mii10q63009.htm

10-Q 1 mii10q63009.htm MEZABAY INTERNATIONAL INC. FORM 10-Q (6/30/09). mii10q63009.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2009

OR

[ ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 000-30013

MEZABAY INTERNATIONAL INC.

(Formerly, Cardtrend International Inc.)

(Exact name of registrant as specified in its charter)

NEVADA

(State or other jurisdiction of incorporation or organization)

800 5th Avenue

Suite 4100

Seattle, Washington 98104

(Address of principal executive offices, including zip code.)

(206) 447-1379

(Telephone number, including area code)

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “non-accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	[ ]	Accelerated Filer	[ ]
Non-accelerated Filer	[ ]	Smaller Reporting Company	[X]
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES [ ] NO [X]

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 402,393,726 as of August 13, 2009.

TABLE OF CONTENTS

MEZABAY INTERNATIONAL INC.
(FORMERLY CARDTREND INTERNATIONAL INC.)

ITEM	Description	Page

PART I - FINANCIAL INFORMATION

ITEM 1.	Financial Statements	3
	Condensed Consolidated Balance Sheets as of June 30, 2009 (unaudited) and December 31, 2008	F-1
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the
	Three Months and Six Months Ended June 30, 2009 and 2008(unaudited)	F-2
	Condensed Consolidated Statement of Cash Flows for the Six Months
	Ended June30, 2009 and 2008 (unaudited)	F-3
	Condensed Consolidated Statement of Stockholders’ Deficit for the Six Months
	Ended June 30, 2009 and 2008 (unaudited)	F-4
	Notes to Condensed Consolidated Financial Statements(unaudited)	F-5 to F-18

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results ofOperations	21

ITEM 3.	Quantitative and Qualitative Disclosure About Market Risk	25

ITEM 4.	Controls and Procedures	25

PART II - OTHER INFORMATION

ITEM 1.	Legal Proceedings	26

ITEM 1A.	Risk Factors	26

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26

ITEM 3.	Defaults Upon Senior Securities	26

ITEM 4.	Submission of Matters to a Vote of Security Holders	26

ITEM 5.	Other Information	26

ITEM 6.	Exhibits	26-28

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2009 AND DECEMBER 31, 2008

(Currency expressed in United States Dollars (“US$”), except for number of shares)

	June 30, 2009		December 31, 2008
	(Unaudited)		(Audited)
ASSETS
Current assets:
Cash and cash equivalents	$	29,462	$	14,919
Accounts receivable, net		234,149		223,933
Inventories		2,161		2,693
Other receivables and prepayments		105,986		67,428

Total current assets		371,758		308,973

Plant and equipment, net		323,607		393,314
Goodwill		-		153,212
Intellectual property, net		233,333		283,333

TOTAL ASSETS	$	928,698	$	1,138,832

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	58,009	$	26
Deferred revenue		1,638		80,541
Accrued liabilities and other payables		932,619		1,085,369
Loan payable		102,727		104,671
Due to related parties		313,682		519,964
Convertible loan payable, net of unamortized discount of Nil and
$422,819 as of June 30, 2009 and December 31, 2008		-		366,223

Total liabilities		1,408,675		2,156,794

Commitments and contingencies

Stockholders’ deficit:
Preferred stock, 10,000,000 authorized preferred shares of $0.001 par value,
no stock issued and outstanding as of June 30, 2009 and December 31, 2008		-		-

Common stock, 1,500,000,000 authorized common shares of $0.001 par value,
402,393,726 and 155,818,136 shares issued and outstanding as of June 30, 2009 and
December 31, 2008, respectively		402,394		155,818
Additional paid-in capital		24,725,750		23,504,772
Deferred compensation		-		(666,666)
Accumulated deficits		(25,769,734)		(24,141,441)
Accumulated other comprehensive income		161,613		129,555

Total stockholders’ deficit		(479,977)		(1,017,962)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	928,698	$	1,138,832

See accompanying notes to condensed consolidated financial statements.

F-1

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

CONDENSED CONSOLIDATED STATEMENTS OF

OPERATIONS AND COMPREHENSIVE LOSS

FOR THE THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 2009 AND 2008

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

		Three months ended June 30,				Six months ended June 30,
		2009		2008		2009		2008
REVENUE, NET
Sales	$	543,189	$	313,458	$	690,509	$	710,460
Sales, related party		431,704		77,819		650,558		200,311
Total revenues, net		974,893		391,277		1,341,067		910,771
COST OF REVENUE		(433,211)		(233,904)		(606,549)		(579,368)
GROSS PROFIT		541,682		157,373		734,518		331,403
OPERATING EXPENSES:
Depreciation and amortization		(55,928)		(71,224)		(124,044)		(141,765)
Stock based compensation		(730,769)		(269,274)		(848,206)		(542,306)
Consulting and management service fee, related party		(6,000)		(10,381)		(12,000)		(27,160)
Impairment of goodwill		(153,212)		-		(153,212)		-
Selling, general and administrative expenses		(702,078)		(638,403)		(1,146,916)		(1,249,958)
Total operating expenses		(1647,987)		(989,282)		(2,284,378)		(1,961,189)
LOSS FROM OPERATIONS		(1,106,305)		(831,909)		(1,549,860)		(1,629,786)
OTHER INCOME (EXPENSES):
Amortization of debt discount		90,384		(67,490)		(59,791)		(638,433)
Other income		2,193		-		2,193		3,556
Interest income		5		3,244		7		-
Interest expense		(20,689)		(9,744)		(20,842)		(7,669)
LOSS BEFORE INCOME TAXES AND MINORITY
INTEREST		(1,034,412)		(905,899)		(1,628,293)		(2,272,332)
Income tax expense		-		-		-		-
Minority interest		-		-		-		-
NET LOSS		(1,034,412)		(905,899)		(1,628,293)		(2,272,332)
Other comprehensive loss:
- Foreign currency translation gain		48,542		25,561		32,058		36,923
COMPREHENSIVE LOSS		(985,870)		(880,338)		(1,596,235)		(2,235,409)
Net loss per share – basic and diluted	$	(0.00)	$	(0.01)		(0.01)	$	(0.02)
Weighted average shares outstanding – basic and diluted		316,174,053		144,944,246		235,996,094		109,046,137

See accompanying notes to condensed consolidated financial statements.

F-2

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2009 AND 2008

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

	Six months ended June 30,
	2009		2008

Cash flows from operating activities:
Net loss	$	(1,628,293)	$	(2,272,332)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		124,044		141,765
Stock based compensation expenses		848,206		542,306
Issuance of common stock for convertible loan interests		46,919		-
Impairment of goodwill		153,212		-
Allowance for doubtful debts		-		6,507
Amortization of discount on convertible loan		59,791		628,433
Changes in operating assets and liabilities:
Accounts receivable, net		(10,216)		145,692
Other receivables and prepayments		(38,558		(33,936)
Inventories		532		(328)
Accounts payable		57,983		(330,087
Deferred revenue		(78,903)		(177)
Accrued liabilities and other payables		354,049		469,356

Net cash used in operating activities		(111,234)		(702,801)

Cash flows from investing activities:
Purchase of plant and equipment		(4,337)		-
Decrease in other assets and deposits		-		8,333

Net cash (used in) provided by investing activities		(4,337)		8,333

Cash flows from financing activities:
Proceeds from related parties		-		84,451
Proceeds from convertible loans		100,000		386,000
Repayment of loan payable		(1,944)		(1,975)

Net cash provided by financing activities		98,056		468,476

Effect of exchange rate changes on cash and cash equivalents		32,058		36,923

NET CHANGE IN CASH AND CASH EQUIVALENTS		14,543		(189,069)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		14,919		211,603

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	29,462	$	22,534

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for income taxes	$	-	$	-
Cash paid for interest	$	-	$	350

NON-CASH INVESTING AND FINANCING TRANSACTIONS
Common stock issued for settlement of convertible loans	$	572,935	$	-
Grant stock options for settlement of accrued expenses	$	713,081	$	-

See accompanying notes to condensed consolidated financial statements.

F-3

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIT

FOR THE SIX MONTHS ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

												Accumulated
	Preferred stock			Common stock				Additional				other				Total
	No of			No of				paid-in		Deferred		comprehensive		Accumulated		stockholder's
	shares		Amount	shares		Amount		capital		compensation		(loss) income		deficits		deficit

Balance as of
January 1, 2009	-	$	-	155,818,136	$	155,818	$	23,504,772	$	(666,666)	$	129,555	$	(24,141,441)	$	(1,017,962)


Issuance of
common stock
upon conversion
of note payables
and interests
accrued	-		-	246,575,590		246,576		326,357		-		-		-		572,933

Grant options
for settlement
of accrued
expense	-		-	-		-		713,081		-		-		-		713,081

Stock based
compensation
expenses	-		-	-		-		181,540		(181,540)-		-		-		-

Amortization of
deferred
compensation	-		-	-		-		-		848,206		-		-		848,206

Net loss for the
period	-		-	-		-		-		-		-		(1,628,293)		(1,628,293)

Foreign currency
translation
adjustment	-		-	-		-		-		-		32,058		-		32,058

Balance as of
June 30, 2009	-	$	-	402,393,726	$	402,394	$	24,725,750	$	-	$	161,613	$	(25,769,734)	$	(479,977)

See accompanying notes to condensed consolidated financial statements.

F-4

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

NOTE－1 BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and note disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.

In the opinion of management, the consolidated balance sheet as of December 31, 2008 which has been derived from audited financial statements and these unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended June 30, 2009 are not necessarily indicative of the results to be expected for the entire fiscal year ending December 31, 2009 or for any future period.

These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2008 filed on April 15, 2009.

