operations and activities throughout Vietnam.  VNAT has full control over business development and planning, public relations, personnel training, research, and overseeing the implementation of policies and regulations in the tourism sector. According to VNAT's latest tourism statistics, the number of international visitors to Vietnam exceeded 2.9million in 2004 and generated over $1.6 Billion USD in tourism revenue. Vietnam tourism is up 23.7% in 2005, the highest ever on record, indicating that Vietnam is fast becoming a very popular Asian destination to worldwide travelers.


The Vietnam Tourism Association (VITA) (www.VietnamTourism.com), directly under Vietnam National Administration of Tourism (VNAT) with members including Vietnamese enterprises, commercial organizations and individuals in the travel/tourism industry based at No. 7 Dao Duy Anh, Dong Da, Hanoi, Vietnam.  Vietnam Trade Information Center (VTIC): Vietnam Trade Information Center (VTIC),   www.ASEMConnectVietnam.gov.vn, and www.VINANET.com.VN, is the Vietnamese government agency responsible for managing and promoting Vietnam’s Import/Export businesses and associations with a membership over 8,000 enterprises.


The term of the Business.com.vn marketing license agreement with WTS has entered into is for two years and requires WTS to pay a licensing fee of $150,000 and $300,000 for the years ending December 31, 2004 and 2005, respectively.  The license fees for 2004 and 2005 are payable by August 10, 2004 and February 10, 2005, respectively.  In the prior year, WTS has negotiated to defer the first license fee payment until February 10, 2005.  Subsequently, WTS negotiated with Business.com.vn to extend the contract for up to two years to February 10, 2007.  In exchange for the rights licensed, WTS will earn a royalty equal to fifty (50%) percent of gross commission, as defined in the agreement (see exhibit 10.2). The extension document also provides that once WTS is trading on the OTC BB, Business.com.vn has the option for payment, or shares to be negotiated at that time.



Partnership with www.DotVN.com:


In May 2003, WTS announced a partnership with Dot.vn, the exclusive online Vietnamese domain registrar company. WTS receives a 15% commission on every Dot.vn domain name sold through the WTS portal. WTS is working closely with Dot.vn to market and distribute these domains on its business web portal.  Many global companies are doing business in Vietnam and many more want to participate. As Vietnam continues to grow economically, these businesses are positioning themselves to take advantage of the expansion. Those companies will have to acquire their Vietnamese Internet identity to brand their names, services and protect their trademarks. In addition, over 30,000 Vietnamese companies and the 80 million citizens of Vietnam will have the opportunity to register their choice of domain names.  The .vn domain names have become un-restricted for worldwide registration, and it currently costs $200 USD to register a .vn domain name per year. The www.VN affiliate program will allow WTS to generate revenue immediately from the registration of the .VN domain names.  


Hanoi Tips:

Hanoi Trade and Investment & Tourism Promotion Solution (www.hanoitips.com), the   Vietnamese Trade Information Program, is designed to assist those who wish to do business in Vietnam. With an extensive network and experience in Vietnamese industry and commerce, it can identify the right suppliers, and provides answers to questions about Vietnamese exports. Its primary role is to promote Vietnamese exports.


This strategic promotional program is designed to help both the U.S. and Vietnam's businesses to grow worldwide, promote trade, investments and tourism, in keeping with the bilateral trade agreement, signed by both countries in 2001.  Hanoi TIPS will also assist in advertising Vietnam's trademarks in the U.S. market, provide businesses with market information and development assistance. The Hanoi Trade Department will act as a bridge between Hanoi TIPS in San Diego and Vietnamese businesses, providing market information and product samples to showcase on the Hanoi TIPS website and its virtual showroom on WorldTradeShow.com's website.


Hanoi Tips has an extensive database of the top fortune 500 companies of the Country of Vietnam.  Members of Hanoi Tips will have opportunities to advertise, make agreements and letters of intents with WTS as well as market, promote their companies products and services on the WorldTradeShow.com portal.


MyBajaGuide.com:

WorldTradeShow.com will market the most efficient electronic promotional vehicle for Baja California Tourism. The official website, www.MyBajaGuide.com, currently in development, provides visitors worldwide information about Baja, California as a travel destination.   Website users will have the the ability to make reservations with airlines, hotels/resorts, car rentals, golf courses and restaurants.


Bordering California and Arizona to the south, Baja California, Mexico is a peninsula with over 780 miles of beach along the Pacific Ocean and the Gulf of California. Each year, over 40 million visitors worldwide travel by land and sea to enjoy the beauty of this northern Mexico peninsula. The Baja California travel and tourism industry generated almost $3 billion U.S. dollars in 2003, growing steadily at 6.7% annually.


Mexican Association of Hotels and Motels for Tijuana, Baja California, Mexico:

WTS has been selected to manage the website for the official Mexican Association of Hotels and Motels for Tijuana, Baja California, Mexico. WTS will generate recurring revenue on advertisements, sponsorships and room reservation commissions from each participating hotel and motel.   The Mexican Association of Hotels and Motels has over 130 hotels and motels currently listed in its membership, accommodating business and leisure travelers worldwide. Tijuana, with a population of about 2 million people, is one of the most frequently visited destinations in Mexico. Over 42 million people cross the U.S. and Mexican border each year to do business and tour this well-known cosmopolitan city.

Agreement to Market MASXIMA Discount Card

In November 2003, WTS signed an agreement with Grupo Campestre to market Mexican MASXIMA Discount Card.  The signing of this Memorandum of Understanding allows WTS to promote and market the MASXIMA Discount Card, in Baja California, Mexico on its WorldTradeshow.com web portal.  

In the Memorandum of Understanding (MOU), WTS and Maxsima Discount Card have a revenue sharing partnership, whereby WTS may retain up to 20% in revenue for sales it generates.

MASXIMA Card is the most recognized retail discount card in Mexico, serving over 8 million consumers throughout Baja California and interior Mexico. The Maxsima Discount Card offers customers savings from over 500 participating businesses, ranging from hotels, restaurants, rent-a-car agencies, department stores, gift stores and numerous other retailers serving majority of the Mexican travel/tourism market.

WTS plans to cross-market the MASXIMA Card between the Countries of Mexico and Vietnam.  The WTS Discount Card will be launched in the summer of 2006 offering discounts in between the Countries.



Letter of Intent with All American Casting International

In November 2003, WTS  signed a Letter of Intent (“LOI”) with All America Casting International to be the exclusive marketer and distributor of its broadband Voice Over Internet Protocol telecom technology (“VOIP”) to its Vietnamese enterprise clients.  However, the LOI with All American Casting International is currently not proceeding.  All American has not fulfilled its obligation as set forth in any of the points on the LOI.  WTS is not pursuing any other agreements regarding VOIP technology at this time.


EMPLOYEES AND EMPLOYMENT AGREEMENTS


WTS currently has no employees, other than its officers and directors, who devote their time as required to its operations.  In June 2000, WTS signed three consulting agreements with three different members of the Board of Directors.  These agreements entitle each individual to a base salary ranging from $7,500 to $15,000 per month expired on January 30, 2001.  Similar consulting agreements were extended for two of the individuals on an annual basis at terms similar to the original agreement through July 1, 2005.  The other individual extended his agreement at terms similar to the original agreement through June 30, 2001.  Each of the three individuals agreed not to withdraw a consulting fee until sufficient funding is secured.  As of April 2005 and April 30, 2004, WTS has unpaid consulting fees of approximately $2,330,000 and $1,692,200, respectively.  One of the unpaid consulting fees bears interest at 12 percent.  As of April 30, 2005 accrued interest on these unpaid fees was approximately $343,500.  These advances are not repayable until July 1, 2005 at which point WTS anticipates it will be able renegotiate the terms of the payments and all monies owed to the related parties.



GOING CONCERN


WTS has experienced recurring losses, has a working capital deficiency of $3,317,836 and an accumulated deficit of $5,092,973 as of April 30, 2005.  These factors, among others raise substantial doubt as to its ability to continue as a going concern.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.


FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISKS RELATED TO AN INVESTMENT IN WORLDTRADESHOW.COM, INC. STOCK


Some of the statements in this report or incorporated by reference are forward-looking, including, without limitation, the statements under the caption "Management's Discussion and Analysis or Plan of Operation".  Forward-looking statements include those that contain words like  "may,"  "will,"  "could," "should,"  "project,"  "believe,"  "anticipate,"  "expect," "plan,"  "estimate," "forecast,"  "potential,"  "intend,"  "maintain,"  "continue” and variations of these words or comparable words.  In addition, all of the non-historical information herein is forward-looking, including any statement or implication about a future time, result or other circumstance.  Forward-looking statements are not a guarantee of future performance and involve risks and uncertainties. Actual results   may differ   substantially   from the   results that the forward-looking statements suggest for various reasons.  These forward-looking statements are made only as of the date of this report.  We do not undertake to update or revise the forward-looking statements, whether as a result of new Information, future events or otherwise. (Note: The statutory safe harbors of the Private Securities Litigation Reform Act will not be available to us until such time as we become a reporting company)


The forward-looking statements included herein are based on, among other items, assumptions that we will be able to meet our operating cash and any debt service requirements, that we will be able to successfully resolve disputes and other business matters as anticipated, that competitive and technological conditions within the medical device and electronic component industries will not affect us materially or adversely, that we will retain key personnel, that our forecasts will reasonably anticipate  market demand for our products,  and that there will be no significant unanticipated cost increases or other material adverse change in our operations or business. Among the factors that could cause actual results to differ materially are the following:


the impact of competitive products and their pricing;

potential effects of inflation;

lack of earnings visibility;

dependence upon certain customers or markets;

dependence upon suppliers;

difficulties  in integrating any acquired businesses and realizing cost savings or productivity gains;

dependence on key personnel;

difficulties regarding hiring and retaining qualified personnel in a competitive labor market; and

Risks of doing business in international markets.


Other factors that could cause results to vary materially from current expectations are referred to elsewhere in this report.


Assumptions regarding the foregoing involve judgments that are difficult to make and future circumstances that are difficult to predict correctly.  Forecasting and other management decisions are subjective in many respects and thus susceptible to interpretations and periodic revisions based on actual experience and business developments, the impact of which may cause us to alter our internal forecasts, and which may in turn affect expectations or future results.  We do not undertake to announce publicly the changes that may occur in our expectations.  Readers are cautioned against giving undue weight to any of the forward-looking statements. The inclusion of forward-looking information should not be regarded as a representation by us or any other person that our objectives or plans will be achieved.  We are setting out some of the more specific risk factors below in full for the convenience of the readers:


The market price of our stock has fluctuated pursuant to the acquisition and our preparations for developing and marketing our products, and can be affected by economic and political uncertainties.  Declines in the market price of our stock could adversely affect our ability to retain personnel with higher-priced stock incentives, to acquire businesses or assets in exchange for stock and/or to conduct future financing activities with the sale of stock.


ITEM 2.   MANGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION


SUMMARY OF SELECTED FINANCIAL INFORMATION


The summary financial data should be read in conjunction with the financial statements (and companying notes) of WTS and the “Management Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in the registration statement.


    

 For the  nine  months ended  January 31,2005

 

For the fiscal year ended April 30,2005

 

For the fiscal year ended April 30, 2004

 

Period from September 15, 1995 (date of inception) to April 31, 2005

           

Revenue

   

                6,124

 

                2,227

 

  $           -

 

         114,538

Cost of sales

    

               -  

 

                 -

 

         158,143

   General & administrative expenses

 

            670,372

 

         1,163,522

 

         753,529

 

      4,711,144

   Interest expense

  

              74,505

 

            278,302

 

           52,258

 

         363,838

   Other income

  

                        -

 

              25,613

 

                     -

 

           25,613

Net loss

   

          (738,753)

 

       (1,413,934)

 

        (805,787)

 

     (5,092,973)

    

 

 

 

 

 

 

 

Weighted average common shares outstanding:

        

          Basic

   

  37,652,851.00

 

37,652,851

 

37,537,540

  
           

Loss per share

         

     Basic

   

                (0.02)

 

($0.04)

 

($0.02)

 

($0.11)

           

Current assets

  

                37.00

 

$2,698

 

$297

  

Total assets

  

       425,600.00

 

507,650

 

989,964

  

Current liabilities

  

    4,482,189.00

 

3,344,315

 

1,280,424

  

Total liabilities

  

    4,482,189.00

 

3,825,487

 

2,972,625

  

Shareholders' deficit

  

  (5,831,726.31)

 

           (5,092,973)

 

             (3,679,039)

  
           




GENERAL


The Company's operating results have fluctuated in the past and may in the future fluctuate significantly, depending upon a variety of factors, including the timely deployment and expansion of new network, the incurrence of related capital costs, variability and length of the sales cycle associated with the Company's product and service offerings, the receipt of new value-added network services and consumer services subscriptions and the introduction of new services by WTS and its competitors.


Additional factors that may contribute to variability of operating results include but are not limited to: the pricing and mix of services offered by the Company; customer retention rate; market acceptance of new and enhanced versions of the Company's services; changes in pricing policies by the Company's competitors; the Company's ability to obtain sufficient supplies of sole or limited-source components; user demand for services; the ability to manage potential growth and expansion; the ability to identify, acquire and integrate successfully suitable acquisition candidates; and charges related to acquisitions. In response to competitive pressures, the Company may take certain pricing or marketing actions that could have a material adverse effect on the Company's business. In the event that the Company's operating results in any future period fall below the expectations of securities analysts and investors, the trading price of the Company's common stock would likely decline.


