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Crowfly Inc · SB-2 · On 1/5/04

Filed On 1/5/04 4:28pm ET · SEC File 333-111708 · Accession Number 898432-4-3

  As Of               Filer                 Filing     As/For/On Docs:Pgs              Issuer               Agent

 1/05/04  Crowfly Inc                       SB-2                  12:119                                    Kirkpatric..Graham/02/FA

Registration of Securities by a Small-Business Issuer · Form SB-2
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: SB-2        Registration of Securities by a Small-Business        47    178K 
                          Issuer                                                 
 2: EX-3        Exhibit 3.1                                            5     18K 
 3: EX-3        Exhibit 3.2                                            1      7K 
 4: EX-3        Exhibit 3.3                                            1      7K 
 5: EX-3.(I)    Exhibit 3.4                                           18     85K 
 6: EX-5        Exhibit 5-1                                            1      9K 
 7: EX-10       Exhibit 10.1                                           8     34K 
 8: EX-10       Exhibit 10.2                                          17     77K 
 9: EX-10       Exhibit 10.3                                           6     35K 
10: EX-10       Exhibit 10.4                                           7     34K 
11: EX-10       Exhibit 10.5                                           7     39K 
12: EX-23       Exhibit 23.2                                           1      6K

SB-2 · Registration of Securities by a Small-Business Issuer
Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (RTF, XML, et al.) Calculation of Registration Fee Certain Relationship and Related Transactions Description of Business Description of Property Description of Securities Experts Financial Statements Forward-Looking Statements Functionality How to Get More Information Legal Matters Legal Proceeding Management Management's Discussion and Analysis or Plan of Operation Market Price of and Dividends on the Registrant's Common Equity and Other Stockholder Matters Offering, The Plan of Distribution Principal Stockholders Prospectus Summary Risk Factors Selling Stockholders Summary Consolidated Financial Information The offering Use of Proceeds
1	1st Page
"	Calculation of Registration Fee
4	Prospectus Summary
5	The offering
6	Summary Consolidated Financial Information
7	Risk Factors
9	Forward-Looking Statements
10	Selling Stockholders
11	Use of Proceeds
12	Plan of Distribution
13	Management's Discussion and Analysis or Plan of Operation
14	Description of Business
16	Functionality
23	Management
24	Description of Property
"	Legal Proceeding
25	Principal Stockholders
27	Certain Relationship and Related Transactions
28	Market Price of and Dividends on the Registrant's Common Equity and Other Stockholder Matters
29	Description of Securities
30	Experts
"	Legal Matters
"	How to Get More Information
35	Financial Statements

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As filed with the Securities and Exchange Commission on January 5, 2004
================================================================================

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

NEVADA CROWFLY, INC. 27-0043260
(State or Other Jurisdiction of (Name of Registrant in Our (I.R.S. Employer
Incorporation or Organization) Charter) Identification No.)

CROWFLY, INC. 7371 WILLIAM E. KING, III
220 WILLIAMS STREET EXTENSION (Primary Standard Industrial CROWFLY, INC.
MOUNT PLEASANT, SC 29464 Classification Code Number) 220 WILLIAMS STREET EXTENSION
(843) 209-9323 MOUNT PLEASANT, SC 29464
(Address and telephone number (843) 209-9323
of Principal Executive Offices (Name, address and telephone
and Principal Place of Business) number of agent for service)

COPIES TO:

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Clayton E. Parker, Esq. Troy J. Rillo, Esq.
Kirkpatrick & Lockhart LLP Kirkpatrick & Lockhart LLP
201 S. Biscayne Boulevard, Suite 2000 201 S. Biscayne Boulevard, Suite 2000
Miami, Florida 33131 Miami, Florida 33131
(305) 539-3300 (305) 539-3300
Telecopier No.: (305) 358-7095 Telecopier No.: (305) 358-7095

Approximate date of commencement of proposed sale to the public: AS SOON AS PRACTICABLE AFTER
THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.

If any of the securities being registered on this Form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. |X|

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b)
under the Securities Act, please check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering. |_|

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities
Act, check the following box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_|

If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the
following box. |_|
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CALCULATION OF REGISTRATION FEE
====================================================================================================================
PROPOSED MAXIMUM
PROPOSED MAXIMUM AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PER SHARE (1) PRICE (1) FEE
--------------------------------------------------------------------------------------------------------------------

Common Stock, par value $0.00001 64,000,000 shares $.05 $3,200,000 $258.88
--------------------------------------------------------------------------------------------------------------------
TOTAL 64,000,000 shares $.05 $3,200,000 $258.88
====================================================================================================================

(1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457 under the Securities
Act of 1933.

----------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS
EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION
STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.

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PROSPECTUS

Subject to completion, dated January 5, 2004

CROWFLY, INC.
64,000,000 SHARES OF COMMON STOCK

This prospectus relates to the sale of up to 64,000,000 shares of Crowfly's
common stock by certain persons who are stockholders of Crowfly. Please refer to
"Selling Stockholders" beginning on page 7. Crowfly is not selling any shares of
common stock in this offering and therefore will not receive any proceeds from
this offering. All costs associated with this registration will be borne by
Crowfly.

There currently is no public market for our common stock. The shares of
common stock are being offered for sale by the selling stockholders at
negotiated prices or prices established in the public market, if one develops
during the term of this offering. These prices will fluctuate based on the
demand for the shares of common stock.

Brokers or dealers effecting transactions in these shares should confirm
that the shares are registered under the applicable state law or that an
exemption from registration is available.

THESE SECURITIES ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK.

PLEASE REFER TO "RISK FACTORS" BEGINNING ON PAGE 4.

No underwriter or person has been engaged to facilitate the sale of shares
of common stock in this offering. This offering will terminate twenty-four
months after the accompanying registration statement is declared effective by
the Securities and Exchange Commission. None of the proceeds from the sale of
stock by the selling stockholders will be placed in escrow, trust or any similar
account.

THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES REGULATORS HAVE
NOT APPROVED OR DISAPPROVED OF THESE SECURITIES, OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

The date of this prospectus is January 5, 2004.

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TABLE OF CONTENTS

PROSPECTUS SUMMARY.............................................................1
THE OFFERING...................................................................2
SUMMARY CONSOLIDATED FINANCIAL INFORMATION.....................................3
RISK FACTORS...................................................................4
FORWARD-LOOKING STATEMENTS.....................................................6
SELLING STOCKHOLDERS...........................................................7
USE OF PROCEEDS................................................................9
PLAN OF DISTRIBUTION..........................................................10
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.....................11
DESCRIPTION OF BUSINESS.......................................................12
MANAGEMENT....................................................................21
DESCRIPTION OF PROPERTY.......................................................22
LEGAL PROCEEDING..............................................................22
PRINCIPAL STOCKHOLDERS........................................................23
CERTAIN RELATIONSHIP AND RELATED TRANSACTIONS.................................25
MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND OTHER
STOCKHOLDER MATTERS.........................................................26
DESCRIPTION OF SECURITIES.....................................................27
EXPERTS.......................................................................28
LEGAL MATTERS.................................................................28
HOW TO GET MORE INFORMATION...................................................28
EXHIBIT 5.1................................................................5.1-1
EXHIBIT 23.1..............................................................23.1-1
FINANCIAL STATEMENTS.........................................................F-1

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PROSPECTUS SUMMARY

OVERVIEW

We are a start-up business that has not yet commenced operations. To date,
we have focused our attention to organizational matters. Crowfly was
incorporated in Nevada on August 16, 2002 under the name Project IV, Inc. On
November 15, 2002, Crowfly entered into an Asset Purchase Agreement with William
E. King, III, M. Phillip Waggoner and Robert A. Gillgrist to purchase the
"Crowfly e-Commerce Models for B2B" business concept (hereinafter the "Crowfly
Business Model"). Messrs. King, Waggoner and Gillgrist were issued a total of
3,600,000 shares of Crowfly common stock in consideration for the Crowfly
Business Model. As a result of a one hundred for one (100 for 1) stock split of
Crowfly's common stock effective as of April 15, 2003, Messrs. King, Waggoner
and Gillgrist have been issued a total of 360,000,000 shares of Crowfly's common
stock in connection with the Crowfly Business Model.

Crowfly is a development stage company which intends to develop and
implement the Crowfly Business Model. Crowfly expects to install, own and manage
electronic distribution centers which operate in business to business (B2B)
environments. The Crowfly Business Model is expected to connect retailers
directly to manufacturers in a real-time electronic marketplace, bypassing the
traditional wholesale distributor. It is anticipated that the Crowfly Business
Model will enhance efficiencies and increase the margins throughout the supply
chain. Crowfly intends to first implement the Crowfly Business Model in the
hardware industry, and thereafter, in other industries where the wholesale
distributor is fundamental to the supply chain.

Crowfly has not had operations or revenue since its inception. As of
October 31, 2003, Crowfly had total assets of $30 and an accumulated deficit of
$5,070. Management recognizes that Crowfly must receive financing to develop and
implement its business plan for the Crowfly Business Model. Management is
planning to obtain capital from the sale of equity securities. However, no
assurances can be given that Crowfly will be successful in these activities.

ABOUT US

Our principal office is located at 220 Williams Street Extension, Mount
Pleasant, South Carolina 29464. Our telephone number is (843) 209-9323.

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THE OFFERING

This offering relates to the sale of common stock by certain persons who
are shareholders of Crowfly who intend to sell up to 64,000,000 shares of common
stock.

COMMON STOCK OFFERED 64,000,000 shares by selling stockholders

OFFERING PRICE Market price

COMMON STOCK OUTSTANDING 605,000,000 shares as of January 5, 2004
BEFORE THE OFFERING

USE OF PROCEEDS We will not receive any proceeds of the shares
offered by the selling stockholders.

RISK FACTORS The securities offered hereby involve a high
degree of risk and immediate substantial
dilution. See "Risk Factors."

OVER-THE-COUNTER Crowfly intends to apply for an Over-the-Counter
BULLETIN BOARD Bulletin Board Symbol upon filing of this
SYMBOL Registration Statement.