NOTE－2 ORGANIZATION AND BUSINESS BACKGROUND

The Company was incorporated under the laws of the State of Nevada in 1998 to engage in international business as Asian Alliance Ventures Inc. and subsequently changed its name to Asia Payment Systems Inc. in 2003, and to Cardtrend International Inc. on July 24, 2007. On June 12, 2009, the Company has obtained the majority votes of its shareholders to change its name to Mezabay International, Inc. The change of name of the Company is effective June 18, 2009.

The Company through its subsidiaries, engages in provision of data and business processes outsourcing services and IT solution of payment and loyalty cards.

NOTE – 3 GOING CONCERN UNCERTAINTIES

The accompanying condensed consolidated financial statements have been prepared on the basis that the Company will continue as a going concern which assumes the realization of assets and settlement of liabilities in the normal course of business. For the period ended June 30, 2009, the Company incurred a net loss of $1,628,293 and generated a negative cash flow of $111,234 from operating activities. At June 30, 2009, the Company had a working capital deficiency of $1,036,917 and the accumulated deficits of $25,769,734. The Company is experiencing difficulty in generating sufficient cash flow to meet its obligations and sustain its operations, which raises substantial doubt about its ability to continue as a going concern.

The Company's existence is dependent upon management's ability to develop profitable operations and resolve its liquidity problems. Management anticipates the Company will attain profitable status and improve its liquidity through the continued developing, marketing and selling of its products and additional equity investment in the Company. The accompanying financial statements do not include any adjustments that might result should the Company be unable to continue as a going concern.

NOTE – 4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

* Basis of presentation

These accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America.

* Principles of consolidation

The condensed consolidated financial statements include the financial statements of the Company and its subsidiaries.

All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

* Use of estimates

In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheets and revenues and expenses during the period reported. Actual results may differ from these estimates.

* Cash and cash equivalents

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.

F-5

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

* Account receivable

Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company extends unsecured credit to its customers in the ordinary course of business but mitigates the associated risks by performing credit checks and actively pursuing past due accounts. An allowance for doubtful accounts is established and determined based on managements’ assessment of known requirements, aging of receivables, payment history, the customer’s current credit worthiness and the economic environment. As of June 30, 2009 and December 31, 2008, the allowance for doubtful accounts of trade receivables was $36,433 and $36,986, respectively.

* Inventories

Inventories are recorded at the lower of cost or market value using the first-in-first-out method. As of June 30, 2009 and December 31, 2008, inventories were $2,161 and $2,693, respectively.

* Plant and equipment, net

Plant and equipment are stated at historical cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the expected useful lives from the date on which they become fully operational, generally ranging from 8 to 10 years. Expenditure for maintenance and repairs is expensed as incurred. When assets have retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

As of June 30, 2009 and December 31, 2008, plant and equipment, net, consisted of office equipment and renovation with an aggregate cost of $323,607 and $393,314, respectively. Depreciation expense for the three months ended June 30, 2009 and 2008 was $30,928 and $46,224, respectively. Depreciation expense for the six months ended June 30, 2009 and 2008 was $74,044 and $91,765 respectively.

* Goodwill

Goodwill represents the excess of the purchase consideration payable in acquisitions of subsidiaries over the fair value of the net assets acquired at the time of acquisition. Goodwill on consolidation is stated at cost when it arises. As part of an ongoing review of the valuation of goodwill, management assesses the carrying value of the goodwill to determine if changes in facts and circumstances suggest that it may be impaired. If this review indicates that the goodwill is not recoverable, the carrying value of the goodwill would be reduced to its estimated fair market value.

For the three months ended June 30, 2009, the Company tested for impairment in accordance with the SFAS No. 142 and impairment charge of $153,212 was recognized for the our investment in Cardtrend Systems Sdn. Bhd.

* Intellectual property

Intellectual property represented internal developed card system software with a cost of $500,000. Amortization is calculated on the straight-line basis over the expected useful life of 5 years.

For three months ended June 30, 2009 and 2008, the amortization expense was $25,000 and $25,000, respectively. For the six months ended June 30, 2009 and 2008, the amortization expense was $50,000 and $50,000, respectively.

* Impairment of long-lived assets

In accordance with SFAS No. 144,“Accounting for the Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as plant and equipment, goodwill and other intangible assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of assets to estimated discounted net cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets.

* Revenue Recognition

The Company recognizes revenue in accordance with SEC’s Staff Accounting Bulletin No. 104“Revenue Recognition in Financial Statement” (“SAB 104”). Revenue is recognized when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed, and collectibility is reasonably assured. The Company further recognizes revenue from the licensing of ‘Cardtrend Systems’ software in accordance with Statement of Position (“SOP”) 97-2, “Software Revenue Recognition”, as amended by SOP 98-9, “Modification of SOP 97-2, and Software Revenue Recognition with Respect to Certain Transactions”. Under the residual method, the fair value of the undelivered elements is deferred and the remaining portion of the arrangement fee is recognized as revenue.

(a) Processing Business

Revenue from Processing Business operations is recognized at the time services are rendered to the Company’s clients progressively and/or periodically as agreed in a service contract. Revenue for the licensing of software is recognized when the criteria in the preceding paragraph have been met and delivery has occurred. If, as is usually the case, the delivery of the software is part of an arrangement that includes the installation of the software, revenue is recognized when the installation is complete and customer acceptance has occurred. Contracts for the maintenance and support of the software are priced separately for one year period and revenue is recognized ratably over service period.

(b) Prepaid Business

Revenue from Prepaid Business operations is recognized at the time services are rendered to its dealers for goods delivered. The Company records the goods sold as gross revenue and less discounts given to the dealers to obtain net revenue, and then less costs of goods sold (i.e. face value of the goods less discounts received from the Company’s suppliers) to arrive at the Company’s gross profits before operating expenses.

F-6

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

* Income taxes

The Company accounts for income tax using SFAS No. 109“Accounting for Income Taxes”, which requires the asset and liability approach for financial accounting and reporting for income taxes. Under this approach, deferred income taxes are provided for the estimated future tax effects attributable to temporary differences between financial statement carrying amounts of assets and liabilities and their respective tax bases, and for the expected future tax benefits from loss carry-forwards and provisions, if any. Deferred tax assets and liabilities are measured using the enacted tax rates expected in the years of recovery or reversal and the effect from a change in tax rates is recognized in the statements of operations and comprehensive income in the period of enactment. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered more likely than not that some portion of, or all of the deferred tax assets will not be realized.

The Company also adopts the provisions of the Financial Accounting Standards Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 prescribes a recognition threshold and measurement process for recording in the financial statements uncertain tax positions taken or expected to be taken in a tax return. FIN 48 also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transitions. In connection with the adoption of FIN No. 48, the Company has analyzed the filing positions in all of the jurisdictions where the Company is required to file income tax returns, as well as all open tax years in these jurisdictions. There was no impact on the condensed consolidated financial statements. The Company did not have any unrecognized tax benefits and there was no effect on the financial condition or results of operations for the period ended June 30, 2009 and 2008.

The Company conducts its major businesses in the PRC, Hong Kong and Malaysia and is subject to tax in these jurisdictions. As a result of its business activities, the Company files tax returns that are subject to examination by the foreign tax authority.

* Net (loss) income per share

The Company calculates net loss per share in accordance with SFAS No. 128, “Earnings per Share”. Basic (loss) income per share is computed by dividing the net (loss) income by the weighted-average number of common shares outstanding during the period. Diluted (loss) income per share is computed similar to basic (loss) income per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive.

* Comprehensive (loss) income

SFAS No. 130, “Reporting Comprehensive Income”, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive (loss) income as defined includes all changes in equity during the period from non-owner sources. Accumulated comprehensive (loss) income consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.

* Foreign currencies translation

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

The reporting currency of the Company is the United States dollar (“US$"). The functional currency of the Company's subsidiaries operating in Hong Kong is Hong Kong dollars (“HKD”) and its financial records are maintained and its statutory financial statements are prepared in HKD. The functional currency of the Company's subsidiaries established in the PRC is the Renminbi Yuan (“RMB”) and its financial records are maintained and its financial statements are prepared in RMB. The functional currency of the Company's subsidiaries established in Singapore is the Singapore dollars (“SGD”) and its financial records are maintained and its financial statements are prepared in SGD. The functional currency of the Company's subsidiaries established in Malaysia is the Malaysian Ringgit (“MYR”) and its financial records are maintained and its financial statements are prepared in MYR.

In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with SFAS No 52. “Foreign Currency Translation”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.

Translation of amounts from the local currency of the Company’s subsidiaries into US dollars has been made at the following exchange rates for the respective period:

	June 30, 2009	June 30, 2008
Period end HKD : US$1 exchange rate	7.75040	7.80370
Average period HKD : US$1 exchange rate	7,75132	7.79968
Period end RMB: US$1 exchange rate	6.84480	6.87180
Average period RMB: US$1 exchange rate	6.83992	6.96957
Period end MYR: US$1 exchange rate	3.54010	3.25880
Average period MYR: US$1 exchange rate	3.55962	3.21501
Period end SGD: US$1 exchange rate	1.45430	1.36350
Average period SGD: US$1 exchange rate	1.47369	1.36621

F-7

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

* Fair value of financial instruments

The Company values its financial instruments as required by SFAS No. 107, “Disclosures about Fair Value of Financial Instruments”. The estimated fair value amounts have been determined by the Company, using available market information and appropriate valuation methodologies. The estimates presented herein are not necessarily indicative of amounts that the Company could realize in a current market exchange.

The Company’s financial instruments primarily consist of cash and cash equivalents, accounts receivable, amount due from a stockholder, prepayments and deposits, other payables and accrued liabilities and income tax payable.