PLAN OF OPERATION


We have a development strategy for the implementation of Phase I of the plan, which will require $1,350,000 to complete. We have historically financed our operations through working capital provided by loans from management and our major vendor and controlling shareholder, Hi-Tek.com, Inc. owned by Thomas and Lee Johnson.  For the time being the Company anticipates that current operations will continue to be funded by shareholder loans or debt from our vendor and majority shareholder, Hi-Tek, until revenue from operations can sustain the cash flow requirements of the Company.  For 2006 we have a commitment from our majority shareholders to fund our operations for that calendar year.  Additionally, we may pursue additional private placement financing through close associates or friends and family members of management and our controlling shareholders. There can be no assurances that additional capital will be available on terms favorable to us or at all, or that we will be able to generate sufficient cash flow in order to sustain operations. To the extent that additional capital is raised through the sale of additional equity or debt securities, the issuance of such securities could result in additional dilution to our stockholders. In the event that we experience the need for additional capital, and are not able to generate capital from financing sources or from future operations, management may be required to modify, suspend or discontinue our operations and business plan.


The funds to complete Phase I, are projected by management to be used as follows:  online and offline marketing programs, marketing Hotels.com.vn, utilizing the reservation software and completing online tradeshow software.  The Company plans on obtaining the necessary joint ventures, licenses, alliances and affiliates to market the web portal. WTS plans to higher sales and marketing staff in Vietnam and Mexico to complete agreements that already in place. The Company also plans on hiring people, obtaining more agreements and alliances in Vietnam and Mexico.


November 2005-January 2006


WTS plans on pushing sales and marketing in Vietnam for Hotels.com.vn. The marketing has begun through search engines such as Google and Yahoo.  Hotels.com.vn is beginning to work with tour companies in Vietnam and working out alliance and affiliate programs to start to promote tour packages.  The selling of a tour package will give multiple reservations with groups of people reserving rooms thus boosting the revenues for Hotels.com.vn


WTS and Hotels.com.vn are continuing to sign up 1 and 2 star hotels in Vietnam under 3 year contracts.  The majority of hotels in the Vietnam are 1 and 2 star hotels, totaling approximately 3,000.  Within the 64 provinces of Vietnam there are many hotels that are not 3, 4, or 5 stars, and the majority of these Hotels do not have websites. WTS and Hotels.com.vn supply these hotels with template websites so they can accept reservations online through the reservation engine.  WTS projects that it will need additional sales and marketing staff as well as more customer care employees in Vietnam.


Currently, we have contracts with over 258 which is an increase of approximately 60 more hotels in Vietnam. , We have contracted with over 90% of the 3-5 star hotels in Vietnam - the 2 star hotel signing is ongoing. Hotels.com.vn has been featured on Vietnamese television during a news television program, and has received an award from the Ministry of Trade in Vietnam.  Hotels.com.vn was awarded the number one e-commerce travel tourism website and was ranked 13th overall in the Country of Vietnam.  We expect to penetrate the hotel market with further funding for marketing in and out of Vietnam.


WTS has redesigned and launched the WorldTradeShow.com website.  The new website has been redesigned to market specifically to Vietnam and Mexican tourism markets. Users are now able to make reservations for hotels in either country:  via Hotels.com.vn for Vietnam, or Mybajaguide.com for Mexico.  MyBajaGuide.com is slated to be launched in the spring of 2006. WTS has a Memorandum of Understanding (MOU) with MyBajaGuide.com for marketing their hotels, tours, restaurants, golf and businesses.   



February - April   2006:


The launching of MyBajaGuide.com is slated to be launched in early spring of 2006 .  WTS has a Memorandum of Understanding (MOU) with MyBajaGuide.com for marketing their hotels, tours, restaurants, golf  resorts and businesses.   


WTS projects launching the MyBajaGuide.com website this quarter, and the Company anticipates the need for additional sales and marketing staff in Mexico for this project.  WTS will market the WTS Discount Card through the MyBajaGuide and WorldTradeShow Websites, and in newspapers and magazines in Mexico. WTS has initiated meetings with potential alliances and affiliates in both Mexico and Vietnam.  We expect to have new agreements and MOUs announced during this quarter.


WTS will market MyBajaGuide.com, through newspapers, magazines, and tour companies in both California and Mexico.  WTS will be working with current alliances and affiliates to cross-market hotel specials and discounts to advertise through websites, magazines, coupons, both on and offline.


WTS plans on officially inviting the Vietnamese Government tourism departments to our offices in late April of 2006.  Invitations will be sent to VNAT, VNNIC, Saigon Tourist, Consulate General of Vietnam – San Francisco, and other affiliates and alliances in the USA, and Mexican.  WTS is co-hosting a trade convention to showcase the Countries of Vietnam and Mexico tourism in late April 2006.



May - July 2006:


WTS will continue to market Hotels.com.vn and MyBajaGuide.com site during this quarter.  Our target alliances and affiliates will be companies working in travel tourism in Asia and Latin America, including American and European travel and tourism Companies.


The DudeSmart.com division will be working on the WTS Discount Card for the Mexico and cross-market into Vietnam.  The WTS Discount Card will be introduced to the Mexican market through a sales and marketing program in Baja, Mexico as a soft launch.  The MyBajaGuide.com and WorldTradeShow.com websites will advertise and market and users will be able to download a temporary card from either website.  WTS will first target hotels and restaurants, followed by golf clubs, travel tour companies, and rental car companies.  The Discount Card will enable WTS to sign up more members to the MyBajaGuide.com website, and the sales staff in Mexico is excited to begin the project.  Vendors have also expressed high interest in this program.


August – October 2006:


WTS anticipates hiring additional sales and marketing staff in Vietnam and Mexico to expand the hotel portals.  Features and benefits such as the WTS Discount Card, tour packages, golf packages are planned in both Mexico and Vietnam.  


WTS plans to sponsor golf tournaments in Vietnam, Mexico and the USA on the same day in all three countries.  The WTS Discount Card will be one of the sponsors, and we plan on having television, newspapers, and magazines covering the event as well as some celebrities making appearances.  This will be part of our marketing and branding of WTS in three different Countries.


Use of Proceeds of $1,350,000 USD:


Operations USA:      $400k

Vietnam Expansion: $200k

Mexican Expansion: $200k

Marketing online:     $300k

Marketing offline:    $250k


As of November 30, 2005 we have expended $150,000 of the $1,500,000.  WTS has expended the initial funds on the back-end operations of MyBajaGuide.com, and the hiring of sales staff and web designers in the Tijuana office.  The company believes that an additional $1,350,000 of funding will be required to complete Phase I.




RESULTS OF OPERATIONS


FISCAL YEAR ENDED APRIL 30, 2005 COMPARED TO THE CORRESPONDING PERIOD IN 2004.


The Company had gross sales totaling $2,277 for the year ended April 30, 2005, compared with $0 in gross sales for the same period ending April 30, 2004. The Company just started to receive revenues from its efforts in signing up hotels to their reservations website Hotels.com.vn. Currently this is the Company's only revenue source. The Company experienced a net loss of $1,413,934 for the year ended April 30, 2005, compared with a net loss of $805,787 for the same period ended April 30, 2004. This represents an increase of $608,077 or 75% from the prior year.  A substantial portion of the increase in net loss is attributable to the impairment of intangible assets, increased marketing fees and interest expense. Robert


Consulting fees totaled $400,428 for the year ended April 30, 2005, compared with $546,200 for the same period ending April 30, 2004. This represented a decrease of $145,772 or 26.7% from the prior year. Marketing and advertising cost totaled $110,912 for the year ended April 30, 2005, compared to $14,275 for the same period ending April 30, 2004.  Selling, general and administrative expenses incurred by the Company were $114,567 for the year ended April 30, 2005, compared with $125,384 for the same period ended April 30, 2004.  This represented a decrease of $10,817 or 9.4% from the prior year. The decrease is due primarily to reduced consulting fees.  One of the officers resigned.   - Robert


THREE MONTH PERIOD ENDED January 31, 2005 COMPARED TO THE CORRESPONDING PERIOD IN 2004


The Company had gross sales totaling $3,414 for the three month period ended January 31, 2006, compared with $ 1,220 in gross sales for the same three month period ended January 31, 2005. The Company started to receive revenues from its efforts in signing up hotels to their reservations website Hotels.com.vn for the past twelve months. Currently this is the Company's only revenue source. The Company experienced a net loss of $330,996 for the three months ended January 31, 2006, compared with a net loss of $290,636 for the same period ended January 31, 2005. This represents an increase of $40,360 or 14.1% from the prior period.  The increase is due primarily to the Companies efforts to implement its business plan whilst using its resources most effectively.  Over all the Company has minted its expenses to a minimum.


Consulting fees totaled $190,500 for the three month period ended January 31, 2006, compared with $137,975 for the same period ended January 31, 2005. This represented an increase of $52,525 or 38.1% from the prior year. Marketing and advertising cost totaled $48,788 for the three month period ended January 31, 2006, compared to $7,500 for the same period ended January 31, 2005.  Selling, general and administrative expenses incurred by the Company were $40,247 for the three month period ended January 31, 2006, compared with $19,769 for the same period ended January 31, 2005.  A substantial portion of the increase in net loss is attributable to the, consulting expenses, and administrative expenses in the companies efforts to establish the companies revenue generating operations,  the company also realized some savings from its expenses for professional and marketing related fees.



NINE MONTH PERIOD ENDED OCTOBER 31, 2005 COMPARED TO THE CORRESPONDING PERIOD IN 2004


The Company had gross sales totaling $6,124 for the period ended January 31, 2006, compared with $1,220 in gross sales for the same period ending January  31, 2005.  The Company started to receive revenues from its efforts in signing up hotels to their reservations website Hotels.com.vn for the past twelve months. Currently this is the Company's only revenue source. The Company experienced a net loss of $776,005 for the period ended January 31, 2006, compared with a net loss of $759,780 for the same period ended January 31, 2004. This represents an increase of $16,226 or 2.1% from the prior year.  While the Company has been able to decrease it operational expenses by about $36,000 the Companies’ interest expense offset these savings.


Consulting fees totaled $333,500 for the period ended January 31, 2006, compared with $480,275 for the same period ended January 31, 2005. This represented a decrease of $146,775 or 30.6% from the prior year’s period. Marketing and advertising cost totaled $138,900 for the period ended January 31, 2006, compared to $73,250 for the same period ended January 31, 2005.  Selling, general and administrative expenses incurred by the Company were $63,104 for the period ended January 31, 2006, compared with $96,391 for the same period ended January 31, 2005.  This represented an increase of $33,286 or 34.5% from the prior year. The increase is due primarily to the Companies effort to place its business plan into operation.


The Company has scaled back on its consulting fees and expenses.


ASSETS AND LIABILITIES


Intangibles and long-lived assets


Chaiisai Tora, Inc.


In March 1999, the Company acquired the business plan, customer database, and software related to the trade show business.   In consideration given for these intangibles, the Company issued 25,000 shares of its’ common stock valued at $2.00 per share, or $50,000.  As of May 1, 2002, the asset has been fully amortized.


Dudesmart.com


On June 23, 2000, the Company accepted a proposal to exchanged 1,200,000 144 shares of common stock for 100% of the outstanding common stock of Dudesmart.com, Inc., from a related party.   At the time of the transaction, the shares were valued at $.22 per share (estimated value $264,000).  Dudesmart.com will be the entertainment division for the Company specializing in the entertainment and gaming industry.  The Company anticipates that the Dudesmart.com will achjeve  operational status by the summer of 2006


Hi-Tek Multimedia License Agreement


On April 24, 2003, the Company announced acquiring an Internet Reservations Software License Agreement, in exchange for issuing 27,500,000 common shares.  At the time of the transaction the shares were valued at $0.01 (estimated value $275,000) to Hi-Tek Multimedia, a related party (Note 8).   The license agreement was accounted for as an intangible asset on the balance sheet.    The Company impaired $209,955 for the period ending April 30, 2005 leaving a net balance of $65,045, which the company believes it can recapture during the remainder of the licensing agreement.


Business.com.vn Marketing License Agreement

In February 2004, the Company entered into a marketing license agreement with Business.com.vn.  Business.com.vn is the owner of a website that promotes the online sale of hotel and tour packages on behalf of participating hotels and tour operators.

The term of the marketing license agreement is for two years and requires the Company to pay a licensing fee of $150,000 and $300,000 for the years ending December 31, 2004 and 2005, respectively.  The license fees for 2004 and 2005 are payable by August 10, 2004 and February 10, 2005, respectively.  The Company has negotiated to defer the license fee payment until February 10, 2007.  In exchange for the rights licensed, the Company will earn a royalty equal to fifty (50%) percent of gross sales, as defined in the agreement.   The Company  impaired $274,315 for the year ending April 30, 2005, leaving a net balance of $175,685, which the company believes it can  recapture during the remainder of the license agreement.


LIQUIDITY AND CAPITAL RESOURCES


FISCAL YEAR ENDED APRIL 30, 2005

As of April 30, 2005, the Company had cash of $421, current liabilities of $3,344,315 and long term liabilities of $481,172.  We anticipate that current operations will continue to be funded by shareholder loans or debt from our primary vendor and majority shareholder, Hi-Tek, until revenue from operations can sustain the cash flow requirements of the Company.  We plan on signing a renewal of our service agreement with Hi-Tek to run for an additional 12 months through  2006, which provides for the payment of our monthly operating expenses and will allow us to operate without additional funding for the next twelve months.


PERIOD ENDING OCTOBER 31, 2005


As of October 31, 2005, the Company had cash of $151.57, current liabilities of $3,558,776 and long term liabilities of $498,202.  We anticipate that current operations will continue to be funded by shareholder loans or debt from our primary vendor and majority shareholder, Hi-Tek, until revenue from operations can sustain the cash flow requirements of the Company.  We plan on signing a renewal of our service agreement with Hi-Tek to run for an additional 12 months through  2006, which provides for the payment of our monthly operating expenses and will allow us to operate without additional funding for the next twelve months.


Once the Company is beyond development stage, it will seek to negotiate stock for debt.  We cannot predict when such operations will be attained.  


