<PAGE>

        As Filed with the Securities and Exchange Commission on December 6, 2002
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-QSB
                   QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                     FOR THE PERIOD ENDED SEPTEMBER 30, 2002

                           COMMISSION FILE NO. 0-27121

                             _______________________


                                   ILIVE, INC.
                 (Name of Small Business Issuer in Its Charter)

           NEVADA                                                95-4783826
(State or other jurisdiction of                               (I.R.S. Employer
 incorporation or organization)                              Identification No.)

                           2102 BUSINESS CENTER DRIVE
                            IRVINE, CALIFORNIA 92612
                    (Address of Principal Executive Offices)

                                 (949) 660-0099
                           (Issuer's Telephone Number)

                                 (949) 756-0856
                           (Issuer's Facsimile Number)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 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 past 90 days.

                                  Yes [_] No [X]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock at the latest practicable date.

As of December 5, 2002, the registrant had 7,419,105 shares of common stock,
$.001 par value, issued and outstanding.

Transitional small business disclosure format (check one): Yes [_] No [X]

<PAGE>


PART I

ITEM 1. FINANCIAL STATEMENTS
<TABLE>

                             iLIVE, INC. AND SUBSIDIARIES
                         CONDENSED CONSOLIDATED BALANCE SHEET
                                     (UNAUDITED)
<CAPTION>

                                                                          SEPTEMBER 30,
                                                                              2002
                                                                          ------------
<S>                                                                       <C>
                                        ASSETS

CURRENT ASSETS
  Cash                                                                    $     1,153
  Accounts receivable, net of allowance for doubtful accounts of $5,158        45,655
  Prepaid expenses                                                            206,000
                                                                          ------------

   Total current assets                                                       252,808

EQUIPMENT, NET OF ACCUMULATED DEPRECIATION OF $72,104                          90,594
WEB CONTENT                                                                   786,500
BEAUTY PAGEANT RIGHTS                                                         100,150
OTHER                                                                          37,907
                                                                          ------------

                                                                          $ 1,267,959
                                                                          ============


                         LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Note payable                                                            $   100,300
  Accounts payable                                                            119,999
  Accrued interest, including $454 to related party                            44,499
  Accrued payroll                                                              57,466
                                                                          ------------

    Total current liabilities                                                 322,264

CONVERTIBLE DEBT                                                              352,544
                                                                          ------------
    Total liabilities                                                         674,808
                                                                          ------------

COMMITMENTS AND CONTINGENCIES                                                      --

STOCKHOLDERS' EQUITY

  Common stock,  $.001 par value; 10,000,000 shares
    authorized, 7,419,105 shares issued and outstanding                         7,419
  Additional paid-in capital                                                7,940,421
  Unamortized beneficial conversion feature of convertible debt               (59,682)
  Accumulated deficit                                                      (7,295,007)
                                                                          ------------

    Total stockholders' equity                                                593,151
                                                                          ------------

                                                                          $ 1,267,959
                                                                          ============

     The accompanying notes are an integral part of these financial statements.
</TABLE>

                                            2
<PAGE>

<TABLE>

                                    iLIVE, INC. AND SUBSIDIARIES
                           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                             (UNAUDITED)
<CAPTION>

                                                  THREE MONTHS ENDED           NINE MONTHS ENDED
                                                     SEPTEMBER 30,                SEPTEMBER 30,
                                             ---------------------------  ---------------------------
                                                 2002           2001          2002           2001
                                             ------------   ------------  ------------   ------------
<S>                                          <C>            <C>           <C>            <C>
REVENUES                                     $     4,473    $    93,000   $    14,543    $   141,000

COSTS AND EXPENSES
  Cost of sales                                   11,492         10,829        13,869         15,779
  Website development and hosting                 40,508          9,000       713,508        155,799
  General and administrative                     183,411         38,510     1,163,855        288,892
  Interest                                        27,446          2,837        52,591         37,799
  Interest - related party                           117          6,431        12,346         75,803
                                             ------------   ------------  ------------   ------------

  INCOME (LOSS) FROM CONTINUING
  OPERATIONS                                    (258,501)        25,393    (1,941,626)      (433,072)
                                             ------------   ------------  ------------   ------------


DISCONTINUED OPERATIONS:
  Gain on disposal                                    --      1,930,673            --      1,930,673
                                             ------------   ------------  ------------   ------------

  INCOME FROM DISCONTINUED
  OPERATIONS                                          --      1,930,673            --      1,930,673
                                             ------------   ------------  ------------   ------------