As of the balance sheet date, the estimated fair values of the financial instruments were not materially different from their carrying values as presented due to the short term maturities of these instruments and that the interest rates on the borrowings approximate those that would have been available for loans of similar remaining maturity and risk profile at respective period ends.

* Stock based compensation

The Company adopts SFAS No. 123 (revised 2004), "Share-Based Payment" ("SFAS No. 123R") using the fair value method. Under SFAS No. 123R, stock-based compensation expense is measured at the grant date based on the value of the option or restricted stock and is recognized as expense, less expected forfeitures, over the requisite service period.

* Related parties

Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

* Segment reporting

SFAS No. 131“Disclosures about Segments of an Enterprise and Related Information” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about geographical areas, business segments and major customers in the financial statements. The Company operates three reportable segments in processing business, prepaid business, and cards business, respectively.

* Recent accounting pronouncements

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

In April 2009, the FASB issued FSP FAS 107-1 and APB 28-1, “Interim Disclosures about Fair Value of Financial Instruments.” This FSP amends SFAS No. 107, “Disclosures about Fair Value of Financial Instruments,” and Accounting Principles Board (“APB”) Opinion No. 28, “Interim Financial Reporting.” (“FAS 107”) This FSP requires publicly-traded entities to disclose in the body or in the accompanying notes of its summarized financial information for interim reporting periods and in its financial statements for annual reporting periods, the fair value of all financial instruments for which it is practicable to estimate that value, whether recognized or not recognized in the statement of financial position, as required by FAS 107. This FSP is effective for interim and annual reporting periods ending after June 15, 2009. The Company adopted FSP FAS 107-1 and APB 28-1 for the period ended June 30, 2009.

In May 2009, the FASB issued SFAS No. 165, “Subsequent Events” (“FAS 165”), which establishes general standards of accounting for, and requires disclosure of, events that occur after the balance sheet date but before financial statements are issued or are available to be issued. The Company adopted the provisions of FAS 165 for the quarter ended June 30, 2009. The adoption of FAS 165 did not have a material effect on the consolidated financial statements.

In June 2009, the FASB issued SFAS No. 166, “Accounting for Transfers of Financial Assets, an amendment to SFAS No. 140” (“FAS 166”). FAS 166 eliminates the concept of a “qualifying special-purpose entity,” changes the requirements for derecognizing financial assets, and requires additional disclosures in order to enhance information reported to users of financial statements by providing greater transparency about transfers of financial assets, including securitization transactions, and an entity’s continuing involvement in and exposure to the risks related to transferred financial assets. FAS 166 is effective for fiscal years beginning after November 15, 2009. The Company will adopt FAS 166 in fiscal 2010 and is evaluating the impact it will have on the consolidated results of the Company.

In June 2009, the FASB issued SFAS No. 167, “Amendments to FASB Interpretation No. 46(R)” (“FAS 167”). The amendments include: (1) the elimination of the exemption for qualifying special purpose entities, (2) a new approach for determining who should consolidate a variable-interest entity, and (3) changes to when it is necessary to reassess who should consolidate a variable-interest entity. FAS 167 is effective for the first annual reporting period beginning after November 15, 2009 and for interim periods within that first annual reporting period. The Company will adopt FAS 167 in fiscal 2010 and is evaluating the impact it will have on the consolidated results of the Company.

In June 2009, the FASB issued SFAS No. 168, “The FASB Accounting Standards Codification ™ and the Hierarchy of Generally Accepted Accounting Principles — a replacement of FASB Statement No. 162” (“FAS 168”). FAS 168 replaces SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles” and establishes the “FASB Accounting Standard Codification ™ ” (“Codification”) as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with generally accepted accounting principles in the United States. All guidance contained in the Codification carries an equal level of authority. On the effective date of FAS 168, the Codification will supersede all then-existing non-SEC accounting and reporting standards. All other nongrandfathered non-SEC accounting literature not included in the Codification will become nonauthoritative. FAS 168 is effective for financial statements issued for interim and annual periods ending after September 15, 2009. The Company has evaluated this new statement, and has determined that it will not have a significant impact on the determination or reporting of the financial results.

F-8

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

NOTE – 5 OTHER RECEIVABLES AND PREPAYMENTS

Other receivables and prepayments are comprised of the following:

		June 30, 2009		December 31, 2008
		(Unaudited)		(audited)
Deposits and prepayments	$	71,459	$	36,279
Other tax recoverable		-		10,291
Other receivables		34,527		20,858
	$	105,986	$	67,428

NOTE – 6 GOODWILL

Goodwill represented the difference between the aggregate consideration paid for the acquisition and the fair value of the net tangible and intangible assets of Cardtrend Systems Sdn. Bhd.

For the three months ended June 30, 2009, the management of the Company evaluated the recoverability of the goodwill using a combination of discounted cash flow method and price-earning method to determine the fair value of Cardtrend Systems. The tests resulted that the fair value of Cardtrend Systems Sdn. Bhd. is lower than the carrying value of goodwill and therefore impairment loss of 153,212 was recognized for the three months ended June 30, 2009.

NOTE－7 ACCRUED LIABILITIES AND OTHER PAYABLES

Accrued liabilities and other payables are comprised of the following:

	June 30, 2009		December 31, 2008
	(Unaudited)		(Audited)

Accrued expenses	$	406,387	$	468,340
Other tax payables		10,090		-
Salaries and expenses owed to employees		127,326		271,704
Customers deposit		54,217		-
Other payables		334,599		345,325

	$	932,619	$	1,085,369

Other payables consisted of temporary advances from independent third parties with no interest bearing, unsecured and no fixed terms of repayment.

NOTE－8 INCOME TAX

For the six months ended June 30, 2009 and 2008, the local (“U.S.”) and foreign components of loss from operations before income taxes were comprised of the following:

	Six months ended June 30,
	2009		2008
Tax jurisdictions from:
- Local	$	(1,514,601)	$	(1,950,212)
- Foreign		(113,692)		(322,120)

Loss before income taxes	$	(1,628,293)	$	(2,272,332)

For the six months ended June 30, 2009 and 2008, no provision for income tax has been made as the Company did not have any assessable profits for the period.

The effective tax rate in the periods presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates. The Company has subsidiaries that operate in various locations: the United States of America, Hong Kong, the PRC, Singapore, Malaysia and British Virgin Islands that are subject to tax in the jurisdictions in which they operate, as follows:

F-9

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

United States of America

The Company is registered in the State of Nevada and is subject to the United States of America tax law.

For the six months ended June 30, 2009, the U.S. operation had $1,514,601 net operating losses available for federal tax purposes, which are available to offset future taxable income. The net operating loss carry forwards begin to expire in 2019. The Company has provided for a full valuation allowance of approximately $514,960 for future tax benefits from net operating loss carry forwards as the management believes it is more likely than not that these assets will not be realized in the future.

Hong Kong

For the six months ended June 30, 2009 and 2008, the Hong Kong profits tax rate was 16.5% and 16.5%, respectively. No provision for Hong Kong profits tax was made for as the Company’s subsidiaries operating in Hong Kong incurred an operating loss of $350 and an operating profit of $1,131 during the respective periods.

The PRC

The Company’s subsidiary operating in PRC is subject to the Corporate Income Tax governed by the Income Tax Law of the PRC. Effective from January 1, 2008, the Corporate Income Tax Law of the PRC (the “New CIT Law”) is followed. Under the New CIT Law, an unified income tax rate of 25% is imposed for both domestic and foreign invested enterprises. APS China is considered a foreign invested enterprise and enjoys the unexpired tax holidays from a full exemption of income tax for the first two profit making years with a 50% exemption of income tax (that is 25%) for the next three years.

For the six months ended June 30, 2009 and 2008, no provision for corporate income tax has been made as APS China incurred an operating loss of $135,253 and $272,619, respectively.

Singapore

Pursuant to the Singapore Income Tax Laws, the Corporate Income Tax is at a statutory rate of 20%. Unutilized tax losses and capital allowances may be carried forward indefinitely to offset future taxable income provided that the beneficial ownership of the company remains substantially (at least 50%) the same as at certain relevant dates. For capital allowances, there is an additional requirement that the same trade or business in respect of which these capital allowances were made continues to be carried on. Carrybacks or transfers to other companies are not permitted. No provision for Singapore Corporate Income Tax has been made as the subsidiaries operating in Singapore incurred an operating profit of $1,379 and an operating loss of $454 respectively for the six months ended June 30, 2009 and 2008.

Malaysia

Pursuant to the Malaysia Income Tax Laws, the Corporate Income Tax is at a statutory rate of 26%. Unutilized tax losses and capital allowances may be carried forward indefinitely to offset future taxable income. For capital allowances, there is an additional requirement that the same trade or business in respect of which these capital allowances were made continues to be carried on. No provision for Malaysia Corporate Income Tax has been made as the subsidiaries operating in Malaysia incurred an operating profit of $19,882 and an operating loss $50,178 respectively, for the six months ended June 30, 2009 and 2008.

British Virgin Islands

Under the current BVI law, those BVI subsidiaries are not subject to tax on income. For the six months ended June 30, 2009 and 2008, the Company’s subsidiaries incurred a operating loss of $350 and $nil respectively, for the six months ended June 30, 2009 and 2008.

The following table sets forth the significant components of the aggregate net deferred tax assets of the Company as of June 30, 2009 and December 31, 2008:

Deferred tax assets:		June 30, 2009	December 31, 2008
Net operating loss carryforward
- United States	$	3,537,897	3,022,937
- Hong Kong		15,263	15,205
- The PRC		165,809	131,996
- Malaysia		29,068	29,068
- Singapore		417	417
Less: valuation allowance		(3,748,454)	(3,199,623)
Net deferred tax assets	$	-	-

Management believes that it is more likely than not that the deferred tax assets will not be fully realizable in the future. Accordingly, the Company provided for a full valuation allowance against its deferred tax assets of $3,748,454 and $3,199,623 as of June 30, 2009 and December 31, 2008, respectively. During the first six months of 2009, the valuation allowance increased by $548,831, primarily relating to net operating loss carryforwards from the local and foreign tax regimes.

