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
period ended March 31,
2010





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





Commission
file Number: 000-50995








Enable
Holdings, Inc.


(Formerly
known as uBid.com Holdings, Inc.)


(Exact
name of registrant as specified in its charter)




Delaware
            52-2372260(State
      or Other Jurisdiction of
            (IRS
      EmployerIncorporation
      or Organization)
            Identification
      No.)





1140
W. Thorndale Avenue, Itasca, Illinois 60143


(Address
of principal executive offices and zip code)





Registrant’s
telephone number including area code:


(773)
272-5000





Indicate
by check mark whether the registrant (1) has filed all reports 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 filing requirements for the past 90
days. Yes x No
o





Indicate
by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of
this chapter) during the preceding 12 months (or for such a shorter period that
the registrant was required to submit and post such files.) Yes x No o





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
definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of
the Exchange Act. (Check one):





Large
accelerated filer o
        Accelerated filer o      
Non-accelerated filer o
    Smaller reporting company x





Indicate
by check mark whether the registrant is a shell company (as defined in Exchange
Act Rule 12b-2). Yes o No x





The
number of shares outstanding of the registrant’s Common Stock, par value $0.001,
as of April 30, 2010 was 19,726,678.





ENABLE
HOLDINGS, INC.


TABLE
OF CONTENTS





PART
      I. FINANCIAL INFORMATIONItem
      1
              Financial
      StatementsConsolidated
      Condensed Balance Sheets - March 31, 2010 (unaudited) and December 31,
      2009
              
              3Consolidated
      Condensed Statements of Operations – Three Months Ended March 31, 2010 and
      2009 (unaudited)
              
              4Consolidated
      Condensed Statement of Shareholders’ Equity – Three Months Ended March 31,
      2010 (unaudited)
              
              5Consolidated
      Condensed Statements of Cash Flows – Three Months ended March 31, 2010 and
      2009 (unaudited)
              
              6Notes
      to Unaudited Consolidated Condensed Financial Statements
              
              7Item
      2
              Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
              
              17Item
      3
              Quantitative
      and Qualitative Disclosures About Market Risk
              
              27Item
      4
              Controls
      and Procedures
              
              27PART
      II. OTHER INFORMATIONItem
      1
              Legal
      Proceedings
              
              27Item
      1A
              Risk
      Factors
              
              27Item
      2
              Unregistered
      Sales of Equity Securities and Use of Proceeds
              
              28Item
      3
              Default
      Upon Senior Securities
              
              28Item
      4
              Submission
      of Matters to a Vote of Security Holders
              
              28Item
      5
              Other
      Information
              
              28Item
      6
              Exhibits
      Index
              
              28Signatures
              
              29


2


PART
1. FINANCIAL INFORMATION


ITEM 1. FINANCIAL
STATEMENTS





ENABLE
      HOLDINGS, INC. and SubsidiariesConsolidated
      Condensed  Balance Sheets(Dollars
      in Thousands, except per share
amounts)


As ofMarch 31,2010
                    
                    
                    December 31,2009(unaudited)AssetsCurrent
      AssetsCash
      and cash equivalents
                    
                    $
                    86
                    
                    
                    $
                    1,018Accounts
      receivable, less allowance for doubtful accounts of $3 and $3,
      respectively
                    
                    
                    92
                    
                    
                    
                    200Merchandise
      inventories, less reserve for obsolescence of $33 and $25,
      respectively
                    
                    
                    1,185
                    
                    
                    
                    433Reserve
      deposit
                    
                    
                    297
                    
                    
                    
                    569Prepaid
      expenses and other current assets
                    
                    
                    257
                    
                    
                    
                    172Total
      Current Assets
                    
                    
                    1,917
                    
                    
                    
                    2,392Property
      and Equipment, net
                    
                    
                    2,188
                    
                    
                    
                    2,337Purchased
      Intangible Assets, net
                    
                    
                    202
                    
                    
                    
                    202Total
      Assets
                    
                    $
                    4,307
                    
                    
                    $
                    4,931Liabilities
      and Shareholders' DeficitCurrent
      LiabilitiesAccounts
      payable
                    
                    $
                    5,747
                    
                    
                    $
                    6,977Accrued
      expenses:Other
                    
                    
                    721
                    
                    
                    
                    1,458Due to former bridge note holder
                    
                    
                    -
                    
                    
                    
                    700Deferred
      rent
                    
                    
                    38
                    
                    
                    
                    42Flooring
      facility
                    
                    
                    1,633
                    
                    
                    
                    535Total
      Current Liabilities
                    
                    
                    8,139
                    
                    
                    
                    9,712Long-term
      notes payable
                    
                    
                    1,904
                    
                    
                    
                    1,904Shareholders'
      DeficitCommon
      stock, $.001 par value (200,000,000 shares authorized;
      19,726,678  outstanding at March 31, 2010 and December
      31,2009)
                    
                    $
                    22
                    
                    
                    $
                    22Preferred
      stock, $.002 par value (2,697,205 and 2,497,205 issued and outstanding at
      March 31, 2010 and December 31, 2009, respectively)
                    
                    
                    5
                    
                    
                    
                    5Stock
      subscription receivable
                    
                    
                    -
                    
                    
                    
                    (1,354
                    )Treasury
      stock, 2,135,550 shares of common stock
                    
                    
                    (2,242
                    )
                    
                    
                    (2,242
                    )Additional
      paid-in-capital
                    
                    
                    51,141
                    
                    
                    
                    50,625Accumulated
      deficit
                    
                    
                    (54,662
                    )
                    
                    
                    (53,741
                    )Total
      Shareholders' Deficit
                    
                    $
                    (5,736
                    )
                    
                    $
                    (6,685
                    )Total
      Liabilities and Shareholders' Deficit
                    
                    $
                    4,307
                    
                    
                    $
                    4,931
 
 The
accompanying notes are an integral part of these consolidated condensed
financial statements.  3


ENABLE
HOLDINGS, INC. and Subsidiaries


Consolidated
Condensed Statements of Operations


(Dollars
in Thousands, except per share amounts)


(Unaudited)


Three Months EndedMarch 31,2010
                  
                  
                  2009Net
      Revenues
                  
                  $
                  2,990
                  
                  
                  $
                  5,094Cost
      of Revenues
                  
                  
                  2,242
                  
                  
                  
                  3,865Gross
      Profit
                  
                  
                  748
                  
                  
                  
                  1,229Operating
      ExpensesGeneral
      and administrative
                  
                  
                  1,459
                  
                  
                  
                  2,867Sales
      and marketing
                  
                  
                  144
                  
                  
                  
                  295Total
      operating expenses
                  
                  
                  1,603
                  
                  
                  
                  3,162Loss
      From Operations
                  
                  
                  (855
                  )
                  
                  
                  (1,933
                  )Other
      Income (Expense)Interest
      (Expense) Income, net
                  
                  
                  (121
                  )
                  
                  
                  (692
                  )Miscellaneous
      Income
                  
                  
                  55
                  
                  
                  
                  -Loss
      on financial instruments
                  
                  
                  -
                  
                  
                  
                  (48
                  )Total
      Other Expense
                  
                  
                  (66
                  )
                  
                  
                  (740
                  )Net
      Loss
                  
                  $
                  (921
                  )
                  
                  $
                  (2,673
                  )Net
      Loss per share - Basic and Diluted
                  
                  $
                  (0.05
                  )
                  
                  $
                  (0.14
                  )Weighted
      Average Shares - Basic and Diluted
                  
                  
                  19,726,678
                  
                  
                  
                  18,986,678
 
 The
accompanying notes are an integral part of these condensed consolidated
financial statements.  4




ENABLE
      HOLDINGS, INC. and SubsidiariesConsolidated Statement of
      Shareholders’ Equity(Dollars
      in Thousands)(Unaudited)


Common Stock
                    
                    
                    Preferred Stock
                    
                    
                    Paid-in
                    
                    
                    Treasury Stock
                    
                    
                    Subscriptions
                    
                    
                    AccumulatedShares
                    
                    
                    Dollars
                    
                    
                    Shares
                    
                    
                    Dollars
                    
                    
                    Capital
                    
                    
                    Shares
                    
                    
                    Dollars
                    
                    
                    Receivable
                    
                    
                    Deficit
                    
                    
                    TotalBalance,
      December 31, 2009
                    
                    
                    19,726,678
                    
                    
                    $
                    22
                    
                    
                    
                    2,497,205
                    
                    
                    $
                    5
                    
                    
                    $
                    50,625
                    
                    
                    
                    2,135,550
                    
                    
                    $
                    (2,242
                    )
                    
                    $
                    (1,354
                    )
                    
                    $
                    (53,741
                    )
                    
                    $
                    (6,685
                    )Stock
      compensation expense
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    16
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    16Preferred stock
      issuance (1)
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    1,354
                    
                    
                    
                    -
                    
                    
                    
                    1,354Preferred stock
      issuance (2)
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    200,000
                    
                    
                    
                    -
                    
                    
                    
                    500
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    500Net
      Loss
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (921
                    )
                    
                    
                    (921
                    )Balance,
      March 31, 2010
                    
                    
                    19,726,678
                    
                    
                    $
                    22
                    
                    
                    
                    2,697,205
                    
                    
                    $
                    5
                    
                    
                    $
                    51,141
                    
                    
                    
                    2,135,550
                    
                    
                    $
                    (2,242
                    )
                    
                    $
                    -
                    
                    
                    $
                    (54,662
                    )
                    
                    $
                    (5,736
                    )
 
 (1) Proceeds received from
preferred stock subscriptions receivable.
 (2) Issued 200,000 shares of
preferred stock at $2.50 per share. Proceeds of $500 received.
 