NET INCOME (LOSS)                            $  (258,501)   $ 1,956,066   $(1,941,626)   $ 1,497,601
                                             ============   ============  ============   ============


BASIC AND DILUTED LOSS PER SHARE
  Income (loss) from continuing operations   $     (0.04)   $      0.01   $     (0.44)   $     (0.19)
                                             ============   ============  ============   ============
 Income from discontinued operations         $        --    $      0.80   $        --    $      0.85
                                             ============   ============  ============   ============
  Net income (loss)                          $     (0.04)   $      0.80   $     (0.44)   $      0.66
                                             ============   ============  ============   ============


BASIC AND DILUTED WEIGHTED AVERAGE
 NUMBER OF SHARES OUTSTANDING                  6,496,541      2,434,315     4,377,992      2,259,073
                                             ============   ============  ============   ============

             The accompanying notes are an integral part of these financial statements.
</TABLE>

                                                 3
<PAGE>

<TABLE>
                            iLIVE, INC. AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (UNAUDITED)
<CAPTION>

                                                              FOR NINE MONTHS ENDED
                                                                  SEPTEMBER 30,
                                                              2002           2001
                                                          ------------   ------------
<S>                                                       <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss                                               $(1,941,626)   $ 1,497,601
   Adjustments to reconcile net loss to net cash
      used by operating activities:
      Gain from discontinued operations                            --     (1,930,673)
      Depreciation and amortization                            55,586         17,777
      Beneficial conversion feature of convertible debt        29,068         42,420
      Issuance of shares for services                       1,573,488             --
   Change in assets and liabilities:
      Accounts receivable                                      18,749       (143,400)
      Prepaids and other assets                              (264,250)       (13,804)
      Accrued interest                                         23,578          8,512
      Accrued interest - related party                         12,290         93,692
      Accrued payroll                                          20,002         30,864
      Accounts payable                                         58,127        (74,704)
      Other accrued expenses                                       --         (3,130)
                                                          ------------   ------------

         Net cash used by operating activities               (414,988)      (474,845)
                                                          ------------   ------------

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchase of equipment                                       (28,799)       (21,229)
                                                          ------------   ------------

         Net cash used by investing activities                (28,799)       (21,229)
                                                          ------------   ------------

CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from issuance of convertible debt                  355,300             --
  Advances from stockholder                                        --        361,074
  Repurchase and retirement of common stock                        --        (25,000)
  Issuance of  common stock for cash                           89,640        160,000
                                                          ------------   ------------

         Net cash provided by financing activities            444,940        496,074
                                                          ------------   ------------


Net increase in cash                                            1,153             --

CASH, BEGINNING OF PERIOD                                          --             --
                                                          ------------   ------------

CASH, END OF PERIOD                                       $     1,153    $        --
                                                          ============   ============

SUPPLEMENTAL DISCLOSURES OF NON-CASH
  INVESTING AND FINANCING ACTIVITIES

      Conversion of debt to equity                        $   461,331    $   761,250
                                                          ============   ============

      Issuance of shares for web content                  $   786,500    $        --
                                                          ============   ============


      The accompanying notes are an integral part of these financial statements.
</TABLE>

                                            4
<PAGE>

                          ILIVE, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                               SEPTEMBER 30, 2002

1.    BASIS OF PRESENTATION
---------------------------

      The accompanying condensed consolidated financial statements include the
      accounts of iLive, Inc., ("iLive"), its wholly owned subsidiaries, Society
      of Economic Assurance, Inc. ("SEA") and Asia Pacific Co., LTD ("Asia
      Pacific") and Asia Pacific's majority owned subsidiary, 246 LLC,
      (collectively, the "Company") through September 30, 2001. All material
      intercompany transactions and accounts have been eliminated in
      consolidation.

      iLive (formerly Powerhouse International Corporation) was incorporated in
      1987 in Nevada, became inactive in 1996, and had no assets or liabilities
      at August 31, 1999. On September 7, 1999, iLive sold 10,000,000 shares of
      common stock for $500,000 cash and on September 30, 1999, it acquired Asia
      Pacific for 690,000 of its common shares valued at $74,609. This
      acquisition was accounted for as a purchase; accordingly, the results of
      operations of Asia Pacific are included in the accompanying consolidated
      financial statements since the date of acquisition through its sale on
      September 30, 2001.

      Asia Pacific, incorporated in October 1995 in Niue (a foreign country),
      acquired a controlling 64% interest in 246 LLC, a limited liability
      company organized in March 1996, to construct and operate a full-service
      restaurant, bar and membership club in Beverly Hills, California. The
      restaurant, known as Chasen's, commenced operations in April 1997. In July
      2000, operations of the restaurant were discontinued and all restaurant
      assets were abandoned. On September 30, 2001, Asia Pacific was sold for
      $10,000.

