UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   Form 10-QSB

(Mark One)

|X|   QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE ACT
      OF 1934

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2005

|_|   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

              FOR THE TRANSITION PERIOD FROM _________ TO _________

                       COMMISSION FILE NUMBER ____________


                                    DIGICORP
                                    --------
              (Exact name of small business issuer in its charter)


             UTAH                                        87-0398271
             ----                                        ----------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)


           100 Wilshire Boulevard, Suite 1750, Santa Monica, CA 90401
           ----------------------------------------------------------
                    (Address of principal executive offices)


                    Issuer's telephone number: (310) 752-1477

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

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

                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity,  as of the latest  practicable  date: As of October 20, 2005, the issuer
had 14,200,104 outstanding shares of Common Stock, $.001 par value.

Transitional Small Business Disclosure Format (check one): Yes |_| No |X|

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

                         PART I - FINANCIAL INFORMATION

Item 1.   Financial Statements..............................................   1
Item 2.   Management's Discussion and Analysis or Plan of Operation.........   8
Item 3.   Controls and Procedures...........................................  15

                           PART II - OTHER INFORMATION

Item 1.   Legal Proceedings.................................................  15
Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds.......  15
Item 3.   Defaults Upon Senior Securities...................................  17
Item 4.   Submission of Matters to a Vote of Security Holders...............  17
Item 5.   Other Information.................................................  17
Item 6.   Exhibits..........................................................  18

SIGNATURES..................................................................  19

<PAGE>

                         PART I - FINANCIAL INFORMATION

Item 1.   Financial Statements.

                                    DIGICORP
                          (A Development Stage Company)
================================================================================

Balance Sheet (Unaudited)

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

                                                                 September 30,
                                                                     2005
                                                                 --------------

ASSETS

CURRENT ASSETS

Cash and cash equivalents                                        $      338,939
Other current assets                                                    195,730
                                                                 --------------

TOTAL CURRENT ASSETS                                                    534,669

Property and equipment, net                                               6,970
Software development costs                                               41,600
Other intangible assets                                                 300,000
Other long term assets                                                   98,926
                                                                 --------------

TOTAL ASSETS                                                     $      982,165
                                                                 ==============

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

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES

Accounts payable and accrued liabilities                         $       35,077
                                                                 --------------

TOTAL CURRENT LIABILITIES                                                35,077

STOCKHOLDERS' EQUITY

Common stock, $0.001 par value: 50,000,000 shares authorized;
  14,200,104 shares issued and outstanding                               14,200
Paid-in capital                                                       1,835,481
Accumulated deficit                                                    (511,627)
Deficit accumulated during the development stage                       (390,966)
                                                                 --------------

TOTAL STOCKHOLDERS' EQUITY                                              947,088
                                                                 --------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                       $      982,165
                                                                 ==============

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

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


                                       1
<PAGE>

                                    DIGICORP
                          (A Development Stage Company)
================================================================================

Statements of Operations (Unaudited)

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

<TABLE>
<CAPTION>
                                                                                         For the Period
                                                                                          July 1, 1995
                                                            Three Months Ended             (inception)
                                                     September 30,     September 30,     to September 30,
                                                          2005              2004              2005
                                                     --------------    --------------    --------------
<S>                                                  <C>               <C>               <C>
REVENUES                                             $           --    $           --    $           --
                                                     --------------    --------------    --------------

EXPENSES
  Salaries and employee benefits                            210,774                --           222,007
  Professional fees                                          67,898                --           116,724
  Taxes other than income taxes                               2,766                --             3,920
  General and administrative                                 15,216             1,515            52,975
                                                     --------------    --------------    --------------

    Operating expenses                                      296,654             1,515           395,626
                                                     --------------    --------------    --------------

    Operating loss                                         (296,654)           (1,515)         (395,626)

  Interest, dividend income and other, net                    3,776                --             4,660
                                                     --------------    --------------    --------------

    Net loss before income taxes                           (292,878)           (1,515)         (390,966)

    Provision for income taxes                                   --                --                --
                                                     --------------    --------------    --------------

    Net loss                                         $     (292,878)   $       (1,515)   $     (390,966)
                                                     ==============    ==============    ==============

    Basic and diluted net loss per common share      $        (0.02)   $           --
                                                     ==============    ==============
    Weighted average common shares outstanding           13,316,389         9,742,000
                                                     ==============    ==============
</TABLE>

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

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


                                       2
<PAGE>

                                    DIGICORP
                          (A Development Stage Company)
================================================================================

Statements of Cash Flows (Unaudited)

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

<TABLE>
<CAPTION>
                                                                                                For the Period
                                                                                                 July 1, 1995
                                                                     Three Months Ended           (inception)
                                                               September 30,    September 30,   to September 30,
                                                                    2005             2004             2005
                                                               -------------    -------------    -------------
<S>                                                            <C>              <C>              <C>
Cash flows from operating activities:
    Net loss                                                   $    (292,878)   $      (1,515)   $    (390,966)
    Adjustments to reconcile net loss to net cash
      (used in) provided by operating activities:
        Depreciation                                                     367               --              367
        Stock based compensation                                     180,036               --          180,036
        Stock and warrants issued in exchange for services            11,564               --          341,564
        Changes in operating assets and liabilities:
            Other current assets                                     146,168               --         (195,730)
            Other long term assets                                   (98,926)              --          (98,926)
            Accounts payable and accrued liabilities                 (24,081)           1,400           35,077
                                                               -------------    -------------    -------------

    Net cash used in operating activities                            (77,750)            (115)        (128,578)
                                                               -------------    -------------    -------------

Cash flows from investing activities:
  Purchase of property and equipment                                  (7,337)              --           (7,337)
  Software development costs                                         (41,600)              --          (41,600)
                                                               -------------    -------------    -------------

    Net cash used in investing activities                            (48,937)              --          (48,937)
                                                               -------------    -------------    -------------

Cash flows from financing activities:
  Proceeds from issuance of common stock and warrants                     --               --          516,000
                                                               -------------    -------------    -------------

    Net cash provided by financing activities                             --               --          516,000
                                                               -------------    -------------    -------------

Net (decrease) increase in cash and cash equivalents                (126,687)            (115)         338,485

Cash and cash equivalents at beginning of period                     465,626            3,991              454
                                                               -------------    -------------    -------------

Cash and cash equivalents at end of period                     $     338,939    $       3,876    $     338,939
                                                               =============    =============    =============

    Supplemental disclosure of noncash investing activities:
            Issuance of common stock in exchange for other
              intangible assets                                $     300,000    $          --    $     300,000
</TABLE>

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

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


                                       3
<PAGE>

Digicorp
Notes to Condensed Financial Statements (Unaudited)
September 30, 2005

1. DESCRIPTION OF BUSINESS

Digicorp  ("the  Company") was organized  under the laws of the State of Utah on
July  19,  1983.  On July 1,  1995,  the  Company  became  a  development  stage
enterprise  as defined in SFAS No. 7 when it sold its  assets  and  changed  its
business plan.  Accordingly the financial  statements include cumulative amounts
since July 1, 1995.  The Company  proposes to seek  business  ventures that will
allow for long-term growth.

2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying condensed financial statements have been prepared in accordance
with the  instructions to Form 10-QSB and do not include all the information and
disclosures  required by accounting  principles generally accepted in the United
States of America.  The  preparation of financial  statements in conformity with
accounting principles generally accepted in the U.S. requires management to make
estimates  and  assumptions  that affect the amounts  reported in the  financial
statements  and   accompanying   notes.  The  actual  results  may  differ  from
management's estimates.

The interim  condensed  financial  information  is  unaudited,  but reflects all
normal adjustments that are, in the opinion of management,  necessary to provide
a fair  statement of results for the interim  periods  presented.  The condensed
interim  financial  statements  should be read in connection  with the financial
statements in the Company's Annual Report on Form 10-KSB for the year ended June
30, 2005, as filed with the Securities and Exchange Commission.