PUBLIC COMPANY EXPENSES


We will incur direct and indirect costs associated with our status as a public company. Among the most significant are the costs associated with compliance with the public reporting obligations imposed by the Commission, which have been greatly increased as a result of the Sarbanes-Oxley Act of 2002.  Many of the requirements of this legislation are only now being felt as a result of the phase-in schedule for smaller public companies. Direct costs associated with compliance with the Commissions’ public reporting requirements include, but are not limited to auditing fees, legal fees, financial printer fees and miscellaneous clerical and other administrative expenses, such as word processing, conversion to EDGAR, telephone and fax charges associated with the preparation and filing 3of periodic reports, proxy materials and other reports and statements with the Commission.


We believe that our direct costs of complying with the Commission’s public reporting requirements are estimated to approximate $200,000 annually, based on estimated annual audit and accounting fees of $50,000, estimated annual legal fees of $20,000, estimated financial printer fees of $10,000, estimated transfer agent fees of $10,000, estimated costs associated with filing reports with the Commission (including internal administrative staff) of $20,000, estimated costs for directors’ and officers’ insurance of $50,000, estimated ongoing costs associated with Sarbanes-Oxley compliance of $20,000 and estimated miscellaneous costs of $20,000. Indirect costs associated with compliance with our public reporting obligations include, among other things, the time our executive officers expend to prepare and review our periodic reports. Because we have only a few executive personnel, these indirect costs are substantial. Due to additional regulations and compliance procedures required of public companies under the Sarbanes-Oxley Act of 2002, we expect that the direct and indirect costs identified above will increase in the future.


We anticipate the sources of funds used to pay for such costs shall be through Hi-Tek’s service agreement to provide funding for miscellaneous operating expense.


CASH FLOWS FROM FINANCING


To date, the Company has satisfied its cash requirements primarily through related party debt and equity financings. The Company has received $90,352 in cash advances and $930,082 for services from its primary shareholder.  The Company's principal uses of cash are to fund working capital requirements. The Company hopes that it will generate positive cash flow from operations within the next twelve-month period. There can be no assurances that the Company will be successful in securing additional financing, and if secured, it will be sufficient to satisfy working capital needs.


LONG-TERM FINANCING


The Company believes that its anticipated funds from operations will be insufficient to fund its working capital and other requirements through April 30, 2006. Therefore, the Company will be required to seek additional funds either through debt or equity financing to finance its long-term operations ("Additional Funds"). Should the Company fail to raise the additional funds; the Company will have insufficient funds for the Company's intended operations for the next twelve months that may have a material adverse effect on the Company's long-term results of operations.


CAPITAL EXPENDITURES


As previously discussed in the Plan of Operations, the Company intends to raise $ 1,500,000 which it plans to utilize over the next twelve months, to further develop and market Hotels.com.vn and finish its online tradeshow software.



ITEM 3. DESCRIPTION OF PROPERTY


We maintain our headquarters at 9449 Balboa Avenue, Suite 114 San Diego, California 92123. We rent these offices, comprising approximately 1,100 square feet, on a month-to-month basis from a related party, Hi-Tek as part of our Services Agreement with this firm.  Rent expense for the fiscal year ended April 30, 2005 and for the fiscal year ended April 30, 2004 was approximately $35,000 and $45,000, respectively.


ITEM 4.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT


The following table sets forth information as of the date of this Registration Statement regarding certain Ownership of our Company's outstanding Common Stock by all officers and directors individually, all officers and directors as a group, and all beneficial owners of more than five percent of the common stock.



Name and Address                 

Shares Owned Beneficially (1)  

Percent of Class


Sheldon Silverman

       

  1,652,965

 

 .043 %

425 Stratford Ct. #14

Del Mar, CA  92014



             Dr. Lee Johnson  (Hi-Tek)


             7151 Cowles Mountain Blvd.

28,100,000

74.5 %
            San Diego, CA 92119

     

             John Spinelli

      45,369

              .0012 %

            5626 Las Virgenes Rd. #26

            Calabasas, CA 91302


            Officer/Director as a group                               29,798,334

              78.9%

    



(1)

A person is deemed to be the beneficial owner of securities that can be acquired by such person within 60 days from the date of the registration statement upon the exercise of options or warrants.  Each beneficial owner's percentage ownership is determined by assuming that options or warrants that are held by such person and which are exercisable within 60 days of the date of this registration statement have been exercised.  Unless otherwise indicated, the Company believes that all persons named in the table have voting and investment power with respect to all shares of common stock beneficially owned by them.      

                               


ITEM 5.  DIRECTORS AND EXECUTIVE OFFICERS, PROMOTORS AND CONTROL PERSONS


Executive Officers and Directors


Name                     

Age

Position

Sheldon Silverman            

 43

Chief Executive Officer   

John Spinelli  *1

 42    

Director International Sales and Marketing

Carlos Rosette *2

 52

Director Sales and Marketing in Mexico


*1 Appointed September 2004 – Subsequently resigned July 2005

*2 Appointed March 2005


The officers and directors of the Company will devote only such time as they deem appropriate in the business affairs of our Company.   It is, however, expected that the officers will devote the time deemed necessary to perform their duties for the business of our Company.  The amount devoted by each director is discussed below.  


The directors of the Company are elected to hold office until the next annual meeting of shareholders and until they’re respective successors have been elected and qualified.



Biographies of Our Executive Officers and Directors


Sheldon Silverman:  Mr. Silverman is the inventor of the football sport remote and TV terminator universal remote controls and holds USA and Canadian patents.


In April 1996, Mr. Silverman served as President and Chief Executive Officer of Interactive Processing Inc., a publicly traded Company under the symbol IAPI.


In March 1999, he founded WorldTradeShow.com, a highly interactive web portal designed to produce and promote virtual trade shows online.  He assisted the Company by designing the business and marketing plan, along with seeking seed capital to produce the web portal and its database.  Mr. Silverman also has experience working with the investment banking community, broker dealers and is experienced with public markets.  


Carlos Rosette: Mr. Carlos Rosette, a Baja California native has a degree in Tourism Administration from Universidad Autonoma de Baja California.  He is a tourism promoter, with over 30 years of experience in the hotel, rental car, tour and travel where he has achieved various executive positions. For example, he managed Ramada Inn, Avis Car Rental of Mexico, Fiesta Americana Hotel and Mexico Coach successfully. In addition, Mr. Rosette has organized business conventions in Tijuana for over 5 straight years and headed the marketing and operation logistics for the Pavarotti Concert in 2003 with over 40,000 attendees. He founded Travel to Baja Tourist Information Center in San Diego , representing and promoting over 50 hotels and merchants in the Tijuana , Rosarito and Ensenada corridor.

Mr. Rosette has been president of the SKÅL CLUB of Tijuana & Ensenada which is an international association of professionals in the field of tourism with over 600 Clubs worldwide, meeting monthly with the main purpose of expanding friendships through tourism. Recently, The Urbi Corporation, the third largest housing developer in Mexico, recruited Mr. Rosette to restructure the business plan for the Festival Plaza Hotel in Rosarito, as sales, marketing and real estate director.





ITEM 6.  EXECUTIVE COMPENSATION


The following table sets forth certain summary information regarding compensation paid by the Company for services rendered during the fiscal year ended April 30, 2005 to the Company’s Chief Executive Officer, Secretary and Director during such period.  


 

Annual Compensation

Long Term Compensation Awards

(a)

(b)

(c)

(d)

(e)

(f)

(g)

(h)

(i)

Name and Principal Position

Year

Salary

Bonus

Other Annual Compensation ($)

Restricted Stock Awards ($)

Securities Underlying Options/SAR (#)

LTIP Payouts ($)

All Other Compensation ($)

Sheldon Silverman

President/CEO

2005

2004

2003



 

      180,000

      180,000

      180,000

 


 150,000

     150,000*3

 

31,358  *5

22,333  *5

Lee Johnson Chief Technical Officer*1

2005

2004

2003

 


 

        45,000

      180,000

      180,000

 


150,000 *3   150,000 *3

  

John Spinelli

Director *2

2005

2004

2003

     -

     -

     -

   

100,000

100,000

-

 



Carlos Rosette

Director *4

2005

     -

   

-

  


*1  Resigned in August 2004

*2  Appointed in September 2004 – Subsequently resigned in July 2005

*3  Expired Options, non-exercised

*4 Appointed March 2004, no options granted

*5 Accruing interest of 12% per annum on unpaid consulting fees exceeds market rates for similar loans by 4%% and is shown as “Other Annual Compensation.”



Options Granted in Last Fiscal Year


The following table sets forth certain information regarding grants of stock options made during the fiscal year ended April 30, 2003 to the Company's chairman and executive officers named in the Summary Compensation Table:



    Exercise Price                   Number         Remaining Contractual            Average Exercise                Exercise Price

      Range                               shares                        Life                                    Price                                                   


   $0.30-$0.75

           250,000                      1 year

                       $0.48                              $120,000

     $0.75

          100,000

         2 years

       $0.75                                $75,000

 

(1)


The range of exercise prices for the performance based options outstanding as April 30, 2005, is $0.30 - $0.75 with a weighted average contractual life of 1.28 years.  The company estimates that based on its current market condition at April 30, 2005, approximately 0% of such options eventually vest.



Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End Option Values


No options were exercised by any of the executive officers during the year ended April 30,, 2005.  The value of the options held at the end of the year are set forth in the following table:


Employment contracts


In June 2000, the Company signed three consulting agreements with three different members of the Board of Director’s.  These agreements entitle each individual to a base salary ranging from $7,500 to $15,000 per month and expired on January 30, 2001.  Similar consulting agreements were extended for two of the individuals on an annual basis at terms similar to the original agreement through July 1, 2005.  The other individual extended his agreement at terms similar to the original agreement through June 30, 2001.   Each of the three individuals agreed not to withdraw a consulting fee until sufficient funding is secured.  At that time, each individual has the option, in his sole discretion, to withdraw cash or to apply the amount owned to him by the Company to the strike price of options held by each of these executive officers.


As of April 30, 2005 and 2004, the Company has unpaid consulting fees to officers / directors of approximately $1,894,396 and $1,692,200, respectively. $1,050,000 of these fees currently bear interest at a rate of 12 percent. As of April 30, 2005 and 2004, accrued interest on these fees was approximately $208,887 and $0, respectively, which are included in amounts due to related parties.   


(1)

Long Term Incentive Plans (Options)


There are no long- term incentive plans currently in effect.  However, the Board of Directors has granted the directors and officers of the Company stock options.  To the date of this filing these options have not been exercised.


STOCK OPTIONS


On June 30, 2000, the Company issued 1,350,000 options to certain officers. The options have an exercise price of $0.10 per share, vest over a three-year period, beginning June 1, 2000 and expire one year after becoming exercisable.  As of April 30, 2003, no options had yet been exercised.  These options were subsequently cancelled and new options issued.  As of June 2000 consulting agreements provided for the options to be purchased at below the Company’s market price on the date of grant, the Company recorded consulting fees relating to these options of $140,630.


The fair value of these options was estimated at the date of grant using the Black-Scholes option-pricing model for the fiscal year ended April 30, 2001; dividend yield of 0%; expected volatility of 250%; risk-free interest rate of 6.5%; and expected life of 3 years.


On June 30, 2003, the Company issued 900,000 options to certain officers. The options have an exercise price of $0.30 per share (estimated market price at date of grant), vest over a three-year period, beginning June 30, 2003 and expire one year after becoming exercisable.  As of the date of this report, no options had yet been exercised.


In September 2004, the Company issued 200,000 options to a consultant. The options have an exercise price of $0.75 per share, vest over a one-year period, beginning in September 2004 and expire one year after becoming exercisable. As of the date of this report, no options had yet been exercised. As the consulting agreement provided for the options to be purchased at below the Company's market price on the date of grant, the Company recorded deferred compensation relating to these options of $39,300 during the second quarter of fiscal 2005 as the Company believes the options will not be exercised.


The fair value of these options was estimated at the date of grant using the Black-Scholes option-pricing model for the year ended April 30, 2005; dividend yield of 0%; expected volatility of 250%; risk-free interest rate of 5.5%; and expected life of 1 years.  


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



COMPENSATION OF DIRECTORS


Directors receive no remuneration for their services as directors at this time.  


ITEM 7.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS


Company Officers


Mr. Sheldon Silverman resigned as the Company’s president and became Chief Executive Officer on June 23, 2000.  Mr. Silverman was again appointed President during July 2001.


Mr. Thomas Johnson became president of the Company on June 23, 2000 and a member of the board of directors on July 6, 2000.  On June 30, 2001, Mr. Thomas Johnson resigned as President.


On September 1, 2004, John Spinelli was appointed to the Board of Directors, as well as, became Director of International Sales & Marketing.


Acquisition of Dudesmart.com, Inc.


On June 23, 2000, the Company accepted a proposal to exchanged 1,200,000 144 shares of common stock for 100% of the outstanding shares common stock of Dudesmart.com, Inc.  In September 2000, the exchange was completed and Mr. Thomas Johnson and Dr. Lee Johnson, the sole shareholders of Dudesmart.com, Inc. each received 600,000 shares of the Company’s common stock.  At the time of the transaction, the shares were valued at $.22 per share (total value $264,000).  The acquisition was accounted for goodwill on the balance sheet.  


Dudesmart.com will be the entertainment division for the Company specializing in the entertainment and gaming industry.  The Company anticipates that the Dudesmart.com will be operational in the second quarter of 2006.  Dudesmart.com members will receive discounts on entertainment, travel, and events and from large chain stores plus additional discounts through our alliances, affiliates and current contracts.  


License Agreement with Hi-Tek Multimedia, Inc.


On April 24, 2003, the Company announced acquiring an Internet Reservations Software License Agreement, in exchange for issuing 27,500,000 144 common shares to Hi-Tek Multimedia (Hi-Tek).  Mr. Thomas Johnson and Dr. Lee Johnson are the sole shareholders of Hi-Tek.  Hi-Tek, a strategic business partner and a leading International e-commerce software development enterprise, will be providing its proprietary software, HI-TEK Res, to generate revenue for the Company from business and consumer travelers seeking to reserve hotels at their selected destinations worldwide while visiting or attending tradeshows and conferences.  The license agreement was accounted for as intellectual property on the balance sheet.  