      On February 17, 2000 the Company acquired 100% of the outstanding shares
      of Society of Economic Assurance, Inc. ("SEA"), a Nevada public shell by
      issuing 200,000 shares of its common stock. The Company elected to have
      SEA become the successor issuer, pursuant to Rule 12g-3(a) of the general
      Rules and Regulations of the Securities and Exchange Commission for
      reporting purposes under the Securities Exchange Act of 1934. For
      accounting purposes, the SEA acquisition was treated as a
      recapitalization. From its inception, SEA has been inactive, has operated
      no business, and held no assets or liabilities.

      Management is focused on the delivery and distribution of streaming video
      content on an on-demand and pay-per-view basis. The Company develops its
      own content and assists others to develop a distribution channel for their
      content on the iLive Network. The Company offers video-on-demand,
      electronic shopping, physical VHS and DVD distribution and
      business-to-business content creation and distribution. The Company
      currently generates virtually all of its revenue from its business
      services division where they help other bring their content online by
      providing editing and encoding solutions. Moving forward the Company looks
      to generate additional revenue from pay-per-view content and the Company's
      recent commitment to enter into the ISP market.

                                       5
<PAGE>

                          ILIVE, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                               SEPTEMBER 30, 2002


2.    INTERIM PERIODS
---------------------

      The accompanying unaudited consolidated financial statements have been
      prepared in accordance with the instructions of Form 10-QSB and do not
      include all of the information required by generally accepted accounting
      principles for complete financial statements. In the opinion of the
      Company's management, all necessary adjustments (consisting of normal
      recurring adjustments) for a fair presentation have been included.
      Operating results for the nine months ended September 30, 2002, are not
      necessarily indicative of results for any future period. These statements
      should be read in conjunction with the consolidated financial statements
      and notes thereto for the year ended December 31, 2001 included in the
      Company's Form 10-KSB.

3.    NOTES PAYABLE
-------------------

      On October 1, 2000 the Company issued a convertible note of up to
      $1,500,000, with 12% interest due on or before July 31, 2002. The note is
      convertible at any time given 15 days notice at the holder's election into
      a maximum of 6,000,000 shares of the Company's common stock at $0.25 per
      share. The Company has borrowed $958,454 of which $761,250 was converted
      to common stock during the year ended December 31, 2001. On July 8, 2002,
      the Company converted the remaining balance of $197,204 and accrued
      interest of $261,556 into 1,835,040 shares.

      On January 10, 2002 the Company issued a convertible note up to $300,000,
      with 8% interest, and a warrant to purchase an additional 10,000 shares of
      its common stock. The note may not be paid, in whole or in part, before
      January 10, 2004. The note is convertible into common stock, at the
      holder's option, a the lower of (i) $1.30 or (ii) 80% of the average of
      the three lowest closing prices for the common stock in the 30 trading
      days before but not including the conversion date. The warrants are
      exercisable until January 10, 2005 at the lower of (i) $1.52 or (ii) 120%
      of the average of the three lowest closing prices for the common stock in
      the 10 trading days before but not including the exercise date. The
      Company reported a beneficial conversion feature of $75,000, which is
      reflected in additional paid in capital. Amortization of $9,451 was
      included in interest expense for the quarter ended September 30, 2002.
      During the three months ended September 30, 2002 the Company converted
      $2,571 into 17,000 shares.

      On June 19, 2002 the Company issued a convertible note up to $55,000, with
      8% simple interest and a warrant to purchase an additional 45,000 shares
      of its common stock. The note and any unpaid interest are due June 19,
      2004. The note is convertible into common stock, at the holder's option, a
      the lower of (i) $1.30 or (ii) 80% of the average of the three lowest
      closing prices for the common stock in the 30 trading days before but not
      including the conversion date. The warrants are exercisable until June 19,
      2005 at a purchase price of $1.35. The Company reported a beneficial
      conversion feature of $13,750, which is reflected in additional paid in
      capital. Amortization of $1,757 was included in interest expense for the
      quarter ended September 30, 2002.

                                       6
<PAGE>

                          ILIVE, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                               SEPTEMBER 30, 2002


4.    STOCKHOLDERS' EQUITY
--------------------------

      The Company effected a ten-for-one reverse stock split in May 2002. All
      references in the financial statements and notes to number of shares and
      per share amounts have been restated to reflect this stock split.