 The
accompanying notes are an integral part of these consolidated financial
statements.  5





ENABLE
HOLDINGS, INC. and Subsidiaries


Consolidated
Condensed Statement of Cash Flows


(Dollars
in Thousands, except per share data)


(Unaudited)





Three months ended March 31,2010
                    
                    
                    2009Cash
      Flows From Operating ActivitiesNet
      loss
                    
                    $
                    (921
                    )
                    
                    $
                    (2,673
                    )Adjustments
      to reconcile net loss to net cash used in operating
    activitiesDepreciation
      and amortization
                    
                    
                    168
                    
                    
                    
                    119Provision
      for bad debts
                    
                    
                    -
                    
                    
                    
                    (138
                    )Non-cash
      stock compensation expense
                    
                    
                    16
                    
                    
                    
                    30Interest
      on warrants issued 90-day bridge loan
                    
                    
                    -
                    
                    
                    
                    455Common
      stock and warrants issued for services
                    
                    
                    -
                    
                    
                    
                    315Loss
      on derivative liability
                    
                    
                    -
                    
                    
                    
                    48Changes
      in assets and liabilities:Accounts
      receivable
                    
                    
                    108
                    
                    
                    
                    612Merchandise
      inventories
                    
                    
                    (753
                    )
                    
                    
                    1,579Prepaid
      expenses and other current assets
                    
                    
                    189
                    
                    
                    
                    (261
                    )Accounts
      payable
                    
                    
                    (1,230
                    )
                    
                    
                    477Accrued
      expenses
                    
                    
                    (738
                    )
                    
                    
                    (545
                    )Deferred
      rent
                    
                    
                    (4
                    )
                    
                    
                    (17
                    )Net
      cash (used in) provided by operating activities
                    
                    
                    (3,165
                    )
                    
                    
                    1Cash
      Flows From Investing ActivitiesCapital
      expenditures
                    
                    
                    (19
                    )
                    
                    
                    (251
                    )Change
      in restricted cash
                    
                    
                    -
                    
                    
                    
                    179Net
      cash used in investing activities
                    
                    
                    (19
                    )
                    
                    
                    (72
                    )Cash
      Flows From Financing ActivitiesChange
      in flooring facility
                    
                    
                    1,098
                    
                    
                    
                    175Payments
      on 90-day bridge loan
                    
                    
                    -
                    
                    
                    
                    (100
                    )Payment
      to bridge note holder
                    
                    
                    (700
                    )
                    
                    
                    -Proceeds
      from preferred stock issuance
                    
                    
                    1,854
                    
                    
                    
                    -Net
      cash provided by financing activities
                    
                    
                    2,252
                    
                    
                    
                    75Net
      (Decrease) Increase in Cash and Cash Equivalents
                    
                    
                    (932
                    )
                    
                    
                    4Cash
      and Cash Equivalents, beginning of period
                    
                    
                    1,018
                    
                    
                    
                    99Cash
      and Cash Equivalents, end of period
                    
                    $
                    86
                    
                    
                    $
                    103Supplemented
      Cash Flow DisclosureCash
      paid for interest
                    
                    $
                    315
                    
                    
                    $
                    290





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


6


Notes to Unaudited Consolidated Financial
Statements





Note
1. Basis of presentation





Enable
Holdings, Inc. (the "Company" or "Enable"), operates leading on-line
websites that allow itself, certified merchants, manufacturers, retailers,
distributors and small businesses to offer high quality excess, new, overstock,
close-out, refurbished and limited supply brand name merchandise to consumer and
business customers. Through the Company's websites, located at www.uBid.com and
www.RedTag.com, the Company offers merchandise across a wide range of product
categories including but not limited to computer products, consumer electronics,
apparel, housewares, watches, jewelry, travel, sporting goods, automobiles, home
improvement products and collectibles. The Company's marketplace employs a
combination of auction style and fixed price formats.





Each
of the Company’s current business segments provides a combination of solutions
for sellers to efficiently liquidate their excess inventory. The segments are
listed below:





1)
            uBid.com:
          The Company’s flagship website, which has operated
      for 12 years. The website allows merchants to sell excess inventory
      and allows consumers to buy products in an auction or fixed price
      format.





2)
            RedTag.com:
          The Company’s fixed price internet site
      offers name brand merchandise with a low shipping and handling fee of only
      $1.95.





3)
            RedTag Live:
          The Company’s live liquidation group, dedicated to
      selling through the traditional in-store sales and live liquidation
      sales.





4)
            Dibu Trading Company:
          A wholesale inventory liquidation company
      dedicated to Business-to-Business (“B2B”) solutions, providing
      manufacturers and distributors the ability to sell large quantities of
      excess inventory. For example, when a retailer needs to liquidate a large
      quantity of inventory, they contact the Company to find a buyer that will
      buy the entire inventory in a single transaction. Our B2B experience
      allows us to present deals to multiple interested buyers to attain the
      highest possible recovery for the
seller.





5)
            Commerce Innovations:
          A software service company which licenses auction
      software to third party companies. Companies, businesses and governments
      can use the Company’s platform to sell excess furniture, appliances,
      autos, and other surplus. This allows them to utilize a trusted platform
      while reducing live auction costs, as well as an efficient way to reach a
      wider target audience.





The
Company’s unaudited consolidated condensed financial statements reflect normal
recurring adjustments that are necessary to present fairly the Company’s
financial position and results of operations on a basis consistent with that of
the prior audited consolidated financial statements. As permitted by rules and
regulations of the Securities and Exchange Commission applicable to quarterly
reports on Form 10-Q, the Company has condensed or omitted certain information
and disclosures normally included in financial statements prepared in accordance
with accounting principles generally accepted in the United States of America
(“GAAP”). Results for interim periods are not necessarily indicative of the
results that may be expected for a full year. These interim financial statements
should be read along with the audited consolidated financial statements included
in our Form 10-K for the year ended December 31, 2009. The consolidated
condensed financial statements include the accounts of the Company and its
wholly owned subsidiaries. All material intercompany accounts and transactions
have been eliminated in the consolidated financial statements.





The
preparation of financial statements in accordance with GAAP requires management
to make estimates and assumptions that affect the amounts reported in the
Company’s Consolidated Condensed Financial Statements and Accompanying Notes.
Actual results could differ materially from those estimates.





7





Note
2. New accounting pronouncements




In
January 2010, the FASB issued Accounting Standards Update No. 2010-06 (“ASU
2010-06”), “Fair Value Measurements and Disclosures (Topic 820): Improving
Disclosures about Fair Value Measurements.” ASU 2010-06 requires reporting
entities to make new disclosures about recurring or nonrecurring fair value
measurements including significant transfers into and out of Level 1 and
Level 2 fair value measurements and information on purchases, sales,
issuances, and settlements on gross basis in the reconciliation of Level 3
fair value measurements. ASU 2010-06 is effective for annual reporting periods
beginning after December 15, 2009, except for Level 3 reconciliation
disclosures which are effective for annual periods beginning after
December 15, 2010. The adoption of ASU 2010-06 did not have a material
impact on the Company’s financial statements.




Note
3. Summary of significant accounting policies




1)
            Revenue
      recognition





The
Company’s business currently consists of three distinct channels: Certified
Merchant (CM), Managed Supply and Cash Recovery. The Company sells merchandise
through the CM Program channel by allowing prescreened third party merchants to
sell their product through our online marketplace to consumers and
businesses.  The Company does not take title to this merchandise and
therefore does not bear the related inventory risk. In the CM Program, the
Company is the primary obligor to whom payment is due, but it bears no inventory
or returns risk, so the Company records only its commission as revenue. Through
the Managed Supply channel, the Company sells inventory that is consigned to it.
The inventory is either stored at the Company’s warehouse or the sellers’. The
Company purchases merchandise outright in the Cash Recovery channel and sells to
consumers and businesses. On this merchandise, the Company bears inventory,
return and credit risk. The full sales amount is recorded as revenue upon
verification of the credit card transaction and shipment of the merchandise. In
all instances where the credit card authorization has been received but
merchandise has not been shipped, the Company defers revenue recognition until
the merchandise is shipped.





2)
            Shipping
      and handling costs





Shipping
costs that are billable to the customer are included in revenue and shipping
costs that are payable to vendors are included in the cost of revenues in the
accompanying consolidated statements of operations. Handling costs consisting
primarily of the third party logistics warehouse costs during 2009 and direct
warehouse costs in 2010 are included in general and administrative expenses and
totaled $26 and $160 for the quarters ended March 31, 2010 and 2009,
respectively.