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SUMMARY CONSOLIDATED FINANCIAL INFORMATION

CROWFLY, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
UPDATE AS OF OCTOBER 31, 2003

ASSETS:
Current Assets $ 30

Total Assets $ 30
========
LIABILITIES AND STOCKHOLDER'S EQUITY:

Liabilities
Due to shareholder $ 100
--------

Total Liabilities 100

Stockholders' Equity
Preferred stock - $0.001 par value;
10 million authorized;
0 issued and outstanding 0
Common Stock - $0.00001 par value;
800 million shares authorized;
605,000,000 shares issued and outstanding 5,000

Deficit accumulated during development stage (5,070)
--------

Total stockholders' equity (70)
--------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 30
========

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RISK FACTORS

WE ARE SUBJECT TO VARIOUS RISKS THAT MAY MATERIALLY HARM OUR BUSINESS,
FINANCIAL CONDITION AND RESULTS OF OPERATIONS. YOU SHOULD CAREFULLY CONSIDER THE
RISKS AND UNCERTAINTIES DESCRIBED BELOW AND THE OTHER INFORMATION IN THIS FILING
BEFORE DECIDING TO PURCHASE OUR COMMON STOCK. IF ANY OF THESE RISKS OR
UNCERTAINTIES ACTUALLY OCCURS, OUR BUSINESS, FINANCIAL CONDITION OR OPERATING
RESULTS COULD BE MATERIALLY HARMED. IN THAT CASE, THE TRADING PRICE OF OUR
COMMON STOCK COULD DECLINE AND YOU COULD LOSE ALL OR PART OF YOUR INVESTMENT.

RISKS RELATED TO OUR BUSINESS

CROWFLY IS A DEVELOPMENT STAGE COMPANY AND HAS HAD NO REVENUES OR OPERATIONS
SINCE INCEPTION

We are a development stage company which has had no operations or revenues
since inception. As of October 31, 2003, we had an accumulated deficit of
$5,070. Future losses are likely to occur, as we are dependent on spending money
to develop and implement our business strategy. No assurances can be given that
we will be successful in implementing our business strategy and reaching
profitable operations.

CROWFLY NEEDS TO RAISE CAPITAL OR DEBT FUNDING TO COMMENCE OPERATIONS

The development and implementation of the Crowfly Business Model and other
aspects of our business requires the expenditure of funds and will require
Crowfly to obtain financing. Further, there will be a gap between the time we
are able to develop and implement the Crowfly Business Model and the time we
expect to collect revenue from the eventual sale of the model in the
marketplace. We cannot assure you that financing whether from external sources
or related parties will be available if needed or on favorable terms. Our
inability to obtain adequate financing will result in the need to reduce the
pace of development and implementation of our business plan. Any of these events
could be materially harmful to our business and may result in a lower stock
price.

OUR COMMON STOCK MAY BE AFFECTED BY LIMITED TRADING VOLUME AND MAY FLUCTUATE
SIGNIFICANTLY

Prior to this offering, there was no public market for our common stock and
there can be no assurance that a public trading market for our common stock will
develop. An absence of an active trading market could adversely affect our
shareholders' ability to sell our common stock in short time periods, or
possibly at all. Our common stock is likely to experience significant price and
volume fluctuations, which could adversely affect the market price of our common
stock without regard to our operating performance. In addition, we believe that
factors such as quarterly fluctuations in our financial results and changes in
the overall economy or the condition of the financial markets could cause the
price of our common stock to fluctuate substantially. These fluctuations may
also cause short sellers to enter the market from time to time in the belief
that Crowfly will have poor results in the future. We cannot predict the actions
of market participants and, therefore, can offer no assurances that the market
for our stock will be stable or appreciate over time.

OUR COMMON STOCK IS DEEMED TO BE "PENNY STOCK," WHICH MAY MAKE IT MORE DIFFICULT
FOR INVESTORS TO SELL THEIR SHARES DUE TO SUITABILITY REQUIREMENTS

If a public market develops for our common stock, it is likely that our
common stock will be deemed to be "penny stock" as that term is defined in Rule
3a51-1 promulgated under the Securities Exchange Act of 1934. These requirements
may reduce the potential market for our common stock by reducing the number of
potential investors. This may make it more difficult for investors in our common
stock to sell shares to third parties or to otherwise dispose of them. This
could cause our stock price to decline. Penny stocks are stock:

o With a price of less than $5.00 per share;

o That are not traded on a "recognized" national exchange;

o Whose prices are not quoted on the NASDAQ automated quotation system
(NASDAQ listed stock must still have a price of not less than $5.00 per
share); or

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o In issuers with net tangible assets less than $2.0 million (if the
issuer has been in continuous operation for at least three years) or
$10.0 million (if in continuous operation for less than three years), or
with average revenues of less than $6.0 million for the last three
years.

Broker/dealers dealing in penny stocks are required to provide potential
investors with a document disclosing the risks of penny stocks. Moreover,
broker/dealers are required to determine whether an investment in a penny stock
is a suitable investment for a prospective investor.

WE COULD FAIL TO ATTRACT OR RETAIN KEY PERSONNEL

The development of our business is expected to depend largely on the
efforts and abilities of key executives, including William E. King, III, our
Chairman of the Board, President and Chief Executive Officer. The loss of the
services of Mr. King could materially harm our business because he developed the
business model upon which our operations are expected to be based. Such a loss
would also divert management attention away from operational issues. We also
have other key employees that manage our operations and if we were to lose their
services, senior management would be required to expend time and energy to
replace and train replacements. Given the start-up nature of our business, we
may not be able to attract the sufficient number and quality of staff.

RISKS RELATED TO THIS OFFERING

FUTURE SALES BY OUR STOCKHOLDERS MAY ADVERSELY AFFECT OUR STOCK PRICE AND OUR
ABILITY TO RAISE FUNDS IN NEW STOCK OFFERINGS

Sales of our common stock in the public market following this offering
could lower the market price of our common stock. Sales may also make it more
difficult for us to sell equity securities or equity-related securities in the
future at a time and price that our management deems acceptable or at all. All
of our outstanding shares are "restricted securities" and may be resold in the
public market only if registered or pursuant to an exemption from registration.

THE SELLING STOCKHOLDERS INTEND TO SELL THEIR SHARES OF COMMON STOCK IN THE
MARKET, WHICH SALES MAY CAUSE OUR STOCK PRICE TO DECLINE

The selling stockholders intend to sell in the public market the shares of
common stock being registered in this offering. That means that up to
approximately 64,000,000 shares may be sold pursuant to this offering. Such
sales may cause our stock price to decline.

THE PRICE YOU PAY IN THIS OFFERING WILL FLUCTUATE AND MAY BE HIGHER OR LOWER
THAN THE PRICES PAID BY OTHER PEOPLE PARTICIPATING IN THIS OFFERING

The price in this offering will fluctuate based on the prevailing market
price of the common stock on the Over-the-Counter Bulletin Board. Accordingly,
the price you pay in this offering may be higher or lower than the prices paid
by other people participating in this offering.

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FORWARD-LOOKING STATEMENTS

Information included or incorporated by reference in this prospectus may
contain forward-looking statements. This information may involve known and
unknown risks, uncertainties and other factors which may cause our actual
results, performance or achievements to be materially different from the future
results, performance or achievements expressed or implied by any forward-looking
statements. Forward-looking statements, which involve assumptions and describe
our future plans, strategies and expectations, are generally identifiable by use
of the words "may," "will," "should," "expect," "anticipate," "estimate,"
"believe," "intend" or "project" or the negative of these words or other
variations on these words or comparable terminology.

This prospectus contains forward-looking statements, including statements
regarding, among other things, (a) our projected sales and profitability, (b)
our growth strategies, (c) anticipated trends in our industry, (d) our future
financing plans and (e) our anticipated needs for working capital. These
statements may be found under "Management's Discussion and Analysis or Plan of
Operations" and "Description of Business," as well as in this prospectus
generally. Actual events or results may differ materially from those discussed
in forward-looking statements as a result of various factors, including, without
limitation, the risks outlined under "Risk Factors" and matters described in
this prospectus generally. In light of these risks and uncertainties, there can
be no assurance that the forward-looking statements contained in this prospectus
will in fact occur.

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SELLING STOCKHOLDERS

The following table presents information regarding the selling
stockholders. The selling stockholders are the entities who have assisted in or
provided financing to Crowfly. A description of each selling stockholder's
relationship to Crowfly and how each selling stockholder acquired the shares to
be sold in this offering is detailed in the information immediately following
this table.

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PERCENTAGE
OF
OUTSTANDING PERCENTAGE
SHARES SHARES OF SHARES
BENEFICIALLY BENEFICIALLY SHARES TO BE BENEFICIALLY
OWNED BEFORE OWNED BEFORE SOLD IN THE OWNED AFTER
SELLING STOCKHOLDER OFFERING OFFERING (1) OFFERING OFFERING
------------------------ ------------- ------------- ------------- -------------

John W. Evans 2,000,000 * 2,000,000 0
Louis and Jean Bacig 1,000,000 * 1,000,000 0
Terry Kinder 1,000,000 * 1,000,000 0
Amber Run LLC 20,000,000 3.3% 20,000,000 0
Funding Enterprises LLC 20,000,000 3.3% 20,000,000 0
Hendrix & Gandy LLC 2,000,000 * 2,000,000 0
Gandy Associates LLC 18,000,000 3.0% 18,000,000 0
------------- ------------- ------------- -------------
TOTAL 64,000,000 100% 64,000,000 0%
============= ============= ============= =============

-------------------------------
* Less than 1%.

(1) Applicable percentage of ownership is based on 605,000,000 shares of common stock outstanding
as of January 5, 2004, together with securities exercisable or convertible into shares of
common stock within 60 days of January 5, 2004, for each stockholder. Beneficial ownership
is determined in accordance with the rules of the Securities and Exchange Commission and
generally includes voting or investment power with respect to securities. Shares of common
stock subject to securities exercisable or convertible into shares of common stock that are
currently exercisable or exercisable within 60 days of January 5, 2004 are deemed to be
beneficially owned by the person holding such securities for the purpose of computing the
percentage of ownership of such person, but are not treated as outstanding for the purpose of
computing the percentage ownership of any other person. Note that affiliates are subject to
Rule 144 and Insider trading regulations - percentage computation is for form purposes only.