Liquidity

Since June 30, 1995, the Company has been a development  stage  enterprise  with
recurring  losses that has relied upon the  issuance of its common stock to fund
operations.  Management believes that existing cash resources should be adequate
to fund its  operations  through the end of the Company's  current  fiscal year,
June 30, 2006.  However,  long term  liquidity  is  dependent  on the  Company's
ability to attain future profitable operations.

Stock-Based Compensation

Prior to July 1, 2005, the Company  accounted for  stock-based  compensation  in
accordance with Accounting  Principles Board ("APB") Opinion No. 25,  Accounting
for Stock  Issued to  Employees,  and related  interpretations,  as permitted by
Statement of Financial  Accounting  Standards  ("SFAS") No. 123,  Accounting for
Stock-Based  Compensation.  In  December  2004,  SFAS  No.  123(R),  Share-Based
Payment,  which addresses the accounting for employee stock options, was issued.
SFAS 123(R)  revises the  disclosure  provisions of SFAS 123 and  supercedes APB
Opinion  No.  25.  SFAS  123(R)  requires  that the cost of all  employee  stock
options, as well as other equity-based compensation  arrangements,  be reflected
in the financial  statements over the vesting period based on the estimated fair
value of the  awards.  This  statement  is  effective  for the Company as of the
beginning of the first annual  reporting period that begins after June 15, 2005.
The Company  adopted  SFAS  123(R) as of July 1, 2005.  Since the Company had no
outstanding  options as of June 30, 2005 and  September  30,  2004,  SFAS 123(R)
would have had no impact on the Company's  financial  statements had the Company
elected to adopt the provisions of SFAS 123(R) in an earlier period.  During the
three months ended September 30, 2005, the Company had stock-based  compensation
expense of $168,786,  from the issuance of 5,100,000  options to purchase shares
of the Company's  common stock,  included in reported net loss of $292,878.  All
options  that we granted in 2005 were granted at the per share fair market value
on the grant date. Vesting of options differs based on the terms of each option.
The Company utilized the Black-Scholes  option pricing model and the assumptions
used for each period are as follows:


                                       4
<PAGE>

Digicorp
Notes to Condensed Financial Statements (continued)
September 30, 2005

                                                        Three months ended
                                                          September 30,
                                                   -----------------------------
                                                       2005            2004
                                                   ------------     ------------

      Weighted average risk free interest rates            3.75%              --

      Weighted average life (in years)                     3.55               --

      Volatility                                            155%              --

      Expected dividend yield                                 0%              --

      Weighted average grant-date fair value
        per share of options granted               $       0.56     $         --

OTHER INTANGIBLE ASSETS

In June 2001, the Financial  Accounting Standards Board ("FASB") issued SFAS No.
142,  "Goodwill and Other  Intangible  Assets",  which  provides  accounting and
reporting standards for acquired intangible assets. Under SFAS No. 142, goodwill
and other intangible assets with indefinite useful lives are no longer amortized
but tested for impairment at least annually. The Company adopted SFAS No. 142 in
connection with its purchase of the iCodemedia  Assets from our Chief Technology
Officer,  a related party,  during September 2005 (see note 4). Upon adoption of
SFAS No. 142, the Company  recorded the  iCodemedia  Assets as other  intangible
assets,  as those  assets  met the  criteria  under  SFAS No.  142 for  separate
identification.  The Company will perform an impairment  test on all  intangible
assets,  in accordance with the guidance  provided by SFAS No. 144,  "Accounting
for the Impairment of Disposal of Long-Lived Assets", at least annually,  unless
events and circumstances indicate that such assets might be impaired.

3. LOSS PER COMMON SHARE

Loss per common share is based on the weighted  average  number of common shares
outstanding. The Company complies with SFAS No. 128, "Earnings Per Share," which
requires dual  presentation of basic and diluted  earnings per share on the face
of the statements of operations.  Basic loss per share excludes  dilution and is
computed by dividing  income  (loss)  available  to common  stockholders  by the
weighted-average  common  shares  outstanding  for the period.  Diluted loss per
share  reflects the potential  dilution that could occur if options and warrants
were to be  exercised  or  converted  or  otherwise  resulted in the issuance of
common stock that then shared in the earnings of the entity.

Options and warrants outstanding as of September 30, 2005 to purchase 10,575,000
and  3,050,000  shares of common  stock,  respectively  were not included in the
computation  of diluted  net loss per common  share for the three  months  ended
September  30,  2005,  as their  inclusion  would  have  been  antidilutive.  At
September 30, 2004 there were no outstanding options or warrants. See note 8 for
subsequent cancellation of warrants.

4. EQUITY TRANSACTIONS

On September 23, 2005, the Company  amended the terms of a legal  representation
agreement initially entered into with Sichenzia Ross Friedman Ference LLP on May
5, 2005.  ("Sichenzia").  Under the amended terms, Sichenzia agreed to represent
the Company in connection with its continuing reporting requirements, as well as
its  general  corporate  matters,  including,  reviewing  and  drafting  general
corporate  documents.  The  initial  term of the  agreement  is from May 1, 2005
through March 31, 2007.

In consideration for Sichenzia's services,  the Company agreed to a fixed fee of
$50,000 and to issue Sichenzia 500,000 shares of the Company's common stock. The
common  stock issued to Sichenzia  was valued at  approximately  $325,000 and is
being  amortized  over the term of the  agreement.  At  September  30,  2005 the
unamortized  balance is $293,478.  Of this balance $195,652 is included in other
current assets and $98,926 is included in other long term assets.

On September 19, 2005, the Company entered into an asset purchase agreement with
Philip Gatch, our Chief Technology  Officer,  and thereby completed the purchase
of certain assets from Mr. Gatch  consisting of the iCodemedia suite of websites
and internet properties and all related  intellectual  property (the "iCodemedia
Assets").   The   iCodemedia   suite  of  websites   consists  of  the  websites
www.icodemedia.com,   www.iplaylist.com,   www.tunecast.com,  www.tunebucks.com,
www.podpresskit.com  and  www.tunespromo.com.  We plan to use these  websites to
provide a suite of  applications  and  services  to enable  content  creators to
publish and deliver content to existing and next generation  devices such as the
Apple  iPod  and the  Sony  PSP.  The  iCodemedia  Assets  are  presently  under
development and constitute  nominal assets of the Company.  As consideration for
the iCodemedia  Assets, we issued Mr. Gatch 1,000,000 shares of our common stock
valued at $300,000. Intangible assets with an indefinite life are not subject to
amortization,  but will be subject to periodic  evaluation for  impairment  (see
Other  Intangible  Assets).  The issuance of shares of common stock to Mr. Gatch
was exempt  from  registration  requirements  pursuant  to  Section  4(2) of the
Securities Act of 1933, as amended.

On September  30,  2005,  we entered  into a  non-binding  Letter of Intent (the
"LOI") to purchase (the  "Acquisition") all of the issued and outstanding shares
of capital  stock of Rebel Crew Films,  Inc., a California  corporation  ("Rebel
Crew"). As proposed in the LOI, upon closing the Acquisition,  we would issue 20
million  shares  of our  common  stock  to the  shareholders  of  Rebel  Crew as
compensation for the issued and outstanding capital stock of Rebel Crew. Also on
September 30, 2005, the Company  entered into a Term Sheet (the "Term Sheet") to
purchase a $345,435 loan receivable  (the "Loan  Receivable") of Rebel Holdings,
LLC, a California limited liability company ("Rebel Holdings"),  in exchange for
the issuance to Rebel Holdings of a $345,435  principal amount  convertible note
(the "Note"). The Loan Receivable constitutes monies loaned by Rebel Holdings to
Rebel Crew to pay for operating  expenses of Rebel Crew. The proposed Note would
have a term of five years from  closing,  would bear 4.5%  simple  interest  and
would be convertible  into shares of the Company's  common stock at a conversion
price of $0.69087 per share.