3)
            Intangibles





Each
reporting period, the Company evaluates its intangible assets to determine
whether events and circumstances continue to support an indefinite useful life,
and record an impairment charge if needed. No impairment was recorded at March
31, 2010.





Note
4. Earnings (loss) per share





The
Company computes both the basic and diluted loss per share. Basic loss per share
is computed by dividing the loss available to common shareholders by the
weighted average common shares outstanding. Dilutive earnings per share would
include all common stock equivalents unless anti-dilutive.





Due to
losses in each period presented, the Company has not included the following
common stock equivalents in its computation of diluted loss per share as their
input would have been anti-dilutive.





March 31,
                        
                        2010
                        
                        
                        2009Shares
      subject to stock warrants
                        
                        
                        -
                        
                        
                        
                        49,589,970Shares
      subject to stock options
                        
                        
                        1,000,000
                        
                        
                        
                        1,544,5001,000,000
                        
                        
                        
                        51,134,470


EPS for
the three months ended March 31, 2010 and 2009 were $(0.05) and $(0.14),
respectively.





8





4)
            Derivative
      financial instruments





As a
result of the adoption of ASC 815 (formerly EITF 07-5), the Company is required
to “Determine the Fair Value of a Financial Asset When the Market for That Asset
Is Not Active”, and to disclose the fair value measurements required by ASC
820-10, “Fair
Value Measurements and Disclosures.” The derivative liability recorded at fair
value in the balance sheet as of March 31, 2009 is categorized based upon the
level of judgment associated with the inputs used to measure its fair value.
Hierarchical levels, defined by ASC 820-10, are directly related to the amount
of subjectivity associated with the inputs to fair valuations of these
liabilities are as follows:





Level 1 —
Inputs are unadjusted, quoted prices in active markets for identical assets or
liabilities at the measurement date;





Level 2 —
Inputs other than Level 1 inputs that are either directly or indirectly
observable; and





Level 3 —
Unobservable inputs, for which little or no market data exist, therefore require
an entity to develop its own assumptions.





The
following table summarizes the financial liabilities that are measured at fair
value on a recurring basis as of March 31, 2009, segregated by the level of the
valuation inputs within the fair value hierarchy utilized to measure fair value.
There were no financial liabilities measured at fair value as of March 31,
2010:




Level1
                    
                    
                    Level2
                    
                    
                    Level3
                    
                    
                    TotalDerivative
      Liability
                    
                    
                    -
                    
                    
                    $
                    48
                    
                    
                    
                    -
                    
                    
                    $
                    48




The
derivative liability consists of stock warrants issued by the Company that
contain a strike price adjustment feature, as stated below. In accordance with
ASC 815, the Company calculated the fair value of the warrants using the
Black–Scholes–Merton valuation model, at January 1, 2009, with a corresponding
reduction of additional paid in capital of $5,386 and $2,028 to accumulated
deficit.





The
Company used the following assumptions in calculation of the Black-Scholes
model: no expected dividend yield, estimated volatility 66.7%, risk-free
interest rate of 1.82% and maturity of two years. All warrants were canceled
effective December 31, 2009.





9





Note
5. Financing Arrangements





On
January 16, 2009, the Company received extensions from certain accredited
investors who previously made commitments for an aggregate of $2,550 in the form
of 90-day bridge loans which extended the original maturity date of January 12,
2009 by an additional 90 days.  During the first quarter of 2009, the
Company paid off $100 associated with the bridge loans and negotiated further
extensions. On December 11, 2009, the Company entered into a restructuring
agreement under which the Bridge Note Holders were paid $700 in cash and
received a note for $900 with interest payable at 6% annually. The interest is
paid quarterly and the principal is due quarterly starting in the second year of
the loan. The Bridge Note Holders forgave all principal and interest due under
the original notes in exchange for 877,511 shares of Series 1 Preferred
Stock.





In March
2009, the Company completed a private placement offering to accredited
investors. Investors purchased units, with each unit consisting of a senior
convertible debenture for one share of common stock of the Company, and a
warrant, depending on the date of investment, to acquire either two shares or
one share of common stock for ten years at a purchase price of $0.25 per share.
The debentures paid interest at a rate of 12% per annum, had a term of 30 months
and were convertible into the Company’s common stock at any time at the option
of the investor. The Company received $1,315 which was held in an escrow account
until April 29, 2009. The Company used the proceeds to pay operating expenses
and to fulfill immediate inventory requirements. Of the $1,315 proceeds
received, $25 was used for legal expenses while $60 was paid to the brokers who
assisted with the offering. On December 11, 2009, the Company entered into a
restructuring agreement with the secured debenture holders and as part of the
restructuring the secured debenture holders received interest due under the 12%
debenture and a note for $822 which bears interest at an annual rate of 6%.
Interest is payable quarterly and the note is due in 24 months. The secured
debenture holders also received 119,694 shares of Series 1 Preferred Stock and
forgave previously issued debt.





On
October 9, 2009, the Company received a $500 loan in the form of 2009
convertible promissory notes provided from a group of accredited investors. The
Company repaid the loan in full on December 2, 2009.





During
the fourth quarter of 2009 the Company entered into a restructuring agreement
with the Bridge Note Holders. As part of the restructuring, the Bridge Note
Holders received $700 in cash and were issued a $900 note that is due in 24
months. The note bears interest at a 6% annual rate. The note and accrued
interest are payable starting 15 months from the closing date. The Bridge Note
Holders forgave previously issued debt, canceled all the warrants received and
received 877,511 shares of Series 1 Preferred Stock.  Per ASC 470-60 –
Accounting for Troubled Debt Restructuring, a gain was recorded for the
difference between the fair market value of the preferred stock issued and the
fair value of the debt forgiven and warrants surrendered.





In
connection with the debt restructuring, two long term notes for $900 and $822
both of which both bear interest at a rate of 6% per annum, were issued by the
Company. The $900 note was issued to the Bridge Note Holders and is payable in
quarterly installments starting in March, 2011. The $822 note was issued to the
12% debenture holders and is due, along with accrued interest in 24 months. All
previously issued debt was forgiven in conjunction with the restructuring
agreement.




March 31,
                    
                    Note 1
                    
                    
                    Note 2
                    
                    
                    TotalFace
      Value
                    
                    $
                    900
                    
                    
                    $
                    822
                    
                    
                    $
                    1,722Interest
                    
                    
                    83
                    
                    
                    
                    99
                    
                    
                    
                    182Note
      Value
                    
                    $
                    983
                    
                    
                    $
                    921
                    
                    
                    $
                    1,904


There
were 1,500,000 shares of Series 1 Preferred Stock sold to accredited investors
at $2.50 per share. At December 31, 2009 the Company had commitments to purchase
all 1,500,000 shares. The Company received $2,396 in cash and the remaining
$1,354 was recorded as a subscription receivable. All monies were received by
February 24, 2010. Each share of Series 1 Preferred Stock is convertible into
66.83 shares of common stock. The Series 1 Preferred Stock has a liquidation
preference equal to a minimum Internal Rate of Return of 25%, but cannot exceed
three times the investment amount.





Note
6. 2005 Equity Incentive Plan and Stock Based Compensation





The
Company’s 2005 Equity Incentive Plan is an equity-based compensation plan to
provide incentives, and to attract, motivate and retain the highest qualified
employees, directors, consultants and other third party service providers. The
2005 Equity Incentive Plan enables the board to provide equity-based incentives
through grants or awards of stock options and restricted stock (collectively,
“Incentive Awards”).





At
December 31, 2009 all outstanding options were canceled. In connection with the
recent restructuring and fund raising a substantial amount of equity was issued.
The number of shares authorized to be issued under the plan as approved by the
Company’s stockholders on May 11, 2010 is 25,000,000.  If an Incentive
Award granted pursuant to the 2005 Equity Incentive Plan expires, terminates, is
unexercised or is forfeited, or if any shares are surrendered to the
Company in connection with an Incentive Award, the shares subject to such
award and the surrendered shares will become available for future awards under
the 2005 Equity Incentive Plan. Options generally vest over a period of four
years and have a ten year contractual life.





10





The
Company measures the cost of employee service received in exchange for a share
based award (stock options and restricted stock) based on the fair value of
the award.  The Company recognizes stock-based compensation costs on a
straight-line basis over the requisite service period of the award which is
generally the option vesting term of four years.