The following information contains a description of each selling
stockholder's relationship to Crowfly and how each selling stockholder acquired
the shares to be sold in this offering is detailed below. None of the selling
stockholders have held a position or office, or had any other material
relationship, with Crowfly, except as follows:

SHAREHOLDERS OF CROWFLY, INC.

AMBER RUN, LLC. Amber Run, LLC is a founding shareholder of Crowfly, and
acquired its shares in connection with the formation of Crowfly. All investment
decisions of Amber Run, LLC are made by its manager Troy H. Myers, Jr. Amber
Run, LLC does not maintain any relationship with Crowfly other than as a
shareholder and no insider of Crowfly has any interest in Amber Run, LLC.

FUNDING ENTERPRISES, LLC. Funding Enterprises, LLC is a founding
shareholder of Crowfly, and acquired its shares in connection with the formation
of Crowfly. All investment decisions of Funding Enterprises, LLC are made by its
manager Joe Bridgeford. Funding Enterprises, LLC does not maintain any
relationship with Crowfly other than as a shareholder and no insider of Crowfly
has any interest in Funding Enterprises, LLC.

HENDRIX & GANDY LLC. Hendrix & Gandy, LLC is a founding shareholder of
Crowfly, and acquired its shares in connection with the formation of Crowfly.
All investment decisions of Hendrix & Gandy, LLC are made by its manager Ron
Hendrix. Hendrix & Gandy, LLC does not maintain any relationship with Crowfly
other than as a shareholder and no insider of Crowfly has any interest in
Hendrix & Gandy, LLC.

GANDY ASSOCIATES LLC. Gandy Associates, LLC is a founding shareholder of
Crowfly, and acquired its shares in connection with the formation of Crowfly.
All investment decisions of Gandy Associates, LLC are made by its manager John
Gandy. Gandy Associates, LLC does not maintain any relationship with Crowfly
other than as a shareholder and no insider of Crowfly has any interest in Gandy
Associates, LLC.

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JOHN W. EVANS. In January 2003, John W. Evans was issued 2,000,000 shares
of Crowfly common stock in consideration of his $10,000 investment or $0.005 per
share. Mr. Evans does not maintain any relationship with Crowfly other than as a
shareholder.

LOUIS AND JEAN BACIG. In January 2003, Louis and Jean Bacig were issued
1,000,000 shares of Crowfly common stock in consideration of their $5,000
investment or $0.005 per share. Louis and Jean Bacig do not maintain any
relationship with Crowfly other than as shareholders.

TERRY KINDER. In January 2003, Terry Kinder was issued 1,000,000 shares of
Crowfly common stock in consideration of his $5,000 investment or $0.005 per
share. Mr. Kinder does not maintain any relationship with Crowfly other than as
a shareholder.

USE OF PROCEEDS

This prospectus relates to shares of our common stock that may be offered and
sold from time to time by certain selling stockholders. There will be no
proceeds to us from the sale of shares of common stock in this offering.

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PLAN OF DISTRIBUTION

The selling stockholders have advised us that the sale or distribution of
our common stock owned by the selling stockholders may be effected directly to
purchasers by the selling stockholders or by pledgees, donees, transferees or
other successors in interest, as principals or through one or more underwriters,
brokers, dealers or agents from time to time in one or more transactions (which
may involve crosses or block transactions) (i) on the over-the-counter market or
in any other market on which the price of our shares of common stock are quoted
or (ii) in transactions otherwise than on the over-the-counter market or in any
other market on which the price of our shares of common stock are quoted. Any of
such transactions may be effected at market prices prevailing at the time of
sale, at prices related to such prevailing market prices, at varying prices
determined at the time of sale or at negotiated or fixed prices, in each case as
determined by the selling stockholders or by agreement between the selling
stockholders and underwriters, brokers, dealers or agents, or purchasers. If the
selling stockholders effect such transactions by selling their shares of common
stock to or through underwriters, brokers, dealers or agents, such underwriters,
brokers, dealers or agents may receive compensation in the form of discounts,
concessions or commissions from the selling stockholders or commissions from
purchasers of common stock for whom they may act as agent (which discounts,
concessions or commissions as to particular underwriters, brokers, dealers or
agents may be in excess of those customary in the types of transactions
involved). The selling stockholders and any brokers, dealers or agents that
participate in the distribution of the common stock may be deemed to be
underwriters, and any profit on the sale of common stock by them and any
discounts, concessions or commissions received by any such underwriters,
brokers, dealers or agents may be deemed to be underwriting discounts and
commissions under the Securities Act.

Under the securities laws of certain states, the shares of common stock may
be sold in such states only through registered or licensed brokers or dealers.
The selling stockholders are advised to ensure that any underwriters, brokers,
dealers or agents effecting transactions on behalf of the selling stockholders
are registered to sell securities in all fifty states. In addition, in certain
states the shares of common stock may not be sold unless the shares have been
registered or qualified for sale in such state or an exemption from registration
or qualification is available and is complied with.

We will pay all the expenses incident to the registration, offering and
sale of the shares of common stock to the public hereunder other than
commissions, fees and discounts of underwriters, brokers, dealers and agents.
The offering expenses consist of: a SEC registration fee of $259, printing
expenses of $2,500, accounting fees of $15,000, legal fees of $50,000 and
miscellaneous expenses of $17,241. We will not receive any proceeds from the
sale of any of the shares of common stock by the selling stockholders.

The selling stockholders should be aware that the anti-manipulation
provisions of Regulation M under the Exchange Act will apply to purchases and
sales of shares of common stock by the selling stockholders, and that there are
restrictions on market-making activities by persons engaged in the distribution
of the shares. Under Regulation M, the selling stockholders or their agents may
not bid for, purchase, or attempt to induce any person to bid for or purchase,
shares of our common stock while such selling stockholders are distributing
shares covered by this prospectus. Accordingly, except as noted below, the
selling stockholders are not permitted to cover short sales by purchasing shares
while the distribution is taking place. The selling stockholders are advised
that if a particular offer of common stock is to be made on terms constituting a
material change from the information set forth above with respect to the Plan of
Distribution, then, to the extent required, a post-effective amendment to the
accompanying registration statement must be filed with the Securities and
Exchange Commission.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

GENERAL

The following plan of operation should be read in conjunction with the
Consolidated Financial Statements, and the Notes thereto included herein. The
information contained below includes statements of Crowfly's or management's
beliefs, expectations, hopes, goals and plans that, if not historical, are
forward-looking statements subject to certain risks and uncertainties that could
cause actual results to differ materially from those anticipated in the
forward-looking statements. For a discussion on forward-looking statements, see
the information set forth in the Introductory Note to this registration
statement under the caption "Forward Looking Statements", which information is
incorporated herein by reference.

PLAN OF OPERATION

Crowfly is a start-up business that has not yet commenced operations and
has not had revenue since inception. As of October 31, 2003, Crowfly had total
assets of $30 and an accumulated deficit of $5,070. During the next twelve
months, Crowfly intends to develop and implement the Crowfly Business Model. The
Crowfly Business Model is expected to develop software to connect retailers
directly to manufacturers in a real-time electronic marketplace, bypassing the
traditional wholesale distributor. It is anticipated that the Crowfly Business
Model will enhance efficiencies and increase the margins throughout the supply
chain. Crowfly intends to first implement the Crowfly Business Model in the
hardware industry, and thereafter, in other industries where the wholesale
distributor is fundamental to the supply chain.

Management recognizes that Crowfly must receive financing to develop and
implement its business plan for the Crowfly Business Model. Management
anticipates that the estimated capital requirement to develop its business model
for sale will be approximately $1,750,000, which funding is expected to come
from external sources. However, Crowfly does not have any commitments for
capital.

Crowfly currently has three employees and does not anticipate any
significant changes in its number of employees. Further, Crowfly does not expect
to purchase or sell plant or other significant equipment in the near term.

LIQUIDITY AND CAPITAL RESOURCES

Crowfly expects to raise sufficient cash through external financing to meet
its capital requirements. However, no assurance is given that Crowfly will be
able to raise sufficient funds to meet its capital needs. Crowfly will seek
financing from various sources including the sales of securities, bank loans and
credit lines. However, no assurances can be given that Crowfly will be able to
meet its needs through the sale of securities or otherwise. Further, the
availability of any financing may not be on terms that are satisfactory to
Crowfly.

From time to time, Crowfly may evaluate potential acquisitions involving
complementary businesses, content, products or technologies. Crowfly has no
present agreements or understanding with respect to any such acquisition.
Crowfly's future capital requirements will depend on many factors, including
growth of Crowfly's business, the success of its operations, economic conditions
and other factors including the results of future operations.

On January 1, 2003, Crowfly entered into a written employment agreement
with each of William E. King, III, Robert A. Gillgrist and M. Phillip Wagoner.
Each employment agreement is for a term of two (2) years. However, both the
employee and Crowfly can terminate the employment agreement upon thirty (30)
days prior notice. The annual salary for each employee under his respective
employment agreement is $84,000. The employees are also entitled to health,
disability and life insurance in accordance with Crowfly's existing insurance
contracts and policies, if any.

SUBMISSION OF MATTERS TO A VOTE OF STOCK HOLDERS

There are no pending matters to be voted on by the stockholders at this
time.

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DESCRIPTION OF BUSINESS

Crowfly was incorporated in Nevada on August 16, 2002 under the name
Project IV, Inc. On November 15, 2002, Crowfly entered into an Asset Purchase
Agreement with William E. King, III, M. Phillip Waggoner and Robert A. Gillgrist
to purchase the business plan for the "Crowfly e-Commerce Models for B2B"
(hereinafter the "Crowfly Business Model"). Messrs. King, Waggoner and Gillgrist
were issued 3,600,000 shares of Crowfly common stock in consideration for the
Crowfly Business Model. As a result of a one hundred for one (100-for-1) common
stock split effective as of April 15, 2003, Messrs. King, Waggoner and Gillgrist
were issued an aggregate of 360,000,000 shares in connection with the Crowfly
Business Model.