      The Company issued common shares (valued at market at the date issued) as
      follows:

      Q-1
      ---

      275,000 shares valued at $605,000 ($2.20 per share) in exchange for web
      content.

      215,000 shares valued $279,500 ($1.30 per share) in exchange for
      consulting services included in website development and hosting expense.

      85,000 shares valued $161,500 ($1.90 per share) in exchange for corporate
      video services included in general and administrative expense.

      130,000 shares valued $247,000 ($1.90 per share) in exchange for investor
      relations services included in general and administrative expense.

      130,000 shares valued at $247,000 ($1.90 per share) in exchange for
      consulting services of which $123,500 is included in website development
      and hosting expense and $123,500 is included in prepaid expenses.

      125,000 shares valued at $275,000 ($2.20 per share) in exchange for
      encoding services of which $192,500 is included in website development and
      hosting and $82,500 in included in prepaid expenses.

      Q-2
      ---

      165,000 shares valued at $181,500 ($1.10 per share) in exchange for web
      content.

      25,000 shares valued at $25,000 ($1.00 per share) in exchange for web
      consulting services included in website development and hosting expense.

      5,000 shares valued at $4,000 ($0.80 per share) in exchange for investor
      relations services included in general and administrative expense.

      13,750 shares valued at $13,750 ($1.00 per share) in exchange for cash.

      170,000 shares valued at $51,000 ($0.30 per share) in exchange for
      consulting services included in general and administrative expense.

                                       7
<PAGE>

                          ILIVE, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                               SEPTEMBER 30, 2002


4.    STOCKHOLDERS' EQUITY
--------------------------

      Q-2 (CONTINUED)
      ---------------

      110,000 shares valued at $99,000 ($0.90 per share) in exchange for
      consulting services included in general and administrative expense.

      50,000 shares valued at $5,000 ($0.10 per share) in exchange for cash.

      170,000 shares valued at $42,500 ($0.25 per share) in exchange for
      consulting services included in general and administrative expense.

      170,000 shares valued at $42,500 ($0.25 per share) in exchange for
      encoding services included in website development and hosting expense.

      15,000 shares valued at $1,500 ($0.10 per share) in exchange for cash.

      40,000 shares valued at $6,000 ($0.15 per share) in exchange for cash.

      Q-3
      ---

      30,000 shares valued at $5,400 ($0.18 per share) in exchange for cash.

      50,000 shares valued at $5,000 ($0.10 per share) in exchange for cash.

      12,500 shares valued at $12,500 ($1.00 per share) in exchange for cash.

      270,000 shares valued at $40,490 ($0.15 per share) in exchange for cash.

      150,000 shares valued at $18,000 ($0.12 per share) in exchange for web
      consulting services.

      640,000 shares valued at $76,800 ($0.12 per share) in exchange for
      consulting services.

      15,000 shares valued at $1,393 ($0.09 per share) for penalties.

      10,000 shares valued at $960 ($0.10 per share) for penalties.

      50,000 shares valued at $2,335 ($0.05 per share) for penalties.

      1,835,040 shares valued at $458,760 ($0.25 per share) issued for
      conversion of debt.

      10,000 shares valued at $1,867 ($0.19 per share) issued for conversion of
      debt.

      7,000 shares valued at $704 ($0.10 per share) issued for conversion of
      debt.

                                       8
<PAGE>

                          ILIVE, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                               SEPTEMBER 30, 2002


5.    DISCONTINUED OPERATIONS
-----------------------------

      On September 30, 2001 the Company sold Asia Pacific to an unrelated party
      for $10,000, resulting in a gain on the disposal of $1,893,083. At
      September 30, 2001, Asia Pacific had zero assets and the following
      liabilities:

      Notes payable                                    $   376,623
      Accounts payable                                     769,382
      Accrued interest                                     136,399
      Accrued payroll and related taxes                    375,816
      Other accrued expenses                               262,453
                                                       ------------
      Estimated liabilities at September 30, 2001        1,920,673
      Cash received                                         10,000
                                                       ------------
                                                         1,930,673

      Fourth quarter 2001 adjustments                      (37,590)
                                                       ------------
                                                       $ 1,883,083
                                                       ============

6.    LEGAL PROCEEDINGS
-----------------------

      The Company from time to time may be involved in various claims, lawsuits,
      disputes with third parties, actions involving allegations of
      discrimination, or breach of contract actions incidental to the operations
      of its business. The Company is currently involved in two such instances.