                                       5
<PAGE>

Digicorp
Notes to Condensed Financial Statements (continued)
September 30, 2005

5. WARRANTS

In July 2005,  the Company issued 50,000  warrants to purchase  shares of common
stock  at  $0.25  per  share  to a  consultant.  The  warrants  are  immediately
exercisable  and have a five-year  life. The warrants were valued at $11,500 and
were expensed during the three months ended September 30, 2005.

Warrants  granted  during the three months ended  September 30, 2005 were valued
using the  Black-Scholes  valuation  model  assuming  expected  dividend  yield,
risk-free  interest rate,  expected life and volatility of 0%, 3.75%, five years
and 155%,  respectively.  As of September 30, 2005,  all warrants  issued remain
outstanding.

Subsequent to September 30, 2005,  3,000,000  warrants  issued to Bodnar Capital
Management, LLC were cancelled (see note 8).

The  following  table  summarizes   information   about  common  stock  warrants
outstanding at September 30, 2005:

<TABLE>
<CAPTION>
                              Outstanding                                              Exercisable
------------------------------------------------------------------------   -----------------------------------
                                          Weighted
                                          Average
                                         Remaining         Weighted                              Weighted
                                        Contractual         Average                               Average
    Exercise             Number             Life           Exercise             Number           Exercise
     Price            Outstanding          (Years)           Price            Exercisable          Price
----------------   ----------------   ----------------  ----------------   ----------------   ----------------
<S>                <C>                <C>               <C>                <C>                <C>
   $ 0.25 - 0.42          1,550,000               4.67            $ 0.34          1,550,000             $ 0.34

   $ 0.75 - 1.50          1,500,000               4.63              1.08          1,500,000               1.08
----------------   ----------------   ----------------  ----------------   ----------------   ----------------

   $ 0.25 - 1.50          3,050,000               4.65            $ 0.70          3,050,000             $ 0.70
================   ================   ================  ================   ================   ================
</TABLE>

6. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Accounts payable and accrued liabilities at September 30, 2005 and June 30, 2004
are comprised of the following:

                                         September 30,         June 30,
                                             2005               2005
                                       ----------------   ----------------

      Professional fees - legal        $         25,000   $         30,000

      Professional fees - other                   5,750             10,000

      Related party liability                        --             17,295

      Accrued - other                             4,327              1,863
                                       ----------------   ----------------

                                       $         35,077   $         59,158
                                       ================   ================


                                       6
<PAGE>

Digicorp
Notes to Condensed Financial Statements (continued)
September 30, 2005

7. RELATED PARTY TRANSACTIONS

At September  30, 2005 and June 30, 2005,  the Company has a liability of $0 and
$17,295,  respectively,  due to an entity  that owned  approximately  20% of the
outstanding  shares of the Company's  common stock.  The liability is unsecured,
non-interest bearing and due on demand.

8. SUBSEQUENT EVENTS

On October 24, 2005,  the Company  cancelled  warrants  issued to Bodnar Capital
Management, LLC ("Bodnar Capital") to purchase 3,000,000 shares of the Company's
common stock and issued  warrants under terms similar to the cancelled  warrants
to purchase  500,000 shares of the Company's common stock with an exercise price
of $0.01.  The cancelled  warrants were  initially  issued to Bodnar  Capital on
April 5, 2005 pursuant to a subscription agreement with Bodnar Capital,  whereby
the Company sold Bodnar Capital  2,941,176  shares of the Company's common stock
and warrants to purchase an additional  3,000,000 shares of the Company's common
stock. The Company  received gross proceeds of  approximately  $500,000 from the
sale of stock and warrants to Bodnar Capital.  The warrants were exercisable for
a period of five years, were callable,  under certain  situations,  upon 30 days
prior written  notice,  and had exercise  prices as follows:  (a) 500,000 shares
with an exercise  price of $0.25;  (b) 500,000  shares with an exercise price of
$0.35;  (c) 500,000 shares with an exercise  price of $0.42;  (d) 500,000 shares
with an exercise  price of $0.75;  (e) 500,000  shares with an exercise price of
$1.00;  (f) 500,000 shares with an exercise price of $1.50. The sale was made in
a private  placement exempt from registration  requirements  pursuant to Section
4(2) of the  Securities  Act of 1933,  as  amended,  and  Rule  506  promulgated
thereunder.  On November  2, 2005,  Bodnar  Capital  exercised  its  warrants to
purchase  500,000 shares of the Company's common stock with an exercise price of
$0.01.

On November 11, 2005, the Company entered into a consulting agreement with Aegis
Equity LLC. In the event the  transactions  with Rebel Crew and Rebel  Holdings,
discussed in Note 4, are  consumated we agreed to issue Aegis Equity LLC 530,000
shares of common stock and warrants to purchase  300,000  shares of common stock
with an exercise price of $0.65 per share.

                                       7
<PAGE>

Item 2.   Management's Discussion and Analysis or Plan of Operation.

Forward-Looking Statements

      The information in this report contains  forward-looking  statements.  All
statements  other than  statements  of  historical  fact made in this report are
forward  looking.  In  particular,  the  statements  herein  regarding  industry
prospects  and  future   results  of   operations  or  financial   position  are
forward-looking  statements.  Forward-looking  statements  reflect  management's
current expectations and are inherently uncertain. Our actual results may differ
significantly from management's expectations.

      The following  discussion and analysis should be read in conjunction  with
the  financial  statements  included  herewith.  This  discussion  should not be
construed to imply that the results  discussed herein will necessarily  continue
into the future,  or that any  conclusion  reached  herein will  necessarily  be
indicative of actual operating results in the future. Such discussion represents
only the best present assessment of our management.

Off-Balance Sheet Arrangements

      We do not have any off  balance  sheet  arrangements  that are  reasonably
likely to have a current or future effect on our financial condition,  revenues,
results of operations, liquidity or capital expenditures.

Critical Accounting Policies

      A  discussion  and  analysis  of our  financial  condition  and results of
operations are based upon our financial statements,  which have been prepared in
accordance with accounting  principles  generally accepted in the United States.
The  preparation  of these  financial  statements  requires  management  to make
estimates  and  assumptions   that  affect  the  reported   amounts  of  assets,
liabilities,  revenues and expenses and related  disclosure of contingent assets
and liabilities.  Note 2 to the financial  statements  describes the significant
accounting  policies  and  methods  used  in the  preparation  of the  financial
statements.  On an ongoing basis,  management evaluates its estimates,  the most
critical are those that are both important to the  presentation of our financial
condition and results of operations  and require  management's  most  difficult,
complex, or subjective judgments.

Accounting Developments

      In December 2004, Statement of Financial Accounting Standards ("SFAS") No.
123(R), "Share-Based Payment", which addresses the accounting for employee stock
options, was issued. SFAS 123(R) revises the disclosure  provisions of SFAS 123,
"Accounting for Stock Based Compensation" and supersedes  Accounting  Principles
Board ("APB") Opinion No. 25,  "Accounting for Stock Issued to Employees."  SFAS
123(R)  requires that the cost of all employee stock  options,  as well as other
equity-based compensation arrangements, be reflected in the financial statements
based on the estimated fair value of the awards. This statement is effective for
us as of the  beginning  of the first  interim or annual  reporting  period that
begins after June 15, 2005. We adopted  Statement 123(R) as of July 1, 2005, and
it did not have a material effect on our accounting for employee stock options.

Overview

      Digicorp was  incorporated on July 19, 1983 under the laws of the State of
Utah for the purpose of developing  and marketing  computer  software  programs.
From 1983 to 1995, our sales and  investments  were  attributable to the sale of
computer software and investments related to oil, gas and mining.

      On June 30, 1995, we became a development  stage  enterprise  when we sold
our assets and changed our business  plan.  Since June 30, 1995, we have been in
the developmental  stage and have had no operations other than issuing shares of
common stock for  financing  the  preparation  of financial  statements  and for
preparing  filings for the SEC. In August 2001,  we elected to file a Form 10-SB
registration  statement  with the SEC on a voluntary  basis in order to become a
reporting company under the Securities Exchange Act of 1934.