Crowfly is a start-up business that has not yet commenced operations. We
expect to commence operations upon receipt of external financing. To date, we
have focused our attention to organizational matters. Crowfly is a development
stage company which intends to develop and implement the Crowfly Business Model.
Crowfly intends to install, own and manage electronic distribution centers which
operate in business to business (B2B) environments. The Crowfly Business Model
expects to develop software to connect retailers directly to manufacturers in a
real-time electronic marketplace, thus bypassing the traditional wholesale
distributor. It is anticipated that the Crowfly Business Model will enhance
efficiencies and increase the margins throughout the supply chain. Crowfly
intends to first implement the Crowfly Business Model in the hardware industry,
and thereafter, in other industries where the wholesale distributor is
fundamental to the supply chain. Below is an in-depth review of Crowfly's plans
for the implementation of the Crowfly Business Model and the markets in which we
intend to concentrate.

MARKET NICHE

Crowfly believes hardware industry trends, as well as those of the
consuming public, have created an environment is more receptive to the
e-Commerce business model described herein. Some of the indicators supporting
this belief are listed below.

BIG CHAINS PRESSURING MANUFACTURERS. Manufacturers, as well as retailers,
have been and continue to be squeezed by "big box" retailers like Home Depot,
Wal-Mart and Lowe's. They are pressured to provide smaller orders, more often,
and with price concessions based on volume. These concessions are not passed on
to the smaller independent retailers. Thus, the retailer struggles to be
competitive in the face of already high product costs, labor costs and intense
price competition from the big box stores.

POWER SHIFTING FROM THE SELLER TO THE BUYER. Internet technology has made
it easier for business people to find and do business with competitive vendors
and suppliers; and thus, they have begun to go "online" to find alternative
supply companies. One reason for the shift is that "switching cost", (the cost
associated with changing vendors) has been dramatically reduced. Computer
technology and the Internet have made it possible for procurement people to
search out and acquire new product lines with out ever having a face to face
meeting with the new vendor's sales representative.

Buyers are demanding on-line self service because it is so much more
convenient and efficient. The growing trend is that more and more the corporate
world is responding with various forms of on-line service.

SUPPLY CHANNEL LOADED WITH INEFFICIENCIES. While manufacturers have been
diligent in trying to take cost out the supply chain, the distributor link has
not. According to industry leaders, upwards of 40% of the "cost of goods to the
retailer" is attached to the distributor link. Because the traditional
distribution model is people and real estate intensive, it is difficult to make
the kind of cost cuts necessary to substantially enhance the retailers'
position. An Internet technology distribution model that requires no real
estate, no paper, and only a very few people can affect the margin enhancing
cuts today's retailers are struggling to find.

MASS COMMUNICATION IS GIVING WAY TO MASS CUSTOMIZATION. Internet technology
has made "one to one" marketing an absolute reality. Users can view merchandise
and place orders the way they want, when they want, with better prices than ever
before.

e-COMMERCE BUSINESSES RECEIVING SIGNIFICANT BENEFITS FROM ONLINE SERVICE.
The Aberdeen Research Group reported in 2000 the following:

- An average online "order" costs $30.00...average manual orders cost
$107.00.

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- Internet "answers" cost 10-20 cents...telephone answers cost
$10.00-$20.00.

- Business-to-business product returns are reduced 40%-80%.

- "Annual total" orders online are 20% higher than manual annual total
orders.

- Cross merchandising and up-sells are more effective online than phone,
fax or in person.

The bottom line, according to the Aberdeen Group, is that B2B customers
are beginning to shift away from companies that do not offer self-service
systems.

MARKETING

VALUE PROPOSITION

Because Crowfly is driven to maximize efficiency through IT leverage and
operational excellence, Crowfly expects to deliver hard-lines merchandise with
the best "total price" in the business. Best "total price" has two components,
(1) the best deliverable price, and (2) additional service benefits. This value
promise is deliverable at both retail and manufacturer levels.

REVENUE MODEL

Crowfly revenues are expected to be the result of the efficiencies it
delivers over the traditional distribution model. The strategy is to leverage IT
efficiencies to transform wholesaler operating expense into revenues. The
following identifies the projected sources of revenue. Totals represent 100% of
cost to retailer.

According to industry research, in the traditional model, line items
processing/paper, sales administration, freight, warehousing and profit margin
represent an estimated 37% of the total cost to the retailer. They represent 22%
of total to retailer in the e-Commerce model. The Crowfly Business Model
captures 15 cost points from the traditional model. It is able to achieve this
and deliver an additional six points of profit margin.

TRADITIONAL CROWFLY
DISTRIBUTION e-COMMERCE
------------ ----------
Cost from manufacturer 63% 63%
Processing/paper 4% 1%
Sales admin. 7% 2%
Freight cost 6% = 37% 4% = 22%
Warehousing cost 11% %
Profit margin 9% 15%
------------ ----------
85%
Captured margin 15%
100% 100%
============ ==========

PRODUCT STRATEGY

Initially, Crowfly expects to provide an online catalog of merchandise and
associated benefits available 24/7 at prices rivaling those here-to-for
available only to big box stores.

The online solution will replace expensive, and error prone, orders sheets
and replicate existing purchasing software products used by retailers.

It will provide customized part numbers and pricing, simple personal order
templates and a defined order entering method. It will deliver real time product
availability and order status.

The site will be simple, intuitive to users, and require minimum training.

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The Crowfly front-end and back-end will be fully integrated in real time
providing inventory data, financial data, and order tracking data to all
retailers. It was reported in a white paper prepared by Cambar Software Inc.
(April of 2001) that less than 10% of all e-Commerce sites today are fully
integrated.

Initially, Management projects the Crowfly site will be scaled to
accommodate the following:

- Order functionality for 5,000 customers...average wholesaler has 3,800
customers.

- Catalog inventory of 70,000 SKUs (stock keeping unit)...average
wholesaler offers 58,000 SKUs.

- Vendor capacity will be commensurate with the delivery of 70,000 SKUs.

FUNCTIONALITY

Site functionality will be developed in carefully measured steps. What
follows here is the "function outline" initially planned for the site. It will
undergo continual modification as the concept is moved through the "open for
business" phase and into the first year of operation. The objective with regard
to "functionality" is to eliminate buyer pain and enhance intuitive usability.

A. OVERVIEW. The Crowfly e-commerce site will serve three types of users:

1. Retailers

2. Suppliers

3. Administrators

B. BROWSER. To include the following:

1. General description or overview of site (home page)

2. Information about the company (about us)

3. Easy access to Crowfly employee or administrator (contact us)

C. RETAILER WILL:

1. Log in as per a user name with a password

2. Go to his personal order desk and find:

a. Message information about pending order and past order
formatting

b. Quick links showing how to: - get started (initial sign up
detail) - change passwords - view order template
alternatives

c. View announcement inputs from the company

d. Search for information about manufacturer members

e. View products currently featured as special offerings

f. View context-sensitive help on each page

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3. Interact with catalog:

a. Browse inventory

b. Search by UPC, manufacturer, or product category

c. Obtain and compare inter-brand pricing detail

d. Calculate estimated savings versus traditional distribution
model

4. Order entry:

a. Add products to order

b. Place order

c. Obtain shipping detail

d. Enter purchase order number

e. Select, and or change billing address

f. Edit any of above: product selection, payment detail,
billing address, quantity

g. Submit order

h. View order and potential savings earned

i. Add product from order template

j. Approve final order

k. Print hard copy of order

5. Personal order file allows retailer to:

a. Conduct search orders previously made (by P.O. number)

b. Conduct search of orders by Crowfly order number

c. Conduct search of orders by part number

d. Get order detail

e. Request return

6. Company profile (not available to all customer employees):

a. Address management (address data for all customer locations)

b. User management (detail regarding all customers approved to
place orders)

7. User profile (available to all customer users) allows individuals
to make changes to their personal data package

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D. SUPPLIER WILL:

1. Log in or out with supplier ID:

a. View all quick links

b. View all announcements

2. Interact with product management function (product status):

a. Add product

b. Change product status (in, out of stock, special offers,
etc.)

c. Delete SKUs from offering

3. View personal order files:

a. Did ship

b. Did not fully ship

c. Returns

d. Search by P.O., order number or part number

4. Company profile--same as retailer except profile information

5. User profile--same as retailer without order templates;
Administrator will:

a. Log in or out with user ID

b. Add announcements

c. View and edit all user information

d. Catalog management

i. Add product

ii. Delete product

iii. Edit existing content by

SOFTWARE DEVELOPMENT PROCESS

Crowfly believes that construction of the Crowfly Business Model site can,
for the most part, be accomplished by stitching together pieces of existing
software which will operate in a seamless fashion.

A "to be determined" amount of vendor time will have to be spent writing
and inserting product refinements that have not yet been identified. As these
are identified, they will be validated, constructed and implemented.

Crowfly estimates it will take approximately four to six months after
funding to develop software for the Crowfly site. There are two reasons for this
estimate. First, much of the code needed for the Crowfly Business Model
currently exists. Second, the software development process requires less time
today than it did even a year ago. The speed with which the e-Commerce industry
is growing has driven vendors to become more efficient, more timely. lmagoQA, an
e-Business software testing and consulting firm, reported recently that the
average software development cycle has been compressed from 18 months to 18
weeks.

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Crowfly is currently talking with Ulanji, Inc., of North Charleston, South
Carolina, regarding the development of the required code and hosting
accommodations. They are experienced in the design development and
implementation of B2B software products for supply chain management. They own
the intellectual property rights to a model which can be modified with a
reasonable amount of time and effort to satisfy the specific needs and
deliverables of Crowfly. They are the lead candidate for the package development
for several reasons:

- Extensive experience in B2B software systems

- An interest in developing product for business spaces such as this

- Located nearby for easy access

- Willing to host and manage the site on a long term basis

- Offer a development structure that seems to be reasonably priced and
timely

The phases of software development are as follows:

1. Requirements Gathering:

a. Define total e-Commerce business model for the Hardware Industry

b. Execute usability study with customers (50-100 retailers): likes,
dislikes, concerns

c. Execute usability study with manufacturers (10-20): likes,
dislikes, concerns

d. Target list of software vendor candidates

2. Development:

a. Design and develop retail web application

b. Design and develop supplier web application

c. Design and develop administrator web application

d. Design and develop back office application

3. Testing

4. Implementation:

a. Load data (suppliers, customers, users)

b. Create "help documentation"

c. Conduct training for Crowfly employees

TARGETING STRATEGY

Crowfly has three primary targets. Isolating and obtaining the first target
is fundamental to the efficient acquisition of targets two and three. In order
of importance these are:

A. DISTRIBUTOR PARTNER. Crowfly will identify and seek the alliance of an
existing distributor of hardware products. An alliance of this sort will provide
the most efficient path to the marketplace. There are four reasons for this
belief.