Stock
options





Stock
option activity under the Company’s Equity Incentive Plan for the three months
ended March 31, 2010 follows:


Shares
                          
                          
                          Weighted-
                            Average
                            exercise price
                            per shareOutstanding
      at December 31, 2009
                          
                          
                          -
                          
                          
                          $
                          -Granted
                          
                          
                          1,000,000
                          
                          
                          
                          0.07Exercised
                          
                          
                          -
                          
                          
                          
                          -Forfeited/Cancelled/Surrendered
                          
                          
                          -
                          
                          
                          
                          -Outstanding
      at March 31, 2010
                          
                          
                          1,000,000
                          
                          
                          $
                          0.07Exercisable
      at March 31, 2010
                          
                          
                          250,000
                          
                          
                          $
                          0.07





The fair
value of the stock options granted under the Company’s Equity Incentive Plan was
estimated using the Black-Scholes option pricing model with the following
weighted average assumptions:


March 31,2010
                    
                    
                    2009Risk
      - free interest rate
                    
                    
                    5.0
                    %
                    
                    
                    4.0
                    %Dividend
      yield
                    
                    
                    0.0
                    %
                    
                    
                    0.0
                    %Expected
      volatility
                    
                    
                    70.0
                    %
                    
                    
                    85.8
                    %Expected
      life (years)
                    
                    
                    10.0
                    
                    
                    
                    6.0Weighted
      average grant date fair value
                    
                    $
                    0.04
                    
                    
                    $
                    0.22Estimated
      forfeiture rate (1)
                    
                    
                    0.0
                    %
                    
                    
                    0.0
                    %
 
 (1)The stock compensation
expensed during the quarters ended March 31, 2009 and March 31, 2010 were
insignificant, thus the Company forgoed adjusting the expense for estimated
forfeitures. The Company will evaluate the expense for future periods for actual
forfeitures





The
risk-free interest rate is based on U.S. Treasury Bill rates. The dividend
reflects the fact that the Company has never paid a dividend on its common stock
and does not expect to do so in the foreseeable-future. Expected volatility was
based on a market-based implied volatility. The expected term of the options is
based on what the Company believes will be representative of future behavior. In
addition, the Company is required to estimate the expected forfeiture rate and
recognize expense only for those shares expected to vest. If the Company’s
actual forfeiture rate is materially different from its estimate, the
stock-based compensation expense could be significantly different from what the
Company has recorded in the current period.




11





The
following table presents additional information regarding outstanding and
exercisable options at March 31, 2010.




Outstanding
                              
                              
                              ExercisableExercise
                                Price
                              
                              Number
                                Outstanding at
                                March 31, 2010
                              
                              
                              Weighted
                                Average
                                Exercise Price
                              
                              
                              Weighted Average
                                Remaining
                                Contractual Life
                              
                              
                              Number
                                Exercisable at
                                March 31, 2010
                              
                              
                              Weighted
                                Average
                                Exercise Price.01
      - 2.00
                              
                              
                              1,000,000
                              
                              
                              $
                              0.07
                              
                              
                              
                              9.60
                              
                              
                              
                              250,000
                              
                              
                              $
                              0.071,000,000
                              
                              
                              $
                              0.07
                              
                              
                              
                              9.60
                              
                              
                              
                              250,000
                              
                              
                              $
                              0.07





As of
March 31, 2010 there was $56,000 of total unrecognized compensation cost related
to the non-vested option awards under the Equity Incentive Plan that is expected
to be recognized over the remaining vesting period of the non-vested option
awards.





Restricted
Stock





As of
March 2010, there was no unvested restricted common stock
outstanding.





Stock–based
Compensation Expense





Stock-based
compensation expense recognized under the Equity Incentive Plan for the three
months ended March 31, 2010 and 2009 was as follows:





(Dollars
      in Thousands)Three
      Months Ended March 31,20102010
                      
                      
                      2009Stock
      Options
                      
                      $
                      16
                      
                      
                      $
                      30


12




Note
7. Common Stock warrants and Series A Convertible Preferred Stock





There are no warrants outstanding as of
March 31, 2010. All warrants were canceled in December 2009 in conjunction with
the debt restructuring described in Note 5.





Series
A Convertible Preferred Stock





There are
25,000,000 shares authorized of preferred stock with preferences and rights to
be determined by our Board of Directors. In December 2009, as part of a debt
restructuring, the Board of Directors approved the issuance of 3,000,000 shares
of Series 1 Preferred Stock. At December 31, 2009 there were 2,497,205 shares of
Series 1 Preferred Stock issued and outstanding. During the first quarter of
2010 an additional 200,000 shares of Series 1 Preferred Stock were issued for a
total of 2,697,205 shares of Series 1 Preferred Stock issued and outstanding at
March 31, 2010.





The Series 1 Preferred Stock was issued
to the Bridge Note Holders and the 12% debenture holders as part of a debt
restructuring during the fourth quarter of 2009. The Bridge Note Holders
received 877,511 shares of Series 1 Preferred Stock and forgave all previously
issued debt. In addition to the receipt of Series 1 Preferred Stock, the Bridge
Note Holders received $700 in cash and received a note for $900 which bears
interest at an annual rate of 6%. The Bridge Note Holders also agreed to cancel
all their outstanding warrants.





In conjunction with the restructuring,
the 12% debenture holders received 119,694 shares of Series 1 Preferred Stock.
In addition, they received a note for $822 which bears interest at an annual
rate of 6%. The 12% debenture holders received all interest accrued and payable.
The 12% debenture holders also agreed to cancel all their outstanding
warrants.





The remaining 1,500,000 shares of
Series 1 Preferred Stock were sold to accredited investors at $2.50 per share.
At December 31, 2009 we had commitments to purchase all 1,500,000 shares. The
Company received $2,396 in cash and the remaining $1,354 was recorded as a
subscription receivable. All monies were received by February 24, 2010. During
the quarter ended March 31, 2010 an additional 200,000 shares of Series 1
Preferred Stock were sold to accredited investors at $2.50 per share. The Series
1 Preferred Stock is convertible into 66.83 shares of common stock per share of
Series 1 Preferred Stock. The Series 1 Preferred Stock has a liquidation
preference of a minimum Internal Rate of Return of 25% but no more than three
times the investment amount.





As part
of the debt restructuring, all options issued to employees under the 2005 Equity
Incentive Plan were canceled. Employees received no consideration for the
cancellations.





The
restructuring of the bridge note and 12% debenture was accounted for in
accordance with ASC 470-60 – Accounting for Troubled Debt Restructuring, and
resulted in a gain being recorded for the difference between the fair market
value of the preferred stock issued and the fair value amount of the debt
forgiven and warrants surrendered.





13





Note 8.  Long-Term Debt





On
October 9, 2009, the Company received a $500 loan in the form of 2009
convertible promissory notes provided from a group of accredited investors. The
Company repaid the loan in full on December 2, 2009.





During
the fourth quarter of 2009 the Company entered into a restructuring agreement
with the Bridge Note Holders. As part of the restructuring, the Bridge Note
Holders received $700 in cash and were issued a $900 note that is due in 24
months. The note bears interest at a 6% annual rate. The note and accrued
interest are payable starting 15 months from the closing date. The Bridge Note
Holders forgave previously issued debt, canceled all the warrants received and
received 877,511 shares of Series 1 Preferred Stock.  Per ASC 470-60 –
Accounting for Troubled Debt Restructuring a gain was recorded for the
difference between the fair market value of the preferred stock issued and the
fair value of the debt forgiven and warrants surrendered.





In
connection with the debt restructuring, two long term notes for $900 and $822
both of which bear interest at a rate of 6% per annum, were issued by the
Company. The $900 note was issued to the Bridge Note Holders and is payable in
quarterly installments starting in March, 2011. The $822 note was issued to the
12% debenture holders and is due, along with accrued interest in 24 months. All
previously issued debt was forgiven in conjunction with the restructuring
agreement.




14




The
revenue and gross profit breakdown based on the Company’s five business segments
is as follows:


(The
Company does not summarize expenses based on the segments).




(Dollars in Thousands)Three months Ended March 31,Net Revenue
                                                        
                                                        2010
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        2009uBid,com
                                                        
                                                        $
                                                        2,089
                                                        
                                                        
                                                        
                                                        69.9
                                                        %
                                                        
                                                        $
                                                        2,686
                                                        
                                                        
                                                        
                                                        52.7
                                                        %RedTag.com
                                                        
                                                        
                                                        359
                                                        
                                                        
                                                        
                                                        12.0
                                                        %
                                                        
                                                        
                                                        127
                                                        
                                                        
                                                        
                                                        2.5
                                                        %RedTag
      Live
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        0.0
                                                        %
                                                        
                                                        
                                                        792
                                                        
                                                        
                                                        
                                                        15.5
                                                        %Dibu
      Trading Co.
                                                        
                                                        
                                                        542
                                                        
                                                        
                                                        
                                                        18.1
                                                        %
                                                        
                                                        
                                                        1,489
                                                        
                                                        
                                                        
                                                        29.2
                                                        %Commerce
      Innovations
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -Total
                                                        
                                                        $
                                                        2,990
                                                        
                                                        
                                                        
                                                        100.0
                                                        %
                                                        
                                                        $
                                                        5,094
                                                        
                                                        
                                                        
                                                        100.0
                                                        %Gross ProfituBid,com
                                                        
                                                        $
                                                        651
                                                        
                                                        
                                                        
                                                        87.0
                                                        %
                                                        
                                                        $
                                                        914
                                                        
                                                        
                                                        
                                                        74.4
                                                        %RedTag.com
                                                        
                                                        
                                                        42
                                                        
                                                        
                                                        
                                                        5.6
                                                        %
                                                        
                                                        
                                                        17
                                                        
                                                        
                                                        