                                       8
<PAGE>

      Our  business  plan is to  attempt to locate and  negotiate  with  another
company  for the purpose of a business  combination  of the two  companies.  The
combination will normally take the form of a merger, stock-for-stock exchange or
stock-for-assets  exchange. In most instances the company combining with us will
wish to structure  the business  combination  to be within the  definition  of a
tax-free reorganization under Section 351 or Section 368 of the Internal Revenue
Code of 1986, as amended.  No assurances can be given that we will be successful
in locating or negotiating with another company in a business combination.

      On September 19, 2005, upon entering into an asset purchase agreement with
Philip Gatch, our Chief Technology Officer, we completed the initial transaction
to transform us from that of a development  stage  enterprise to a digital media
and content delivery company.  The assets purchased  consisted of the iCodemedia
suite of websites and internet properties and all related intellectual  property
(the  "iCodemedia  Assets").  The iCodemedia  suite of websites  consists of the
websites      www.icodemedia.com,      www.iplaylist.com,      www.tunecast.com,
www.tunebucks.com,  www.podpresskit.com and  www.tunespromo.com.  We plan to use
these  websites  and the  related  intellectual  property  to provide a suite of
applications  and services to enable content creators the ability to publish and
deliver content to existing and next generation  digital media devices,  such as
the Apple  iPod and the Sony PSP,  based  upon the  consumers'  expectation  for
broader and on-demand access to content and services.

      On September 30, 2005, we entered into a non-binding Letter of Intent (the
"LOI") to purchase (the  "Acquisition") all of the issued and outstanding shares
of capital  stock of Rebel Crew Films,  Inc., a California  corporation  ("Rebel
Crew"). As proposed in the LOI, upon closing the Acquisition,  we would issue 20
million  shares  of our  common  stock  to the  shareholders  of  Rebel  Crew as
compensation  for the issued and outstanding  capital stock of Rebel Crew. Rebel
Crew was  founded  in 2001 and is film  licensing  and  distribution  company of
Latino home entertainment products. Rebel Crew currently maintains more than 200
Spanish  language  films and  serves  some of the  nation's  largest  wholesale,
retail,  catalog, and e-commerce  accounts.  Rebel Crew's titles can be found at
Wal-Mart,  Best Buy,  Blockbuster,  K-Mart,  and hundreds of  independent  video
outlets across the United States and Canada.

      Also on  September  30, 2005,  the Company  entered into a Term Sheet (the
"Term Sheet") to purchase a $345,435 loan receivable (the "Loan  Receivable") of
Rebel Holdings,  LLC, a California limited liability company ("Rebel Holdings"),
in exchange for the issuance to Rebel  Holdings of a $345,435  principal  amount
convertible note (the "Note"). The Loan Receivable  constitutes monies loaned by
Rebel  Holdings to Rebel Crew to pay for operating  expenses of Rebel Crew.  The
proposed  Note would have a term of five  years  from  closing,  would bear 4.5%
simple  interest and would be  convertible  into shares of the Company's  common
stock at a conversion price of $0.69087 per share.

      Since the  Acquisition  of Rebel Crew and purchase of the Loan  Receivable
are subject to further  negotiation of definitive  agreements,  we cannot assure
our shareholders that the proposed  transactions will be completed.  However, we
believe  that  the  proposed  transactions,  if  consummated,  will  allow us to
leverage  Rebel  Crew's  Latino  content  and  industry  relationships  with the
iCodemedia  Assets to create a  compelling  digital  media and content  delivery
company.

      We believe we have sufficient capital to continue operations until the end
of our current fiscal year, June 30, 2006.  After that period if we do not enter
a  business  combination,   we  anticipate  that  our  owners,  affiliates,  and
consultants will provide  sufficient  capital for another year, but there can be
no assurance that this expectation will be realized.

      We have incurred  losses since our inception.  We will continue to sustain
losses until we  establish  profitable  operations  through an  acquisition,  or
otherwise.  The achievement  and/or success of these planned measures,  however,
cannot be determined  at this time. We do not expect to generate any  meaningful
revenue  or incur  significant  operating  expenses  unless  and until we either
complete  the  proposed  Acquisition  with Rebel Crew or acquire an  interest in
another operating company.


                                       9
<PAGE>

      Our headquarters are located at 100 Wilshire Boulevard,  Suite 1750, Santa
Monica, CA 90401, where we occupy office space with Patient Safety Technologies,
Inc.  and Ault Glazer  Bodnar & Company  Investment  Management  LLC. Our office
space is approximately 2,000 square feet.

Liquidity and Capital Resources

      Our total assets were  $982,165 at September  30, 2005 versus  $807,524 at
June 30,  2005.  The  change in total  assets is  primarily  attributable  to an
increase in intangible  assets of $300,000 from our completion of the iCodemedia
Asset acquisition,  offset by our operating and investing  activities of $77,750
and $48,937, respectively.

      At September  30, 2005 and June 30, 2005,  we had $338,939 and $465,626 in
cash and cash  equivalents,  respectively,  representing a decrease of $126,687.
During the three months ended September 30, 2005, we spent approximately $49,000
on the  development of applications  related to the iCodemedia  Assets and other
fixed assets and paid  approximately  $24,000  toward accrued  liabilities.  The
remaining  decrease in cash is attributed to recurring  operating  expenses.  We
believe that existing cash  resources  should be adequate to fund our operations
for the twelve months subsequent to June 30, 2005. However,  long-term liquidity
is  dependent  on our ability to attain  future  profitable  operations.  We may
undertake  additional debt or equity  financings to better enable us to grow and
meet our future operating and capital requirements. We do not currently have any
definitive  plans or  commitments  for such  financing and there is no assurance
that we will be successful in obtaining such financing.

      Operating  activities  used  $77,750  of cash for the three  months  ended
September  30, 2005,  compared to $115 for the three months ended  September 30,
2004.

Results of Operations

Expenses

      Operating  expenses were $296,654 in the three months ended  September 30,
2005,  and  $1,515 in the three  months  ended  September  30,  2004.  Operating
expenses in the  September  30, 2005 three month period  primarily  consisted of
professional fees and employee compensation.

      Professional  fees for the three months ended September 30, 2005 increased
approximately  $68,000  over the six  months  ended  September  30,  2004 due to
significant  increases in legal and other  professional  fees. Of this increase,
approximately  $47,000  related to the  amortization  of  prepaid  legal fees to
Sichenzia Ross Friedman Ference LLP  ("Sichenzia")  pursuant to the terms of the
May 5, 2005 legal  retainer  agreement,  as amended.  We entered into this legal
retainer  agreement in anticipation of an increased level of legal work required
to complete a business  combination or acquire assets that can then be developed
into a viable business,  and generate  revenues.  Under the terms of the amended
agreement,  Sichenzia  agreed to represent us in connection  with our continuing
reporting  requirements,  as well as our general corporate matters.  The term of
the agreement is from May 1, 2005 through March 31, 2007.

      In  consideration  for Sichenzia's  services,  we agreed to a fixed fee of
$50,000 and to issue  Sichenzia  500,000 shares of our common stock.  The common
stock  issued to  Sichenzia  was valued at  approximately  $325,000 and is being
amortized over the term of the agreement. At September 30, 2005 we had amortized
approximately  $82,000. The increase in other professional fees of approximately
$21,000 is  attributable to services  performed by consultants  assisting in the
development of our digital media strategy,  primarily  related to the iCodemedia
Assets.

      At  September  30, 2005,  we had two full time  employees as opposed to no
employees at September 30, 2004. In addition to cash based employee compensation
of  approximately  $28,000,  we incurred  approximately  $180,000 in stock based
compensation  expense  related  to  our  officers,  employees  and  non-employee
directors performing services for the Company, all of which were expensed during
the three months ended September 30, 2005, in accordance  with SFAS 123(R).  The
Company   valued  the   nonqualified   stock  options  of  $169,000   using  the
Black-Scholes  valuation  model  assuming  expected  dividend  yield,  risk-free
interest rate,  expected life and volatility of 0%, 3.75%, two to five years and
155%,  respectively.  The restricted  stock awards of $11,000 were valued at the
closing price on the date the restricted  shares were granted.  During the three
months ended  September 30, 2004, we did not incur any stock based  compensation
expense.