NOTE－9 COMMON STOCK

On January 30, 2009, the Company increased its authorized shares of common stock from 250,000,000 shares to 500,000,000 shares with a par value of $0.001 per share.

F-10

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

On June 18, 2009, the Company increased its authorized shares of common stock from 500,000,000 shares to 1,500,000,000 shares with a par value of $0.001 per share.

On April 6, 2009, the Company received the notices from the six Note Holders as described in Note 14(b) of the Annual Report for the year ended December 31, 2008 on Form 10K filed on April 15, 2009 to convert the entire principal in an aggregated amount of $589,041 and accrued interests in an aggregated amount of $32,725 as of April 6, 2009, to 163,622,600 shares of common stock of the Company at $0.0038 per share. The directors of the Company approved the conversion on April 7, 2009 and the Company proceeded to issue restricted shares under Rule 144 to the six Note Holders.

On April 15, 2009, the Company accepted an offer each from two individuals, of 6-month maturity convertible loan of $40,000 each, bearing no interest. The lenders will have the option to convert any money advanced into shares of the Company’s common stock priced at $0.002 per share, if the said loans are converted within 6 months from the effective date of the loans. The Company recorded an intrinsic value of the beneficial conversion feature of the loans at $20,000.

On April 15, 2009, the directors of the Company approved the conversion of the entire principal in the aggregate amount of $20,000 of two loans received on March 21, 2009 at a conversion price of $0.002 per share to 10,000,000 shares of the Company’s common stock. The Company proceeded to issue restricted shares under Rule 144 to the two holders of the said loans.

On April 22, 2009, the directors of the Company approved the conversion of the entire principal in the aggregate amount of $80,000 of two loans received on April 15, 2009 at a conversion price of $0.002 per share to 40,000,000 shares of the Company’s common stock. The Company proceeded to issue restricted shares under Rule 144 to the two holders of the said loans.

On May 6, 2009, the director approved the conversion of the $200,000 convertible loan from RBSM LLP, which was obtained on May 5, 2008, together with a total accrued interest of $14,194 to 32,952,990 shares of the Company’s common stock at a conversion price of $0.0065. The Company issued the said shares under Rule 144 restriction.

As of June 30, 2009, the Company had authorized 1,500,000,000 shares, issued and outstanding 402,393,726 shares of common stock.

NOTE－10 STOCK BASED COMPENSATION

(a) Options

In 2004, 2005 and 2007, the Company respectively registered under a Form S-8 each for the non-qualified incentive stock option plans (the "2004 Plan", the “2005 Plan” and the “2007 Plan”, or the “Registered Plans”) or the “Plan” for the benefit of employees or other persons associated with the Company. In accordance with each of the Plans, the Company is authorized to grant stock options for the purchase of 5,000,000 (35,000,000 in aggregate) free trading shares of common stock. The Company had decided to enact an unregistered stock option plan in 2006 (“Unregistered Plan”) to accommodate stock options granted outside of the Plans for the benefit of employees and other person associated with the Company to purchase restricted shares of common stock under Rule 144.

On April 15, 2009, the Company granted an option to Katherine Yoke-Lin Tung, the Secretary and Treasurer of the Company, to purchase a total of 78,148 restricted shares of the Company’s common stock under the 2007 Option Plan and another option to purchase a total of 9,337,084 restricted shares of the Company’s common stock under the Unregistered Option Plan, both with immediate vesting but exercisable at an exercise price of $0.0025 per share on or after the day that the authorized shares of the Company’s common stock have been effectively increased to 1,500,000,000 shares to settle fees owing to KateLin Enterprise Inc. (in which Katherine Tung has a controlling interest ) as of March 31, 2009 amounting to $23,538. The fair values of these options, which were $23,538, were computed using a Black- Scholes model with the following assumptions: (1) dividend yield of 0%; (2) expected volatility 812%; (3) risks free interest rate of 1.27%; (4) expected lives of 1 day; and (5) at a market price $0.0025.

On April 15, 2009, the Company granted options to 9 employees, 1 officer, 3 officer/directors and a director to purchase a total of 275,817,484 restricted shares of the Company’s common stock under the Unregistered Option Plan with immediate vesting but exercisable at an exercise price of $0.0025 per share on or after the day that the authorized shares of the company’s common stock have been effectively increased to 1,500,000,000 shares to settle salaries owing to them as of March 31, 2009 and advances made by them for the Company’s expenses totaling $689,543. The fair values of these options, which were $689,543, were computed using a Black- Scholes model with the following assumptions: (1) dividend yield of 0%; (2) expected volatility 812%; (3) risks free interest rate of 1.27%; (4) expected lives of 1 day; and (5) at a market price $0.0025.

A summary of the changes in the Company's common stock purchase options granted to directors, officers & employees (“Employees”) and consultants (“Consultants”) at June 30, 2009 and December 31, 2008 is presented below:

							Average
			Unregistered				Exercise
	2004 Plan	2005 Plan	Plan	2007 Plan	Total		Price

Balance at January 1, 2008	483,000	450,000		15,800,000	16,733,000	$	0.103
Granted	788,020	1,169,000	10,550,000	13,196,900	25,703,920	$	0.019
Forfeited & cancelled	(483,000)	(450,000)		(10,481,911)	(11,414,911)	$	0.107
Exercised	(788,020)	(1,169,000)		(12,464,989)	(14,422,009)	$	0.016

Balance at December 31, 2008	-	-	10,550,000	6,050,000	16,600,000	$	0.020
Granted	-	-	285,154,568	78,148	285,232,716	$	0.0025

Balance at June 30, 2009	-	-	295,704,568	6,128,148	301,832,716	$	0.0035

F-11

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

A summary of the changes in the Company’s stock options granted to Employees at June 30, 2009 and December 31, 2008 is presented below:

										Average
					Unregistered					Exercise
	2004 Plan		2005 Plan		Plan	2007 Plan		Total		Price

Balance at January 1, 2008	43,000		-		-	15,800,000		15,843,000		$	0.095
Granted	788,020		1,169,000		10,550,000	10,996,900		23,503,920		$	0.019
Forfeited & cancelled	(43,000	)	-		-	(10,481,911	)	(10,524,911	)	$	0.096
Exercised	(788,020	)	(1,169,000	)	-	(10,364,989	)	(12,322,009	)	$	0.018

Balance at December 31, 2008	-		-		10,550,000	5,950,000		16,500,000		$	0.020
Granted	-		-		285,154,568	78,148		285,232,716		$	0.0025

Balance at June 30, 2009	-		-		295,704,568	6,028,148		301,732,716		$	0.0035

A summary of the changes in the Company’s stock options granted to Consultants at June 30, 2009 and December 31, 2008 is presented below:

										Average
					Unregistered					Exercise
	2004 Plan		2005 Plan		Plan	2007 Plan		Total		Price

Balance at January 1, 2008	440,000		450,000		-	-		890,000		$	0.234
Granted	-		-		-	2,200,000		2,200,000		$	0.005
Forfeited & cancelled	(440,000	)	(450,000	)	-	-		(890,000	)	$	0.236
Exercised	-		-		-	(2,100,000	)	(2,100,000	)	$	0.001
Balance at December 31, 2008
and June 30, 2009	-		-		-	100,000		100,000		$	0.080

Additional information regarding total options outstanding (for Employees and Consultants) at June 30, 2009 is as follows:

		Outstanding				Exercisable
			Weighted						Weighted
			Average	Weighted			Weighted		Average
		Number	Remaining	Average		Number	Average		Remaining
Exercise		of	Contractual	Exercise		of	Exercise		Contractual
Price		Options	Life (Years)	Price		Options	Price		Life(Years)

$	0.0025	285,232,716	7.44	$	0.0025	285,232,716	$	0.0025	7.44
$	0.0200	16,500,000	7.63	$	0.0200	8,661,073	$	0.0200	7.59
$	0.0800	100,000	0.58	$	0.0800	100,000	$	0.0800	0.58
Total		301,832,716	7.45	$	0.0350	293,993,789	$	0.0210	7.44

F-12

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

Additional information regarding total options outstanding (for Employees only) at June 30, 2009 is as follows:

		Outstanding				Exercisable
			Weighted						Weighted
			Average	Weighted			Weighted		Average
		Number	Remaining	Average		Number	Average		Remaining
Exercise		of	Contractual	Exercise		Of	Exercise		Contractual
Price		Options	Life (Years)	Price		Options	Price		Life (Years)

$	0.0025	285,232,716	7.44	$	0.0025	285,232,716		0.0025	7.44
$	0.0200	16,500,000	7.63	$	0.0200	8,661,073	$	0.0200	7.59
Total		301,732,716	7.45	$	0.0200	293,893,789		0.0200	7.45

Additional information regarding total options outstanding (for Consultants only) at June 30, 2009 is as follows:

Outstanding

Exercisable

Weighted

Average

Weighted

Average

Number

Remaining

Average

Number

Average

Remaining

Exercise

Contractual

Exercise

Contractual

Price

Options

Life (Years)

Price

Options

Price

Life (Years)

0.08

100,000

0.58

0.080

100,000

0.080

0.58

Total

100,000

0.58

0.080

100,000

0.080

0.58

The fair value for the options granted was estimated at the date of grant using the Black-Scholes Option Pricing model with the following assumptions:

Risk-free interest rate (per annum)	0.11% to 0.19%
Expected life (in years)	1 to 5 years
Expected volatility	800% to 827%
Expected dividend yield	0%

The Company recognized $730,769 and $269,274 of stock-based compensation to operations for the three months ended June 30, 2009 and 2008 respectively. The Company recognized $848,206 and $542,306 of stock-based compensation to operations for the six months ended June 30, 2009 and 2008 respectively. .For the three months ended June 30, 2009, $639,999 was recorded as amortization of deferred stock based compensation and $90,770 was recorded as amortization of vested options which increases the additional paid-in capital. For the six months ended June 30, 2009, $666,666 was recorded as amortization of deferred stock based compensation and $181,540 was recorded as amortization of vested options which increases the additional paid-in capital.