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1. Knows the business. A distributor's base of knowledge will be
invaluable in keeping the Crowfly concept on track and sharply focused.

2. Has most to lose. As the business begins to shift from the
traditional to the e-Commerce model, the distributor stands most vulnerable and
has the most to lose. Conversely, the distributor stands to gain the most if
willing to embrace the new model and get in front of the power curve.

3. Knows manufacturers, knows retailers. The distributor base of
business is an existing set of manufacturers and retailers, which is the perfect
environment for incubating the Crowfly Business Model.

4. Instant sales staff. The distributor's current sales force
represents a jumpstart opportunity for selling Crowfly to retailers. These
people are in the field every day and are hungry for "good news" to take to the
trade.

The best candidate for this role is likely a successful regional
distributor who wants continued growth; is somewhat limited by geography and is
hesitant to commit the resources necessary to compete on the national level.

B. MANUFACTURERS WITH MERCHANDISE TO SELL. Manufacturers of quality
hard-line merchandise. Crowfly will attract manufacturers to the Crowfly
Business Model by demonstrating the benefits of such a relationship. Initially
they are:

- Incremental sales

- Improved margins

- Lower cost of sales

- Enhanced order accuracy

- Enhanced product exposure

- Fewer returns

- Catalog maintenance and support

- Better communications with retailer

- Less big box dependence

- Paperless business

- Improved market knowledge

C. INDEPENDENT RETAILERS TO BUY. Retailers currently operating hardware
stores, home centers, paint stores and lumber yards. Crowfly will attract
retailers by demonstrating the benefits they can expect as a result of doing
business with the Crowfly Business Model:

- Better pricing

- Easy ordering

- Order 24/7 for increased convenience

- More accurate orders

- Enhanced product selection

- Single order point

- Paperless business

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- Built in freight

- Personalized order format

- Online community

According to a 2002 hardware industry report, there are 65,000-70,000
independent hardware stores in the country today.

BRAND NAME AND THEME LINE

The brand name and theme line will be as follows: "Crowfly, Buy Better.
Earn More." Crowfly is the working brand name for the hardware package. The
required trademark work will be completed when the concept is funded. However,
as the Crowfly Business Model moves from industry to industry, it will likely be
given industry specific brand names. Names that can be attached to the corporate
entity set up specifically for a particular industry. For example, the furniture
model brand may end up being something like MakersMart.

PRICING STRATEGY

Research conducted in July of 2001 by NewMarket Research Associates among
500 retailers revealed that over 60% of the respondents would seriously consider
"switching" to an online supply company for a cost savings of between 1% and
15%. Forty percent said they would be "very interested" in a supply company that
allowed them to price more closely with the big chains and just over 50% said
they would prefer to work directly with the manufacturer.

Crowfly's pricing strategy is expected to be designed to exploit these
attitudes. A portion of the captured margin (15% vs. traditional model), likely
5%-8% will be used to enhance the retailer margin.

Crowfly is prepared to assign 2%-4% of the captured margin to the
manufacturer. The intent is to insure the notion that the manufacturer will be
able increase its customer base without the promulgation of "big box" price
concessions.

Another reason to incentivise the manufacturer is that they will be asked
to pack and ship smaller orders, more often. A margin allowance in the early
stages will offset some of that cost.

ADVERTISING/PROMOTION STRATEGY

There are expected to be three parts to the initial advertising strategy.
The objectives of each are described as follows: Attract a distributor, sell and
sign manufacturers, sell and sign retailers.

A. ATTRACT A DISTRIBUTOR. Crowfly will use "one on one" tactics to
attract and form an alliance with the appropriate distributor. Industry contacts
and internet research will provide the information needed to identify the best
candidates. Meetings will then be set to present and sell the alliance
opportunity.

B. SELL AND SIGN MANUFACTURERS. An awareness campaign for the concept and
brand will be created and packaged for use in attracting manufacturers. The
"factory campaign" will position the brand, as well as to instruct and inform
manufacturers regarding all operational aspects of doing business via the
Crowfly Business Model.

The factory campaign will be implemented via direct mail, e-mail and an
"e-sign-up center" website. Distributor partner's procurement people will be
used to present, pitch and sign-up manufacturers to the Crowfly concept. The
company will develop a "sell-in process" for use by distributor personnel. Once
materials are produced, the distributor personnel will be trained to sell and
sign manufacturers.

C. SELL AND SIGN RETAILERS. Public relations, traditional trade
advertising, e-mail and the e-sign-up website will be utilized to attract
retailers to Crowfly. The "retailer campaign" will position the brand as well as
to inform how each can participate in Crowfly. Interested retailers will be
directed to the e-sign-up site where they can obtain the necessary information
or request contact from a Crowfly sales person.

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Distributor sales people will "pitch and sign" retailers as part of their
normal calling-on-the-trade process. A "sales process" will be developed
specifically for these employees. This program will be created and implemented
by the Crowfly principals.

RESEARCH AND DEVELOPMENT STRATEGY

Crowfly will keep in constant contact with retailers, manufacturers and out
source partners in an effort to continually refine the product. Management will
relentlessly strive to deliver more usable value to its customers than any of
its competition.

Crowfly's ultimate success is based upon its ability to replicate and
implement the fundamental Crowfly Business Model in other industries. An
immediate objective will be to develop the process by which these industry
selection decisions are made.

There are numerous spin-off products, services, even businesses that will
fall out of the original concept. Ongoingly, the recognition and analysis of
likely potential levels for each will be a critical part of the R&D effort.

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MANAGEMENT

As of January 5, 2004, the directors and executive officers of Crowfly,
their age, positions in Crowfly, the dates of their initial election or
appointment as directors or executive officers, and the expiration of the terms
are as follows:

[Enlarge/Download Table]

NAME OF DIRECTOR/
EXECUTIVE OFFICER AGE POSITION PERIOD SERVED
----------------------- --- ----------------------------------- ----------------------

William E. King, III 47 Chairman of the Board of Directors, January 2003 to date
President and CEO

Robert A. Gillgrist 59 Chief Operations Officer, Chief January 2003 to date
Financial Officer and Director

M. Phillip Waggoner 57 Chief Officer of Business January 2003 to date
Development and Director

None of Crowfly's directors or executive officers is a director of any
company that files reports with the SEC. None of the Company's directors has
been involved in any bankruptcy or criminal proceeding (excluding traffic an
other minor offenses), nor has been enjoined from engaging in any business.

Crowfly's directors are elected at the annual meeting of stockholders and
hold office until their successors are elected. Crowfly's officers are appointed
by the Board of Directors and serve at the pleasure of the Board and are subject
to employment agreements, if any, approved and ratified by the Board.

WILLIAM E. KING, III

William E. King, III was named President, Chief Executive Officer and
Chairman of the Board of Directors of Crowfly in January 2003. In addition,
since 1999, Mr. King has been engaged in real estate development as a managing
member of both Tilly Island, LLC and Wateree River, LLC. Also, since 2000, Mr.
King has been a partner in the consulting firm of wizBang Company. Previously,
Mr. King had built Employee Resource Management, an employee leasing company in
Charleston, South Carolina, from $5,000,000 in sales to $53,000,000 and
successfully completed the sale of the company. He was the 1994 recipient of
Ernst and Young's Entrepreneur of the Year Award for Emerging Companies. Mr.
King is experienced in areas of operations, marketing, finance, sales process,
training, equity packaging, human resources and motivation.

ROBERT A. GILLGRIST

Robert A. Gillgrist was named Chief Operations Officer, Chief Financial
Officer and a Director of Crowfly in January 2003. In addition, since January
2001, Mr. Gillgrist has been a partner in the consulting firm of wizBang
Company. From December 1999 to January 2001, Mr. Gillgrist was President of RAG,
Inc., a management consulting company. From May 1996 to December 1999, Mr.
Gillgrist was Vice President for Operations for the Southeast Division of
Intellisource, an outsourcing company that specializes in managing back offices
for companies. Prior to such experience, Mr. Gillgrist spent twenty-five years
with Westinghouse. As a management consultant, Mr. Gillgrist has worked for
clients like Pricewaterhouse Coopers, Shell Oil Company, Mile High Properties
and Pitney-Bowes. Mr. Gillgrist brings experience in operations, IT, finance,
human resource and marketing. Mr. Gillgrist received a B.S. in Mathematics from
Slippery Rock University. He continued his education sponsored by Westinghouse
with graduate level work at the University of Pittsburgh and the University of
West Virginia. He attended the Young Executive Management Business School
Program at Penn State in preparation for management assignments within
Westinghouse. While there he was named to lead an internal consulting team
charged with the enhancement of productivity and profitability of business units
within the Westinghouse universe.

M. PHILLIP WAGGONER

M. Phillip Waggoner was named Chief Officer of Business Development and a
Director of Crowfly in January 2003. In addition, since 2000, Mr. Waggoner has
been a partner in the consulting firm of wizBang Company. Also, since 1997, Mr.
Waggoner has been a developer of Newpoint Corners, a commercial area in
Beaufort, South Carolina. From July 1998 to 2000, Mr. Waggoner worked as an

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independent marketing consultant. Previously, Mr. Waggoner spent twenty-five
years in the marketing communications business. Mr. Waggoner was a senior
partner at Carmichael Lynch, an advertising agency in Minneapolis, MN. When he
began his time at the agency, it had about 30 employees and annual billings of
about $15,000,000. When he sold his interest in the agency, it had in excess of
200 employees and billings approaching $220,000,000. At the agency, Mr. Waggoner
helped build brands for Schwinn (bicycles), Avia (athletic shoes), Mercruiser
(sterndrives), Polaris (snowmobiles), Rollerblade, Mack Trucks, Gateway
Computers, National Car Rental, Zebco (fishing tackle) and Harley-Davidson. In
his role as senior partner he was responsible for corporate strategy development
and business development. The experience Mr. Waggoner brings to Crowfly is in
the areas of advertising, public relations, marketing, strategy development and
business development.

EXECUTIVE COMPENSATION

To date, Crowfly has not paid any salary or issued options, and has not
entered into any Long-Term Incentive Plan Awards. Crowfly began to accrue salary
for its executive officers on November 1, 2003.