Professional Services Agreement with Hi-Tek Multimedia, Inc.


WorldTradeShow.com retained Hi-Tek to design, program, produce and implement the following:

 

Corporate and promotional web sites.

Initial module of the WorldTradeShow.com reservation engine.

Preliminary offline and online marketing plan, including designing and producing all supporting marketing and promotional materials (CD-ROM, media kit, web slide presentation and corporate literature).

Consult with the management of the Company on an as needed basis.


As of April 30, 2005 and April 30, 2004, the Company owed Hi-Tek approximately $930,082 and $452,300, respectively, for unpaid fees.  The agreement is renewable on an annual basis.  In addition, Hi-Tek charges the Company interest at a rate of 10 percent on unpaid fees.  During the year ended April 30, 2005, Hi-Tek forgave approximately $23,800 in interest due on unpaid invoices.  The transaction was accounted for as a reduction in accrued interest due to related parties.


Other Affiliated Entities


Mr. Sheldon Silverman owns shares personally and through a Company under his control.  From time to time, this Company and Mr. Silverman have received Worldtradeshow.com, Inc. common shares in exchange for debt.  During the fiscal years ended April 30, 2005 and 2004, Mr. Silverman did not receive any common shares in exchange for debt.


Another Company controlled by Mr. Silverman’s parents has an outstanding payable to that Company for consulting services.  During the fiscal year ended April 30, 2005 and 2004, Mr. Silverman’s parents did not receive any common shares for consulting services.  Prior to April 30, 2005, Mr. Silverman’s parents have forgiven all debt owed to them in the amount $1,794.


Consulting Agreements


Dr. Lee Johnson, Mr. Thomas Johnson and Mr. Sheldon Silverman entered into three separate consulting agreements with the Company on January 1, 2001 through June 30, 2003 for which the Company has accrued unpaid consulting fees. Similar consulting agreements were extended for two of the individuals on an annual basis at terms similar to the original agreement through July 2005.


The above consultants also received stock option agreements during June 2000 and June 2003.  The Company has recorded $140,630 of consulting fees relating to these options as of June 2000.


The fair value of these options was estimated at the date of grant using the Black-Scholes option-pricing model for the period ended April 30, 2001; dividend yield of 0%; expected volatility of 250%; risk-free interest rate of 6.5%; and expected life of 3 years.  


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


As of April 30, 2005 and 2004, the Company has unpaid consulting fees to officers / directors of approximately $1,894,396 and $1,512,00, respectively. $1,050,000 of these fees currently bear interest at a rate of 12 percent. As of April 30, 2005 and 2004, accrued interest on these fees was approximately $ 208,887 and $ 0, respectively, which are included in amounts due to related parties.   


As of April 30, 2005 and 2004, the Company also has received advances of $180,000 from a former officer and Board member. These advances currently bear interest at a rate of 12 percent. As of April 30, 2005 and 2004, accrued interest on these advances was approximately $88,148 and $61,700, respectively, which are included in due to related parties. These advances are not repayable until July 1, 2005 at which point the Company anticipates it will be able renegotiate the terms of the payments and all monies owed to the related parties.


ITEM 8.  DESCRIPTION OF SECURITIES


GENERAL


The authorized capital stock of the Company consists of 100,000,000 shares of common stock, $0.0001 par value, of which 37,710,506 shares are outstanding as of April 30, 2005.  The following description of the securities of the Company and certain provisions of the Company’s Articles of Incorporation and By-Laws is a summary and is qualified in its entirety by the provisions of the Articles of Incorporation and By-Laws as currently in effect.


Common Stock

 

Holders of common stock are entitled to one vote for each share held on all matters submitted to a vote of shareholders, including the election of directors.  Accordingly, holders of a majority of shares of Common Stock entitled to vote in any election of directors may elect all of the directors standing for election if they chose to do so.  The Articles of Incorporation do not provide for cumulative voting for the election of directors.  Holders of Common Stock will be entitled to receive ratably such dividends, if any, as may be declared from time to time by the Board of Directors out of funds legally available therefore, and will be entitled to receive, pro rata, all assets of the Company available for distribution to such holders upon liquidation.  Holders of Common Stock have no preemptive, subscription or redemption rights.  All outstanding shares of Common Stock are, and the shares offered hereby, upon issuance, will be, fully paid and non assessable.


Preferred Stock


There are 5,000,000 shares of preferred stock, $0.001 par value authorized.  None are issued or outstanding at this time.  The rights associated with the preferred stock are still to be determined by the Board of Directors of the Company.  There are no present plans by the Company’s Board of Directors to issue preferred stock or to address the rights assigned to such shares.




DIVIDENDS


As of the date of this registration statement, we had not paid any cash dividends to shareholders.  The declaration of any future cash dividend will be at the discretion of the Board of Directors and will depend upon the earnings, if any, capital requirements and our financial position, general economic conditions, and other pertinent conditions.  It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any, into the business.


STOCK TRANSFER AGENT


The Company’s transfer agent is First American Stock Transfer located at 706 East Bell Road, Suite 202, Phoenix, Arizona 85022.



PART II


ITEM 1. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS


Our common stock trades on the pink sheet market under the symbol "WTSW." We were initially cleared for trading on the OTC: BB on March 1996. From March, 1996 to March 15, 1999, we traded under the symbol "IAPI". On March 16, 1999, our symbol changed to "WTSW" to indicate that we had a Company name change and new symbol.


The following table sets forth the range of high and low closing bid quotations of our common stock for each fiscal quarter during the last two fiscal years:



Fiscal Year 2003

             High             Low

1st Quarter                                 $0.55

   $0.25

2nd Quarter                                $1.28

   $0.25

3rd Quarter                              $2.50             $0.81

4th Quarter                                $1.20

   $0.60


Fiscal Year 2004                    High                Low

1st Quarter………                      $1.01

  $0.45

2nd Quarter……                         $1.00

   $0.51

3rd Quarter                                 $1.00

   $0.36

4th Quarter                                 $0.75

   $0.36




The above quotations reflect inter-dealer prices, without retail mark-up, markdown, or commission and may not necessarily represent actual transactions.


As of April 30, 2005, there were approximately 178 shareholders of record (that are not in street name) of WTSW’s common stock.


ITEM 2. LEGAL PROCEEDINGS

 

To the best of management’s knowledge, there are no material legal proceedings filed or threatened against the Company.


ITEM 3.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE


On June 16, 2005 the Registrant engaged the accounting firm of Armando Ibarra, CPA, A Professional Corporation as the independent public accountant to audit the Registrant’s financial statements for the fiscal year ending April 30, 2005, as well as future financial statements, to replace the firm of Wong Johnson & Associates, A Professional Corporation, which was the Registrant’s principal independent accountant for the fiscal period ending April 30, 2004. Wong Johnson & Associates, A Professional Corporation resigned as the Registrant’s independent public accountants in May, 2005.

During the Registrant’s fiscal year ended April 30, 2004, there were no disagreements between the Registrant and Wong Johnson & Associates, A Professional Corporation on any matters of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements(s) if not resolved to would have caused them to make reference in connection with their report to the subject matter of the disagreements.

The selection of Armando Ibarra, CPA, A Professional Corporation, to replace Wong Johnson & Associates, A Professional Corporation as the Registrant’s independent public accountants was approved by the Board of Directors of the Registrant and its Audit Committee.


During the year ended April 30, 2004 and through June 16, 2005, neither the Registrant nor anyone on its behalf consulted Armando Ibarra, CPA, A Professional Corporation. regarding the application of accounting principles to a specific transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Registrant’s financial statements, or any other matters or reportable events as set forth in Items 304(a)(2)(i) and (ii) of Regulation S-K.


ITEM 4. RECENT SALE OF UNREGISTERED SECURITIES


On March 27, 2000, the Company completed a twenty-for-one (20:1) common stock split to all shareholders of record on March 23, 2000.  The par value of common stock has been reduced to $0.0001 to reflect this stock split.  The effect of the stock split has been recognized retroactively in the shareholders’ equity accounts on the balance sheets as of April 30, 2000, and in all shares and per share data in the accompanying financial statements.


In July 2000, the Company issued 1,200,000 144 common shares of its $0.0001 par value common stock for the purchase from a related party of Dudesmart.com, an internet web portal for men.


In August 2000, the Company issued 80,000 144 common shares of its $0.0001 par value common stock to an investor at $0.25 per share, or $20,000.


In February 2003, the Company issued 27,500,000 144 common shares of its $0.0001 par value common stock to enter into an Internet Reservations Software License Agreement with Hi-Tek Multimedia, Inc., a related party.  The shares were issued pursuant to Section 4(2) of the Securities Act of 1933, as amended.  The purchaser was an accredited investor with access to information about the Company.


In September 2004, the Company issued approximately 173,000 144 common shares of its $0.0001 par value common stock for repayment of approximately $79,000 in outstanding debt, which includes $3,450 of accrued interest.  The shares were issued pursuant to Section 4(2) of the Securities Act of 1933, as amended.  The purchaser was an accredited investor with access to information about the Company.


ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS


The Company shall indemnify to the fullest extent not prohibited by law any person who has or is a party or is threatened to be made a party to any proceeding (as hereinafter defined) against all expenses (including attorney’s fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such proceeding.


Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the “Act”) may be permitted to directors, officers and controlling persons of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore unenforceable.





PART III

 

ITEM 1.

Exhibits, List and Reports in Form 8-K



(a) Exhibits


Exhibit


Number

Description


3.1*

Articles of Incorporation of the Company filed September 15, 1995

4.1

Form of Common Stock Certificate.

 

10.1        Business.com.vn MOU

10.2        Hotels.com.vn Marketing agreement (Business.com.vn agreement)

10.3        Hotels Extension document (Business.com.vn extension)

10.4        Hi-Tek Reservation Engine agreement

10.5        Maxsima discount card

10.6        Hi-Tek Service agreement

10.8        MyBajaGuide.com MOU

10.9        Mexican association agreement

10.10      DotVN agreement

10.11      VTIC MOU

10.12      Consulting Agreement

10.13      Hi-Tek interest agreement

10.14      Hi-Tek Reservation Engine Extension

10.15      Independent contractors’ agreement Carlos

10.16      Independent contractors’ agreement Sheldon

10.17      Hi-Tek Service agreement with attached schedule “A”

23.1

 Consent of  Armando Ibarra, CPA, A Professional Corporation

23.2

 Consent of Wong Johnson & Associates, A Professional Corporation


99           Code of Ethics for Chief Executive Officer and Senior Financial Officer



(b)

Reports on Form 8-K:


1.        None






ITEM 2.

PRINCIPAL ACCOUNTANT FEES AND SERVICES


1) Audit Fees & Audit-Related Fees


During fiscal year 2003, the Company’s principal accountant billed $13,000 in fees that were directly associated with the preparation of annual audit reports.



During fiscal year 2004, the Company’s principal accountant billed $15,900 in fees that were directly associated with the preparation of annual audit reports.


During fiscal year 2005, the Company’s principal accountant billed $15,900 in fees that were directly associated with the preparation of annual audit reports.


2) Tax Fees


During fiscal year 2003, there were no fees billed associated with the preparation of tax filings.

During fiscal year 2004, there were no fees billed associated with the preparation of tax filings.

During fiscal year 2005, there were no fees billed associated with the preparation of tax filings.


3) All Other Fees


During fiscal year 2003, there were no other fees billed by the Company’s principal accountant for services other than those reported for audit and audit related fees.


During fiscal year 2004, there were no other fees billed by the Company’s principal accountant for services other than those reported for audit and audit related fees.


During fiscal year 2005, there were no other fees billed by the Company’s principal accountant for services other than those reported for audit and audit related fees.


Audit committee’s pre-approval policies and procedures


Due to the fact that the Company’s only active officer and two board members, the Board of Directors acts as the audit committee at this time.


Percentage of hours expended


The amount of hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees was less than 50%.




SIGNATURES


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


            WorldTradeShow.Com, Inc.

By:     /s/ Sheldon Silverman

             

           Sheldon Silverman

               

           Director, Chief Executive Officer,

               

           Chief Accounting Officer

                                                                  Date:  March 29, 2006










FINANCIAL STATEMENTS


Following are audited financial statements for the fiscal years ended April 30, 2005 and April 30, 2004


and the unaudited financial statements for the period ended July 31, 2005 and July 31, 2004


Financial Statements of

WORLDTRADESHOW.COM, INC.

April 30, 2005 and 2004



     Page

Index To Audited Financial Statements

 


Independent Auditors’ Report

F-2


Consent of Armando Ibarra, CPA, A Professional Corporation                                                                 F-3


Balance Sheet as of April 30, 2005 (audited) and April 30, 2004 (audited)

F-4


Statement of Operations for the Year ended April 30, 2005

F-5

(audited),  April 30, 2005 (audited) and cumulative from inception

(September 15, 1995 to April 30, 2005



Statement of Stockholders Equity from Inception  September 19, 1995 to April 30,2005

 F-6

 

                                                    

                                    


Statement of Cash Flows for the year ended April 30, 2005

                                      F-8

(audited),  April 30, 2004 (audited) and cumulative from inception

(September 15, 1995 to April 30, 2005


Notes to Financial Statements                 

F-16

















F1






A

C

I

   ARMANDO C. IBARRA

            Certified Public Accountants

            A Professional Corporation

                              

                                                                                                                        

Armando C. Ibarra, C.P.A.                                       Members of the California Society of Certified Public Accountants

Armando Ibarra, Jr., C.P.A., JD                          Members of the American Institute of Certified Public Accountants            

                                                                                       Registered with the Public Company Oversight Accounting Board


To the Board of Directors

WorldTradeShow.com, Inc.

Report of Independent Registered Public Accounting Firm


We have audited the accompanying balance sheet of WorldTradeShow.com, Inc. as of April 30, 2005 and the related statements of operations, changes in shareholders’ equity and cash flows for the year then ended and for the period September 15, 1995 (inception) to April 30, 2005. These financial statements are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements based on our audits. The financial statements of WorldTradeShow.com, Inc. as of April 30, 2004, and for the period September 15, 1995 (inception) to April 30, 2004 were audited by other auditors whose report dated December 9, 2004, expressed an unqualified opinion on those statements.  Their report included an explanatory paragraph regarding going concern.