(b) Warrants

Transaction involving warrants issued to investors and consultants at June 30, 2009 and December 31, 2008 are summarized as follows (warrants were not issued to employees):

	Share Issued
	Upon	Average
	Exercise of	Price
	Warrants	Per Share
Outstanding at January 1, 2008	22,927,187	$	0.230
Granted	17,133,263	$	0.084
Exercised	-	$	-
Cancelled	(500,000)	$	0.400
Outstanding at December 31, 2008 and June 30, 2009	39,560,450	$	0.168

F-13

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

Additional information regarding warrants outstanding at June 30, 2009 is as follows (Note: No warrants were issued to employees):

		Outstanding			Exercisable
			Weighted				Weighted
			Average	Weighted		Weighted	Average
		Number	Remaining	Average	Number	Average	Remaining
Exercise		of	Contractual	Exercise	Of	Exercise	Contractual
Price		Warrants	Life (Years)	Price	Warrants	Price	Life (Years)

$	0.062	23,665,206	1.43	$ 0.062	23,665,206	$ 0.062	1.68
$	0.112	5,504,464	1.67	$ 0.112	5,504,464	$ 0.112	1.92
$	0.130	1,569,659	1.67	$ 0.130	1,569,659	$ 0.130	1.92
$	0.159	645,644	0.25	$ 0.159	645,644	$ 0.159	0.50
$	0.200	4,638,333	0.50	$ 0.200	4,638,333	$ 0.200	0.75
$	0.300	1,448,985	0.25	$ 0.300	1,448,985	$ 0.300	0.50
$	0.713	1,000,000	1.17	$ 0.713	1,000,000	$ 0.713	1.42
$	2.000	1,088,159	1.17	$ 2.000	1,088,159	$ 2.000	1.42

		39,560,450	1.29	$ 0.168	39,560,450	$ 0.168	1.54

NOTE－11 CONVERTIBLE DEBT

(a) Convertible loan payable

On September 19, 2008, all the Note Holders called for redemption with an aggregated principal and interest amounted to $589,041 and on the same day the Company issued six new Notes to the same group of Note Holders with the same aggregate amount for a term of 12 months from its effective date, carried an interest rate of 10% per annum, and at the option of the Note Holders, principal and accrued interest may be redeemable in cash at anytime after 6 months from the effective date of the Note or convertible into shares of common stock of the Company at a conversion price of $0.005 per share or the average closing bid price of the Company’s common stock 5 days preceding the date of conversion, whichever is lower, and no warrants will be issued upon the conversion of the Notes.

On March 21, 2009, the Company accepted an offer each from two individuals of 6-month callable, on-demand convertible loans of $10,000 each, bearing no interest. The lenders will have the option to convert any money advanced and/or interest in arrears into shares of the Company’s common stock priced at $0.002 per share, if the said loans are converted within 6 months from the effective date of the loans.

On April 6, 2009, the Company received the notices from the six Note Holders as described in Note 14(b) of the Annual Report for the year ended December 31, 2008 on Form 10K filed on April 15, 2009 to convert the entire principal in an aggregated amount of $589,041 and accrued interests in an aggregated amount of $32,725 as of April 6, 2009, to 163,622,600 shares of common stock of the Company at $0.0038 per share. These Notes are convertible into shares of common stock of the Company at a conversion price of $0.005 per share or the average closing bid price of the Company’s common stock 5 days preceding the date of conversion, whichever is lower. The directors of the Company approved the conversion on April 7, 2009 and the Company proceeded to issue restricted shares under Rule 144 to the six Note Holders.

The Company recorded the intrinsic value (i.e. the difference between the conversion price and the fair market value of the common stock on the date of issuance) attributable to the beneficial conversion feature as a discount to be amortized over the life of each of the above convertible loans as interest expense in accordance with EITF No. 00-27 Application of EITF 98-5 “Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios” and APB No. 14, “Accounting for Convertible Debt and Debt Issued with Stock Purchase Warrants”. For the six months ended June 30, 2009, the Company has charged $59,791 to operation as amortization of debt discount. As of June 30, 2009, all of the convertible loan payables are fully redeemed and the unamortized discount is charged to additional paid in capital upon the conversion.

F-14

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

(b) Convertible promissory note to service provider

On May 5, 2008, the Company issued a convertible promissory note of $200,000 to RBSM LLP, the predecessor auditor of the Company for a term of 6 months, bearing interest at a rate of 7% per annum and payable at its maturity date, due November 4, 2008. The convertible promissory note is unsecured and upon the maturity date, the Company may, at its election, pay cash to RBSM LLP for the principal balance plus accrued interest or convert such amount into shares of common stock of the Company, in whole or in part, at a conversion price equal to the average closing bid price of the Company's common stock 5 days preceding the date of maturity. On October 30, 2008, the Company and RBSM LLP signed an agreement to extend the maturity of the convertible promissory note to May 4, 2009 for a consideration of $5,000 paid by the Company.

On May 6, 2009, the director approved the conversion of the $200,000 convertible loan from RBSM LLP together with a total accrued interest of $14,194 to 32,952,990 shares of the Company’s common stock at a conversion price of $0.0065. The Company issued the said shares under Rule 144 restriction.

NOTE－12 RELATED PARTY TRANSACTIONS

The Company incurred $9,203 and $9,582 for the three months ended June 30, 2009 and 2008, respectively, and $17,874 and $17,578 for the six months ended June 30, 2009 and 2008, respectively, for administrative, management services and consulting services provided by companies in which certain officers and/or shareholders have a controlling interest. The Company also earned $431,704 and $650,558 from sales transaction in processing business for the three and six months ended June 31, 2009, respectively, at a market fair value in a normal course of business with a related company, which is controlled by a director, Mr. Chen Yu Hua.

The following balances, which represent temporary advances from directors, officers and companies controlled by certain officers and/or directors, carry no interest charges with no fixed terms of repayment, were outstanding as of:

	June 30, 2009		December 31, 2008
	(Unaudited)		(Audited)

Salaries payable	$	110,082	$	358,500
Loan from directors		199,629		161,464
Loan from related companies		1,872		-
Expenses claims		2,294		-
Due to related parties	$	313,877	$	519,964

NOTE－13 SEGMENT INFORMATION

(a) Segment information

For the three and six months ended June 30, 2009, the Company’s business units have been aggregated in three reportable segments: business processing (“Processing Business Unit”), prepaid communications products (“Prepaid Business Unit”) and payment and loyalty-rewards cards (“Card Business Unit”), as defined by SFAS 131, “Disclosures about Segments of an Enterprise and Related Information” ("SFAS 131"). The Company's management makes financial decisions and allocates resources based on the information it receives from its internal management system on each of its lines of business. Certain other expenses associated with the public company status of Cardtrend are reported at the Cardtrend parent company level, not within the subsidiaries. These expenses are reported separately in this footnote. The Company's management relies on the internal management system to provide sales, cost and asset information by line of business.

Summarized financial information concerning the Company’s reportable segments is shown in the following tables for the three and six months ended June 30, 2009 and 2008:

	Three months ended June 30, 2009
		Processing business			Prepaid business			Card business			Corporate		Total

Operating revenues, net	$	955,758		$	19,135		$	-		$	-	$	974,893
Cost of revenues		(414,342	)		(18,869	)		-			-		(433,211)
Gross profit		541,416			266			-			-		541,682
Depreciation and amortization		40,221			15,272			435			-		55,928
Impairment of goodwill		153,212			-			-			-		153,212
Net loss		(1,004,171	)		(22,647	)		(7,594	)		-		(1,034,412)
Total assets		782,376			128,958			17,364			-		928,698
Expenditure for long-lived assets	$	4,337		$	-		$	-		$	-	$	4,337

	Three months ended June 30, 2008
		Processing business			Prepaid business			Card business			Corporate		Total

Operating revenues, net	$	200,257		$	191,020		$	-		$	-	$	391,277
Cost of revenues		(45,716	)		(188,188	)		-			-		(233,904)
Gross profit		154,541			2,832			-			-		157,373
Depreciation and amortization		53,421			16,817			986			-		71,224
Net loss		(866,399	)		(27,627	)		(11,873	)		-		(905,899)
Total assets		3,502,655			2,068,197			1,662,779			-		7,233,631
Expenditure for long-lived assets	$	-		$	-		$	-		$	-	$	-

F-15

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

	Six months ended June 30, 2009
		Processing business			Prepaid business			Card business			Corporate		Total

Operating revenues, net	$	1,304,423		$	36,644		$	-		$	-	$	1,341,067
Cost of revenues		(570,311	)		(36,238	)		-			-		(606,549)
Gross profit		734,112			406			-			-		734,518
Depreciation and amortization		92,963			30,077			1,004			-		124,044
Impairment of goodwill		153,212			-			-			-		153,212
Net loss		(1,562,181	)		(44,997	)		(21,115	)		-		(1,628,293)
Total assets		782,376			128,958			17,364					928,698
Expenditure for long-lived assets	$	4,337		$	-		$	-		$	-	$	4,337

	Six months ended June 30, 2008
		Processing business		Prepaid business		Card business		Corporate	Total