                                                        1.4
                                                        %RedTag
      Live
                                                        
                                                        
                                                        (6
                                                        )
                                                        
                                                        
                                                        (0.8
                                                        )%
                                                        
                                                        
                                                        185
                                                        
                                                        
                                                        
                                                        15.1
                                                        %Dibu
      Trading Co.
                                                        
                                                        
                                                        61
                                                        
                                                        
                                                        
                                                        8.2
                                                        %
                                                        
                                                        
                                                        113
                                                        
                                                        
                                                        
                                                        9.2
                                                        %Commerce
      Innovations
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -Total
                                                        
                                                        $
                                                        748
                                                        
                                                        
                                                        
                                                        100.0
                                                        %
                                                        
                                                        $
                                                        1,229
                                                        
                                                        
                                                        
                                                        100.0
                                                        %Gross Profit %uBid,com
                                                        
                                                        
                                                        31.2
                                                        %
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        34.0
                                                        %RedTag.com
                                                        
                                                        
                                                        11.7
                                                        %
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        13.4
                                                        %RedTag
      Live
                                                        
                                                        
                                                        0.0
                                                        %
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        23.4
                                                        %Dibu
      Trading Co.
                                                        
                                                        
                                                        11.3
                                                        %
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        7.6
                                                        %Commerce
      Innovations
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        -Total
                                                        
                                                        
                                                        25.0
                                                        %
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        24.1
                                                        %





Note
9. Related Party Transactions





A member
of the Company’s Board of Directors has provided inventory financing during the
current period. The Board member was paid $18 in interest during the quarter
ended March 31, 2010.





Note
10. Going Concern





The
accompanying consolidated financial statements have been prepared assuming that
we will continue as a going concern, considering we realize the assets and
liquidate the liabilities in the normal course of business. As of March 31, 2010
we had accumulated a deficit of approximately $55 million.  Over the
last twelve years and through the first quarter of 2010, we have incurred losses
due to operational problems, capital constraints and a change in our business
model. During 2006 and 2007 the Company’s operations were funded by the capital
raised during our 2005/2006 private offerings. During 2008 the Company had fully
utilized these funds and drew on our bank line of credit. However, after the
second quarter of 2008 the Company did not meet the established bank covenants
and was required to pay off the outstanding balance. Due to the Company’s
recurring losses we could not obtain new bank financing. Instead during 2008,
2009 and 2010 we received financing from our investors to fund our operations
through the issuance of various debt instruments. We have also utilized short
term financing deals in order to make inventory purchases. During 2009 the
Company restructured our financing, reducing our debt from $4.6 million to $1.9
million. We also issued preferred stock, raising approximately $4.2 million.
Most of this capital raised was used to pay off our outside vendors therefore we
need to either raise additional capital, obtain financing or increase revenue in
order for operations to continue. The current credit market remains volatile
which affects our ability to raise long-term capital financing and inventory
financing needed to run our business. This, coupled with our lack of cash,
significantly reduces the Company’s ability to pursue the plans noted below.
This creates substantial doubt about our ability to continue as a going
concern.





15





Management’s
plans to continue operations consist of the following:





·
            Increase
      available inventory for sale through establishing an asset based lending
      credit line (ABL) of approximately
$3,000,


·
            Raise
      additional long term equity
capital,


·
            Increase
      revenues through focused marketing to customers in our robust data base
      reestablishing our sites as ones that appeal to the diversified
      demographics of the group,


·
            Increase
      revenues through the introduction of diversified product lines to serve
      the asset recovery industry,


·
            Increase
      revenues by completing the installation of our ERP application allowing us
      to provide all the requirements necessary for our vendors and Certified
      Merchants to sell product through us both domestically and
      globally,


·
            Increase
      revenues through the introduction of transaction fees and restructuring of
      CM vendor rate card,


·
            Execute
      revised business plan under new leadership and expanded
    board.





As a
result of the conditions discussed above, and in accordance with generally
accepted accounting principles in the United States, there exists substantial
doubt about our ability to continue as a going concern. Our continued operations
are contingent on our ability to be successful in implementing the above plans.
There is no assurance that we will be successful in these efforts, therefore
there is substantial doubt as to our ability to have sufficient cash to meet our
operating requirements and continue as a going concern. The accompanying
consolidated financial statements do not reflect adjustments relating to the
recoverability and classification of assets or liabilities that might result
from the outcome of these uncertainties.





Note
11. Subsequent Events





The
Company has evaluated subsequent events through the date financial statements
were issued.





The
annual meeting of stockholders of the Company was held on Tuesday May 11, 2010
in Itasca, Illinois. At the meeting stockholders approved (i)an amendment to the
Certificate of Incorporation to increase the number of authorized shares of
Common Stock from 200,000,000 to 300,000,000. (ii)an increase in the number
of shares authorized for issuance under the Company 2005 Equity Incentive Plan
from 10,000,000 to 25,000,000 (iii)the election of four
directors and (iv)the
ratification of the appointment of BDO Seidman, LLP for the year ending December
31, 2010.





16





ITEM 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.





The
following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our consolidated condensed
financial statements and related notes included in Item 1 of Part 1 of this
Quarterly Report and the audited consolidated financial statements and notes
thereto and Management’s Discussion and Analysis of Financial Condition and
Results of Operations contained in the Company’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2009. Enable Holdings, Inc. is a holding
company for uBid, Inc., Dibu Trading Corp., RedTag, Inc., RedTag Live, Inc.,
Enable Payment Systems, Inc. and uSaas, Inc., our operating businesses. For
purposes of this Quarterly Report, unless otherwise indicated or the context
otherwise requires, all references herein to “Enable,” “we,” “us,” and “our”
refer to Enable Holdings, Inc. and our subsidiaries.





Information
in the following Management's Discussion and Analysis of Financial Condition and
Results of Operations and elsewhere in this Quarterly Report contains
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements provide current expectations or forecasts of future
events and can be identified by the use of terminology such as “believe,”
“estimate,” “expect,” “intend,” “may,” “could,” “will,” and similar words or
expressions. Any statement that is not a historical fact, including statements
regarding estimates, projections, future trends and the outcome of events that
have not yet occurred, is a forward-looking statement. Actual results could
differ materially from those projected in the forward-looking statements as a
result of a number of factors, including but not limited to  the risk
factors detailed in our filings with the SEC, including our Annual Report on
Form 10-K for the year ended December 31, 2009. We assume no obligation to
update such forward-looking statements or to update the reasons actual results
could differ materially from those anticipated in such forward-looking
statements.





Overview





We
operate leading online websites located at www.uBid.com and
www.RedTag.com,
respectively. The two websites offer high quality excess, new, overstock,
close-out, recertified and limited supply brand name merchandise to both
consumers and businesses using auction style and fixed price formats. We offer
consumers a trustworthy buying environment in which we continually monitor and
certify activity to minimize the potential for fraud by certifying all merchants
and processing 100% of all transactions between buyers and sellers. Our online
properties offer brand-name merchandise from over 200 product categories
including computer products, consumer electronics, apparel, house wares,
watches, jewelry, travel, sporting goods, home improvement products and
collectibles.





Our
current business model provides value for consumers, manufacturers,
distributors, retailers and other approved third party merchants. Consumers shop
in a trustworthy and secure online environment and have the opportunity to bid
their own prices on popular, brand-name products realizing product savings of
generally 20% to 80% off retail prices. Our online properties provide merchants
with an efficient and economical distribution channel for maximizing revenue on
their merchandise. Merchants can monetize overstock and close-out inventory,
expand their customer base and increase sales without compromising existing
distribution channels.





Our
business model currently consists of three distinct business channels: Certified
Merchant (CM), Managed Supply and Cash Recovery.





We sell
merchandise through the CM Program channel by allowing prescreened third party
merchants to sell their product through our online marketplace to consumers and
business. On this merchandise, we do not take title and therefore do not bear
the related inventory risk. In the CM Program, we are the primary obligor to
whom payment is due, but we bear no inventory or returns risk, so we record only
our commission as revenue. Through the Managed Supply channel, we sell inventory
that is consigned to us. The inventory is either stored at our warehouse or at
the sellers’. We purchase merchandise outright in the Cash Recovery channel and
sell to consumers and businesses. On this merchandise, we bear the inventory,
return and credit risk. The full sales amount is recorded as revenue upon
verification of the credit card transaction and shipment of the merchandise. In
all instances where the credit card authorization has been received but
merchandise has not been shipped, we defer revenue recognition until the
merchandise is shipped.





Our
online properties are available 24 hours a day; seven days a week and we
currently offer over 200,000 items each day. Since the first offer of product in
December 1997, our marketplace has facilitated over $1 billion in net revenues
and has registered over five million members.





We conduct live liquidation events at
various times throughout the year.  Live sales are conducted over a
short period of time (usually a week) and all the merchandise is sold
locally.





17





Our
current seven proprietary selling solutions within the five operating divisions
are:





·
            uBid.com: Our flagship
      website, which has operated for 12 years. The website allows merchants to
      sell excess inventory and allows consumers to buy products in an auction
      price format.




·
            RedTag.com: Our fixed
      price internet site offers name brand merchandise with a low shipping and
      handling fee of only $1.95.