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


In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of WorldTradeShow.com, Inc., as of April 30, 2005, and for the period September 15, 1995 (inception) to April 30, 2005 and the results of its operations and its cash flows for the year and period then ended in conformity with U.S. generally accepted accounting principles.


The financial statements have been prepared assuming that the Company will continue as a going concern.  As discussed in Note 15 to the financial statements, the Company’s losses from operations raise substantial doubt about its ability to continue as a going concern.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.


/s/ ARMANDO C. IBARRA, CPA

__________________________________

ARMANDO C. IBARRA, CPA


July 24, 2005

Chula Vista, Ca. 91910











F2





WONG

JOHNSON

ASSOCIATES




WONG JOHNSON & ASSOCIATES, A PROFESSIONAL CORPORATION

CERTIFIED PUBLIC ACCOUNTANTS

SUITE 102

28936 OLD TOWN FRONT STREET, TEMECULA, CALIFORNIA  92590

TELEPHONE 951–693–1120 • FACSIMILE  951–693–1189



To the Board of Directors

WorldTradeShow.com, Inc.

San Diego, California


We have audited the accompanying balance sheets of WorldTradeShow.com, Inc. as of April 30, 2004 and 2003, and the related statements of operations, of shareholders’ equity (deficit) and of cash flows for each of the two years in the period ended April 30, 2004, and for the period from September 15, 1995 (date of inception) to April 30, 2004.   These financial statements are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements based on our audits.  


We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.


In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of WorldTradeShow.com, Inc. as of April 30, 2004 and 2003, and the results of its operations and its cash flows for each of the two years in the period ended April 30, 2004, and the period from September 15, 1995 (date of inception) to April 30, 2004, in conformity with United States generally accepted accounting principles.


The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  As discussed in Note 2 to the financial statements, the Company has not yet commenced operations.  This factor raises substantive doubt as to the Company’s ability to obtain long-term debt or equity financing.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.


WONG JOHNSON & ASSOCIATES

A Professional Corporation

Temecula, California

December 9, 2004



F3



WORLDTRADESHOW.COM, INC.

(A Development Stage Company)

Balance Sheets


     

For the Year Ending

        
     

April 30,

 

April 30,

     

2005

 

2004

ASSETS

       

Current assets

      

  Cash

   

$

421

$

297

  Accounts receivable

   

2,277

 

-

        

     Total current assets

   

2,698

 

297

        
        

Equipment, net

   

222

 

667

Goodwill

    

264,000

 

264,000

Intangibles, net of accumulated amortization and

    

Impairment of $ 534,270  and $ 50,000, in 2005

    

and 2004, respectively

  

240,730

 

725,000

        

     Total assets

  

$

507,650

$

989,964

        

LIABILITIES AND SHAREHOLDERS' DEFICIT

    

Current liabilities

      

  Accounts payable

  

$

91,485

$

91,485

  Due to related parties

   

2,995,601

 

537,794

  Accrued liabilities

   

134,954

 

573,454

  Demand notes payable

   

122,274

 

77,691

        

Total current liabilities

  

3,344,314

 

1,280,424

        

     Due to shareholders

   

-

 

1,692,201

     Long-term liabilities

   

481,172

 

-

        

     Total liabilities

   

3,825,486

 

2,972,625

        

Shareholders' deficit

      

Prefered stock; $0.001 par value; 5,000,000 shares

    

authorized none issued and outstanding

 

-

 

-

Common stock; $0.0001 par value; 100,000,000 shares

    

authorized 37,710,506 and 37,537,540 shares issued

    

and outstanding as of April 30, 2005 and 2004,

    

       respectively

   

3,770

 

3,754

Additional paid-in capital

  

1,811,786

 

1,693,744

Deferred compensation

  

(39,300)

 

-

Foreign currency translation

  

(1,119)

 

(1,119)

Deficit accumulated during the development stage

 

(5,092,973)

 

(3,679,039)

        

Total shareholders' deficit

  

(3,317,836)

 

(1,982,661)

        

Total liabilities and shareholders' deficit

$

507,650

$

989,964

        


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




WORLDTRADESHOW.COM, INC.

(A Development Stage Company)

Statements of Operations


          
         

Cumulative

     

 Fiscal Year Ending

 

from inception

     

 April 30,

 

 April 30,

 

(September 15, 1995

     

2005

 

2004

 

 to April 30, 2005)

Revenue

  

$

                    2,277

 $

 

$

                       114,538

          

Cost of Sales

   

                          -   

 

 

 

                       158,143

          

Gross profit

   

                    2,277

 

                              -   

 

                       (43,605)

          

General and administrative expenses:

      

  Consulting fees

   

                400,428

 

                     546,200

 

                    2,682,134

  Depreciation and amortization

 

                       445

 

                            445

 

                         65,465

  Marketing and promotion

  

                110,912

 

                       14,275

 

                       450,552

  Office and rent

   

                  35,000

 

                       45,000

 

                       265,059

  Professional fees

   

                  17,900

 

                       22,225

 

                       227,468

  Other administrative expenses

 

                114,567

 

                     125,384

 

                       536,195

  Impairment on intangible assets

 

                484,270

 

                              -   

 

                       484,270

          

Total general and administrative expenses

 

             1,163,522

 

                     753,529

 

                    4,711,143

          

Other income

        

  Other income  (debt forgivness)

 

                  25,613

 

                              -   

 

                         25,613

  Interest expense

   

              (278,302)

 

                     (52,258)

 

                     (363,838)

          

Net loss

   

$

           (1,413,934)

 $

                   (805,787)

$

                  (5,092,973)

          

Loss per common share:

       

  Basic and

diluted

  

$

                    (0.04)

 $

                         (0.02)

  
          
          

Weighted average shares outstanding:

      

  Basic

    

           37,652,851

 

                37,537,540

  
          

Other comprehensive income (loss)

      

  Foreign currency translation

  

 

 

 

 

                         (1,119)

          

Comprehensive loss

 

$

           (1,413,934)

 $

                   (805,787)

$

                  (5,094,092)


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



WORLDTRADESHOW.COM, INC.

(A Development Stage Company)

Statement of Shareholders Equity



              

Deficit

  
    

Common Stock

   

Additional

 

Deferred

 

Foreign

 

Accumulated

 

Total

    

Number

   

Paid In

 

Compensation

 

Currency

 

during the

 

Shareholders'

    

of Shares

 

Amount

 

Capital

 

Expense

 

Translation

 

Development Stage

 

Equity (Deficit)

Inception, September 15, 1995

-

 

$           -

 

$                -

 

$                -

 

$              -

 

$                   -

 

$                    -

Common stock issued for:

              

  Cash, October 1

  

                         31,240

 

               31

 

        156,169

       

                  156,200

  Cash, December 5

  

                           6,950

 

                7

 

          69,493

       

                    69,500

  Acquisition of license rights, April 17

                         56,000

 

               56

 

            5,544

       

                      5,600

Share issue costs

      

         (45,000)

       

                   (45,000)

Comprehensive loss, April 30, 1996

 

 

 

 

 

 

 

 

 

 

               (173,617)

 

                 (173,617)

Balance, April 30, 1996

 

                         94,190

 

               94

 

        186,206

 

                  -

 

                -

 

               (173,617)

 

                    12,683

Common stock issued for:

              

  Cash, August 28

  

                           6,071

 

                6

 

        169,994

       

                  170,000

  Cash, January 31

  

                           6,938

 

                7

 

        138,743

       

                  138,750

Comprehensive loss, April 30, 1997

 

 

 

 

 

 

 

 

 

 

               (436,130)

 

                 (436,130)

Balance, April 30, 1997

 

                        107,199

 

             107

 

        494,943

 

                  -

 

                -

 

               (609,747)

 

                 (114,697)

Comprehensive loss, April 30, 1998

 

 

 

 

 

 

 

 

 

 

               (187,315)

 

                 (187,315)

Balance, April 30, 1998

 

                        107,199

 

             107

 

        494,943

 

                  -

 

                -

 

               (797,062)

 

                 (302,012)

Common stock issued for:

              

  Debt settlement, January 29

 

                         35,000

 

               35

 

          34,965

       

                    35,000

  Cash, March 30

  

                         13,750

 

               14

 

          27,486

       

                    27,500

  Obligation to issue stock, March 30

                         47,975

 

               48

 

          95,902

       

                    95,950

  Debt settlement, April 6

 

                         37,700

 

               38

 

          75,362

       

                    75,400

  Acquisition of intellectual property, April 6

                         25,000

 

               25

 

          49,975

       

                    50,000

Comprehensive loss, April 30,1999

 

 

 

 

 

 

 

 

           (553)

 

               (138,713)

 

                 (139,266)

Balance, April 30, 1999

 

                        266,624

 

             267

 

        778,633

 

                  -

 

           (553)

 

               (935,775)

 

                 (157,428)

Common stock issued for:

              

  Cash, February 11

  

                         22,894

 

               23

 

          59,977

       

                    60,000

  Debt settlement, February 14

 

                        119,899

 

             120

 

        113,783

       

                  113,903

  Cash, February 23

  

                         21,505

 

               21

 

          19,979

       

                    20,000

  Cash, March 16

  

                           6,955

 

                7

 

          24,993

       

                    25,000

Forward split 20:1, March 27

 

                     8,319,663

 

             437

 

             (437)

       

                            -

Comprehensive loss, April 30, 2000

 

 

 

 

 

 

 

 

           (566)

 

               (296,598)

 

                 (297,164)

Balance, April 30, 2000

 

                     8,757,540

 

             875

 

        996,928

 

                  -

 

        (1,119)

 

            (1,232,373)

 

                 (235,689)

Common stock issued for:

              

  Acquisition of Dudesmart.com, May 11

                     1,200,000

 

             120

 

        263,940

       

                  264,060

  Cash, August 23

  

                         80,000

 

                8

 

          19,996

       

                    20,004

Stock Option Issued

      

        140,630

       

                  140,630

Comprehensive loss, April 30, 2001

 

 

 

 

 

 

 

 

 

 

               (680,009)

 

                 (680,009)

Balance, April 30, 2001

 

                   10,037,540

 

          1,003

 

      1,421,494

 

                  -

 

        (1,119)

 

            (1,912,382)

 

                 (491,004)

Comprehensive loss, April 30, 2002

 

 

 

 

 

 

 

 

 

 

               (415,912)

 

                 (415,912)

Balance, April 30, 2002

 

                   10,037,540

 

          1,003

 

      1,421,494

 

                -   

 

        (1,119)

 

            (2,328,294)

 

                 (906,916)

Common stock issued for:

              

  License fee Hi-Tek Multimedia, February 25

                   27,500,000

 

          2,750

 

        272,250

       

                  275,000

Comprehensive loss, April 30, 2003

 

 

 

 

 

 

 

 

 

 

               (544,959)

 

                 (544,959)

Balance, April 30, 2003

 

                   37,537,540

 

          3,753

 

      1,693,744

 

                -   

 

        (1,119)

 

            (2,873,253)

 

              (1,176,875)

Comprehensive loss, April 30, 2004

 

 

 

 

 

 

 

 

 

 

               (805,787)

 

                 (805,787)

Balance, April 30, 2004

 

                   37,537,540

 

          3,753

 

      1,693,744

 

                -   

 

        (1,119)

 

            (3,679,039)

 

              (1,982,661)

Common stock issued for:

              

Debt settlement, August 27,2004

                      172,966

 

               17

 

          78,742

       

                    78,759

Stock Option Issued

      

          39,300

 

         (39,300)

     

                            -

Comprehensive loss, April 30, 2005

          

          (1,413,934)

 

    (1,413,934)

Balance, April 30, 2005

 

                   37,710,506

 

$    3,770

 

$  1,811,786

 

 $      (39,300)

 

 $     (1,119)

 

 $         (5,092,973)

 

 $  (3,317,836)

F6

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




WORLDTRADESHOW.COM, INC.

(A Development Stage Company)

Statement of Cash Flows

     
     
    

 Cumulative  

  

Fiscal Year Ended

 from inception

  

 April 30,

April 30,

 (September 15, 1995)

Cash flows from operating activities:

 

2005

2004

 to April 30, 2005

Net loss

 

 $   (1,413,934)

 $        (805,787)

 $               (5,092,973)

Adjustments to reconcile net loss to net cash

    

(used) provided by operating activities:

    

Depreciation and amortization

 

                 445

                    445

                         65,465

Foreign currency translation

 

                    -   

                      -   

                         (1,119)

Stock options issued

 

                    -   

                      -   

                       140,630

Impairment

 

          484,270

 

                       484,270

Changes in operating assets and liabilities:

    

(Increase) decrease in accounts receivable

 

             (2,277)

 

                         (2,277)

Increase (decrease) in accounts payable

 

                    -   

                  (733)

                         91,485

Increase (decrease) in accrued liabilities

 

            44,582

             410,317

                       705,893

     

Net cash used by operating activities

 

         (886,914)

           (395,758)

                  (3,608,626)

Cash flows from investing activities:

    
     

Purchase of equipment

 

                    -   

                      -   

                       (10,087)

Acquisition of intellectual property (in-kind)

 

                    -   

 

                         50,000

Net cash (used) provided by operating activities

 

                    -   

                      -   

                         39,913

Cash flows from financing activities:

    
     

Common stock issued for cash

  

 -  

                       686,950

Share issuance costs

 

 -  

 -  

                       (45,000)

Settlement of debt and intellectual property (in-kind)

 

 -  

 -  

                       174,304

Settlement of obligation to issue capital stock

 

            78,759

 -  

                       174,709

Proceeds from demand notes payable

 

            44,583

               35,379

                       122,274

Due to related parties

 

          763,696

             355,500

                    2,455,897

Net cash provided by financing activities

 

          887,038

             390,879

                    3,569,134

     

Net increase (decrease) in cash

 

                 124

               (4,879)

                              421

Cash, beginning of the period

 

                 297

                 5,175

                                -   

Cash, end of the period

 

                 421

                    297

                              421

     

Non-cash investing and financing activities:

    
     

Debt issued for marketing license agreement

 

 $                 -   

 $          450,000

 $                    450,000

Other income

 

            25,613

                      -   

                         25,613

Stock options Issued

 

            39,300

 -  

                       179,930

Common stock issued for license fee - HiTek Multimedia

 

 -  

                      -   

                       275,000

Common stock issued for acquisition of Dudesmart.com

 

 -  

 -  

                       264,000

Common stock issued in exchange for intellectual property

 

 -  

 -  

                         55,600

Common stock issued in exchange for debt

 

            78,759

 -  

                       399,013

Supplemental cash flow disclosure:

    

Interest paid

 

 $ -  

 $ -  

 $ -  

Taxes paid

 

 $ -  

 $ -  

 $ -  

     


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







 







F14


WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005


1.