Operating revenues, net	$	463,176		447,595		-		-	910,771
Cost of revenues		(138,422	)	(440,946	)	-		-	(579,368)
Gross profit		324,754		6,649		-		-	331,403
Depreciation and amortization		106,273		33,545		1,947		-	141,765
Net loss		(2,205,279	)	(55,869	)	(11,184	)	-	(2,272,332)
Total assets		3,502,655		2,068,197		1,662,779		-	7,233,631
Expenditure for long-lived assets	$	-		-		-		-	-

(b) Geographic information

The Company’s operations are located in three main geographical areas. The Company’s sales by geographical market are analyzed as follows:

	Three months ended June 30,
	2009		2008
Revenue, net:
PRC	$	431,704	$	77,819
Hong Kong		129		192
Malaysia		543,060		313,266
	$	974,893	$	391,277

	Three months ended June 30,
	2009		2008
Gross profit:
PRC	$	298,028	$	17,630
Hong Kong		129		-
Malaysia		243,525		139,743
	$	541,682	$	157,373

	Six months ended June 30,
	2009		2008
Revenue, net:
PRC	$	650,558	$	200,311
Hong Kong		323		449
Malaysia		690,186		710,011
	$	1,341,067	$	910,771

	Six months ended June 30,
	2009		2008
Gross profit:
PRC	$	435,577	$	70,442
Hong Kong		323		-
Malaysia		298,618		260,961
	$	734,518	$	331,403

As of June 30, 2009, 32% and 65% of the Company’s long-lived assets were located in the PRC and Malaysia, respectively.

F-16

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

NOTE－14 CONCENTRATIONS OF RISK

The Company is exposed to the following concentrations of risk:

(a) Major customers

For the three months ended June 30, 2009, the customers who account for 10% or more of revenue of the Company are presented as follows:

	Three months ended June 30, 2009			June 30, 2009
	Revenue		Percentage of sales	Accounts receivable

Customer A	$	431,704	44%	$	-
Customer B		309,048	32%		4
Total:	$	740,752	76%	$	4

For the six months ended June 30, 2009, the customers who account for 10% or more of revenue of the Company are presented as follows:

	Six months ended June 30, 2009			June 30, 2009
	Revenue		Percentage of sales	Accounts receivable

Customer A	$	650,558	49%	$	-
Customer B		309,048	23%		4
Total:	$	959,606	72%	$	4

For the three months ended June 30, 2008, the customers who account for 10% or more of revenue of the Company are presented as follows:

	Three months ended June 30, 2008			June 30, 2008
	Revenue		Percentage of sales	Accounts receivable

Customer A	$	77,819	20%	$	42,833
Customer B		171,779	44%		219,493
Total:	$	249,598	64%	$	262,326

For the six months ended June 30, 2008, the customers who account for 10% or more of revenue of the Company are presented as follows:

	Six months ended June 30, 2008			June 30, 2008
	Revenue		Percentage of sales	Accounts receivable

Customer A	$	200,311	22%	$	42,833
Customer B		408,726	45%		219,493
Total:	$	609,037	67%	$	262,326

F-17

MEZABAY INTERNATIONAL INC.

(FORMERLY CARDTREND INTERNATIONAL INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2009

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

(b) Major vendors

For the three months ended June 30, 2009, one vendor represented more than 10% of the Company’s purchase. This vendor accounted for 27% of purchase amounting to $115,653 with no outstanding accounts payable as of June 30, 2009.

For the six months ended June 30, 2009, one vendor represented more than 10% of the Company’s purchase. This vendor accounted for 19% of purchase amounting to $115,653 with no outstanding accounts payable as of June 30, 2009.

For the three months ended June 30, 2008, one vendor represented more than 10% of the Company’s purchase. This vendor accounted for 72% of purchase amounting to $168,916 with the outstanding accounts payable of $196,832 as of June 30, 2008.

For the six months ended June 30, 2008, one vendor represented more than 10% of the Company’s purchase. This vendor accounted for 69% of purchase amounting to $401,915 with the outstanding accounts payable of $196,832 as of June 30, 2008.

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and trade accounts receivable. The Company performs ongoing credit evaluations of its customers’ financial condition, but does not require collateral to support such receivables.

(d) Interest rate risk

As the Company has no significant interest-bearing assets, the Company’s income and operating cash flows are substantially independent of changes in market interest rates.

The Company’s interest-rate risk arises from long-term borrowings. Borrowings issued at variable rates expose the Company to cash flow interest-rate risk. Borrowings issued at fixed rates expose the Company to fair value interest-rate risk. Company policy is to maintain approximately all of its borrowings in fixed rate instruments. As of June 30, 2009, all of borrowings were at fixed rates.

(e) Exchange rate risk

The reporting currency of the Company is US$, to date the majority of the revenues and costs are denominated in RMB and MYR and a significant portion of the assets and liabilities are denominated in RMB, MYR and SGD. As a result, the Company is exposed to foreign exchange risk as its revenues and results of operations may be affected by fluctuations in the exchange rate between US$, RMB, MYR and SGD. If RMB, MYR and SGD depreciate against US$, the value of RMB, MYR and SGD revenues and assets as expressed in US$ financial statements will decline. The Company does not hold any derivative or other financial instruments that expose to substantial market risk.

NOTE－15 COMMITMENTS AND CONTINGENCIES

(a) Capital lease commitments

Etop Services (Malaysia) Sdn Bhd, a subsidiary of ours based in Malaysia had obtained a financing of MYR50,000 (approximately $14,160) for the purchase of computers and peripherals in December 2006 and there remains an amount of MYR6,944 (approximately $2,727) to be repaid within 1 year from June 30, 2009.

(b) Operating lease commitments

The subsidiaries operating in Malaysia and the PRC were committed under various non-cancelable operating leases with a term of up to four years with fixed monthly rentals, due 2009. The monthly aggregate lease payment is approximately $8,226. None of the leases included contingent rentals.

Total lease expenses for the three months and six months ended June 30, 2009 were $26,594 and $49,358, respectively, as compared to $28,690 and $52,800 for the corresponding periods in 2008, respectively.

As of June 30, 2009, the Company had a total of 17 ( as compared to 21 as of June 30, 2008) employment contracts expiring within 1 month to 42 months with a payroll amount of approximately $80,318 per month (as compared to $88,500 per month as of June 30, 2008), reducing as and when each contract expires. As of June 30, 2009, there were 118 (as compared to 129 as of June 30, 2008) employment contracts terminable with prior notice of between 1 to 3 months that were entered into by our subsidiaries, with a payroll amount of approximately $41,635 per month (as compared to $43,513 per month as of June 30, 2008).

(d) Consulting services contract commitments

As of June 30, 2009, the Company had one consulting service contract expiring within 3 month with a cash fee payment of $2,000 per month.

NOTE－16 COMPARATIVE FIGURES

Certain amounts in the prior periods presented have been reclassified to conform to the current period financial statement presentation.

F-18

ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

You should read the following discussion of the Company’s financial condition and operations in conjunction with the consolidated financial statements and the related notes included elsewhere in this report. This report contains forward-looking statements. These include statements about the Company’s expectations, beliefs, intentions or strategies for the future, which the Company indicate by words or phrases such as “anticipate,” “expect,” “intend,” “plan,” “will,” “the Company believes,” “our company believes,” “management believes” and similar language. The forward-looking statements are based on the Company’s current expectations and are subject to certain risks, uncertainties and assumptions, including those set forth in the discussion under the sections of “Business,” “Risk Factors”, and “Management’s Discussion and Analysis.” The actual results may differ materially from results anticipated in these forward-looking statements. The Company bases the forward-looking statements on information currently available to us, and the Company assumes no obligation to update them. In addition, the Company’s historical financial performance is not necessarily indicative of the results that may be expected in the future and the Company believes that such comparisons cannot be relied upon as indicators of future performance.

Currently, the Company does not have sufficient capital to implement its entire plan of operations. The information contained herein reflects a prospective plan of future operation. There is no assurance that the plan will be implemented. As of the date of this filing, the Company does not have sufficient funds to implement the foregoing plan of operations. There are no assurances as to when, if ever, the Company will have all the required funds to implement this plan of operations.

The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and related notes included in this report as well as the Company’s 2008 Annual Report on Form 10K filed on April 15, 2009.

Recent Developments

Effective January 30, 2009, the Company’s authorized shares of common stock have been increased from 250,000,000 to 500,000,000.

On April 1, 2009, the directors of the Company approved the termination of the joint venture agreement entered into with two Mongolians. The Company intended to send the termination notice to the Mongolians by April 30, 2009 but such notice is yet to be sent as at the date of this Report as the Company is using its best effort to avoid such termination in view of certain new developments.

On April 15, 2009, the directors approved the extension of the service contract with KateLin Enterprise Inc. (which expired on April 6, 2009) to supply administrative services to June 6, 2009 at the same monthly fee of $2,000.

On June 6, 2009, the directors approved the further extension of of the service contract with KateLin Enterprise Inc. (which expired on June 6, 2009) to supply administrative services to September 30, 2009 at the same monthly fee of $2,000.

Effective June 18, 2009, the Company’s authorized shares of common stock have been increased from 500,000,000 to 1,500,000,000 and its name has been changed from Cardtrend International Inc. to Mezabay International Inc.