                                       10
<PAGE>

Contractual Obligations

      We did not have any contractual obligations as of September 30, 2005

                                  RISK FACTORS

      Our business  involves a high degree of risk.  Potential  investors should
carefully  consider the risks and  uncertainties  described  below and the other
information  in this report before  deciding  whether to invest in shares of our
common stock.  Each of the following  risks may materially and adversely  affect
our business,  results of operations  and financial  condition.  These risks may
cause the market  price of our common  stock to decline,  which may cause you to
lose all or a part of the money you paid to buy our common stock.

RISKS RELATED TO OUR BUSINESS

FOR THE PAST TEN YEARS WE HAVE NOT HAD ANY BUSINESS  OPERATIONS  OR ANY REVENUES
AND WE DO NOT  HAVE  SIGNIFICANT  ASSETS.  IF WE DO NOT  CONSUMMATE  A  BUSINESS
COMBINATION,  WE WILL  CONTINUE  TO HAVE NO  REVENUES  AND OUR SHARE  PRICE WILL
LIKELY DECLINE.

      As of  September  30, 2005,  our assets  consisted of $338,939 in cash and
$195,730 in other  current  assets,  primarily  comprised of prepaid legal fees.
Since July 1, 1995, we have not generated any revenue. As of September 30, 2005,
we had an accumulated deficit of $902,593.  For the three months ended September
30,  2005  and  2004,  we  incurred  total  expenses  of  $296,655  and  $1,515,
respectively.  We will, in all likelihood,  continue to incur operating expenses
without  corresponding  revenues,  at least until the consummation of a business
combination or the successful  commercialization of assets that we acquire. As a
result,  we will  continue  to  operate  at a loss  at  least  until a  business
combination  with another  company can be completed or we  successfully  develop
acquired assets into a viable  business.  On September 19, 2005, we entered into
an asset purchase agreement with Philip Gatch, our Chief Technology Officer, and
thereby  completed the purchase of certain  assets from Mr. Gatch  consisting of
the  iCodemedia  suite of  websites  and  internet  properties  and all  related
intellectual  property  (the  "iCodemedia  Assets").  The  iCodemedia  suite  of
websites  consists  of  the  websites   www.icodemedia.com,   www.iplaylist.com,
www.tunecast.com, www.tunebucks.com, www.podpresskit.com and www.tunespromo.com.
We plan to use these websites to provide a suite of applications and services to
enable  content  creators to publish and  deliver  content to existing  and next
generation  devices  such as the  Apple  iPod and the Sony PSP.  The  iCodemedia
Assets  are  presently  under  development  and there is no  guarantee  that the
iCodemedia Assets will develop into a viable business.

      On September 30, 2005, we entered into a non-binding Letter of Intent (the
"LOI") to purchase (the  "Acquisition") all of the issued and outstanding shares
of capital  stock of Rebel Crew Films,  Inc., a California  corporation  ("Rebel
Crew"). As proposed in the LOI, upon closing the Acquisition,  we would issue 20
million  shares  of our  common  stock  to the  shareholders  of  Rebel  Crew as
compensation  for the issued and outstanding  capital stock of Rebel Crew. Rebel
Crew was founded in 2001 and is rapidly  becoming a leading film  licensing  and
distribution company of Latino home entertainment products. Rebel Crew currently
maintains more than 200 Spanish  language films and serves the nation's  largest
wholesale,  retail, catalog, and e-commerce accounts. Rebel Crew's titles can be
found at Wal-Mart,  Best Buy,  Blockbuster,  K-Mart, and hundreds of independent
video outlets  across the United  States and Canada.  Since the  Acquisition  is
subject to further  negotiation of definitive  agreements,  we cannot assure our
shareholders  that the proposed  transactions  will be  completed.  However,  we
believe that the proposed Acquisition, if consummated, will allow us to leverage
Rebel Crew's  Latino  content and  industry  relationships  with the  iCodemedia
Assets to create a compelling digital media and content delivery company.  If we
are unable  complete a business  combination,  or develop assets that we acquire
into a viable  business,  and  generate  revenues,  our share  price will likely
decline.


                                       11
<PAGE>

AS OF THE DATE HEREOF, THE ONLY BUSINESS OPPORTUNITY FOR WHICH WE HAVE COMPLETED
A  BUSINESS  COMBINATION  OR ASSET  ACQUISITION  OR  ENTERED  INTO A  DEFINITIVE
AGREEMENT  FOR IS TO ACQUIRE  CERTAIN  ASSETS FROM A RELATED  PARTY.  WE DID NOT
CONDUCT A FORMAL  VALUATION TO DETERMINE THE FAIRNESS OF THE  CONSIDERATION  FOR
THE ACQUISITION, WHICH WAS COMPLETED ON SEPTEMBER 19, 2005. IF THE CONSIDERATION
PAID AND THE ACTUAL VALUE OF THE ASSETS ACQUIRED IS LESS THAN EXPECTED, THEN THE
MARKET VALUE OF OUR STOCK MAY DECLINE.

      On September 19, 2005, we completed the purchase of the iCodemedia  Assets
from Philip  Gatch,  our Chief  Technology  Officer.  As  consideration  for the
iCodemedia  Assets,  we issued Mr. Gatch  1,000,000  shares of our common stock,
which  is  approximately   7.0%  of  our  currently   outstanding   shares.  The
consideration  for the acquisition  was determined by arms' length  negotiations
between non-interested members of our management and Mr. Gatch, but there was no
formal valuation of the subject assets by an independent third party. We did not
obtain a  fairness  opinion by an  investment  banking  firm or other  qualified
appraiser.  Since the  acquisition of the assets did not require the approval of
our stockholders, we are unable to determine whether our stockholders agree with
the  determination  by our board of directors that the terms of the  acquisition
are fair and in the stockholders' best interests.  If the consideration paid and
the actual value of the assets  acquired is less than expected,  then the market
value of our stock may decline.

THE NATURE OF OUR PROPOSED  PLAN OF OPERATION IS EXTREMELY  SPECULATIVE  AND OUR
SUCCESS AND POTENTIAL  PROFITABILITY DEPENDS ON A NUMBER OF FACTORS THAT ARE NOT
WITHIN OUR CONTROL.  ACCORDINGLY,  IT IS VERY DIFFICULT FOR ANYONE TO ACCURATELY
EVALUATE THE MERITS AND RISKS OF AN  INVESTMENT  IN US. THESE RISKS MAKE IT VERY
LIKELY THAT OUR SHARE PRICE COULD DECLINE.

      The success of our proposed plan of operation depends to a great extent on
the operations and financial  condition of a target business to combine with us.
While our management  would prefer  business  combinations  with entities having
established  operating  histories,  there  can be no  assurance  that we will be
successful  in locating a candidate  that meets such  criteria.  In the event we
complete a business combination - an event for which there can be no assurance -
the  success  of our  operations  will  depend  upon  management  of the  target
business, other risks inherent to business combination transactions and specific
risks to the type of business acquired, which cannot be determined at this time.
Acquisitions  involve numerous risks,  including  increased expenses and working
capital  requirements  and the potential  loss of key employees and customers of
acquired companies.  In addition,  acquisitions involve financial risks, such as
potential liabilities of the acquired business, dilutive effects of the issuance
of  additional  equity  securities,  the  incurrence  of  additional  debt,  the
financial  impact of transaction  expenses and the  amortization of goodwill and
other intangible  assets involved in any transactions  that are accounted for by
using the purchase method of accounting, and possible adverse tax and accounting
effects.  All of the foregoing  increase the  speculative  nature of our plan of
operation and make it difficult to  accurately  evaluate the merits and risks of
an investment in us. All of the foregoing  factors make it very likely that that
our share price could decline.