Organization


WorldTradeShow.com, Inc. (the “Company”) was originally formed on September 15, 1995 as Interactive Processing, Inc., a Nevada corporation, to market high-tech consumer electronics through television home-shopping networks, retail stores, catalog companies and their website remotecontrols.com.  In March 1999, the Company changed its name to WorldTradeShow.com, Inc.  During the same month, the Company acquired intellectual property rights to a database and business plan and significantly changed its business plan to develop tradeshow software and market both physical and virtual tradeshow space through the Company’s website.  


The Company is an online e-commerce marketing company.  WTS is currently marketing Hotels in Vietnam through a portal – www.Hotels.com.vn  The Company will be marketing a virtual trade show online, show casting companies from Vietnam and Mexico through its current alliance and affiliate agreements.  WTS plans on marketing Mexican hotels through its portal – www.mybajaguide.com in late summer 2005.  The Company will promote tour packages, golf tours and resort packages on both web sites.


The Company has not yet commenced significant operations and therefore, is classified as a development stage enterprise.  


    






2.

Summary of Significant Accounting Policies


Basis of Presentation


The Company has experienced recurring losses, has an accumulated deficit of $5,092,973, has negative working capital and has not yet commenced significant operations.  These factors, among others, raise substantial doubt as to its ability to obtain long-term debt or equity financing in order to have the necessary resources to further design, develop and launch the website and market the Company’s new service and existing products.  The Company’s management believes that if the Company is not successful in obtaining equity financing, the business plan will be seriously inhibited.  The Company’s management believes it can attain the necessary funding because of its penetration in the online Hotel market in the Country of Vietnam.  The Company also has a strong partner in Hi-Tek, Inc. which has been funding the operations of WTS.


Accordingly, the financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classifications or liabilities or other adjustments that might be necessary should the Company be unable to continue as a going concern.

Reclassifications

The Company reclassified several 2004 liability amounts of $1,692,201 to conform to the 2005 presentation.


Revenue Recognition

We recognize revenue in accordance with SEC Staff Accounting Bulletin No. 101, “Revenue Recognition in Financial Statements,” as amended by SAB 101A and 101B and as revised by SAB 104, “Revenue Recognition” and Statement of Position No. 97-2, “Software Revenue Recognition.” Accordingly, we recognize revenue when: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed or determinable; and (4) collectibility is reasonably assured. Determination of criteria (3) and (4) are based on management’s judgments regarding the fixed nature of the fee charged for services rendered and products delivered and the collectibility of those fees. Should changes in conditions cause management to determine these criteria are not met for certain future transactions, revenue recognized for any reporting period could be adversely affected.

F15

WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005


Revenue Recognition, continued

The Company generates revenues from commissions earned on net sales from its internet-based reservations. Internet revenues consist primarily of commissions, which are recorded at net in accordance with EITF 99-19. This revenue is recognized when customers present records of the room reservations made on the Company’s internet based software.

Sales Returns Allowances and Allowance for Doubtful Accounts

Significant management judgments and estimates must be made and used in connection with establishing the sales returns and other allowances in any accounting period. Management must make estimates of potential future order disputes related to current period product revenue. Allowances for estimated product returns are provided at the time of sale. We evaluate the adequacy of allowances for returns primarily based upon our evaluation of historical and expected sales experience and by channel of distribution. The judgments and estimates of management may have a material effect on the amount and timing of our revenue for any given period.

Similarly, management must make estimates of the uncollectibility of accounts receivable. Management specifically analyzes accounts receivable and historical bad debts, customer concentrations, customer credit-worthiness, current economic trends and changes in our customer payment terms when evaluating the adequacy of the allowance for doubtful accounts. If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required.

Fair Value of Financial Instruments


Statement of Financial Accounting Standards (“SFAS”) No. 107, Disclosures About Fair Value of Financial Instruments requires disclosure of fair value information about financial instruments when it is practicable to estimate that value.  The carrying amounts of the Company’s financial instruments as of April 30, 2005 approximate their respective fair values because of the short-term nature of these instruments.  Such instruments consist of cash, accounts payable and accrued expenses.  The fair value of related party payables is not determinable.

 

Equipment


Equipment is carried at cost.  Depreciation is computed using a declining balance method over the estimated useful lives of the depreciable property, which range from 3 to 5 years.  Management evaluates useful lives regularly in order to determine recoverability taking into consideration current technological conditions.  Maintenance and repairs are charged to expense as incurred; additions and betterments are capitalized.  Upon retirement or disposal of any item of equipment, the cost is and related accumulated depreciation of the disposed assets is removed, and any resulting gain or loss is credited or charged to operations.


Long-lived Assets


The Company records impairments to its long-lived assets when there is evidence that events or changes in circumstances have made recovery of the asset’s carrying value unlikely.  In that case, if the sum of the expected future cash flows were less than the carrying amount of the asset, an impairment loss would be recognized for the difference between the carrying amount of the asset and its fair value.


                                                                                  F16










 WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005




Income Taxes


The Company utilizes SFAS No. 109, Accounting for Income Taxes, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns.  Under this method, deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income.  Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.



Issuance of Stock for Services

SFAS No. 123, Accounting for Stock-Based Compensation, encourages, but does not require, companies to record compensation cost for stock-based employee compensation plans at fair value. The Company has elected to continue to account for employee stock-based compensation using the intrinsic method prescribed in Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees, and related interpretations, as permitted by SFAS No. 123; accordingly, compensation expense for stock options is measured as the excess, if any, of the quoted market price of the Company's stock at the date of the grant over the amount an employee must pay to acquire the stock. For stock options issued to non-employees, the issuance of stock options is accounted for based on the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. Compensation expense is recognized in the financial statements for stock options granted to non-employees in the period in which the consideration is obtained from the non-employee.

Compensation expense is recognized in the financial statements for issuances of common shares to employees and non-employees that have rendered services to the Company. Compensation expense is recognized based on the fair value of the services rendered or the fair value of the common stock, whichever is more readily determinable.

Comprehensive Income


SFAS No. 130, Reporting Comprehensive Income, requires the Company to report and display certain information related to comprehensive income.  Comprehensive income consists of net income; unrealized gains on available-for-sale securities; minimum pension liability adjustments; change in market value of futures contracts that qualify as a hedge; and negative equity adjustments recognized in accordance with SFAS No. 87.  The Company evaluated SFAS No. 130 and determined that the Company’s foreign currency translation adjustment was the only comprehensive income adjustment as of April 30, 2005 and 2004.


Foreign Exchange Transaction and Translation


The assets and liabilities maintained in other than United States dollars are translated into United States dollars at current exchange rates, and revenues and expenses are translated at average exchange rates for the year.  Resulting translation adjustments are reflected as a separate component of shareholders’ equity (deficit).


Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other the functional currency, except those transactions which operate as a hedge of an identifiable foreign currency commitment or as a hedge of a foreign currency investment position, are included in the results of operations as incurred.  




F17




         WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005


Segment Information


SFAS No. 131, Segment Information, amends the requirements for companies to report financial and descriptive information about their reportable operating segments.  Operating segments, as defined in SFAS No. 131, are components of an enterprise for which separate financial information is available and is evaluated regularly by a Company in deciding how to allocate resources and in assessing performance.  It also establishes standards for related disclosures about products and services, geographic areas and major customers.  The Company evaluated SFAS No. 131 and determined that the Company intends to operate two operating segments, trade show and entertainment.  

 

Basic and Diluted Net Loss Per Share


Net loss per share is calculated in accordance with SFAS No. 128, Earnings Per Share for the period presented.  Basic net loss per share is based upon the weighted average number of common shares outstanding.  Diluted net loss per share is based on the assumption that all dilative convertible shares and stock options were converted or exercised.  Dilution is computed by applying the treasury stock method.  Under this method, options and warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby we used to purchase common stock at the average market price during the period.


The Company has potentially dilutive securities in the form of outstanding stock options issued to three members of the Board of Directors.  There are no other potentially dilutive securities outstanding.


Use of Estimates


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


Significant estimates made by management are, among others, realizability of long-lived assets, deferred taxes and stock option valuation.  Management reviews its estimates on a quarterly basis and, where necessary, makes adjustments prospectively.



New Accounting Pronouncements

.

In July 2001, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 141, Business Combinations, and SFAS No. 142, Goodwill and Other Intangible Assets. SFAS No. 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 No. 141 also requires that the Company recognize acquired intangible assets apart from goodwill if the acquired intangible assets meet certain criteria. SFAS No. 141 applies to all business combinations initiated after June 30, 2001, and for purchase business combinations completed on or after July 1, 2001. Upon adoption of SFAS No. 142, it also requires that the Company reclassify, if necessary, the carrying amounts of intangible assets and goodwill, based on the criteria in SFAS No. 141. SFAS No. 142 requires, among other things, that companies no longer amortize goodwill, but instead test goodwill for impairment, at least annually. In addition, SFAS No. 142 requires that the Company identify reporting units for the purpose 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.  The effect of adoption of these statements is not expected to be material.

In July 2001, the FASB issued SFAS No. 143, Accounting for Asset Retirement Obligations. SFAS No. 143 is effective for fiscal years beginning after June 15, 2002, and will require companies to record a liability for asset

        



WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005


retirement obligation in the period in which they are incurred.  Adoption of this statement is not expected to be material.

In August 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. SFAS No. 144 supersedes SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of, in that it removes goodwill from its impairment scope and allows for different approaches in cash flow estimation. However, SFAS No. 144 retains the fundamental provisions of SFAS No. 121 for (a) recognition and measurement of long-lived assets to be held and used and (b) measurement of long-lived assets to be disposed of. SFAS No. 144 also supersedes the business segment concept in Accounting Principles Board Opinion No. 30, Reporting the Results of Operations-Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions, in that it permits presentation of a component of an entity, whether classified as held for sale or disposed of, as a discontinued operation. However, SFAS No. 144 retains the requirement of Accounting Principals Board Opinion No. 30 to report discontinued operations separately from continuing operations. The provisions of this Statement are effective for financial statements issued for fiscal years beginning after December 15, 2001 with earlier application encouraged. Implementation of SFAS No. 144 will not have a material effect on the Company’s results of operations or financial position.

In July 2002, the Financial Accounting Standards Board issued SFAS No. 146, Accounting for Costs Associated with Exit or Disposal Activities. SFAS No. 146 requires that a liability for costs associated with an exit or disposal activity be recognized and measured initially at fair value only when the liability is incurred. SFAS No.146 is effective for exit or disposal activities that are initiated after December 31, 2002. Management is evaluating the effect of this statement on the Company’s results of operations and financial position.

In April 2003, the FASB issued SFAS No. 149, Amendment of Statement 133 on Derivative  Instruments and Hedging Activities, which amends SFAS No. 133 for certain decisions made by the FASB Derivatives Implementation Group.  In particular, SFAS No. 149 (1) clarifies under what circumstances a contract with an initial net investment meets the characteristic of a derivative, (2) clarifies when a derivative contains a financing component, (3) amends the definition of an underlying instrument to conform it to language used in FASB Interpretation No. 45, Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others, and (4) amends certain other existing pronouncements.  This Statement is effective for contracts entered into or modified after June 30, 2003, and for hedging relationships designated after June 30, 2003. In addition, most provisions of SFAS No. 149 are to be applied prospectively.  Management does not expect the adoption of SFAS No. 149 to have a material impact on our financial position, cash flows or results of operations.


In May 2003, the FASB issued SFAS No. 150, “Accounting for Certain Financial            Instruments with Characteristics of Both Liabilities and Equity” (“SFAS 150”). SFAS 150 changes the accounting for certain financial instruments that under previous guidance issuers could account for as equity. It requires that those instruments be classified as liabilities in balance sheets. The guidance in SFAS 150 is generally effective for all financial instruments entered into or modified after May 31, 2003, and otherwise is effective on July 1, 2003.  The adoption of SFAS 150 did not have any material impact on its financial position, cash flows or results of operations.


On December 16, 2004, the Financial Accounting Standards Board (“FASB”) published Statement of Financial Accounting Standards No. 123 (Revised 2004), Shared-Based Payment (“SFAS 123R).  SFAS 123R requires that compensation cost related to share-based payment transactions be recognized in the financial statements.  Share-based payment transactions within the scope of SFAS 123R include stock options, restricted stock plans, performance-based awards, stock appreciation rights, and employee share purchase plans.  The provisions of


F19






         WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005



SFAS 123R are effective as of the first interim period that begins after June 15, 2005.  Accordingly, the Company will implement the revised standard in the third quarter of fiscal year 2005.  Currently, the Company accounts for its share-based payment transactions under the provisions of APB 25, which does not necessarily require the recognition of compensation cost in the financial statements.  The Company does not anticipate that the implementation of this standard will have a material impact on its financial position


On December 16, 2004, FASB issued Statement of Financial Accounting Standards No. 153, Exchanges of Nonmonetary Assets, an amendment of APB Opinion No. 29, Accounting for Nonmonetary transactions (“SFAS 153”).  This statement amends APB Opinion 29 to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception of exchanges of nonmonetary assets that do not have commercial substance.  Under SFAS 153, if a nonmonetary exchange of similar productive assets meets a commercial-substance criterion and fair value is determinable, the transaction must be accounted for at fair value resulting in recognition of any gain or loss.  SFAS 153 is effective for nonmonetary transactions in fiscal periods that begin after June 15, 2005.  The Company does not anticipate that the implementation of this standard will have a material impact on its financial position, results of operations or cash flows.