Recent Financial Results

Revenue of Processing Business Unit

(i) In Other Asia Markets

During the three and six months ended June 30, 2009, the Processing Business Unit in Other Asia Markets, which currently comprises of all the Company’s wholly-owned subsidiaries, namely Cardtrend Systems Sdn. Bhd. in Malaysia, Asia Payment Systems Pte. Ltd., in Singapore (which is still inactive as at the date of this Report), and Asia Payment Systems (Hong Kong) Ltd. in Hong Kong reported a net revenue of $524,054 and $671,374, respectively, as compared to $122,438 and $262,865, respectively, recorded for the corresponding three and six months ended June 30, 2008, an increase of 328% and 155%, respectively . During the three and six months ended June 30, 2009, the Processing Business Unit in Other Asia Markets recorded total cost of services of $280,666 and $355,330 respectively, as compared to $28,086 and $51,112, respectively, for the corresponding three and six months ended June 30, 2008, an increase of approximately 899% and 595%, respectively, thereby generating a gross profit of $243,388 and $316,044 ended June 30, 2009, an increase of 158% and 41%, respectively. The gross margin for this business unit in Other Asia Markets for the three and six months ended June 30, 2009 was 46%and 47%, respectively, as compared to 77% and 81%, respectively, for the corresponding three and six months ended June 30, 2008. The reduction of the gross margin was due to the higher cost of service incurred by Cardtrend Systems Sdn. Bhd.

(ii) China Market

During the three and six months ended June 30, 2009, the Processing Business Unit in China Market which currently comprises only Asia Payment Systems (China) Co. Ltd., recorded a total net revenue of $431,704 and $650,558, respectively, as compared to $77,819 and $200,311, respectively, recorded for the corresponding three and six months ended June 30, 2008, an increase of 455% and 225%, respectively. During the three and six months ended June 30, 2009, the Processing Business Unit in China Market recorded total cost of services of $133,676 and $214,981, respectively, as compared to $17,630 and $87,310, respectively, for the corresponding three and six months ended June 30, 2008, an increase of 658% and 146%, respectively. The gross margin for this business unit in China Market for the three and six months ended June 30, 2009 was 69% and 67%, respectively, as compared to 77% and 56%, respectively, for the corresponding three and six months ended June 30, 2008. The improvement of the gross margin was due to the lower cost of service incurred by Asia Payment Systems (China) Co. Ltd.

Revenue of Prepaid Business Unit

(i) In Other Asia Markets

During the three and six months ended June 30, 2009, the Prepaid Business Unit in Other Asia Markets, which comprises two subsidiaries of ours in Malaysia, namely, the wholly owned Payment Business Solutions Sdn. Bhd. and the 60%-owned Etop Services (Malaysia) Sdn. Bhd., reported a total net revenue of $19,135 and $36,644, respectively, as compared to $191,020 and $447,595, respectively, recorded for the corresponding three and six months ended June 30, 2008, a decrease of 90%. and 92% , respectively. The reduction of the net revenue for this business unit for the six months ended June 30, 2009 was due to the management’s decision to completely stop the business of Payment Business Solutions Sdn. Bhd. in the distribution of IDD telecommunication prepaid cards because of the difficulty in obtaining higher profit margin as well as a sudden drop in the customers who consist of mainly foreign workers in Malaysia which has substantially reduced the quota for foreign workers. The total cost of the prepaid products was $18,869 and $36,238, respectively, for the three and six months ended June 30, 2009, as compared to $188,188 and $440,946, respectively, recorded for the corresponding three and six months ended June 30, 2008, a decrease of 90% and 92%, respectively. The gross margin for this business unit in Other Asia Market for the three and six months ended June 30, 2009 was approximately 1% and 1%, respectively, as compared to approximately 1% and 1%, respectively, for the corresponding three and six months ended June 30, 2008.

(ii) China Market

As at the date of this Report, the Company has not begun to conduct the Prepaid Business in China Market.

Cards Business Unit

(i) In Other Asia Markets

During the three and six months ended June 30, 2009 and 2008, the Cards Business Unit in Other Asia Markets, which comprises two associated companies in Malaysia, namely, ISynergy Sdn. Bhd., an operator of loyalty-rewards cards, and Synergy Cards Sdn. Bhd., an operator of payment cards, in which we have a 20% and 10% equity, respectively, continued to incur losses and did not declare any dividend. The accumulated losses of these two associated companies exceeded the balance of our investments of $1 and $105,263, respectively. Hence, this Business Unit did not report any share of losses or income for this reporting period and the corresponding period in 2008. As we have not been issued with any share of the common stock of Interpay Co. Ltd., a company incorporated in Mongolia which Asia Payment Systems (HK) Ltd., our wholly owned subsidiary in Hong Kong, is supposed to subscribe for 50% of the proposed paid up capital of $500,000, we have not recorded any share of the losses suffered by such company for this reporting period and the corresponding period ended June 30, 2008.

(ii) In China Market

As of the date of this Report, the Company has not begun to conduct Cards Business in China.

Consolidated Revenues and Operating Expenses

On a consolidated basis, the Company recorded total net revenue of $974,893 and $1,341,067, respectively, for the three and six months ended June 30, 2009, as compared to $391,277 and $910,771, respectively, for the corresponding three and six months ended June 30, 2008, an increase of 149% and 47%, respectively. The corresponding total costs of goods sold and services rendered for the three and six months ended June 30, 2009 was $433,211 and $606,549 as compared to $233,904 and $579,368, respectively, for the corresponding three and six months ended June 30, 2008, an increase of 85% and 5%, respectively. Hence, the total gross profits of the Company for the three and six months ended June 30, 2009 was $541,682 and $734,518, respectively, producing a gross margin of approximately 56% and 55%, respectively, as compared to $157,373 and $331,403, respectively, producing a gross margin of 40%, and 34%, respectively, for the same corresponding three and six months ended June 30, 2008, an improvement of 40% and 62%, respectively. The increase of the net revenue was due mainly to increased revenues from Cardtrend systems and APS China. The improvement of gross margin was due to the complete stoppage of Payment Business Solutions Sdn. Bhd.’s business.

The Company incurred total operating expenses of approximately $1,870,569 and $2,506,960, respectively, for the three and six months ended June 30, 2009 as compared to $989,282 and $1,961,189, respectively, for the corresponding three and six months ended June 30, 2008, an increase of $881,287 (or 89%) and $545,771 (or 28%), respectively. The increase of operating expenses was primarily contributed by the accelerated write-off deferred stock compensation and goodwill.

Financing expense for the three and six months ended June 30, 2009 was approximately $20,689 and $20,842, respectively, as compared to $9,744 and $7,669, respectively, for the same corresponding three and six months ended June 30, 2008, an increase of 112% and 172%, respectively.

During the three and six months ended June 30, 2009 and 2008, the Company did not issue any common stock for consulting service. For the three and six months ended June 30, 2009, the Company expensed stock-based compensation from stock options granted to directors, officers and employees in the amount of $181,540 and $272,310, respectively, as compared to $168,103 and $333,880 respectively, for the corresponding three and six months ended June 30, 2008. For the three and six months ended June 30, 2009, the Company expensed stock-based compensation from stock options granted to consultants in the amount of $125,145 and $131,812, respectively, as compared to $101,171 and $208,426, respectively, for the corresponding three and six months ended June 30, 2008.

Net loss for the three-month period ended June 30, 2009 was $1,034,412, as compared to $905,899 for the corresponding three-month period ended June 30, 2008, an increase of $128,513 (or 14%). This was mainly due to goodwill write-off and accelerated stock based compensation expenses. The comprehensive loss for the three-month period ended June 30, 2009 was $985,870 as compared to $880,338 for the corresponding three-month period ended June 30, 2008, an increase of $105,532 (or 12%). Net loss for the six months ended June 30, 2009 was $1,628,293, as compared to $2,272,332 for the corresponding six months ended June 30, 2008, a decrease of $644,039 (or 28%). This was mainly due to lower amortization of discount on convertible loans and higher gross profit Company wide. The comprehensive loss for the six months ended June 30, 2009 was $1596,235, as compared to $2,235,409 for the corresponding six months June 30, 2008, a decrease of 29%.

Liquidity and Capital Resources

As of June 30, 2009, the Company had cash of $29,462, as compared to the ending cash balance at of December 31, 2008 in the amount of $14,919, an increase of $14,543 (or 97 %).

Net cash used in operating activities was $111,234 for the six-month period ended June 30, 2009, compared to $702,801 for the same corresponding period in 2008, a reduction of $591,567 or 84%. The decrease in net cash used in operations was mainly due to less repayment for accounts payable.

Net cash used in investing activities was $4,337 for the six-month period ended June 30, 2009, compared to net cash generated of $8,333 for the same corresponding period in 2008.

Net cash provided by financing activities was $98,056 for the six-month period ended June 30, 2009, compared to $468,476 for the corresponding period in 2008. The cash for both the periods was obtained from issuance of convertible loans, which were used to fund the operating activities.

As of June 30, 2009, total current liabilities exceeded total current assets by $1,036,917 compared to $1,847,821 at December 31, 2008. Shareholders, directors and related party advances comprise $313,877 of the current liabilities at June 30, 2009, compared to $519,964 at December 31, 2008. As of June 30, 2009, the current liabilities include $100,000 owing to the Company’s former JV partner, Shandong Hengtong Chemical Industrial Company Ltd, and $3,618 owing to a Malaysian leasing company. The loan from Shandong Hengtong Chemical Industrial is non-interest bearing and no fixed term of repayment, due upon demand.

Goodwill Review Process

Goodwill represented the difference between the aggregate consideration paid for the acquisition and the fair value of the net tangible assets of Cardtrend Systems Sdn. Bhd.

For the three months ended June 30, 2009, the management of the Company evaluated the recoverability of the goodwill using a combination of discounted cash flow method and price-earning method to determine the fair value of Cardtrend Systems Sdn. Bhd. The tests resulted that the fair value of Cardtrend Systems Sdn. Bhd. was lower than the carrying value of goodwill and therefore an impairment loss of $153,212 was recognized for the three months ended June 30, 2009.