·
            RedTag Live: Our live
      liquidation group, dedicated to selling through the traditional in-store
      sales and live liquidation sales.





·
            Dibu Trading Co.: A
      wholesale inventory liquidation company dedicated to Business-to-Business
      solutions, providing manufacturers and distributors the ability to sell
      large quantities of excess inventory. For example, when a retailer needs
      to liquidate a large quantity of inventory, they contact us to find a
      buyer that will buy the entire inventory in a single transaction. Our B2B
      experience allows us to present deals to multiple interested buyers to
      attain the highest possible recovery for the
  seller.





·
            Commerce Innovations: A
      software service company which licenses auction software to third party
      companies. Companies, businesses and governments can use our platform to
      sell excess furniture, appliances, autos, and other surplus. This allows
      them to utilize a trusted platform while reducing live auction costs, as
      well as an efficient way to reach a wider target
  audience.





The
Company’s current financial results during the first quarter of 2010 as well as
results in 2008 and 2009 were negatively impacted by the planned change in the
business model and the severe global economic downturn. We have made major
changes to our traditional operations as we transition to the new business
model.





The
transition from an auction marketplace to an asset solutions company also
required that operationally we improve the efficiency of our platform to enhance
the user experience. The Company significantly decreased the number of listings,
eliminating the unprofitable listings, while migrating fixed price listings to
the RedTag platform based on the new business model. The reduction in the number
of unprofitable listings improved our auction success rate and provides
efficiencies to both buyers and sellers on our platform.





Executive Commentary





Our
management believes that the most important financial and non-financial measures
that track our progress include sales, website traffic, total average order
value, gross margin, customer acquisition costs, advertising expense, personnel
costs, and fulfillment costs.





Key Business
Metrics : We
periodically review key business metrics to evaluate the effectiveness of our
operational strategies and the financial performance of our business. These key
metrics include the following:




Net Revenue
  2010
                          
                          
                          2009
                          
                          
                          2008Quarter 1
                          
                          
                          Quarter 4
                          
                          
                          Quarter 3
                          
                          
                          Quarter 2
                          
                          
                          Quarter 1
                          
                          
                          Quarter 4
                          
                          
                          Quarter 3
                          
                          
                          Quarter 2uBid.comGMS
      (in thousands)
                          
                          $
                          4,604
                          
                          
                          $
                          4,103
                          
                          
                          $
                          5,113
                          
                          
                          $
                          9,555
                          
                          
                          $
                          11,821
                          
                          
                          $
                          12,374
                          
                          
                          $
                          14,385
                          
                          
                          $
                          17,117Number
      of Orders (in thousands)
                          
                          
                          36
                          
                          
                          
                          43
                          
                          
                          
                          52
                          
                          
                          
                          70
                          
                          
                          
                          81
                          
                          
                          
                          94
                          
                          
                          
                          95
                          
                          
                          
                          97Average
      Order Value
                          
                          $
                          126
                          
                          
                          $
                          95
                          
                          
                          $
                          98
                          
                          
                          $
                          137
                          
                          
                          $
                          145
                          
                          
                          $
                          131
                          
                          
                          $
                          152
                          
                          
                          $
                          176Visitors
      to Bidders %
                          
                          
                          3.2
                          %
                          
                          
                          2.5
                          %
                          
                          
                          1.8
                          %
                          
                          
                          3.3
                          %
                          
                          
                          3.1
                          %
                          
                          
                          2.9
                          %
                          
                          
                          3.3
                          %
                          
                          
                          3.6
                          %Auctions
      Closed (in thousands)
                          
                          
                          441
                          
                          
                          
                          367
                          
                          
                          
                          371
                          
                          
                          
                          373
                          
                          
                          
                          377
                          
                          
                          
                          383
                          
                          
                          
                          215
                          
                          
                          
                          181Auction
      Success Rate
                          
                          
                          6.6
                          %
                          
                          
                          9.1
                          %
                          
                          
                          10.0
                          %
                          
                          
                          13.0
                          %
                          
                          
                          14.4
                          %
                          
                          
                          15.0
                          %
                          
                          
                          26.6
                          %
                          
                          
                          30.9
                          %RedTag.com1GMS
      (in thousands)
                          
                          $
                          399
                          
                          
                          $
                          288
                          
                          
                          $
                          386
                          
                          
                          $
                          140
                          
                          
                          $
                          143
                          
                          
                          $
                          474
                          
                          
                          $
                          304
                          
                          
                          
                          -Number
      of Orders (in thousands)
                          
                          
                          4
                          
                          
                          
                          3
                          
                          
                          
                          3
                          
                          
                          
                          2
                          
                          
                          
                          2
                          
                          
                          
                          5
                          
                          
                          
                          3
                          
                          
                          
                          -Average
      Order Value
                          
                          $
                          101
                          
                          
                          $
                          86
                          
                          
                          $
                          122
                          
                          
                          $
                          88
                          
                          
                          $
                          83
                          
                          
                          $
                          96
                          
                          
                          $
                          119
                          
                          
                          
                          -Visitors
      to Bidders %
                          
                          
                          15.0
                          %
                          
                          
                          17.0
                          %
                          
                          
                          10.4
                          %
                          
                          
                          3.5
                          %
                          
                          
                          9.6
                          %
                          
                          
                          30.2
                          %
                          
                          
                          15.1
                          %
                          
                          
                          -





18





(1)
            RedTag.com
      was first launched in August 2008.





(Auctions
in these metrics refer to auctions and fixed price listings)





Gross
Merchandise Sales (GMS):     Gross Merchandise Sales
differ from GAAP revenue in that gross bookings represents the gross sales price
of goods sold by us (including sales through our CM Program) before returns,
sales discounts, and cancellations.





Number
of Orders:This represents the total number of orders shipped in a
specified period. We analyze the number of orders by category to evaluate the
effectiveness of our merchandising and advertising strategies as well as to
monitor our inventory management.





Average
Order Value: Average order value is the ratio of gross sales divided by
the number of orders shipped within a given time period. We analyze average
order value by category primarily to manage costs and other operating
expenses.





Visitors
to Bidder %: The percentage of visitors that bid on an auction item. We
use this as a measure of the effectiveness of advertising.





Auctions
Closed: A closed auction is an auction that has ended because it reached
the scheduled closing time for that auction. Auctions closed include both
successful auctions and auctions with no bids.





Auction
Success Rate: The percentage of closed auctions that were successful and
received at least one bid.





Revenue
Source: We derive most of our revenue from sales of products to consumers
and businesses as well as commission revenue earned for sales of merchandise
under revenue sharing agreements with third party sellers. We believe that the
principal drivers of our revenue consist of the average order value placed by
our customers, the number of orders placed by both existing and new customers,
special offers we make available that result in incremental orders, our ability
to attract new customers and advertising that impacts our revenue drivers. Sales
consist of orders placed through our uBid.com and RedTag.com websites, live
sales events and direct business to business sales. We further generate revenue
from shipping fees we charge our customers and advertising sales. We record our
revenue net of returns and other discounts. Our revenues may fluctuate from
period to period as a result of special offers we provide such as free shipping,
and other special promotions.





19





Our
revenue is dependent in part on sales of products produced by or purchased from
several vendors.  The following vendors accounted for revenues greater
than 5% of our total revenues in the three months ended March 2010 and 2009. No
other supplier represented more than 5% of our net revenues for any period
presented.





Three Months EndedMarch31,Vendor
                    
                    2010
                    
                    
                    2009Always
      - at - Market
                    
                    
                    0.8
                    %
                    
                    
                    6.5
                    %Hewlett
      Packard Company
                    
                    
                    35.5
                    %
                    
                    
                    42.2
                    %Dealtree
                    
                    
                    9.6
                    %
                    
                    
                    0.0
                    %


Cost of
Revenues: Cost of revenues primarily consists of the cost of the product
and inbound and outbound shipping. There is no cost of revenues for UCM Program
revenue. Cost of revenues does not include order fulfillment costs, which are
included in general and administrative expenses.





Gross
Profits: Our gross profit margins are impacted by a number of factors
including the category of merchandise, the introduction of new product
categories, the mix of sales among our product categories, pricing of products
by our vendors, pricing strategies, promotional programs, market conditions,
packaging, excess and obsolete inventory charges and other factors. Gross
profits and gross profit percentages are not comparable to gross profit and
gross profit percentages reported by companies that include order fulfillment
costs in the cost of revenues.





Results
of Operations (Dollars in Thousands)





Comparison
of three months ended March 31, 2010 and 2009


(Dollars
in thousands, except per share data and average order value)





The  below
sets forth certain data from our statement of operations as a percentage of net
revenues as well as the increase (decrease) in quarter ended March 2010 as
compared to March 2009. This information should be read in conjunction with our
financial statements and notes thereto included elsewhere in this
report.