COMPENSATION OF DIRECTORS

None of the directors are paid for their service on the Board of Directors.

EMPLOYMENT AGREEMENTS

On January 1, 2003, Crowfly entered into a written employment agreement
with each of William E. King, III, Robert A. Gillgrist and M. Phillip Wagoner.
Each employment agreement is for a term of two (2) years; however, both the
employee and Crowfly can terminate the agreement upon thirty (30) days prior
notice. The annual salary for each employee under his respective employment
agreement is $84,000. The employees are also entitled to health, disability and
life insurance in accordance with Crowfly's existing insurance contracts and
policies, if any.

COMMITTEES OF THE BOARD OF DIRECTORS

Currently, Crowfly does not have any executive or standing committees of
the Board of Directors.

DESCRIPTION OF PROPERTY

Crowfly currently maintains its principal office, rent-free, at the home of
its President and Chief Executive Officer, William E. King, III, which office is
located at 220 Williams Street Extension, Mount Pleasant, South Carolina 29464.

LEGAL PROCEEDING

None.

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PRINCIPAL STOCKHOLDERS

The following table sets forth information with respect of the beneficial
ownership as of January 5, 2004 for any person who is known to Crowfly to be (i)
the beneficial owner of more than 5% of Crowfly's common stock; (ii) an officer
or direct; and (iii) all directors and executive officers as a group.

SECURITY OWNERSHIP BY MANAGEMENT AND OF CERTAIN BENEFICIAL OWNERS
--------------------------------------------------------------------------------
AMOUNT
AND NATURE
TITLE OF NAME AND ADDRESS OF BENEFICIAL PERCENTAGE
CLASS OF BENEFICIAL OWNER OWNERSHIP OF CLASS(1)
-------- ------------------------------------ -------------- -----------

Common Great West LLC(2) 60,000,000(D) 9.9%
1960 Stickney Point Road, Suite 207
Sarasota, Florida 34231

Quandry LLC(3) 60,000,000(D) 9.9%
2033 Main Street, Suite 600
Sarasota, Florida 34237

Old Field Investments, LLC(4) 60,000,000(D) 9.9%
c/o Rachel Gandy
561 Old Field Road
Murrells Inlet, South Carolina 29576

William E. King, III 120,000,000(D) 19.8%
220 Williams Street Extension
Mount Pleasant, South Carolina 29464

Robert A. Gillgrist 120,000,000(D) 19.8%
220 Williams Street Extension
Mount Pleasant, South Carolina 29464

M. Phillip Wagoner 121,000,000(D) 20.0%
220 Williams Street Extension
Mount Pleasant, South Carolina 29464

Officers and Directors as a group 361,000,000(D) 59.7%

(1) Applicable percentage of ownership is based on 605,000,000 shares of common
stock outstanding as of January 5, 2004 for each stockholder. Beneficial
ownership is determined in accordance within the rules of the Commission
and generally includes voting of investment power with respect to
securities. Shares of common stock subject to securities exercisable or
convertible into shares of common stock that are currently exercisable or
exercisable within 60 days of January 5, 2004 are deemed to be
beneficially owned by the person holding such options for the purpose of
computing the percentage of ownership of such persons, but are not treated
as outstanding for the purpose of computing the percentage ownership of any
other person.

(2) Macella Mica may be deemed to be a beneficial owner of the shares of common
stock owned by Great West, LLC, because as the manager of Great West, LLC,
she has the power to direct the voting and disposition of such shares. Ms.
Mica, however, specifically disclaims beneficial ownership of all shares
held by Great West, LLC.

(3) Holly M. Hawk may be deemed to be a beneficial owner of the shares of
common stock owned by Quandry, LLC, because as the manager of Quandry, LLC,
she has the power to direct the voting and disposition of such shares. Ms.
Hawk, however, specifically disclaims beneficial ownership of all shares
held by Quandry, LLC.

(4) Steve Donvanat may be deemed to be a beneficial owner of the shares of
common stock owned by Old Field Investments, LLC, because as the manager of
Old Field Investments, LLC, he has the power to direct the voting and
disposition of such shares. Mr. Donvanat, however, specifically disclaims
beneficial ownership of all shares held by Old Field Investments, LLC.

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SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLAN

Crowfly has not adopted any equity compensation plan.

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CERTAIN RELATIONSHIP AND RELATED TRANSACTIONS

Each of William E. King, III, Robert A. Gillgrist and M. Phillip Waggoner
has entered into a two year employment agreement with Crowfly, whereby each is
paid an annual salary of $84,000. The employees are also entitled to health,
disability and life insurance in accordance with Crowfly's existing insurance
contracts and policies, if any.

Mr. Waggoner has made an investment in Crowfly of $5,000. Mr. Waggoner
received 1,000,000 shares of stock for his $5,000 investment or $0.005 per
share.

Crowfly currently maintains its principal office, rent-free, at the home of
its President William E. King, III.

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MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S
COMMON EQUITY AND OTHER STOCKHOLDER MATTERS

As of the filing of this registration statement, there is no public market
for shares of Crowfly's common stock. Crowfly anticipates that shares of its
common stock will be traded on the Over-the-Counter Bulletin Board.

Crowfly presently is authorized to issue 5,000,000,000 shares of common
stock with $0.00001 par value. As of January 5, 2004, there were fourteen
holders of record of Crowfly's common stock and 605,000,000 shares issued and
outstanding.

Crowfly is also authorized to issue 10,000,000 shares of preferred stock
having a par value of $0.001 per share. The Board of Directors may from time to
time determine the designations, rights and preferences of the Preferred Stock.

DIVIDENDS

Crowfly has not declared or paid cash dividends on its common stock since
its inception and does not anticipate paying such dividends in the foreseeable
future. The payment of dividends may be made at the discretion of the Board of
Directors and will depend upon, among other factors, on Crowfly's operations,
its capital requirements, and its overall financial condition.

CHANGES IN SECURITIES

In connection with the formation of Crowfly, the following shares of common
stock (as calculated after the 100-for-1 stock split of Crowfly's common stock)
were issued to the following founding shareholders: 60,000,000 shares were
issued to each of Great West, LLC, Quandry, LLC and Old Field Investments, LLC;
20,000,000 shares were issued to each of Amber Run, LLC and Funding Enterprises,
LLC; 18,000,000 shares were issued to Gandy Associates, LLC; and 2,000,000 were
issued to Hendrix & Gandy, LLC.

On November 15, 2002, Crowfly issued to Messrs. King, Gillgrist and
Waggoner 3,600,000 shares of common stock in connection with the purchase of the
Crowfly Business Model. As a result of a one hundred for one (100-for-1) common
stock split effective as of April 15, 2003, Messrs. King, Gillgrist and Waggoner
were issued an aggregate of 360,000,000 shares in consideration for the Crowfly
Business Model.

In January 2003, John W. Evans was issued 2,000,000 shares of Crowfly
common stock in consideration of his $10,000 investment or $0.005 per share.

In January 2003, Louis and Jean Bacig were issued 1,000,000 shares of
Crowfly common stock in consideration of their $5,000 investment or $0.005 per
share.

In January 2003, Terry Kinder was issued 1,000,000 shares of Crowfly common
stock in consideration of his $5,000 investment or $0.005 per share.

In January 2003, M. Phillip Waggoner was issued 1,000,000 shares of Crowfly
common stock in consideration of his $5,000 investment or $0.005 per share.

With respect to the sale of unregistered securities referenced above, all
transactions were exempt from registration pursuant to Section 4(2) of the
Securities Act of 1933 (the "1933 ACT"), and Regulation D promulgated under the
1933 Act. In each instance, the purchaser had access to sufficient information
regarding Crowfly so as to make an informed investment decision. More
specifically, Crowfly had a reasonable basis to believe that each purchaser was
an "accredited investor" as defined in Regulation D of the 1933 Act and/or
otherwise had the requisite sophistication to make an investment in Crowfly's
securities.

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DESCRIPTION OF SECURITIES

GENERAL

Crowfly's authorized capital consists of 5,000,000,000 shares of common
stock, par value $0.00001 per share and 10,000,000 shares of preferred stock,
par value $0.001. Effective April 15, 2003, the Board of Directors of Crowfly
authorized a 100-for-1 stock split of its common stock. As of January 5, 2004,
there were 605,000,000 outstanding shares of common stock and no outstanding
shares of preferred stock. Set forth below is a summary description of certain
provisions relating to Crowfly's capital stock contained in its Articles of
Incorporation and By-Laws and under Nevada Statutes. The summary is qualified in
its entirety by reference to Crowfly's Articles of Incorporation and By-Laws and
the Nevada law.

COMMON STOCK

Each outstanding share of common stock has one vote on all matters
requiring a vote of the stockholders. There is no right to cumulative voting;
thus, the holder of fifty percent or more of the shares outstanding can, if they
choose to do so, elect all of the directors. In the event of a voluntary of
involuntary liquidation, all stockholders are entitled to a pro rata
distribution after payment of liabilities and after provision has been made for
each class of stock, if any, having preference over the common stock. The
holders of the common stock have no preemptive rights with respect to future
offerings of shares of common stock. Holders of common stock are entitled to
dividends if, as and when declared by the Board out of the funds legally
available therefore. It is Crowfly's present intention to retain earnings, if
any, for use in its business. The payment of dividends on the common stock is,
therefore, unlikely in the foreseeable future.

PREFERRED STOCK

WARRANTS

No warrants are currently outstanding relating to Crowfly's common stock.

OPTIONS

No options are currently outstanding relating to Crowfly's common stock.

TRANSFER AGENT

The Transfer Agent for the common stock is Interwest Transfer located at
P.O. Box 17136, 1981 East 4800 South, Suite 100, Salt Lake City, Utah 84117.

LIMITATION OF LIABILITY: INDEMNIFICATION

Our Articles of Incorporation include an indemnification provision under
which we have agreed to indemnify directors and officers of Crowfly from and
against certain claims arising from or related to future acts or omissions as a
director or officer of Crowfly. Insofar as indemnification for liabilities
arising under the Securities Act of 1933 may be permitted to directors, officers
and controlling persons of Crowfly pursuant to the foregoing, or otherwise,
Crowfly has been advised that in the opinion of the SEC such indemnification is
against public policy as expressed in the Securities Act of 1933 and is,
therefore, unenforceable.