FAILURE TO PROPERLY MANAGE OUR POTENTIAL  GROWTH  POTENTIAL WOULD BE DETRIMENTAL
TO HOLDERS OF OUR SECURITIES.

      Since we currently  have no  operations  and our total assets at September
30,  2005  consisted  only of $338,939  in cash and  $195,730  in other  current
assets, any significant  growth will place considerable  strain on our financial
resources and increase  demands on our  management  and on our  operational  and
administrative systems, controls and other resources.  There can be no assurance
that our existing personnel, systems, procedures or controls will be adequate to
support  our  operations  in the future or that we will be able to  successfully
implement  appropriate measures consistent with our growth strategy.  As part of
this growth,  we may have to implement new  operational  and financial  systems,
procedures  and controls to expand,  train and manage our employees and maintain
close coordination among our technical,  accounting,  finance,  marketing, sales
and editorial  staff. We cannot guarantee that we will be able to do so, or that
if we are able to do so, we will be able to effectively  integrate them into our
existing  staff and systems.  We may fail to adequately  manage our  anticipated
future  growth.  We will also need to continue to attract,  retain and integrate
personnel  in all  aspects  of our  operations.  Failure  to manage  our  growth
effectively could hurt our business.


                                       12
<PAGE>

CONSUMMATION  OF A BUSINESS  COMBINATION  INVOLVING  THE  ISSUANCE OF OUR EQUITY
SECURITIES AS CONSIDERATION OR PARTIAL  CONSIDERATION  WILL DILUTE THE OWNERSHIP
AND VOTING INTERESTS OF OUR CURRENT STOCKHOLDERS.

      Our plan for a business combination may involve the issuance of our equity
securities as consideration, or partial consideration, for acquiring a business.
If we issue  significant  amounts of our equity  securities as consideration for
such a business  combination,  the ownership and voting interests of our current
stockholders will be materially diluted.

WE CURRENTLY  COMPETE FOR BUSINESS  COMBINATIONS WITH MANY LARGER COMPANIES THAT
HAVE GREATER  FINANCIAL AND OTHER RESOURCES THAN WE DO. THOSE  ADVANTAGES  COULD
MAKE IT DIFFICULT FOR US TO IDENTIFY A FEASIBLE ACQUISITION TARGET.

      We  are  and  will  continue  to be an  insignificant  participant  in the
business of seeking mergers with and  acquisitions  of business  entities and/or
assets.  A large number of established  and  well-financed  entities,  including
venture capital firms,  are active in mergers and  acquisitions of companies and
assets which may be merger or acquisition  target  candidates for us. Nearly all
such  entities  have  significantly   greater  financial  resources,   technical
expertise and managerial  capabilities  than us and,  consequently,  we are at a
competitive  disadvantage in identifying  possible  business  opportunities  and
successfully completing a business combination.

SEC REPORTING REQUIREMENTS MAY DELAY OR PRECLUDE ACQUISITION TARGETS.

      Sections  13  and  15(d)  of  the  Exchange  Act,  and  rules  promulgated
thereunder,  require  reporting  companies to provide certain  information about
significant acquisitions,  including audited financial statements for businesses
acquired,  covering one, two, or three years,  depending on the relative size of
the  acquisition.  New SEC rules and forms effective in August 2005 require that
reporting  companies  with  insignificant  operations  must  file  such  audited
financial  statements  with the SEC within four business days of completing  the
acquisition.  The time and additional  costs that may be incurred by some target
businesses  to prepare such  financial  statements  may  significantly  delay or
essentially preclude consummation of an otherwise desirable acquisition by us.

EXISTING TAX LAWS COULD RESULT IN THE IMPOSITION OF BOTH FEDERAL AND STATE TAXES
IN CONNECTION WITH A BUSINESS COMBINATION,  WHICH MAY HAVE AN ADVERSE EFFECT OUR
BUSINESS.

      Federal and state tax consequences will, in all likelihood, be significant
considerations in any business  combination  undertaken by us.  Currently,  such
transactions  may be  structured  so as to result in tax-free  treatment  to all
parties  involved,  pursuant to various federal and state tax laws. We intend to
structure any business  combination  so as to minimize the federal and state tax
consequences  to both us and  the  target  business.  However,  there  can be no
assurance that such business  combination will meet the statutory and regulatory
requirements  of a tax-free  reorganization  or that the parties will obtain the
intended tax-free treatment upon a transfer of stock or assets. A non-qualifying
reorganization  could result in the  imposition  of both federal and state taxes
which may have an adverse effect on both parties to the transaction.

IF WE DO NOT MAINTAIN THE CONTINUED  SERVICE OF OUR EXECUTIVE  OFFICERS,  WE MAY
NEVER DEVELOP BUSINESS OPERATIONS.

      Our  success  is  dependent  upon the  continued  service  of our  current
executive officers. To date, we have entered into a written employment agreement
only with Philip  Gatch,  our Chief  Technology  Officer,  and none of our other
executive officers. In addition, we do not have key man life insurance on any of
our executive  officers.  While none of our executive officers currently has any
definitive plans to retire or leave our company in the near future,  any of such
persons could decide to leave us at any time to pursue other opportunities.  The
loss of services of any of our executive  management team could adversely affect
the opportunity of a business combination for us.


                                       13
<PAGE>

                        RISKS RELATED TO OUR COMMON STOCK

OUR HISTORIC  STOCK PRICE HAS BEEN  VOLATILE AND THE FUTURE MARKET PRICE FOR OUR
COMMON STOCK IS LIKELY TO CONTINUE TO BE VOLATILE.  FURTHER,  THE LIMITED MARKET
FOR OUR SHARES WILL MAKE OUR PRICE MORE VOLATILE. THIS MAY MAKE IT DIFFICULT FOR
YOU TO SELL OUR COMMON STOCK FOR A POSITIVE RETURN ON YOUR INVESTMENT.

      The  public  market  for our  common  stock  has  historically  been  very
volatile.  Over the past two fiscal years, the market price for our common stock
as quoted on the OTC Bulletin Board has ranged from $0.01 to $1.37.  The closing
sale price for our common  stock on October  19,  2005 was $0.99 per share.  Any
future  market  price for our shares is likely to continue to be very  volatile.
This price volatility may make it more difficult for you to sell shares when you
want at prices you find attractive.  We do not know of any one particular factor
that has caused  volatility  in our stock  price.  However,  the stock market in
general has experienced  extreme price and volume  fluctuations  that have often
been unrelated or  disproportionate  to the operating  performance of companies.
Broad market  factors and the  investing  public's  negative  perception  of our
business may reduce our stock price,  regardless of our  operating  performance.
Further,  the market for our common  stock is limited  and we cannot  assure you
that a larger  market will ever be developed or  maintained.  The average  daily
trading volume of our common stock has historically been  insignificant.  Market
fluctuations and volatility,  as well as general economic,  market and political
conditions,  could  reduce  our  market  price.  As a  result,  this may make it
difficult or  impossible  for you to sell our common stock or to sell our common
stock for a positive return on your investment.

OUR  COMMON  STOCK IS  SUBJECT  TO THE  "PENNY  STOCK"  RULES OF THE SEC AND THE
TRADING MARKET IN OUR  SECURITIES IS LIMITED,  WHICH MAKES  TRANSACTIONS  IN OUR
STOCK CUMBERSOME AND MAY REDUCE THE VALUE OF AN INVESTMENT IN OUR STOCK.

      The SEC has adopted  Rule 3a51-1 which  establishes  the  definition  of a
"penny stock," for the purposes  relevant to us, as any equity security that has
a market  price of less than $5.00 per share or with an  exercise  price of less
than  $5.00 per  share,  subject  to  certain  exceptions.  For any  transaction
involving a penny stock, unless exempt, Rule 15g-9 requires:

      o     that a broker or dealer approve a person's  account for transactions
            in penny stocks; and
      o     the broker or dealer  receive from the investor a written  agreement
            to the  transaction,  setting forth the identity and quantity of the
            penny stock to be purchased.