Financial Condition

As of June 30, 2009, the Company’s consolidated cash and cash equivalents totaled $29,462. The Company has insufficient funds to operate their existing business over the next three months. However, the Company’s goal is to achieve profitability and to generate positive cash flows from operations. The Company’s capital requirements depend on a variety of factors, including but not limited to, the rate of increase or decrease in the Company’s existing business base, the success, timing, and amount of investment required to launch new businesses, revenue growth or decline, and potential acquisitions. Failure to generate positive cash flow from operations will have a material adverse effect on the Company’s business, financial condition and results of operations. The Company’s ability to achieve the planned revenue targets and/or generate positive cash flows from operations in the future is predicated upon numerous factors with varying levels of importance as follows:

First, the Company’s Business Units will attempt to successfully implement their business plans, manage expenditures according to their budgets, and generate positive cash flow from their operations;

Second, the Company’s Business Units will attempt to each develop an effective marketing and sales strategy in order to grow the Company’s businesses and compete successfully in the Company’s markets;

Third, the Company will attempt to increase positive cash flow with respect to the Company’s Processing Business undertaken by Cardtrend Systems in order to provide the Company with cash flow.

The Company has established a management plan to guide the Management in growing the Company’s net revenues and generating positive cash flows from operations during 2009. The major components of the plan are discussed on the subsection of Item 7 Part II entitled “Management Initiatives & Plans” of the Annual Report for the year ended December 31, 2008 on Form 10K filed on April 15, 2009. No assurance can be given that the Company will be successful in implementing the plan. The Company’s net revenues and cash flows from operations depend on many factors including the success of its marketing programs, the maintenance and reduction of expenses and its ability to successfully develop and implementing new businesses in all the markets.

The accompanying unaudited condensed consolidated financial statements have been prepared on the basis that the Company will continue as a going concern which assumes the realization of assets and settlement of liabilities in the normal course of business. Since its inception, the Company has been engaging in organizational, pre-operating as well as acquisition and merger activities. As of June 30, 2009, the Company had a working capital deficit of $1,036,917 and an accumulated deficit of $25,769,734 since inception of its business. These matters raise substantial doubt about the Company’s ability to continue as a going concern. Continuation of the Company's existence is dependent upon its ability to obtain additional capital and sustain profitable operations. The uncertainty related to these conditions also raises doubt about the Company's ability to continue as a going concern. The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Although the Company has funded and will continue to fund the acquisitions and mergers by the issuance of the Company’s common stock, the Company requires additional cash to meet on-going operating expenses. To date, the Company’s primary source of funds has been equity investments and shareholders’ and directors’ advances, and this trend is expected to continue over the next quarter. The Company does not currently have any agreements with investors or the Company’s shareholders or directors for future equity investment. The Company expects to raise such additional capital through additional private financings, as well as borrowings and other resources. The Company may also raise additional funds in a public offering or from the exercise of currently outstanding options and warrants. To the extent that additional capital is raised through the sale of equity or equity-related securities or the exercise of currently outstanding options and warrants, the issuance of such securities could result in further dilution of the Company’s stockholders. There can be no assurance that additional funding will be available on favorable terms, if at all. If adequate funds are not available when required, the Company will be required to further curtail or suspend operations or to seek funding through arrangements with collaborative partners or others that may require the Company to relinquish rights that the Company would not otherwise relinquish. Since much of the information contained in this report herein reflects a prospective plan of future operation, there is no assurance that the plan will be implemented as described.

Contractual Obligations

The Company’s contractual obligations as at June 30, 2009 as required to be disclosed by Item 303(a)(5) of Regulation S-K are tabulated as follows:

Contractual obligations	Payments due by period
	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Capital Lease Obligations	$	2,215	$	2,215	$	-	$	-	$	-
Operating Lease Obligations	$	118,681	$	70,086	$	48,595	$	-	$	-
Total	$	120,896	$	72,301	$	48,595	$	-	$	-

The following summarizes other significant contractual obligations of the Company as of June 30, 2009, and the effect such obligations are expected to have on the Company’s liquidity and cash flows in future periods:

The settlement of salaries owed to employees and officers of the Company totaling $237,213 as at June 30, 2009, which the Company believes would have impact on the Company’s liquidity and cash flow in the future periods unless the employees and officers would agree to a settlement by means of shares of the Company’s common stock.

The settlement of loans owed to certain directors of the Company totaling $201,923 as at June 30, 2009, which the Company believes would have impact on the Company’s liquidity and cash flow in the future periods unless the directors would agree to a settlement by means of shares of the Company’s common stock.

The settlement of fees owed to our service contractors totaling $388,817 as at June 30, 2009, which the Company believed would have great impact on the Company’s liquidity and cash flow in the future periods.

The expected timing of the obligation s discussed above was estimated based on information known to the Company as at the time of filing of this report. As at the time of this report, certain of the above contractual obligations have not been met.

Inflation

The impact of inflation on the costs of the Company, and the ability to pass on cost increases to its customers over time is dependent upon market conditions. The Company is not aware of any inflationary pressures that have had any significant impact on the Company’s operations over the past quarter, and the Company does not anticipate that inflationary factors will have a significant impact on future operations.

Off Balance Sheet Arrangements

The Company does not maintain off-balance sheet arrangements nor does it participate in non-exchange traded contracts requiring fair value accounting treatment.

Trends, Risk and Uncertainties

We have sought to identify what we believe to be the most significant risks to our business, but we cannot predict whether, or to what extent, any of such risks may be realized nor can we guarantee that we have identified all possible risks that might arise. Investors should carefully consider all of such risk factors discussed in the Company’s Form 10K filed on April 15, 2009 before making an investment decision with respect to our Common Stock.

Cautionary Factor That May Affect Future Results

We have sought to identify what we believe are significant risks to our business, but we cannot predict whether, or to what extent, any of such risks may be realized nor can we guarantee that we have identified all possible risks that might arise.

ITEM 3. QUANTITIVE AND QUALITIVE DISCLOSURE ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures

The Company’s management, with the participation of our chief executive Officer and chief financial officer, carried out an evaluation of the effectiveness of our disclosure controls and procedures” (as defined in the Securities Exchange Act of 1934 (the Exchange Act”) Rules 13a-15(e) and 15-d-15(e)) as of the end of the period covered by this report (the Evaluation Date”). Based upon that evaluation, the Company’s chief executive officer and chief financial officer concluded that as of the Evaluation Date, the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act (i) is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and (ii) is accumulated and communicated to management, including the chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

The Company’s management, including the chief executive officer and chief financial officer, does not expect that the Company’s disclosure controls and procedures or its internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within Cardtrend International, Inc. can be prevented.

(b) Management’s Report on Internal Control over Financial Reporting

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). The Company’s management has assessed the effectiveness of our internal control over financial reporting as of June 30, 2009. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework. Our management has concluded that, as of June 30, 2009, our internal control over financial reporting is effective based on these criteria. This quarterly report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this quarterly report.

There were no changes in our internal controls over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 1A. RISK FACTORS

The risk factors for the period ended June 30, 2009 are similar to those disclosed in Item 1A of the Form 10K for the year ended December 31, 2008 filed on April 15, 2009, the reference of which is hereby made.

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

Other than the issuance of the restricted shares of the Company’s common stock to the holders of the convertible loans as disclosed in Note 11 of this report, there were no unregistered sales of equity securities during the six months ended June 30, 2009. The proceeds for the convertible loans were used for general administration expenses.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

On January 15, 2009, the Company obtained the votes of 73.42 %, forming a majority, of the shareholders of all classes of the Company’s common stock in favor of increasing the authorized number of shares of its common stock from 250,000,000 to 500,000,000. The change was effective January 30, 2009.

On April 28, 2009, the Company filed Form PRE14A for a Special Meeting of the Company’s shareholders to be held on June 11, 2009 to vote for (i) the increase of the authorized shares of the Company’s common stock from 500,000,000 to 1,500,000,000, and (ii) the change of name of the Company from Cardtrend International Inc. to Mezabay International Inc.

On May 11, 2009 and May 13, 2009, the Company filed Form DEF14A and DEFR14A, respectively, for the Special Meeting of the Company’s shareholders as mentioned above.

On June 12, 2009, the Company obtained (i) the votes of 74.26 %, forming a majority, of the shareholders of all classes of the Company’s common stock in favor of increasing the authorized number of shares of its common stock from 500,000,000 to 1,500,000,000, and (ii) the votes of 77.14% , forming a majority, of the shareholders of all classes of the Company’s common stock in favor of the name of the Company from Cardtrend International Inc. to Mezabay International Inc. These changes were effective June 18, 2009. As at the date of this report, the Company is waiting for FINRA’s assignment of a new stock symbol.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

Exhibit Number	Description

3.7	Certificate of Amendment to Articles of Incorporation Dated June 18, 2009.

31.1	Certification of Principal Executive Officer pursuant Section 302 of the Sarbanes-Oxley Act of 2002

31.2	Certification of Principal Financial Officer pursuant Section 302 of the Sarbanes-Oxley Act of 2002

32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized on this 19th day of August, 2009.

	MEZABAY INTERNATIONAL INC.
	(formerly, Cardtrend International Inc.)
	A Nevada corporation

	By:	KING K. NG
		King K. Ng
		Chief (Principal) Executive Officer

	By:	THOMAS CL WONG
		Thomas CL Wong
		Chief (Principal) Financial Officer

EXHIBIT INDEX

Exhibit Number	Description

3.7	Certificate of Amendment to Articles of Incorporation Dated June 18, 2009.

31.1	Certification of Principal Executive Officer pursuant Section 302 of the Sarbanes-Oxley Act of 2002

31.2	Certification of Principal Financial Officer pursuant Section 302 of the Sarbanes-Oxley Act of 2002

32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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