ANTI-TAKEOVER EFFECTS OF PROVISIONS OF THE ARTICLES OF INCORPORATION

AUTHORIZED AND UNISSUED STOCK

The authorized but unissued shares of our common stock are available for
future issuance without our stockholders' approval. These additional shares may
be utilized for a variety of corporate purposes including but not limited to
future public or direct offerings to raise additional capital, corporate

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acquisitions and employee incentive plans. The issuance of such shares may also
be used to deter a potential takeover of Crowfly that may otherwise be
beneficial to stockholders by diluting the shares held by a potential suitor or
issuing shares to a stockholder that will vote in accordance with Crowfly's
Board of Directors' desires. A takeover may be beneficial to stockholders
because, among other reasons, a potential suitor may offer stockholders a
premium for their shares of stock compared to the then-existing market price.

The existence of authorized but unissued and unreserved shares of preferred
stock may enable the Board of Directors to issue shares to persons friendly to
current management which would render more difficult or discourage an attempt to
obtain control of Crowfly by means of a proxy contest, tender offer, merger or
otherwise, and thereby protect the continuity of Crowfly's management.

EXPERTS

Crowfly's balance sheet for the period ended February 28, 2003 was audited
by Moore Kirkland & Beauston LLP, independent auditors. The balance sheet is
included in this prospectus and incorporated by reference in the Registration
Statement in reliance upon the report of such firm given upon their authority as
experts in accounting and auditing. Further included in this prospectus and
incorporated by reference in the Registration Statement in reliance upon the
report of such firm, given upon their authority as experts in accounting and
auditing, is Crowfly's balance sheet as of October 31, 2003 and the related
statements of income (loss) and cash flows for the ten (10) months then ended.

LEGAL MATTERS

Kirkpatrick & Lockhart LLP, Miami, Florida, will pass upon the validity of
the shares of common stock offered hereby for us.

HOW TO GET MORE INFORMATION

We have filed with the Securities and Exchange Commission a registration
statement on Form SB-2 under the Securities Act with respect to the securities
offered by this prospectus. This prospectus, which forms a part of the
registration statement, does not contain all the information set forth in the
registration statement, as permitted by the rules and regulations of the
Commission. For further information with respect to us and the securities
offered by this prospectus, reference is made to the registration statement.
Statements contained in this prospectus as to the contents of any contract or
other document that we have filed as an exhibit to the registration statement
are qualified in their entirety by reference to the exhibits for a complete
statement of their terms and conditions. The registration statement and other
information may be read and copied at the Commission's Public Reference Room at
450 Fifth Street N.W., Washington, D.C. 20549. The public may obtain information
on the operation of the Public Reference Room by calling the Commission at
1-800-SEC-0330. The Commission maintains a web site at http://www.sec.gov that
contains reports, proxy and information statements, and other information
regarding issuers that file electronically with the Commission.

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CROWFLY, INC.
CONSOLIDATED FINANCIAL STATEMENTS
FEBRUARY 28, 2003 (AUDITED)

PAGE(S)
-------

Independent Auditor's Report F-2
Balance Sheet as of February 28, 2003 (Audited) F-3
Notes to Balance Sheet F-4

F-1

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INDEPENDENT AUDITORS' REPORT

The Board of Directors of Crowfly, Inc.
Charleston, South Carolina

We have audited the accompanying balance sheet of Crowfly, Inc. (the
"Company"), a development stage company, as of February 28, 2003. This balance
sheet and accompanying notes are the responsibility of the Company's management.
Our responsibility is to express an opinion on the balance sheet and
accompanying notes based on our audit.

We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. 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 balance sheet and accompanying notes referred to above
present fairly, in all material respects, the financial position of Crowfly,
Inc. as of February 28, 2003, in conformity with accounting principles generally
accepted in the United States.

Charleston, South Carolina
April 1, 2003

F-2

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CROWFLY, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
AS OF FEBRUARY 28, 2003

ASSETS:

Cash $ 100
-------

Total Assets $ 100
=======

LIABILITIES AND STOCKHOLDER'S EQUITY:

Liabilities
Due to shareholder $ 100
-------

Total Liabilities 100

Stockholders' Equity
Preferred stock - $0.001 par value;
10 million authorized;
0 issued and outstanding 0
Common Stock - $0.001 par value;
800 million shares authorized;
6,060,000 shares issued and outstanding 6,060

Paid in capital in excess of par (1,060)
Deficit accumulated during development stage (5,000)
-------

Total stockholders' equity 0
-------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 100
=======

See independent auditors' report and accompanying notes

F-3

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CROWFLY, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO BALANCE SHEET
AS OF FEBRUARY 28, 2003

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES AND ANTICIPATED BUSINESS ACTIVITIES

Crowfly, Inc. (the "Company") was incorporated on August 16, 2002 in Nevada.

The Company's shareholders and management have been primarily engaged in
pre-opening activities.

The Company will be engaged in the business of on line distribution, providing a
self-service e-Commerce tool that connects retailers to manufacturers in a real
time electronic marketplace; one that drives distribution efficiencies for the
manufacturer and procurement efficiencies for the retailer.

NOTE 2 - STOCKHOLDERS' EQUITY

The Company is authorized to issue 10,000,000 shares of preferred stock with a
par value of $0.001. No shares have been issued as of February 28, 2003.

The Company is authorized to issue 800,000,000 shares of common stock with a par
value of $0.001. As of February 28, 2003, the Company has issued 6,060,000
shares in exchange for $25,000 in legal expenses which were paid on the
Company's behalf and a business plan with a value of $5,000 as estimated by
management. The legal expenses are considered stock issuance costs and have been
charged against additional paid in capital, accordingly.

NOTE 3 - LINE OF CREDIT

In January 2003, the company entered into a $3,000,000 equity line of credit
with an investor, whereby the Company may request funds in exchange for shares
of its common stock, which will be issued with a 5% discount from market price.
190,000,000 shares of the Company's common stock have been reserved for this
equity line of credit. This line of credit is available with condition that the
company files a Registration Statement with the Securities and Exchange
Commission (SEC) and its common stock is available for trading on public
markets. The Company has not yet completed its Registration Statement with the
SEC. The Company has no outstanding balance on this line of credit as of
February 28, 2003.

NOTE 4 - CONVERTIBLE DEBENTURE

As part of this equity line of credit, the company issued a $150,000 convertible
debenture with a 5% interest rate, which is due on January 2005. Upon maturity,
the Company may elect to pay this amount in cash or a common stock equivalent.

F-4

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CROWFLY, INC.
CHARLESTON, SOUTH CAROLINA
COMPILED FINANCIAL STATEMENTS
AS OF OCTOBER 31, 2003 AND FOR THE TEN MONTHS THEN ENDED
(UNAUDITED)

Page

Compilation Report F-5

Financial Statements:

Balance Sheet F-6

Statement of Income (Loss) F-7

Statement of Cash Flows F-8

Notes to Financial Statement F-9

F-5

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MOORE KIRKLAND & BEAUSTON L.L.P.
Certified Public Accountants & Consultants

The Board of Directors of Crowfly, Inc.
Charleston, South Carolina

We have compiled the accompanying balance sheet of Crowfly, Inc., a development
stage company, as of October 31, 2003 and the related statements of income
(loss) and cash flows for the ten months then ended, in accordance with
Statements on Standards for Accounting and Review Services issued by the
American Institute of Certified Public Accountants.

A compilation is limited to presenting in the form of financial statements
information that is the representation of management. We have not audited or
reviewed the accompanying financial statements and supplementary schedules and,
accordingly, do not express an opinion or any other form of assurance on them.

Charleston, South Carolina
October 6, 2003

150 North Ninth Street West Columbia, SC 29169
Phone (803) 791-7472 Fax (803) 796-1168

RO Box 1036 110 Pinewood Avenue Hartsville, SC 29551
Phone (843) 332-1335 Fax (843) 332-9010

1616 Ashley River Road Charleston, SC 29407
Phone (843) 766-5010 Fax (843) 766-5768

8 Gillon Street Charleston, SC 29401
Phone (843) 723-4~24 Fax (843) 853-6974

www.mkbcpa.com

F-6

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CROWFLY, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
AS OF OCTOBER 31, 2003

ASSETS:

Cash $ 30
-------

Total Assets $ 30
-------

LIABILITIES AND STOCKHOLDERS' EQUITY:

Current Liabilities
Due to stockholder $ 100
-------

Total Liabilities 100
-------

Stockholders' Equity
Preferred stock - $0.00l par value; 0
10 million authorized; none issued and
outstanding
Common Stock - $0.00001 par value; 800 million shares
authorized; 605,000,000 shares issued and outstanding 5,000
Deficit accumulated during development stage (5,070)
-------

Total stockholders' equity (deficit) (70)
-------

Total Liabilities and Stockholders' Equity $ 30
-------

See accountants' compilation report and accompanying notes

F-7

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CROWFLY, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF INCOME (LOSS)
FOR THE TEN MONTHS ENDED OCTOBER 31, 2003

REVENUES:
Revenues $ 0
TOTAL REVENUES 0
--------

EXPENSES:
Bank fees 70
Organizational expense 5,000
--------

TOTAL EXPENSES 5,070
--------

NET INCOME (LOSS) $(5,070)
--------

See accountants' compilation report and accompanying notes

F-8

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CROWFLY, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE TEN MONTHS ENDED OCTOBER 31, 2003

CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (loss) $(5,070)
Adjustments to reconcile net income to net cash provided
by operating activities:
Organization expense 5,000
Change in assets and liabilities:
Increase in Due to Shareholder 100
--------
Cash disbursed for operating activities 30

NET CASH USED BY OPERATING ACTIVITIES: 30
--------

CASH FLOWS FROM INVESTING ACTIVITIES:
NET CASH USED BY INVESTING ACTIVITIES: 0

CASH FLOWS FROM FINANCING ACTIVITIES:
NET CASH USED BY FINANCING ACTIVITIES: 0
--------

NET INCREASE (DECREASE) IN CASH 30

CASH AT BEGINNING OF PERIOD 0
--------
CASH AT END OF PERIOD $ 30
--------

NON-CASH FINANCING ACTIVITIES:

The stockholders contributed a business plan valued at $5,000 and paid $25,000
directly to attorneys for work in conjunction with the issuance of securities.