      In order to approve a person's  account for  transactions in penny stocks,
the broker or dealer must:

      o     obtain financial information and investment experience objectives of
            the person; and
      o     make a  reasonable  determination  that  the  transactions  in penny
            stocks are  suitable  for that person and the person has  sufficient
            knowledge  and  experience  in  financial  matters  to be capable of
            evaluating the risks of transactions in penny stocks.

      The broker or dealer  must also  deliver,  prior to any  transaction  in a
penny stock, a disclosure  schedule  prescribed by the SEC relating to the penny
stock market, which, in highlight form:

      o     sets  forth  the  basis on  which  the  broker  or  dealer  made the
            suitability determination; and
      o     that the broker or dealer received a signed,  written agreement from
            the investor prior to the transaction.

      Disclosure  also has to be made  about  the  risks of  investing  in penny
stocks  in  both  public  offerings  and in  secondary  trading  and  about  the
commissions payable to both the broker-dealer and the registered representative,
current  quotations for the securities and the rights and remedies  available to
an  investor  in cases of fraud in penny stock  transactions.  Finally,  monthly
statements  have to be sent  disclosing  recent price  information for the penny
stock held in the account and information on the limited market in penny stocks.


                                       14
<PAGE>

      Generally,  brokers  may  be  less  willing  to  execute  transactions  in
securities  subject to the "penny stock" rules.  This may make it more difficult
for  investors  to dispose of our common stock and cause a decline in the market
value of our stock.

Item 3.   Controls and Procedures.

      As of the end of the  period  covered  by this  report,  we  conducted  an
evaluation,  under  the  supervision  and with the  participation  of our  chief
executive  officer and chief  financial  officer of our disclosure  controls and
procedures  (as defined in Rule  13a-15(e)  and Rule  15d-15(e)  of the Exchange
Act).  Based  upon  this  evaluation,  our  chief  executive  officer  and chief
financial  officer  concluded  that our  disclosure  controls and procedures are
effective to ensure that all  information  required to be disclosed by us in the
reports that we file or submit under the  Exchange Act is: (1)  accumulated  and
communicated to our management,  including our chief executive officer and chief
financial officer,  as appropriate to allow timely decisions  regarding required
disclosure;  and (2) recorded,  processed,  summarized and reported,  within the
time periods specified in the Commission's  rules and forms. There was no change
in our internal  controls or in other  factors that could affect these  controls
during our last fiscal  quarter that has materially  affected,  or is reasonably
likely to materially affect, our internal control over financial reporting.

                                     PART II

Item 1.   Legal Proceedings.

      We are not a party to any pending  legal  proceeding,  nor is our property
the subject of a pending legal  proceeding.  None of our directors,  officers or
affiliates is involved in a proceeding adverse to our business or has a material
interest adverse to our business.

Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds.

      On July 20, 2005, as consideration  for service on our Board of Directors,
we granted to each of Melanie Glazer, Alice M. Campbell, Darrell Grimsley, Lynne
Silverstein  and William B. Horne options to purchase  250,000  shares of common
stock with an exercise  price of $0.25 per share.  These stock options will vest
quarterly  over two years,  with the first 31,250  options of each grant to vest
September  30,  2005.  The  issuance  of these  stock  options  was exempt  from
registration  requirements  pursuant to Section  4(2) of the  Securities  Act of
1933, as amended (the "Securities Act").

      On July 20, 2005,  as  consideration  for service as Chairman of our Audit
Committee,  we granted Ms. Campbell options to purchase 100,000 shares of common
stock with an exercise  price of $0.25 per share.  These stock options will vest
quarterly  over two years,  with the first 12,500  options to vest September 30,
2005.  The  issuance  of  these  stock  options  was  exempt  from  registration
requirements pursuant to Section 4(2) of the Securities Act.

      On July 20, 2005,  as  consideration  for service as a member of our Audit
Committee,  we granted Ms.  Glazer  options to purchase  50,000 shares of common
stock with an exercise  price of $0.25 per share.  These stock options will vest
quarterly  over two years,  with the first 6,250  options to vest  September 30,
2005.  The  issuance  of  these  stock  options  was  exempt  from  registration
requirements pursuant to Section 4(2) of the Securities Act.

      On July 20,  2005,  as  consideration  for service as our Chief  Executive
Officer,  we granted Mr. Ault  options to  purchase  2,000,000  shares of common
stock  with an  exercise  price of $0.25 per share.  These  stock  options  vest
quarterly over two years,  with the first 250,000  options to vest September 30,
2005.  On September 30, 2005,  we  accelerated  the vesting of such options such
that options to purchase  475,000  shares of common  stock  vested  immediately.
Further, such 475,000 options will be exercisable by Mr. Ault for a period of 18
months from the date of closing of the proposed acquisition of all of the issued
and outstanding  shares of capital stock of Rebel Crew Films, Inc., a California
corporation. The remaining options to purchase 1,525,000 shares of common stock,
to the extent not vested in accordance with the initial grant, will be cancelled
upon completing the acquisition of Rebel Crew Films,  Inc. The issuance of these
stock options was exempt from registration requirements pursuant to Section 4(2)
of the Securities Act.


                                       15
<PAGE>

      On July 20,  2005,  as  consideration  for  service  as our  President  of
Operations,  we granted  Kathryn  Queen  options to purchase  750,000  shares of
common stock with an exercise price of $0.25 per share. These stock options will
vest quarterly  over two years,  with the first 93,750 options to vest September
30, 2005. Also on July 20, 2005, as an incentive  bonus,  subject to the earlier
to occur of us obtaining a market  capitalization of $25 million at December 31,
2006,  or  prior to  December  31,  2006,  if we  obtain,  and  maintain  for 21
consecutive days, a market capitalization of $25 million, we agreed to grant Ms.
Queen options to purchase  750,000  shares of common stock.  These stock options
will vest  quarterly  over four years from the date of grant.  The  issuance  of
these  stock  options  was exempt  from  registration  requirements  pursuant to
Section 4(2) of the Securities Act.

      On July 20, 2005,  as  consideration  for service as our Chief  Technology
Officer,  we granted  Philip Gatch options to purchase  250,000 shares of common
stock with an exercise  price of $0.25 per share.  These stock options will vest
in equal amounts on July 20, 2005, 2006 & 2007, with the first 83,333 options to
vest July 20, 2005. Also on July 20, 2005, we agreed to issue  restricted  stock
valued at $12,500  quarterly  during the  three-year  term of his  employment as
Chief  Technology  Officer.  The issuance of these stock options was exempt from
registration requirements pursuant to Section 4(2) of the Securities Act.

      On July 20,  2005,  as  consideration  for service as our Chief  Financial
Officer, we granted Mr. Horne options to purchase 250,000 shares of common stock
with an  exercise  price of $0.25  per  share.  These  stock  options  will vest
quarterly  over two years,  with the first 31,250  options to vest September 30,
2005.  The  issuance  of  these  stock  options  was  exempt  from  registration
requirements pursuant to Section 4(2) of the Securities Act.

      On July 20,  2005,  as  consideration  for service as our  Controller,  we
granted Jeanne Olsky options to purchase  100,000 shares of common stock with an
exercise price of $0.25 per share.  These stock options will vest quarterly over
two  years,  with the first  12,500  options to vest  September  30,  2005.  The
issuance  of these  stock  options  was exempt  from  registration  requirements
pursuant to Section 4(2) of the Securities Act.

      On July 20, 2005, as consideration for service as our Corporate Secretary,
we granted Ms.  Silverstein  options to purchase  150,000 shares of common stock
with an  exercise  price of $0.25  per  share.  These  stock  options  will vest
quarterly  over two years,  with the first 18,750  options to vest September 30,
2005.  The  issuance  of  these  stock  options  was  exempt  from  registration
requirements pursuant to Section 4(2) of the Securities Act.