      Jerry Nieto v. iLive, Inc., et al.
      ----------------------------------

      On September 21, 2001, a lawsuit was filed in the Superior Court of the
      State of California for the County of Orange against the Company entitled
      Jerry Nieto v. iLive, Inc., et al. The complaint alleges various claims
      seeking payment of $9,000 for past due wages, 750,000 shares of the
      Company's common stock, and penalties and attorney fees. The Company
      denies these claims and is vigorously defending the action.

                                       9
<PAGE>

                          ILIVE, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                               SEPTEMBER 30, 2002


      Al Moshiri v. iLive Inc., et al.
      --------------------------------

      On July 20, 2001, a lawsuit was filed in the Superior Court of the State
      of California for the County of Los Angeles against the Company entitled
      Al Moshiri v. iLive, Inc., et. al. The complaint alleges various claims
      seeking payment of alleged finder's fees and damages in the amount of
      $500,000 and seeks punitive damages of $5,000,000. The Company denies
      these claims and is vigorously defending the action.

7.    WEB CONTENT
-----------------

      During the three months ended March 31, 2002, the Company purchased
      $605,000 of Internet Content through the issuance of 275,000 shares of its
      common stock valued at $2.20 per share. During the three months ended June
      30, 2002, the Company purchased $181,500 of Internet Content through the
      issuance of 165,000 shares of its common stock valued at $1.10 per share.
      The Internet Content purchased includes reality based programming, comedy,
      and distance learning applications. This content will be streamed over the
      Internet on a pay-per-view basis. The content was accounted for at cost
      (considered to be the fair value of the shares issued) and will be
      amortized in the same ratio as current pay-per-view revenues bear to
      anticipated total pay-per-view gross revenues.

                                       10
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS

         Some of the information in this 10QSB contain forward-looking
statements that involve substantial risks and uncertainties. You can identify
these statements by forward-looking words such as "may," "will," "expect,"
"anticipate," "believe," "estimate" and "continue," or similar words. You should
read statements that contain these words carefully because they:

         --       discuss our future expectations;

         --       contain projections of our future results of operations or of
                  our financial condition; and

         --       state other "forward-looking" information.

         We believe it is important to communicate our expectations. However,
there may be events in the future that we are not able to accurately predict or
over which we have no control. The risk factors listed in this section, as well
as any cautionary language in this prospectus, provide examples of risks,
uncertainties and events that may cause our actual results to differ materially
from the expectations we describe in our forward-looking statements. You should
be aware that the occurrence of the events described in these risk factors could
have an adverse effect on our business, results of operations and financial
condition.


RESULTS  OF  OPERATIONS

QUARTER ENDED SEPTEMBER 30, 2002 COMPARED TO THE QUARTER ENDED SEPTEMBER 30,
2001.

         Revenues: Revenues totaled $4,473 for the quarter ended September 30,
2002 as compared to $93,000 for the quarter ended September 30, 2001. As a
percentage revenue decreased 95% during the quarter ended September 30, 2002.
The Company's revenue for the quarter ended September 30, 2002 consisted almost
entirely of Business Services as it accounted for $4,000 of the revenue.
Compared to the Company generating $93,000 in business services revenue for the
quarter ended June 30, 2001. The decrease in revenue is attributed to
management's focus on the long-term marketing of its pay-per-view content and
less emphasis on business services. Revenues totaled $14,543 for the nine months
ended September 30, 2002 as compared to $141,000 for the nine months ended
September 30, 2001. The decrease in revenue is attributed to management's focus
on the long-term marketing of its pay-per-view content and less emphasis on
business services.

         Cost of Sales: Cost of Sales totaled $11,492 for the quarter ended
September 30, 2002 as compared to $10,829 for the quarter ended September 30,
2001. As a percentage of total revenue, cost of sales was 257% for the quarter
ended September 30, 2002 resulting in negative gross margins. Cost of Sales
totaled $13,869 for the nine months ended September 30, 2002 as opposed to
$15,779 for the nine months ended September 30, 2001. As a percentage of total
revenue, Costs of Sales was 95% for the nine months ended September 30, 2002
resulting in gross margins of 5%. The Company achieved negative margins due to
the higher costs associated with generating consumer pay-per-view customers as
opposed to business services customers. The cost of sales will vary
significantly from project to project but we aim to consistently challenge and
keep the cost of sales to a minimum.