20





(Dollars in Thousands)Three months ended March 31,2010
                              
                              
                              2009
                              
                              
                              Increase (Decrease)Net
      Revenues:uBid.com
      $
                              
                              
                              2,089
                              
                              
                              
                              69.9
                              %
                              
                              $
                              2,686
                              
                              
                              
                              52.7
                              %
                              
                              $
                              (597
                              )
                              
                              
                              (22.2
                              )%RedTag.com
                              
                              
                              359
                              
                              
                              
                              12.0
                              %
                              
                              
                              127
                              
                              
                              
                              4.2
                              %
                              
                              
                              232
                              
                              
                              
                              182.7
                              %RedTag
      LIVE
                              
                              
                              -
                              
                              
                              
                              0.0
                              %
                              
                              
                              792
                              
                              
                              
                              15.5
                              %
                              
                              
                              (792
                              )
                              
                              
                              (100.0
                              )%Dibu
      Trading Co.
                              
                              
                              542
                              
                              
                              
                              18.1
                              %
                              
                              
                              1,489
                              
                              
                              
                              29.2
                              %
                              
                              
                              (947
                              )
                              
                              
                              (63.6
                              )%Total
      Net Revenues
                              
                              
                              2,990
                              
                              
                              
                              100.0
                              %
                              
                              
                              5,094
                              
                              
                              
                              100.0
                              %
                              
                              
                              (2,104
                              )
                              
                              
                              (41.3
                              )%Gross
      Profit:uBid.com
                              
                              
                              651
                              
                              
                              
                              21.8
                              %
                              
                              
                              914
                              
                              
                              
                              17.9
                              %
                              
                              
                              (263
                              )
                              
                              
                              (28.8
                              )%RedTag.com
                              
                              
                              42
                              
                              
                              
                              1.4
                              %
                              
                              
                              17
                              
                              
                              
                              -
                              
                              
                              
                              25
                              
                              
                              
                              (147.1
                              )%RedTag
      LIVE
                              
                              
                              (6
                              )
                              
                              
                              (0.2
                              )%
                              
                              
                              185
                              
                              
                              
                              3.6
                              %
                              
                              
                              (191
                              )
                              
                              
                              (103.2
                              )%Dibu
      Trading Co.
                              
                              
                              61
                              
                              
                              
                              2.0
                              %
                              
                              
                              113
                              
                              
                              
                              2.2
                              %
                              
                              
                              (52
                              )
                              
                              
                              46.0
                              %Total
      Gross Profit
                              
                              
                              748
                              
                              
                              
                              25.0
                              %
                              
                              
                              1,229
                              
                              
                              
                              24.1
                              %
                              
                              
                              (481
                              )
                              
                              
                              (39.1
                              )%General
      and administrative
                              
                              
                              1,459
                              
                              
                              
                              48.8
                              %
                              
                              
                              2,867
                              
                              
                              
                              56.3
                              %
                              
                              
                              (1,408
                              )
                              
                              
                              (49.1
                              )%Sales
      and marketing
                              
                              
                              144
                              
                              
                              
                              4.8
                              %
                              
                              
                              295
                              
                              
                              
                              5.8
                              %
                              
                              
                              (151
                              )
                              
                              
                              (51.2
                              )%Total
      operating expenses
                              
                              
                              1,603
                              
                              
                              
                              53.6
                              %
                              
                              
                              3,162
                              
                              
                              
                              62.1
                              %
                              
                              
                              (1,559
                              )
                              
                              
                              (49.3
                              )%Loss
      from operations
                              
                              
                              (855
                              )
                              
                              
                              (28.6
                              )%
                              
                              
                              (1,933
                              )
                              
                              
                              (37.9
                              )%
                              
                              
                              1,078
                              
                              
                              
                              (55.8
                              )%Interest
      Expense, net
                              
                              
                              (121
                              )
                              
                              
                              (4.0
                              )%
                              
                              
                              (692
                              )
                              
                              
                              (13.6
                              )%
                              
                              
                              571
                              
                              
                              
                              82.5
                              %Miscellaneous
      Income
                              
                              
                              55
                              
                              
                              
                              1.8
                              %
                              
                              
                              (48
                              )
                              
                              
                              -
                              
                              
                              
                              103
                              
                              
                              
                              (100.0
                              )%Net Loss$
                              
                              
                              (921
                              )
                              
                              
                              (30.8
                              )%
                              
                              $
                              (2,673
                              )
                              
                              
                              (52.5
                              )%
                              
                              $
                              1,752
                              
                              
                              
                              (65.5
                              )%




Revenue





Web
Properties:  uBid.com and RedTag.com





Net
revenue for the web properties decreased $365 or13.0% and gross profit decreased
$238 or 25.6%  in the quarter ended March 31, 2010 compared to the
same period in 2009. Revenues decreased as a result of a decrease in visitors to
the site. Visitors to the two web properties decreased 863 or 38.1%. The
decrease in the visitors and the resulting revenue decline were due to the lack
of capital to promote the sites and to obtain inventory for posting. The decline
in revenue was primarily in the direct channel. The Certified Merchant channel
also decreased as merchants experienced slower payments and reduced the amount
of postings. The inventory at March 31, 2010 increased $785 or 316% over the
same period in the prior year as we began to increase inventories with the
capital raise that was completed on February 24, 2010.


The gross
margin dollars decreased $238 on the lower sales volumes. The gross margin
percentage increased to 26.6% from 17.9% as a result of eliminating some of the
unprofitable listings and reducing the number of auctions for the reduced number
of visitors.





Offline
Sales Channels: Dibu Trading Co. and RedTag Live





Net
revenue for the offline sales channels decreased approximately 76.2% in the
first quarter of 2010 as compared to 2009, which was due to a live liquidation
event held in 2009 versus none in 2010. Dibu trading revenues decreased $947 or
63.6% as a result of the liquidity constraints.





21





Sales,
General and Administrative Expenses





Sales and
marketing, general and administrative (“SG&A”) expenses consist primarily of
sales and marketing expenses, including online marketing activities, order
fulfillment and other costs, such as personnel, rent, warehouse and handling,
common area maintenance, depreciation, credit card processing charges,
insurance, legal and accounting fees. The following is a summary of the SG&A
expenses:





Three months endedMarch31,2010
                      
                      
                      2009
                      
                      
                      Increase
                        (Decrease)Salary
      and Benefits
                      
                      $
                      630
                      
                      
                      $
                      1,187
                      
                      
                      $
                      (557
                      )Advertising
                      
                      
                      121
                      
                      
                      
                      205
                      
                      
                      
                      (84
                      )RedTag
      Live Events
                      
                      
                      -
                      
                      
                      
                      362
                      
                      
                      
                      (362
                      )Credit
      Card Fees
                      
                      
                      170
                      
                      
                      
                      281
                      
                      
                      
                      (111
                      )Legal,
      Audit, Insurance & Regulatory Fees
                      
                      
                      226
                      
                      
                      
                      344
                      
                      
                      
                      (118
                      )Consulting
      and Outside Services
                      
                      
                      9
                      
                      
                      
                      136
                      
                      
                      
                      (127
                      )Warehouse
                      
                      
                      26
                      
                      
                      
                      187
                      
                      
                      
                      (161
                      )Stock
      Based Compensation
                      
                      
                      16
                      
                      
                      
                      30
                      
                      
                      
                      (14
                      )Telecommucations,
      Hardware and Storage
                      
                      
                      128
                      
                      
                      
                      152
                      
                      
                      
                      (24
                      )Depreciation
      & Amortization
                      
                      
                      168
                      
                      
                      
                      119
                      
                      
                      
                      49Other
      SG&A
                      
                      
                      24
                      
                      
                      
                      20
                      
                      
                      
                      4Facility
      Fees
                      
                      
                      63
                      
                      
                      
                      63
                      
                      
                      
                      -Travel
                      
                      
                      21
                      
                      
                      
                      31
                      
                      
                      
                      (10
                      )Dues
      & Subscriptions
                      
                      
                      1
                      
                      
                      
                      45
                      
                      
                      
                      (44
                      )$
                      1,603
                      
                      
                      $
                      3,162
                      
                      
                      $
                      (1,559
                      )


SG&A
expenses decreased $1,559 or 49.30% in the quarter ended March 2010 as compared
to the quarter ended March 2009.  The primary reason for the decrease
in these expenses was the implementations of several cost reduction projects
starting in November 2009. The primary categories contributing to the decrease
are as follows:





·
              Advertising
      expenses decreased $84 or 40.98% due to the continued elimination of
      unprofitable and ineffective advertising campaigns.·
              Salary
      and benefits expenses decreased $557 or 46.93% due to staff reductions and
      salary reductions. Most senior managers and other managers took pay
      reductions starting in November 2009 ranging from 10% to over
      60%.·
              RedTag
      Live event expenses decreased $362 or100.0% no live liquidation events
      were held during the period.·
              Credit
      card fees decreased $111 or 39.5% due to decreased sales volume at the web
      properties.·
              Legal,
      audit, insurance, and other regulatory fees decreased $118 or 34.3%
      primarily due to fees incurred in the convertible debt issuance in the
      first quarter of 2009.·
              Consulting
      and outside services decreased $127 or 93.38% as we continued to eliminate
      outside services and consulting contracts.·
              Warehouse
      expense decreased $161 or 86.1% as a result of the lower sales volumes and
      the move to a multi-use facility that includes a
  warehouse.