      On  September  19,  2005,  we  purchased  certain  assets  from Mr.  Gatch
consisting of the iCodemedia  suite of websites and internet  properties and all
related intellectual property (the "iCodemedia Assets"). The iCodemedia suite of
websites  consists  of  the  websites   www.icodemedia.com,   www.iplaylist.com,
www.tunecast.com, www.tunebucks.com, www.podpresskit.com and www.tunespromo.com.
As consideration for the iCodemedia Assets, we issued Mr. Gatch 1,000,000 shares
of our common  stock.  The issuance of these shares to Mr. Gatch was exempt from
registration  requirements  pursuant to Section 4(2) of the  Securities  Act and
Rule 506 promulgated thereunder.

      On  September  30,  2005,  we granted  Jay Rifkin,  as interim  President,
options to purchase  4,400,000  shares of common stock with an exercise price of
$0.85 per share,  which stock  options will vest annually over a period of three
years from the date of closing of the proposed  acquisition of all of the issued
and  outstanding  shares of  capital  stock of Rebel  Crew  Films,  Inc.  If the
acquisition  of Rebel Crew Films,  Inc. is not  completed,  such options will be
cancelled. The grant of these options was exempt from registration  requirements
pursuant  to  Section  4(2) of the  Securities  Act  and  Rule  506  promulgated
thereunder.


                                       16
<PAGE>

      On September 30, 2005, we granted Cesar Chatel, as President of Rebel Crew
Films, Inc., options to purchase 800,000 shares of common stock with an exercise
price of $0.85 per share,  which stock  options will vest annually over a period
of three years from the date of closing of the  proposed  acquisition  of all of
the issued and outstanding  shares of capital stock of Rebel Crew Films, Inc. If
the acquisition of Rebel Crew Films, Inc. is not completed, such options will be
cancelled. The grant of these options was exempt from registration  requirements
pursuant  to  Section  4(2) of the  Securities  Act  and  Rule  506  promulgated
thereunder.

      On September 30, 2005, we granted Oscar  Carreno,  as Director of Sales of
Rebel Crew Films,  Inc., options to purchase 150,000 shares of common stock with
an exercise  price of $0.85 per share,  which stock  options will vest  annually
over a period of four years from the date of closing of the  acquisition  of all
of the issued and outstanding  shares of capital stock of Rebel Crew Films, Inc.
If the acquisition of Rebel Crew Films, Inc. is not completed, such options will
be  cancelled.   The  grant  of  these  options  was  exempt  from  registration
requirements  pursuant  to  Section  4(2) of the  Securities  Act and  Rule  506
promulgated thereunder.

      On September 30, 2005, we granted Ian Monsod,  as Manager of Operations of
Rebel Crew Films,  Inc., options to purchase 125,000 shares of common stock with
an exercise  price of $0.85 per share,  which stock  options will vest  annually
over a period of four years from the date of closing of the  acquisition  of all
of the issued and outstanding  shares of capital stock of Rebel Crew Films, Inc.
If the acquisition of Rebel Crew Films, Inc. is not completed, such options will
be  cancelled.   The  grant  of  these  options  was  exempt  from  registration
requirements  pursuant  to  Section  4(2) of the  Securities  Act and  Rule  506
promulgated thereunder.

      On November 11, 2005,  we issued  530,000  shares of common stock to Aegis
Equity  LLC.  On the same date we also  issued  Aegis  Equity  LLC  warrants  to
purchase  300,000  shares of common  stock with an  exercise  price of $0.65 per
share  exercisable  for a term of five years.  These  shares of common stock and
warrants  were  issued as  compensation  for  investor  relations  and  advisory
services in connection with our proposed  acquisition of Rebel Crew Films,  Inc.
The  issuance  of these  securities  was exempt from  registration  requirements
pursuant to Section 4(2) of the Securities Act.

Item 3.   Defaults Upon Senior Securities.

      Not applicable.

Item 4.   Submission of Matters to a Vote of Security Holders.

      Not applicable.

Item 5.   Other Information.

      On November 11, 2005,  we entered into a consulting  agreement  with Aegis
Equity LLC. Such services include M&A advisory  services related to the proposed
acquisition of Rebel Crew Films, Inc. and certain loans receivable of Rebel Crew
Holdings LLC, including performance and coordination of due diligence, advice on
integration,   legal  affairs,   and  communications   advisory   services.   As
consideration  for such  services  we agreed to issue  Aegis  Equity LLC 530,000
shares of common stock and warrants to purchase  300,000  shares of common stock
with an exercise  price of $0.65 per share.  In addition,  one of our  principal
stockholders,  Patient Safety Technologies, Inc., agreed to pay Aegis Equity LLC
cash  from  the  sale  of  100,000  shares  of our  common  stock  held  by such
stockholder. The consulting agreement terminates immediately upon the earlier of
120 days from execution, mutual written agreement among the parties to terminate
or a breach by either party of the consulting  agreement.  The above  securities
will be issued pursuant to an exemption from registration  requirements provided
by Section 4(2) of the Securities Act of 1933, as amended.


                                       17
<PAGE>

Item 6.   Exhibits.

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

3.1               Bylaws  (Incorporated by reference to Digicorp's  registration
                  statement  on Form 10-SB (File No.  000-33067)  filed with the
                  Securities and Exchange Commission on August 9, 2001)
3.2               Amendment  No.  1 to  Bylaws  (Incorporated  by  reference  to
                  Digicorp's  Form 8-K filed with the  Securities  and  Exchange
                  Commission on July 21, 2005)
10.1              Binding Letter of Intent to purchase iCodemedia Assets,  dated
                  July 15, 2005,  among Digicorp and Philip Gatch  (Incorporated
                  by reference to Digicorp's  Form 8-K filed with the Securities
                  and Exchange Commission on July 21, 2005)
10.2              Asset Purchase  Agreement made as of September 19, 2005 by and
                  among Digicorp and Philip Gatch  (Incorporated by reference to
                  Digicorp's  Form 8-K filed with the  Securities  and  Exchange
                  Commission on September 22, 2005)
10.3              Employment Agreement effective as of September 20, 2005 by and
                  between  Digicorp and Philip Gatch  (Incorporated by reference
                  to Digicorp's  Form 8-K filed with the Securities and Exchange
                  Commission on September 22, 2005)
10.4              Consulting  Agreement  entered  into  November  11, 2005 among
                  Digicorp,  Aegis Equity LLC and Patient  Safety  Technologies,
                  Inc.
99.1              Letter of Intent to purchase the outstanding  capital stock of
                  Rebel  Crew  Films,   Inc.  dated  September  30,  2005  among
                  Digicorp, Rebel Crew Films, Inc. and the stockholders of Rebel
                  Crew Films, Inc. (Incorporated by reference to Digicorp's Form
                  8-K filed  with the  Securities  and  Exchange  Commission  on
                  October 5, 2005)
99.2              Term Sheet dated  September 30, 2005 among  Digicorp and Rebel
                  Holdings,  LLC  (Incorporated  by reference to Digicorp's Form
                  8-K filed  with the  Securities  and  Exchange  Commission  on
                  October 5, 2005)
31.1              Certification  by Chief Executive  Officer and Chief Financial
                  Officer,  required by Rule  13a-14(a) or Rule 15d-14(a) of the
                  Exchange Act
32.1              Certification  by Chief Executive  Officer and Chief Financial
                  Officer,  required by Rule  13a-14(b) or Rule 15d-14(b) of the
                  Exchange Act and Section 1350 of Chapter 63 of Title 18 of the
                  United States Code


                                       18
<PAGE>

                                   SIGNATURES

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

                                             DIGICORP


      Dated: November 14, 2005               By: /s/ William B. Horne
                                                 -------------------------------
                                                 William B. Horne
                                                 Chief Executive Officer, Chief
                                                 Financial Officer and Principal
                                                 Accounting Officer


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