1.

Capital Structure


In February 2003, the Company issued 27,500,000 shares of its $0.0001 par value common stock to enter into an Internet Reservations Software License Agreement with Hi-Tek Multimedia, Inc., a related party (Note 8).  


2.

Equipment


Equipment at April 30, 2005 and 2004 consisted of the following:


 

2005

2004

Computer equipment

   $    10,087

$       10,087

Accumulated depreciation

        (9,865)

        (9,420)

Equipment, net

$          222

$          667


Depreciation expense charged to operations was $445 and $445 for the period ending April 30, 2005 and 2004, respectively.



3.

Intangibles, long-lived assets and Goodwill


Chaiisai Tora, Inc.


In March 1999, the Company acquired the business plan, customer database, and software related to the trade show business from Chaiisai Tora, Inc.   In consideration given for these intangibles, the Company issued 25,000 shares of its’ common stock valued at $2.00 per share, or $50,000.  The asset has been fully amortized in prior years.


Dudesmart.com


On June 23, 2000, the Company accepted a proposal to exchanged 1,200,000 shares of common stock for 100% of the outstanding common stock of Dudesmart.com, Inc., from a related entity (Note 8).   At the time of the transaction, the shares were valued at $.22 per share (estimated value $264,000).  Dudesmart.com will be the entertainment division for the Company specializing in the entertainment and gaming industry. At the date of accusation Dudesmart.com had no fixed assets and all development fees were expensed as occurred.  Therefore the Company recognized this transaction as Goodwill.  The Company anticipates that the Dudesmart.com will be fully operational in the second quarter of 2006.  The Company from time to time evaluates the fair value of its goodwill and at this time the company feels fair market value of the goodwill.



         WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005



Hi-Tek Multimedia License Agreement


On April 24, 2003, the Company announced the License Agreement of an Internet Reservations Software License Agreement from Hi Tek Multimedia (Hi Tek), in exchange for 27,500,000 common shares.  At the time of the transaction the shares were valued at $0.01.   The Company is utilizing the Hi-Tek internet reservations software. The license agreement was accounted for as an intangible asset on the balance sheet.  During the fiscal year ended April 30, 2005 the Company recognized  $209,955 was impaired to bring the asset to its estimated recoverable value, leaving a net balance of $65,045, which the Company believes it will be able to recover before the license agreement expires The Company management continually reviews its Goodwill for impairment and believes that carrying value of the assets is stated at its fair market value.  


Business.com.vn Marketing License Agreement

 

In February 2004, the Company entered into a marketing license agreement with Business.com.vn. Business.com.vn is the owner of a website (Hotels.com.vn) that promotes the online sale of hotel and tour packages on behalf of participating hotels and tour operators.


VNAT and VITA, Vietnam National Association of the Tourism and Vietnam Travel Association, recognize Hotels.com.vn as Vietnam’s official Hotel Website. In Vietnam, there are over 3,500 hotels and 400 tour companies to be promoted worldwide via the internet to generate online sales throughout the Country of Vietnam.


The term of the marketing license agreement is for two years and requires the Company to pay a licensing fee of $150,000 and $300,000 for the years ending December 31, 2004 and 2005, respectively. The license fees for 2004 and 2005 are payable by August 10, 2004 and February 10, 2005, respectively. The Company has negotiated to defer the license fee payment until February 10, 2007. In exchange for the license fee, the Company will earn a royalty equal to fifty (50%) percent of gross sales, from reservations made on the Hotels.com.vn website, as defined in the agreement. As of April 30, 2005, $481,172 in unpaid license and royalty fees, including interest of $31,172  accumulated at 18%.  The amount is included in long-term liabilities in the balance sheet. The Company has recognized revenues from this project prior the end of the year ended.  The Company has impaired $274,315 to bring the asset to its estimated recoverable value, leaving a net balance of $175,685.  Company management continually reviews its intangible assets for impairment and believes that carrying value of the assets is recoverable .  


Currently, Hotels.com.vn has contracts with approximately 88 percent of all three to five star hotels in Vietnam. Company management believes this is significant because no other company has penetrated the Vietnamese online hotel market in depth. WTS and Hotels.com.vn are signing up hotels that have never done any marketing online, as a matter of fact most of the 1-2 star hotels do not even have websites.  We supply website templates for any hotels that need this technology.  All contracts with hotels are for a three-year term. During the second quarter of 2005, Hotels.com.vn will be working on contracting with 1-2 star hotels, of which there are approximately 3,500 throughout Vietnam.



Summary of Intangible,long lived assets and goodwill:

        

     Amortization/

Licenses:

Purchase Price           Impairment

       Net Value


Chaiisai Tora, Inc.

     $  50,000                  $  50,000              $       -

  

Hi-Tek Software License                            275,000                    209,955                  65,045

Business.com License Agreement           450,000                    274,315                 175,685

Total Intangible Assets                           $ 775,000                $ 534,270              $ 240,730

==================================================================

Dudesmart.com

                                     $ 264,000                             -                 $ 264,000

                                Total Goodwill                                           $ 264,000                                   -               $ 264,000  




Estimated Amortization Expense:


                For the year ended April 30, 2006      $152,888

                For the year ended April 30, 2007      $  87,842



    

        WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005

             



4.

Provision for income taxes

The components of the provision for income taxes are as follows:

        2005

 2004

Current Tax Expense                                                

  U.S. Federal                                    $            -           $           -

  State and Local                                         800                    800

Total Current                                              800                    800


Deferred Tax Expense

  U.S. Federal                                                -                          -

  State and Local                                           -                          -

Total Deferred                                              -                          -

Total Tax Provision                         $       800            $        800

                                                    

The reconciliation of the effective income tax rate to the Federal statutory rate is as follows:

1

2004

                                  Federal Income Tax Rate                                (34.0)%      (34.0)%

                                  Effect of Valuation Allowance                         34.0%        34.0%

                                  Effective Income Tax Rate                                 0.0%          0.0%


As of April 30, 2005, the Company has a federal net operating loss carry forwards of $4,840,585 that can be utilized to reduce future taxable income.  The net operating loss carry forward will expire at various dates beginning 2011 through 2017 if not utilized.  Utilization of the net operating loss and tax credit carry forward may be subject to substantial annual limitations due to the ownership change limitations provided by the Internal Revenue Code of 1986, as amended, and similar state provisions.  The annual limitation may result in the

        

 WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005



expiration of net operating loss and tax credit carry forwards before utilization.  The Company has provided a full valuation allowance on the deferred tax asset because of uncertainty regarding realizability.

 

1.

Major Customer And Segment Information

The Company currently operates solely in one industry segment: the marketing and support of its hotel reservations system in Vietnam.  No one customer accounted for approximately 5% of gross revenues for the year ending April 30, 2005. The Company has no operations or assets located outside of the United States. The Company’s commissions revenue is concentrated in the Vietnam Hotel reservations system, creating a risk of concentration associated with the sale of a single product and limited customer base. The loss of this single market could cause severe damage to the Company’s financial future. 

2.

Related Party Transactions


Company Officers


Mr. Sheldon Silverman resigned as the Company’s president and became Chief Executive Officer on June 23, 2000. Mr. Silverman was again appointed Chief Executive Officer in July 2001.


Mr. Thomas Johnson became president of the Company on June 23, 2000 and a member of the board of directors on July 6, 2000. On June 30, 2001, Mr. Thomas Johnson resigned as President.


Dr. Lee Johnson became Chief Technical Officer of the Company on June 23, 2000 and a member of the board of directors on July 6, 2000. On August 31, 2004, Dr. Lee Johnson resigned as a director and joined the Board of Advisors.


Mr. Thomas Johnson and Dr. Lee Johnson, both former officers and members of the board of directors, are brothers. We believe that we would not be able to continue as a going concern at this time if Dr. Johnson did not control the Company].


During September 2004, John Spinelli was appointed to the Board of Directors, as well as, Director of International Sales & Marketing.


Acquisition of Dudesmart.com, Inc.


On June 23, 2000, the Company accepted a proposal to exchange 1,200,000 shares of its common stock for 100% of the outstanding shares common stock of Dudesmart.com, Inc. In September 2000, the exchange was completed and Mr. Thomas Johnson and Dr. Lee Johnson, the sole shareholders of Dudesmart.com, Inc. each received 600,000 shares of the Company’s common stock. At the time of the transaction, the shares were valued at $.22 per share (total value $264,000).



License Agreement with Hi-Tek Multimedia, Inc.


On April 24, 2003, the Company announced acquiring an Internet Reservations Software License Agreement, in exchange for issuing 27,500,000 common shares to Hi-Tek Multimedia (Hi-Tek). Mr. Thomas Johnson and Mr. Lee Johnson are the sole shareholders of Hi-Tek. Hi-Tek, a strategic business partner and a leading International e-commerce software development enterprise, will be providing its proprietary software, HI-TEK Res, to generate revenue for the Company from business and consumer travelers seeking to reserve hotels at their selected destinations worldwide while visiting or attending tradeshows and conferences.


 

        WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005



Professional Services Agreement with Hi-Tek Multimedia, Inc.


WorldTradeShow.com retained Hi-Tek to design, program, produce and implement the following:

 

·

 

Corporate and promotional web sites.

·

Initial module of the WorldTradeShow.com reservation engine.

·

Preliminary offline and online marketing plan, including designing and producing all supporting marketing and promotional materials (CD-ROM, media kit, web slide presentation and corporate literature).

·

Consult with the management of the company on an as needed basis.


As of April 30, 2005 and 2004, the Company owed Hi-Tek approximately $930,082 and $452,300, respectively, for unpaid consulting fees, service fees, rent, expenses and cash advances   which were included in amount due to related party on the balance sheet. Cash advances as of  April 30, 2005 and 2004 amounted to $90,352 and $28,800, respectively. Additionally, Hi-Tek charges interest at a rate of 10 percent on the cash advances and “unpaid fees” resulted in accrued interest. As of April 30, 2005 and 2004, accrued interest on these advances was approximately $6,700 and $23,800, respectively. The agreement is renewable on an annual basis. Hi-Tek agreed to forgive the interest accrued as of April 30, 2004 in the amount of 23,800 during the year ended April 30, 2005. The amount forgiven is included in other income.


Other Affiliated Entities


Mr. Sheldon Silverman owns shares personally and through a company under his control. From time to time, this company and Mr. Silverman have received Worldtradeshow.com, Inc. common shares in exchange for debt. For the fiscal years ended April 30, 2005 and 2004, Mr. Silverman did not receive any common shares in exchange for debt.


Consulting Agreements


Dr. Lee Johnson, Mr. Thomas Johnson and Mr. Sheldon Silverman have entered into three separate consulting agreements with the Company, for which the Company has accrued unpaid consulting fees. Similar consulting agreements were extended for two of the individuals on an annual basis at terms similar to the original agreement through July 2005.


The above consultant agreements also contained 2,250,000 stock options, of which 150,000 remain exercisable due to expiration or have been forfeited by the officers. As the June 2000 consulting agreement provided for the options to be purchased at below the Company’s market price on the date of grant, the Company has recorded consulting fees relating to these options of $140,630 (Note 11).


Unpaid Consulting Fees / Advances from Related Parties


As of April 30, 2005 and 2004, the Company has unpaid consulting fees to officers / directors of approximately $2,330,000 and $1,512,200, respectively. $1,050,000 of these fees currently bear interest at a rate of 12 percent. As of April 30, 2005, accrued interest on these fees were approximately $208,887, which is included in  due to related parties.   


As of April 30, 2005 and 2004, the Company also has received advances of $180,000 from a former officer and Board member. These advances currently bear interest at a rate of 12 percent. As of April 30, 2005 and 2004, accrued interest on these advances was approximately $88,148 and $61,700, respectively, which are included in due to related parties. These advances are not repayable until July 1, 2005 at which point the Company anticipates it will be able renegotiate the terms of the payments and all monies owed to the related parties.

        

 WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005



Office Leases

 

The Company leases its office space in San Diego, California, on a month-to-month basis from a related party. Rent expense under these agreements for the fiscal years ended April 30, 2005 and 2004 was $35,000 and $45,000, respectively.


3.

Marketing and Distribution Agreements


Partnership with DotVN

 

In May 2003, the Company announced a partnership with Dot.vn the official Vietnamese Registration Company.  The Company is considered a re-seller of domain names, WTS will receive a commission for each domain name set up via the Companies web portal.

 

The Company is working closely with Dot.vn to market and distribute these domains on its WTS business web portal. The revenue from the partnership agreement is anticipated to allow the Company to start receiving operating funds during 2005.

 

Agreement to Market MASXIMA Discount Card

 

In November 2003, the Company signed an agreement with Grupo Campestre to market the Mexican MASXIMA Discount Card. The signing of this Memorandum of Understanding allows the Company to promote and market the MASXIMA Discount Card, in Baja California, Mexico on its WorldTradeshow.com web portal.


WTS and Maxsima Discount Card Memorandum of Understanding (MOU) states “both parties will have a revenue sharing partnership, whereby WTS may retain up to 20% in recurring revenue.”

 


 Letter of Intent with All American Casting International

 

 In November 2003, the Company signed a Letter of Intent (“LOI”) with All America Casting International (“All American”) to be the exclusive marketer and distributor of its broadband Voice Over Internet Protocol telecom technology to its Vietnamese enterprise clients. The LOI with All American is not currently proceeding. All American has not fulfilled its obligation as set forth in any of the points on the LOI. The Company is not pursuing any other agreements regarding Voice Telecommunications over the Internet

4.