         General and Administrative Expenses: General and Administrative
expenses totaled $183,411 (4100% of revenues) for the quarter ended September
30, 2002 and $38,510 in General and Administrative expenses (41% of revenues)
for the quarter ended September 30, 2001. General and Administrative expenses
totaled $1,163,855 (8003% of revenues) for the nine months ended September 30,
2002. The significant increase in general and administrative expenses was due to
the increased costs associated with editing and encoding content which was
purchased in subsequent quarters for the Company's website. The Company also
incurred increased legal and accounting fees associated with Laurus convertible
note.

         The Company also received a one-time gain from discontinued operations
in the divesture of Asia Pacific for the period ended September 30, 2001.

                                       11
<PAGE>

         Basic and diluted loss per share from continuing operations totaled
($0.44) for the nine months ended September 30, 2002 as opposed to ($0.19) for
the nine months ended September 30, 2001. This is a result of the decrease in
revenue and increase in expenses, offset by an increase in the number of shares
outstanding.


LIQUIDITY AND CAPITAL RESOURCES

         On June 19, 2002 the Company issued a convertible note up to $55,000
and a warrant to purchase an additional 45,000 shares of its common stock. For
the quarter ended June 30, 2002 the Company also raised $26,250 through the sale
of 118,750 shares to accredited investors through a Private Placement Offering.

         In 1999, we entered into a $1,500,000 convertible line of credit
arrangement with Street Capital Inc., an entity that is controlled by our
President, Mr. Henricks and CEO, Mr. Aimers, bearing interest at 12% and due on
or before March 7, 2001. The note was convertible at the holder's election into
common stock at $0.25 per share, was fully utilized, and was converted into
6,000,000 shares in 2000. In 2000, we entered into a new $1,500,000 convertible
line of credit at 12% interest with all principal and interest due on or before
June 7, 2002. On June 6, 2002 the note was extended to a due date of July 31,
2002. The note is convertible at the holder's election into a maximum of
6,000,000 shares of common stock at $0.25 per share. At September 30, 2002, we
had borrowed a total of $958,454 on this line of credit and the holder had
converted all of the outstanding principal and interest of the debt into
4,880,040 common shares.

         For the quarter ended September 30, 2002, our only material cash flow
came from our business to business sales. Revenue from the Company's
pay-per-view sales have proceeded more slowly than expected as the Company has
faced increasing difficulty in its ability to obtain tier one content. Other
companies in our industry have filed lawsuits against content providers to allow
equal access to their libraries. We are currently reviewing our options in this
arena.

         We do not have existing capital resources or credit lines available
that are sufficient to fund our operations and capital requirements as presently
planned over the next twelve months. We are actively pursuing additional funds
through the issuance of either debt or equity instruments. We may also pursue a
working capital line of credit to be secured by our assets. However, such funds
may not be available on favorable terms or at all.

         We currently estimate that we will need approximately $50,000 to
continue operations through the end of the fiscal year 2002. These operating
costs include general and administrative expenses, website development and
hosting, and cost of sales.

ITEM 3.  CONTROLS AND PROCEDURES

         As of September 30, 2002, an evaluation was performed under the
supervision and with the participation of the Company's management, including
the Chief Executive Officer and the Chief Accounting Officer, of the
effectiveness of the design and operation of the Company's disclosure controls
and procedures. Based on that evaluation, the Company's management, including
the Chief Executive Officer and the Chief Accounting Officer, concluded that the
Company's disclosure controls and procedures were effective as of September 30,
2002. There have been no significant changes in the Company's internal controls
or in other factors that could significantly affect internal controls subsequent
to September 30, 2002.

                                       12
<PAGE>

PART II
                                OTHER INFORMATION

ITEM 1.           LEGAL PROCEEDINGS

         From time to time may be involved in various claims, lawsuits, disputes
with third parties, actions involving allegations of discrimination, or breach
of contract actions incidental to the operations of its business. We are
currently involved in two such instances.

JERRY NIETO V. ILIVE, INC., ET AL.

         On September 21, 2001, a lawsuit was filed in the Superior Court of the
State of California for the County of Orange, against us entitled Jerry Nieto v.
iLive, Inc., et al. The complaint alleges various claims seeking payment of past
due wages in the amount of $9,000, 750,000 shares of our common stock, and
penalties and attorney fees. Mr. Nieto was contracted to develop a functional
website for us and was paid in excess of $250,000 to perform this task. We
believe that Mr. Nieto breached his contract by not delivering a functional
website and withheld a final payment. We deny all of Mr. Nieto's claims and are
vigorously defending the action.

AL MOSHIRI V. ILIVE INC., ET AL.