See accountants compilation report and accompanying notes

F-9

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CROWFLY, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO BALANCE SHEET
AS OF OCTOBER 31, 2003 AND FOR THE TEN MONTHS THEN ENDED

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES AND ANTICIPATED BUSINESS ACTIVITIES

Crowfly, Inc. (the "Company") was incorporated on August 16, 2002, in Nevada.

The Company's stockholders and management have been primarily engaged in
pre-opening activities.

The Company will be engaged in the business of online distribution, providing a
self-service c-Commerce tool that connects retailers to manufacturers in a real
time electronic marketplace; one that drives distribution efficiencies for the
manufacturer and procurement efficiencies for the retailer.

NOTE 2 - STOCKHOLDERS EQUITY

The Company is authorized to issue ~ 0,000,000 shares of preferred stock with a
par value of $0.001. No shares have been issued as of October 31, 2003.

The Company is authorized to issue 800,000,000 shares of common stock with a par
value of $0001. As of October 31, 2003, the Company has issued 605,000,000
shares in exchange for $25,000 in legal expenses which were paid on the
Company's behalf and a business plan with a value of $5,000 as estimated by
management. ~ legal expenses are considered stock issuance costs and accordingly
have been charged against additional paid-in capital.

NOTE 3 - LINE OF CREDIT AND OTHER FINANCING ARRANGEMENTS

In January 2003, the Company entered into a $3,000,000 equity line of credit
agreement with an investor, whereby the Company may request funds in exchange
for shares of its common stock which will be issued with a 5% discount from
market price. Shares totaling 180,000,000 of the Company's common stock have
been reserved for issuance under this equity line of credit agreement. This line
of credit is available with condition that the Company files a Registration
Statement with the Securities and Exchange Commission (SEC) and its common stock
is available for trading on public markets. The Company has not yet completed
its Registration Statement with the SEC. The Company has not yet borrowed on
this line of credit as of October 31, 2003.

F-10

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CROWFLY, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO BALANCE SHEET
AS OF OCTOBER 31, 2003 AND FOR THE TEN MONTHS THEN ENDED

NOTE 3 - LINE OF CREDIT AND OTHER FINANCING ARRANGEMENTS

(CONTINUED)

Under the line of credit agreement, the Company issued a $150,000 convertible
debenture with a 5% interest rate, maturing on January 2005. Upon maturity, the
Company may elect to pay the debenture in cash or in a common stock equivalent.

F-11

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CROWFLY, INC.

WE HAVE NOT AUTHORIZED ANY DEALER,
SALESPERSON OR OTHER PERSON TO PROVIDE
ANY INFORMATION OR MAKE ANY
REPRESENTATIONS ABOUT CROWFLY, INC.
EXCEPT THE INFORMATION OR
REPRESENTATIONS CONTAINED IN THIS
PROSPECTUS. YOU SHOULD NOT RELY ON ANY
ADDITIONAL INFORMATION OR
REPRESENTATIONS IF MADE.

-----------------------

This prospectus does not constitute an ----------
offer to sell, or a solicitation of an PROSPECTUS
offer to buy any securities: ----------

[ ] except the common stock offered
by this prospectus;

[ ] in any jurisdiction in which the 605,000,000 SHARES OF COMMON STOCK
offer or solicitation is not
authorized;

[ ] in any jurisdiction where the
dealer or other salesperson is
not qualified to make the offer
or 605,000,000 Shares of Common
Stock solicitation; CROWFLY, INC.

[ ] to any person to whom it is
unlawful to make the offer or
solicitation; or CROWFLY, INC.

[ ] to any person who is not a United __________, 2004
States resident or who is outside
the jurisdiction of the United
States.

The delivery of this prospectus or any
accompanying sale does not imply that:

[ ] there have been no changes in the
affairs of Crowfly, Inc. after
the date of this prospectus; or

[ ] the information contained in this
prospectus is correct after the
date of this prospectus.

-----------------------

Until _________, 2004, all dealers
effecting transactions in the
registered securities, whether or not
participating in this distribution,
may be required to deliver a
prospectus. This is in addition to the
obligation of dealers to deliver a
prospectus when acting as
underwriters.

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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

INDEMNIFICATION OF DIRECTORS AND OFFICERS

OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth estimated expenses expected to be incurred
in connection with the issuance and distribution of the securities being
registered. Crowfly will pay all expenses in connection with this offering.

Securities and Exchange Commission Registration Fee $ 259
Printing and Engraving Expenses $ 2,500
Accounting Fees and Expenses $ 15,000
Legal Fees and Expenses $ 50,000
Miscellaneous $ 17,241

TOTAL $ 85,000

RECENT SALES OF UNREGISTERED SECURITIES

In connection with the formation of Crowfly, the following shares of common
stock (as calculated after the 100-for-1 common stock split) were issued to the
following founding shareholders: 60,000,000 shares were issued to each of Great
West, LLC, Quandry, LLC and Old Field Investments, LLC; 20,000,000 shares were
issued to each of Amber Run, LLC and Funding Enterprises, LLC; 18,000,000 shares
were issued to Gandy Associates, LLC; and 2,000,000 were issued to Hendrix &
Gandy, LLC.

In January 2003, John W. Evans was issued 2,000,000 shares of Crowfly
common stock in consideration of his $10,000 investment or $0.005 per share.

In January 2003, Louis and Jean Bacig were issued 1,000,000 shares of
Crowfly common stock in consideration of their $5,000 investment or $0.005 per
share.

In January 2003, Terry Kinder was issued 1,000,000 shares of Crowfly common
stock in consideration of his $5,000 investment or $0.005 per share.

In January 2003, M. Phillip Waggoner was issued 1,000,000 shares of Crowfly
common stock in consideration of his $5,000 investment or $0.005 per share.

II-1

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With respect to the sale of unregistered securities referenced above, all
transactions were exempt from registration pursuant to Section 4(2) of the
Securities Act of 1933 (the "1933 Act"), and Regulation D promulgated under the
1933 Act. In each instance, the purchaser had access to sufficient information
regarding Crowfly so as to make an informed investment decision. More
specifically, Crowfly had a reasonable basis to believe that each purchaser was
an "accredited investor" as defined in Regulation D of the 1933 Act and/or
otherwise had the requisite sophistication to make an investment in Crowfly's
securities.

II-2

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EXHIBITS

[Enlarge/Download Table]

EXHIBIT NO. DESCRIPTION LOCATION
----------- ----------------------------------------------- ----------------------------------------

3.1 Articles of Incorporation Provided herewith

3.2 Certificate of Amendment to Articles of Provided herewith
Incorporation dated November 11, 2002

3.3 Certificate of Amendment to Articles of Provided herewith
Incorporation dated January 12, 2003

3.4 Bylaws Provided herewith

5.1 Legal Opinion of Kirkpatrick & Lockhart LLP Provided herewith

10.1 Asset Purchase Agreement dated November 15, 2002 Provided herewith

10.2 Bill of Sale Provided herewith

10.3 Employment Agreement with William E. King, III, Provided herewith
effective as of January 1, 2003

10.4 Employment Agreement with Robert A. Gillgrist, Provided herewith
effective as of January 1, 2003

10.5 Employment Agreement with M. Phillip Waggoner, Provided herewith
effective as of January 1, 2003

23.1 Consent of Kirkpatrick & Lockhart LLP Incorporated by reference to Exhibit 5.1
contained in this filing

23.2 Consent of Moore, Kirkland & Beauston LLP Provided herewith

II-3

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UNDERTAKINGS

The undersigned registrant hereby undertakes:

(1) To file, during any period in which it offers or sells
securities, a post-effective amendment to this registration statement to:

(i) Include any prospectus required by Sections 10(a)(3) of the
Securities Act of 1933 (the "ACT");

(ii) Reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective Registration Statement;

(iii) Include any additional or changed material information on
the plan of distribution;

(2) That, for the purpose of determining any liability under the Act,
each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the bona fide offering thereof.

(3) To remove from registration by means of a post-effective
amendment any of the securities that remain unsold at the end of the offering.

Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the small business
issuer pursuant to the foregoing provisions, or otherwise, the small business
issuer 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. In the event that a claim for indemnification
against such liabilities (other than the payment by the small business issuer of
expenses incurred or paid by a director, officer or controlling person of the
small business issuer in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the small business issuer will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

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SIGNATURES

In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form SB-2 and authorized this registration
statement to be signed on our behalf by the undersigned, on January 5, 2004.

CROWFLY, INC.

By: /s/ William E. King, III
---------------------------------------
William E. King, III
Chairman and President

By: /s/ Robert A. Gillgrist
---------------------------------------
Robert A. Gillgrist
Chief Financial Officer

Pursuant to the requirements of the Securities Act of 1933 this
Registration Statement has been duly signed by the following persons on behalf
of the registrant and in the capacities and on the dates indicated.

/s/ William E. King, III January 5, 2004
------------------------------------------ ----------------------------
President and Chairman Date

/s/ Robert A. Gillgrist January 5, 2004
------------------------------------------ ----------------------------
Director Date

/s/ M. Phillip Waggoner January 5, 2004
------------------------------------------ ----------------------------
Director Date

II-5

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Dates Referenced Herein and Documents Incorporated By Reference

		Referenced-On Page
This SB-2 Filing	Date	First	Last	Other Filings

	8/16/02	4	40
	11/11/02	45
	11/15/02	4	45
	1/1/03	13	45
	1/12/03	45
	2/28/03	30	34
	4/1/03	32
	4/15/03	4	43
	10/6/03	36
	10/31/03	4	41
	11/1/03	24
Filed On / Filed As Of	1/5/04	1	47

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Crowfly Inc · SB-2 · On 1/5/04

Filed On 1/5/04 4:28pm ET · SEC File 333-111708 · Accession Number 898432-4-3

Registration of Securities by a Small-Business Issuer · Form SB-2Filing Table of Contents

SB-2 · Registration of Securities by a Small-Business IssuerDocument Table of Contents

Dates Referenced Herein and Documents Incorporated By Reference

Registration of Securities by a Small-Business Issuer · Form SB-2
Filing Table of Contents

SB-2 · Registration of Securities by a Small-Business Issuer
Document Table of Contents