SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

____________________

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): ~~July~~ September 1324, ~~2006~~ 2007

~~Axial~~AXIAL ~~Vector~~VECTOR ~~Engine~~ENGINE ~~Corporation~~CORPORATION

(Exact name of registrant as specified in its charter)

Nevada	000-49698	2098-~~3362479~~0353007
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

121 S W Salmon Street Suite 1100, Portland, OR	97204
One World Trade Center, 121 SW Salmon Street, Portland, Oregon	97204
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (503) 471-~~595-5088~~1348

~~___________________________________________________~~_________________________________________ (Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ]	Written communications pursuant to Rule 425 under the Securities Act (17CFR 230.425)

[ ]	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ]	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ]	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

~~SECTION~~ 1 ~~- Registrant’s Business and Operations~~

~~Item~~SECTION ~~8.01 Other Events~~1 -- REGISTRANT’S BUSINESS AND OPERATIONS

OnItem ~~July 13,~~1.01. Entry ~~2006, we entered~~ into ~~an agreement titled “Distribution Agreement” (the “Agreement”) with Dynamic Engines Limited,~~ a ~~New~~Material ~~Zealand company (“DEL”),~~Definitive pursuant to which DEL has become the exclusive distributor of our GENSETS product in the country of New Zealand for a period of twenty years. In exchange for the exclusive distribution rights, DEL has agreed to pay a licensing fee of $1,000 and to contribute and transfer to us certain application development work that has enhanced the value of our intellectual property. Agreement

The ~~Agreement~~Company isentered ~~renewable~~into ~~upon~~a ~~consent~~joint ofventure ~~the~~agreement ~~parties~~with ~~for~~Eastcom ~~additional~~Ltd., ~~terms~~a ofU.K. ~~twenty~~company, ~~years.~~to ~~Under~~perform ~~the~~internal ~~Agreement,~~combustion ~~DEL~~engine ~~has~~manufacturing ~~the~~and ~~first~~sales ~~right~~in ~~to negotiate for~~Europe and ~~purchase~~ ~~exclusive~~the ~~distribution~~Middle ~~rights~~East. This ~~for~~relates ~~our~~to ~~other~~the ~~products~~Axial ~~and~~Gas toCam ~~negotiate~~Engine, patent ~~for~~pending ~~and~~(notice ~~purchase~~of ~~exclusive~~allowance ~~distribution~~previously ~~rights~~issued toby the ~~additional territories~~USPTO). The agreement requires Eastcom Ltd to pay the Company an advance royalty of $500,000 ~~Australia,~~in ~~the~~relation ~~Cook~~to ~~Islands,~~a ~~Tonga,~~per ~~Samoa~~unit ~~Niue,~~royalty ~~and~~fee ~~Fiji.~~of In20% of the ~~event~~gross ~~that~~sales for each ~~DEL declines~~manufactured orengine completed by Eastcom Ltd. Eastcom is ~~unable~~also required to ~~meet~~begin final assembly of the ~~terms~~internal ~~offered~~combustion byengines uswithin ~~for~~120 ~~these~~days ~~additional~~from the ~~product~~date of ~~and/or~~the ~~territorial~~contract. The ~~distribution~~Company ~~rights,~~anticipates wethat Eastcom Ltd. will complete beno ~~entitled~~less tothan ~~offer those~~200 ~~rights~~engines toduring ~~other~~the ~~parties~~initial period of the 20 year term of the contract.

InSECTION ~~order to~~2 ~~maintain~~- ~~its~~FINANCIAL rights under the Agreement, DEL must annually purchase a minimum number of GENSETS to be determined and periodically reviewed by both parties. The Agreement requires us to exert reasonable efforts to supply DEL’s requirements for the GENSETS. Under the Agreement, DEL is obligated to promote our products through product shows, advertising, a website presence, and showroom and/or product demonstration sites. DEL will be responsible for obtaining all licenses and permits necessary to sell our products in New Zealand. INFORMATION

The above description of the Distribution Agreement and the transactions contemplated thereby is a summary of terms, is not intended to be complete, and is qualified in its entirety by the complete text of that agreement, a copy of which is attached as Exhibit 99.1 to this Current Report. None

SECTION 93 - ~~FINANCIAL STATEMENTS~~SECURITIES AND ~~EXHIBITS~~TRADING MARKETS

~~Item 9.01~~None

~~Exhibit~~SECTION ~~99.l Distribution~~4 - MATTERS RELATED TO ACCOUNTANTS AND FINANCIAL ~~Agreement~~STATEMENTS

None.

SECTION 5 - CORPORATE GOVERNANCE AND MANAGEMENT

None

SECTION 6 - RESERVED

None

SECTION 7 - REGULATION FD

None

SECTION 8 - OTHER EVENTS

None

SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS

None

10.1	Memorandum of Understanding

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 hereunto duly authorized.

Axial Vector Engine Corporation.

/s/ ~~Raymond~~Samuel ~~Brouzes~~ Higgins

Samuel ~~Raymond Brouzes~~Higgins

Chief ~~Chief~~ Executive Officer~~, Chief Financial Officer,~~

Date: October ~~and~~2, ~~Director~~2007

Date: July 18, 2006

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