         On July 20, 2001, a lawsuit was filed in the Superior Court of the
State of California for the County of Los Angeles, against us entitled Al
Moshiri v. iLive, Inc., et. al. The complaint alleges various claims seeking
payment of alleged finder's fees and damages in the amount of $500,000 and seeks
punitive damages of $5,000,000. Mr. Moshiri alleges to have raised iLive
millions of dollars in financing and seeks payment of a commission for such
funding. We deny these claims and are vigorously defending the action.


ITEM 2.           CHANGES IN SECURITIES AND USE OF PROCEEDS

         The securities described below represent our securities sold by us for
the period ending September 30, 2002 that were not registered under the
Securities Act of 1933, as amended, all of which were issued by us pursuant to
exemptions under the Securities Act. Underwriters were involved in none of these
transactions.

PRIVATE PLACEMENTS OF COMMON STOCK AND WARRANTS FOR CASH

         On May 14 2002, we issued to John Otto 7,500 shares valued at $7,500
($1.00 per share) in exchange for cash.

         On May, 17, 2002, we issued David Mallery 6,250 shares valued at $6,250
($1.00 per share) in exchange for cash.

         On June 6, 2002, we issued to Robert Lambdin 50,000 shares valued at
$5,000 ($0.10 per share) in exchange for cash.

         On June 17, 2002, we issued John Otto 15,000 shares valued at $1,500
($0.10 per share) in exchange for cash.

         On June 24, 2002, we issued Donald Sandell 40,000 shares valued at
$6,000 ($0.15 per share) in exchange for cash.

         On July 10, 2002, we issued to Donald A. Sandell 30,000 shares valued
at $5,400 ($0.18 per share) in exchange for
cash.

         On July 10, 2002 we issued to Harold Segal 50,000 shares valued at
$5,000 ($0.10 per share) in exchange for cash.

         On July 10, 2002 we issued to Harold Segal 12,500 shares valued at
$12,500 ($1.00 per share) in exchange for cash.

                                       13
<PAGE>

         On September 19, 2002 we issued Harry S. Omartian 170,000 shares valued
at $25,500 ($0.15 per share) for cash.

         On September 19, 2002 we issued Carl & Phillis J. Elkins 100,000 shares
valued at $15,000 ($0.15 per share) for
cash.

SALES OF DEBT AND WARRANTS FOR CASH

         On June 19, 2002, we issued to Laurus Master Fund, Ltd. a $55,000
principal amount convertible note, with 8% simple interest and a warrant to
purchase an additional 45,000 shares of our common stock. The note and any
unpaid interest are due June 19, 2004. The note is convertible into common
stock, at the holder's option, at the lower of (i) $1.30 or (ii) 80% of the
average of the three lowest closing prices for the common stock in the 30
trading days before but not including the conversion date. The warrants are
exercisable until June 19, 2005 at a purchase price of $1.35.

OPTION GRANTS

         None.

ISSUANCES OF STOCK FOR SERVICES OR IN SATISFACTION OF OBLIGATIONS

         On April 23, 2002, we issued to Academy Entertainment 165,000 shares
valued at $181,500 ($1.10 per share) in exchange for web content.

         On May 1, 2002, we issued to Mark Moline 25,000 shares valued at
$25,000 ($1.00 per share) in exchange for web consulting services included in
website development and hosting expense.

         On May 2, 2002, we issued to Vision Publishing 5,000 shares valued at
$4,000 ($0.80 per share) in exchange for investor relations services included in
general and administrative expenses .

         On June 13 2002, we issued to Todd Hanas 170,000 shares valued at
$51,000 ($0.30 per share) in exchange for consulting services for foreign
content acquisition included in general and administrative expense.

         On May 15 2002, we issued to Mark Moline 110,000 shares valued at
$99,000 ($0.90 per share) in exchange for consulting services for
advertising/graphics included in general and administrative expense.

         On, June 7,2002 we issued to Kent Broussard 170,000 shares valued at
$42,500 ($0.25 per share) in exchange for consulting services for content
acquisition included in general and administrative expense.

         On June 7, 2002, we issued to Gennady Levtchenko 170,000 shares valued
at $42,500 ($0.25 per share) in exchange for encoding services included in
website development and hosting expense.

         On August 15, 2002 we issued to Mark Moline 150,000 shares valued at
$18,000 ($0.12 per share) in exchange for web consulting services.

         On August 20, 2002 we issued to Laurus Master Fund 7,000 shares valued
at $700 ($0.10 per share) for conversion against debt.

         On August 27,2002 we issued Mike Harrison 320,000 shares valued at
$38,400 ($0.12 per share) in exchange for consulting services.