 Basic And Fully Diluted Loss Per Common Share:

Effective November 30, 1998, the Company adopted the provisions of Statement of Financial Accounting Standards No. 128, Earnings per Share (“SFAS 128”) which replaced the presentation of “primary” and “fully-diluted” earnings (loss) per common share required under previously promulgated accounting standards with the presentation of “basic” and “diluted” earnings (loss) per common share. Basic earnings (loss) per common share is calculated by dividing net income or loss by the weighted average number of common shares outstanding during the period. The calculation of diluted earnings (loss) per common share is similar to that of basic earnings (loss) per common share, except that the numerator and denominator are adjusted to reflect the decrease in earnings per share or the increase in loss per share that could occur if securities or other contracts to issue common stock, such as stock options and convertible notes, were exercised or converted into common stock.

5.

Stock Options


On June 30, 2000, the Company issued 1,350,000 options to certain officers. The options have an exercise price of $0.10 per share, vest over a three-year period, beginning July 1, 2000 and expire one year after becoming exercisable. As of April 30, 2005, no options had yet been exercised. As the consulting agreements provided for the options to be exercised at below the Company’s market price on the date of grant, the Company recorded additional consulting fees relating to estimated value of these options of $140,630. These options were subsequently cancelled and new options issued.


The fair value of these options was estimated at the date of grant using the Black-Scholes option-pricing model for the fiscal year ended April 30, 2001; dividend yield of 0%; expected volatility of 250%; risk-free interest rate of 6.5%; and expected life of 3 years.


On June 30, 2003, the Company issued 900,000 options to certain officers. The options have an exercise price of $0.30 per share (estimated market price at date of grant), vest over a three-year period, beginning June 30, 2003 and expire one year after becoming exercisable. As of the date of this report, 750,000 options have expired or were forfeited and no options had yet been exercised.


WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005



In September 2004, the Company issued 200,000 options to a consultant. The options have an exercise price of $0.75 per share, vest over a one-year period, beginning in September 2004 and expire one year after becoming exercisable. As of the date of this report, no options had yet been exercised. As the consulting agreement provided for the options to be purchased at below the Company’s market price on the date of grant, the Company recorded deferred compensation relating to these options of $39,300 during the second quarter of fiscal 2005 as the company believes the options will not be exercised.


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


A summary of stock option activity for all plans follows:


Outstanding Options

 

Options
Outstanding

 

Exercise Price

 

     Authorized

 

 

 

 

 

     Granted

 

    2,450,000

 

$0.75-$0.30

 

     Exercised

 

                 -

 

$0.00

 

     Canceled

 

    (2,100,000

)

$0.30

 

     Balance, April 30, 2005

 

        350,000

 

$0.75-$0.30

 


Following is a summary of the status of fixed options outstanding at April 30, 2005:

 
  

Outstanding Options

Exercisable Options

 

Exercise Price Range

Number

Weighted Average Remaining Contractual Life

Weighted Average Exercise Price

Number

Exercisable

Weighted Average Exercise Price

 
 

$.30–$.75

250,000

1 years

$0.48

250,000

   $0.48

 
 

$0.75

100,000

2 years

0.75

100,000

.75

 


       

  Had compensation cost for the Company’s stock-based compensation plan been determined based on the fair value at grant dates for awards under those plans consistent with the method described in SFAS 123, the Company’s net loss would have been as follows:



 

Year Ended April 30,

 

2005

2004

Net Loss:

  

        As reported

$  1,413,934

$     805,757

        Pro forma

$  1,554,564

$     946,647

   

Basic loss per share:

  

        As reported

$        (0.04)

$        (0.02)

        Pro forma

$        (0.04)

$        (0.03)



WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005



6.

Comprehensive Loss


The single component of other comprehensive loss is foreign exchange translation gains.  Due to the availability of net operating losses, there is no tax effect associated with the component of other comprehensive loss.

7.

Contingencies


In the opinion of management, there are no matters requiring recognition or disclosure as a loss contingency in accordance with Statement of Financial Standards No. 5, Accounting for Contingencies.F19


8.

Foreign Currency Exchange and Translation


The functional currency of the Company is the U.S. dollar.  The Company, prior to the fiscal year ended April 30, 2001, also had a Canadian dollar bank account it used for some operations.  For reporting purposes, the financial statements are presented in U.S. dollars in accordance with SFAS No. 52, Foreign Currency Translation.  The balance sheet is translated into U.S. dollars at the exchange rates prevailing at the balance sheet date and the statement of operations and cash flows at the average rates for the relevant periods.

9.

Going Concern

To date the Company has had limited sales due to the early stage of its efforts to transition into the marketing of its internet resources.  Consequently, the Company has incurred recurring losses from operations. These factors, as well as the risks associated with raising capital through the issuance of equity and/or debt securities creates uncertainty as to the Company’s ability to continue as a going concern.

The Company’s plans to address its going concern issues include:

*

Increasing sales of its products through national distribution channels and through direct marketing to consumers;

*

Raising capital through the sale of debt and/or equity securities; and,

*

Settling outstanding debts and accounts payable, when available, through the issuance of debt and/or equity securities.

There can be no assurance that the Company will be successful in its efforts to increase sales, issue debt and/or equity securities for cash or as payment for outstanding obligations.

Capital raising efforts may be influenced by factors outside of the control of the Company, including, but not limited to, capital market conditions. During the year ended April 30, 2005 the Company borrowed cash and retired outstanding obligations through the issuance of equity and debt/equity securities totaling $ 169,111 in the aggregate. Of this amount, $78,759 of equity and were issued to pay past due creditors.

The Company is in various stages of finalizing implementation strategies on a number of products and is actively attempting to market its products nationally in Vietnam. As a result of capital constraints it is uncertain when it will be able to start its websites to utilize the available licenses.


F29

         WorldTradeShow.com, Inc.

(A Developmental Stage Company)

Notes to Financial Statements

April 30, 2005


16.   Stock Issuances

In February 2003, the Company issued 27,500,000 shares of its $0.0001 par value common stock to enter into an Internet Reservations Software License Agreement with Hi-Tek Multimedia, Inc., a related party.


In September 2004, the Company issued approximately 173,000 shares of its $0.0001 par value common stock for repayment of approximately $79,000 in outstanding debt, which includes $3,450 of accrued interest.

17.  Subsequent Events

On July 21, 2005 Mr. John Spinelli resigned due to personal reasons forfeiting his rights to execute the 200,000 options granted to him in the year ended April 30, 2005.

















 








Financial Statements of

WORLDTRADESHOW.COM, INC.

October 31, 2005 and 2004



     Page

Index To Unaudited Financial Statements

 


Balance Sheet as of October 31, 2005 (unaudited)            

F-30

 

Statement of Operations for the three month period ended October 31, 2005

F-31

(unaudited),


Statement of Operations for the six month period ended October 31, 2005

F-32

(unaudited),   and cumulative from inception  (September 15, 1995 to October 31, 2005



Statement of Stockholders Equity from Inception  September 15, 1995 to  October 31,2005

 F-33

(unaudited),


Statement of Cash Flows for the period ended October 31, 2005

                                      F-35

(unaudited),  October 31, 2004 (unaudited) and cumulative from inception

(September 15, 1995 to October 31, 2005


Notes to Financial Statements                 

  F-36



























 





WORLDTRADESHOW.COM, INC.

 (A Developmet Stage Company)

 Balance Sheets (unaudited)

       
     

For the Period Ending

 
       
     

January 31,

 
     

2006

 

ASSETS

      

Current assets

     

  Cash

   

$

                 37

 

  Accounts receivable

   

                  -   

 
       

     Total current assets

   

                 37

 
       
       

Equipment, net

   

                  -   

 

Goodwill

    

        264,000

 

Intangibles, net of accumulated amortization and

   

    impairment of $ 563,437  and $ 50,000, in 2006

   

   and 2005, respectively

  

        161,563

 
       

     Total assets

  

$

        425,600

 
       

LIABILITIES AND SHAREHOLDERS' DEFICIT

   

Current liabilities

     

  Accounts payable

  

$

        360,062

 

  Due to related parties

   

     2,350,483

 

  Accrued liabilities

   

     1,638,477

 

  Demand notes payable

   

        170,419

 
       

     Total current liabilities

  

     4,519,441

 
       

     Due to shareholders

   

                  -   

 

     Long-term liabilities

   

                  -   

 
       

     Total liabilities

   

     4,519,441

 
       

Shareholders' deficit

     

 Prefered stock; $0.001 par value; 5,000,000 shares

   

       authorized none issued and outstanding

 

                  -   

 

 Common stock; $0.0001 par value; 100,000,000 shares

   

       authorized 37,710,506 and 37,710,506 shares issued

   

       and outstanding as of January 31, 2006 and April

   

      30, 2005, respectively

  

            3,770

 

  Additional paid-in capital

  

     1,811,786

 

  Deferred compensation

  

         (39,300)

 

  Foreign currency translation

  

           (1,119)

 

  Deficit accumulated during the development stage

 

    (5,868,978)

 
       

     Total shareholders' deficit

  

    (4,093,841)

 
       

     Total liabilities and shareholders' deficit

$

        425,600

 
       

the accompanying notes are an integral part of these financial statements




WORLDTRADESHOW.COM, INC.

 (A Developmet Stage Company)

 Statements of Operations (unaudited)

          
          
          
         

  3 Month Period Ending

          
 

 January 31,

   

 January 31,

    
       

2006

  
 

2005

 

Revenue

     

$

 

             3,414

 

 $

 

             1,220

    
          
   

Cost of Sales

      
 

                   -   

   

                   -   

    
          
   

Gross profit

      
 

             3,414

   

             1,220

    
          
   

General and administrative expenses:

     

  Consulting fees

       

         190,500

  
 

         137,975

 

  Depreciation and amortization

     

                    0

   

                112

 

  Marketing and promotion

    
 

           48,788

   

           53,250

 

  Office and rent

  
     

           15,000

   

             7,500

 

  Professional fees

       

             2,622

   

           19,068

 

  Other administrative expenses

    
 

           40,247

   

           19,769

 

  Impairment on intangible assets

  
   

                     -

   

                   -   

  
          
          
          
 

Total general and administrative expenses

 

         297,158

   

         237,673

  
          
     

Other income

    
         

  Other income  (debt forgivness)

     

                   -   

   

                   -   

 

  Interest expense

       

         (37,252)

   

         (54,183)

      
          
 

Net loss

     

$

 

       (330,996)

 

 $

 

       (290,636)

      
          
 

Loss per common share:

        
   

  Basic

     

$

 

           (0.009)

 

 $

 

           (0.008)

    
          
          
         

Weighted average shares outstanding:

     

  Basic

    
   

    37,710,506

   

    37,710,506

  
          
     

Other comprehensive income (loss)

    
 

  Foreign currency translation

     

                   -   

  
 

                   -   

        
         

Comprehensive loss

   

$

 

       (330,996)

 

 $

 

       (290,636)

          
          





WORLDTRADESHOW.COM, INC.

 (A Development Stage Company)

 Statements of Operations (unaudited)

          
          
          
         

Cumulative

     

  9 Month Period Ending

 

from inception

     

 January 31,

 

 January 31,

 

(September 15, 1995

     

2006

 

2005

 

 to January 31, 2006)

Revenue

  

$

                    6,124

 $

                         1,220

$

                       120,662

          

Cost of Sales

   

                          -   

 

                              -   

 

                       158,143

          

Gross profit

   

                    6,124

 

                         1,220

 

                       (37,481)

          

General and administrative expenses:

      

  Consulting fees

   

                333,500

 

                     480,275

 

                    3,015,634

  Depreciation and amortization

 

                       222

 

                            334

 

                         65,687

  Marketing and promotion

  

                138,900

 

                       73,250

 

                       589,452

  Office and rent

   

                  30,000

 

                       27,500

 

                       295,059

  Professional fees

   

                  25,479

 

                       29,068

 

                       252,947

  Other administrative expenses

 

                  63,104

 

                       96,391

 

                       599,299

  Impairment on intangible assets

 

                  79,167

 

                              -   

 

                       615,362

          

Total general and administrative expenses

 

                670,372

 

                     706,817

 

                    5,381,515

          

Other income

        

  Other income  (debt forgivness)

 

                          -   

 

                              -   

 

                         25,613

  Interest expense

   

              (111,757)

 

                     (54,183)

 

                     (475,595)

          

Net loss

   

$

              (776,005)

 $

                   (759,780)

$

                  (5,868,978)

          

Loss per common share:

       

  Basic

   

$

                  (0.021)

 $

                       (0.020)

  
          
          

Weighted average shares outstanding:

      

  Basic

    

           37,710,506

 

                37,710,506

  
          

Other comprehensive income (loss)

      

  Foreign currency translation

  

                          -   

 

                              -   

 

                         (1,119)

          

Comprehensive loss

 

$

              (776,005)

 $

                   (759,780)

$

                  (5,870,097)

          

The accompanying notes are an integral part of these financial statements














WORLDTRADESHOW.COM, INC.

 (A Development Stage Company)

 Statement of Shareholders Equity

              

Deficit

  
    

Common Stock

 

 

 

Additional

 

Deferred

 

Foreign

 

Accumulated

 

Total

    

Number

   

Paid In

 

Compensation

 

Currency

 

during the

 

Shareholders'

    

of Shares

 

Amount

 

Capital

 

Expense

 

Translation

 

Development Stage

 

Equity (Deficit)

Inception, September 15, 1995

 

                                              -

 

 $                    -

 

 $                      -

 

 $                      -

 

 $                    -

 

 $                                 -

 

 $                                    -

Common stock issued for:

               

  Cash, October 1

  

                                    31,240

 

                     31

 

              156,169

       

                           156,200

  Cash, December 5

  

                                      6,950

 

                       7

 

                69,493

       

                             69,500

  Acquisition of license rights, April 17

 

                                    56,000

 

                     56

 

                  5,544

       

                               5,600

Share issue costs