22




Net
Losses





The
Company experienced a net loss of $921 or $0.05 per share for the three months
ended March 31, 2010 compared to a net loss of $2,673 or $0.14 per share for the
three months ended March 31, 2009. Net loss decreased due to lower operating
costs resulting from cost reduction measures imposed starting in the fourth
quarter of 2009. The first quarter ending March 31, 2010 was the first full
quarter with all the cost reductions completed. The delay in closing the capital
raise also impacted the loss.





Interest
expense





Interest
expense decreased $571 due to interest on warrants issued incurred during the
three months ended March 31, 2009. All warrants were canceled in 2009 in
conjunction with the restructure.





23





Liquidity
and Capital Resources





Net cash used in operating activities for the three months ended
March 31, 2010 was $3,165 compared to $1 provided by in the three months ended
March 31, 2009. The significant change in net cash provided by operating
activities was primarily due to the decrease in accounts payable and accrued
expenses of $1,230 and $738 respectively. The increase in inventories of $753
also contributed to the net cash used in operating activities. Cash raised in
the financing that closed on February 24, 2010 was used to pay vendors and
purchase inventories to impact the sales generated. The improvement in the net
loss compared to the same period in the prior year also reduced the net cash
required for operating activities.





Net cash used in investing activities
was $19 and $72 for the three months ended March 31, 2010 and 2009,
respectively. The decrease in net cash used was due to lower capital
spending.





Net cash provided by financing
activities was $2,252 for the three months ended March 31, 2010, compared to $75
for the same period last year. The increase in cash provided is a result of the
sale of preferred stock and increased borrowing to purchase inventories on the
flooring facility.





24





As a
result of the tightening credit market (including uncertainties with respect to
financial institutions and the global credit markets), extreme volatility in
energy costs and other macro-economic challenges currently affecting the economy
of the United States and other parts of the world, customers or vendors may
experience serious cash flow problems and as a result, may modify, delay or
cancel plans to purchase the Company’s products and vendors may significantly
and quickly increase their prices or reduce their output. Additionally, if the
Company  is not successful in securing financing, we may not be able
to pay, or may delay payment of, accounts payables owed to our vendors which may
adversely affect the Company’s ability to procure additional materials and
services needed to meet our customers’ requirements. If the Company is unable to
secure long-term financing or capital, the operations will be difficult to
continue for the near term. However, there is no assurance that we will be
successful in these efforts, which raises substantial doubt as to our ability to
continue as a going concern.





25





In the
fourth quarter of 2009 the Company received commitments to purchase 1,700,000
shares of preferred for $3,750 from accredited investors many of which had
invested in the previous bridge loan and convertible debentures. The Company
raised an additional $500 during the first quarter of 2010. These proceeds were
used to pay the October 9, 2009 $500 loan, to restructure the bridge loan and
convertible debenture, pay the $700 owed to the bridge loan holders, pay down
vendor balances and to fund operations.





Throughout
2009 negotiations with vendors were undertaken and for the most part
successfully completed with all creditors to partially settle outstanding
balances and or establish extended payment terms.





On March
31, 2010, in conjunction with the issuance of our annual report, our auditors
issued a qualified opinion which raised substantial doubt about our ability to
continue as a going concern. Management’s plans to alleviate this condition
consist of, but are not limited to the following:





·
            Increase
      available inventory for sale through establishing an asset based lending
      credit line (ABL) of approximately
$3,000,


·
            Raise
      additional long term equity
capital,


·
            Increase
      revenues through focused marketing to customers in our robust data base
      reestablishing our sites as ones that appeal to the diversified
      demographics of the group,


·
            Increase
      revenues through the introduction of diversified product lines to serve
      the asset recovery industry,


·
            Increase
      revenues by completing the installation of our ERP application allowing us
      to provide all the requirements necessary for our vendors and Certified
      Merchants to sell product through us both domestically and
      globally,


·
            Increase
      revenues through the introduction of transaction fees and restructuring of
      CM vendor rate card,


·
            Execute
      revised business plan under new leadership and expanded
    board.





As a
result of the conditions discussed above, and in accordance with generally
accepted accounting principles in the United States, there exists substantial
doubt about our ability to continue as a going concern. Our continued operations
are contingent on our ability to be successful in implementing the above plans.
There is no assurance that we will be successful in these efforts, therefore
there is substantial doubt as to our ability to have sufficient cash to meet our
operating requirements and continue as a going concern. The accompanying
consolidated financial statements do not reflect adjustments relating to the
recoverability and classification of assets or liabilities that might result
from the outcome of these uncertainties.





26





ITEM 3.   QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK





The
Company has little exposure to risks of fluctuating interest rates or
fluctuating currency exchange rates. Accordingly, the Company does not believe
that changes in interest or currency rates will have a material effect on the
Company’s liquidity, financial condition or results of operations. It is the
Company’s policy not to enter into derivative financial
instruments.





ITEM 4.   CONTROLS AND
PROCEDURES




Under
the supervision and with the participation of our management, including our
principal executive officer and principal financial officer, we conducted an
evaluation of the effectiveness of the design and operation of our disclosure
controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as of the
end of the period covered by this report (the "Evaluation Date"). Based on this
evaluation, our principal executive officer and principal financial officer
concluded as of the Evaluation Date that our disclosure controls and procedures
were effective such that the information relating to the Company, including our
consolidated subsidiaries, required to be disclosed in our SEC reports
(i) is recorded, processed, summarized and reported within the time
periods specified in SEC rules and forms, and (ii) is accumulated and
communicated to the Company’s management, including our principal executive
officer and principal financial officer, as appropriate to allow timely
decisions regarding required disclosure.




Under
the supervision and with the participation of our management, including our
principal executive officer and principal financial officer, we conducted an
evaluation of any changes in our internal control over financial reporting (as
such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange
Act) that occurred during our most recently completed fiscal quarter. Based on
that evaluation, our principal executive officer and principal financial officer
concluded that there has not been any change in our internal control over
financial reporting during that quarter that ended March 31, 2010 has materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting.





PART II OTHER INFORMATION





ITEM 1.   LEGAL
PROCEEDINGS





From time
to time the Company may be named in claims arising in the ordinary course of
business. Currently, no legal proceedings or claims are pending against the
Company or involve the Company that, in the opinion of the Company’s management,
could reasonably be expected to have a material adverse effect on its business
or financial condition.





ITEM 1A. RISK FACTORS





As a
result of the tightening credit market (including uncertainties with respect to
financial institutions and the global credit markets), increases in energy costs
and other macro-economic challenges currently affecting the economy of the
United States and other parts of the world, customers and vendors may experience
serious cash flow problems and as a result, may modify, delay or cancel plans to
purchase the Company’s products and vendors may significantly and quickly
increase their prices or reduce their output. Additionally, if the Company is
not successful in securing financing, when and as needed, we may not be able to
pay, or may delay payment of, accounts payables owed to our vendors which may
adversely affect the Company’s ability to procure additional materials and
services needed to meet our customer’s requirements. If economic conditions in
the United States and other key parts of the world deteriorate further or do not
show improvement, the Company may experience material adverse impacts to its
business and operating results.





In
addition to other information set forth in this report, you should carefully
consider the factors discussed in Part 1, “Item 1A. Risk Factors” in the
Company’s Annual Report on Form 10-K for the year ended December 31, 2009, which
could materially affect the Company’s business, financial condition or future
results. The risks described in the Company’s Annual Report on Form
10-K  are not the only risks facing the Company. Additional risks and
uncertainties not currently known to the Company or that are currently deemed to
be immaterial also may materially adversely affect the Company’s business,
financial conditions and/or operating results.





27





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





For the
three months ended March 31, 2010, options to purchase an aggregate
of 1,000,000 shares of the Company’s common stock were granted to an
individual who became the Chief Executive Officer of Enable Holdings, Inc. The
options have a term of ten years and vest over a four year period annually
beginning 25% on the date of grant and 25% over the next three anniversaries of
the date of grant.





ITEM 3. DEFAULT UPON SENIOR
SECURITIES





There are
no events of default as of March 31, 2010.





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





The
Company did not submit any matters to a vote of its security holders during the
three months ended March 31, 2010.





ITEM 5. OTHER INFORMATION





None.





ITEM 6. EXHIBITS





Exhibit No.
            
            Description31.1
            
            Certification
      of the President and Chief Executive Officer pursuant to Section 302 of
      the Sarbanes-Oxley Act of 2002.31.2
            
            Certification
      of the Chief Financial Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002.32.1
            
            Certification
      of the President and Chief Executive Officer pursuant to 18 U.S.C. Section
      1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
      2002.32.2
            
            Certification
      of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as
      adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
      2002.





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SIGNATURES





Pursuant
to requirements of Section 13 or 15(d) 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 as of May 14, 2010.


ENABLE
      HOLDINGS, INC.By:
              /s/ Miguel A Martinez,
  Jr.Name:  Miguel
      A. Martinez, Jr.Title:    Chief
      Financial Officer(Principal
      Financial Officer and Principal Accounting
  Officer)


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