                                       14
<PAGE>

         On August 27, 2002 we issued Tim Hunold 320,000 shares valued at
$38,400 ($0.12 per share) in exchange for consulting services.

         On August 30, 2002 we issued Laurus Master Fund, LTD 15,000 shares
valued at $1,393 ($0.09 per share) for penalties.

         On August 30, 2002 we issued Laurus Master Fund, LTD 10,000 shares
valued at $960 ($0.10 per share) for penalties.

         On August 30, 2002 we issued Laurus Master Fund, LTD 50,000 shares
valued at $2,335 ($0.05 per share for penalties.

         All of the above offerings and sales were deemed to be exempt under
Regulation D and Section 4(2) of the Securities Act. No advertising or general
solicitation was employed in offering the securities. The offerings and sales
were made to a limited number of persons, all of whom were accredited investors,
business associates of iLive or executive officers of iLive, and transfer was
restricted by iLive in accordance with the requirements of the Securities Act of
1933. In addition to representations by the above-referenced persons, we have
made independent determinations that all of the above-referenced persons were
accredited or sophisticated investors, and that they were capable of analyzing
the merits and risks of their investment, and that they understood the
speculative nature of their investment. Furthermore, all of the above-referenced
persons were provided with access to our Securities and Exchange Commission
filings.

ITEM 3.           DEFAULTS UPON SENIOR SECURITIES

                  Not Applicable.

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

                  Not Applicable.

ITEM 5.           OTHER INFORMATION

                  Not Applicable.

ITEM 6.           EXHIBITS AND REPORTS ON 8-K:


(A) EXHIBITS:

Exhibit Number               Description
--------------               -----------

99.1              Certification of the Chief Executive Officer of iLive, Inc.
                  Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002.

99.2              Certification of the Chief Financial Officer of iLive, Inc.
                  Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002.


(B) REPORTS ON FORM 8-K

                  Not Applicable.


                                       15
<PAGE>

                                   SIGNATURES

In accordance with the requirements of the Exchange Act of 1933, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                        ILIVE, INC., a Nevada Corporation


Date:  December 6, 2002                     By:  /s/ Albert Aimers
                                                 -------------------------------
                                                 ALBERT AIMERS, Chairman & Chief
                                                 Executive Officer



Date: December 6, 2002                      By:  /s/ Scott Henricks
                                                 -------------------------------
                                                 SCOTT HENRICKS, President &
                                                 Chief Financial Officer


                                       16
<PAGE>

                                  CERTIFICATION

          I, Albert Aimers, CEO and Chairman, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of iLive, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

         a) designed such disclosure controls and procedures to ensure that
         material information relating to the registrant, including its
         consolidated subsidiaries, is made known to us by others within those
         entities, particularly during the period in which this quarterly report
         is being prepared;

         b) evaluated the effectiveness of the registrant's disclosure controls
         and procedures as of a date within 90 days prior to the filing date of
         this quarterly report (the "Evaluation Date"); and

         c) presented in this quarterly report our conclusions about the
         effectiveness of the disclosure controls and procedures based on our
         evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

         a) all significant deficiencies in the design or operation of internal
         controls which could adversely affect the registrant's ability to
         record, process, summarize and report financial data and have
         identified for the registrant's auditors any material weaknesses in
         internal controls; and

         b) any fraud, whether or not material, that involves management or
         other employees who have a significant role in the registrant's
         internal controls; and

6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

December 6, 2002

/s/Albert Aimers, CEO and Chairman
Albeert Aimers, CEO and Chairman

                                       17
<PAGE>

                                  CERTIFICATION

         I, Scott Henricks, Chief Financial Officer, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of iLive, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

         a) designed such disclosure controls and procedures to ensure that
         material information relating to the registrant, including its
         consolidated subsidiaries, is made known to us by others within those
         entities, particularly during the period in which this quarterly report
         is being prepared;

         b) evaluated the effectiveness of the registrant's disclosure controls
         and procedures as of a date within 90 days prior to the filing date of
         this quarterly report (the "Evaluation Date"); and

         c) presented in this quarterly report our conclusions about the
         effectiveness of the disclosure controls and procedures based on our
         evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

         a) all significant deficiencies in the design or operation of internal
         controls which could adversely affect the registrant's ability to
         record, process, summarize and report financial data and have
         identified for the registrant's auditors any material weaknesses in
         internal controls; and

         b) any fraud, whether or not material, that involves management or
         other employees who have a significant role in the registrant's
         internal controls; and

6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

December 6, 2002

/s/ Scott Henricks
Scott Henricks, Chief Financial Officer

                                       18