UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549  FORM 10-KSB  (Mark One) [X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2007  [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from               to
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Commission file number: 000-24835

LEGEND MOBILE, INC.
(Name of small business issuer in its charter)

DELAWARE                                      38-3399098
(State or other jurisdiction of             (I.R.S. Employer Identification No.)   incorporation or organization)  244 Fifth Avenue Ste. P203 New York, New York 10001 (Address of principal executive offices) (Zip Code)  Issuer's telephone number: (212) 252-2459  Securities registered under Section 12(b) of the Exchange Act: NONE  Securities registered under Section 12(g) of the Exchange Act:  COMMON STOCK, $0.001 PAR VALUE (Title of class)  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 [ ]  Check if no disclosure of delinquent filers in response to Item 405 of Regulation S-B is contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [X]        State issuer's revenues for its most recent fiscal year: $ 1,164  State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of a specified date within the past 60 days: $  733,088 AS OF MARCH 31, 2008  State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 73,308,869 AS OF April 1, 2008  Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]   PART I   ITEM 1. DESCRIPTION OF BUSINESS.  CAUTIONARY STATEMENT FOR PURPOSES OF "SAFE HARBOR PROVISIONS" OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.  Certain statements contained in this Annual Report on Securities and Exchange Commission ("SEC") Form 10-KSB ("Form 10-KSB") constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different than any expressed or implied by these forward-looking statements. These statements may be contained in our filings with the Securities and Exchange Commission, press releases, and written or oral presentations made by our representatives to analysts, rating agencies, stockholders, news organizations and others. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "intend", "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," "continue," or the negative of these terms or other comparable terminology. Although we believe that the expectations in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.  OUR BUSINESS  We are a developer and marketer SMS services, and mobile data applications. Through our subsidiary Legend Credit, Inc. (which we own 50%), we also develop and market filmed entertainment products related to mixed martial arts and combat sports.  Through our 91% subsidiary, Legend Studios, Inc., , we have entered into a letter of intent to acquire the Midnight Movies Group. a producer of feature motion pictures.  OUR SOURCES OF REVENUE  SALES OF MOBILE PRODUCTS  We derive limited revenues from the sale of mobile phone services. We currently operate a free SMS service called www.mmasms.com. This service allows users to send text messages for free to mobile phones. We intend to derive revenue by paid advertising on our site. To date, we have derived no revenue from this service.      We also own the domain names www.hollywoodfone.com and www.poker2cell.com.  We intend to offer similar branded services for mobile phone SMS services.  We also intend to market premium SMS services through short codes. Short codes are special telephone numbers that are designed to be shorted to read out and easier to remember. Short codes are unique to each operator. We expect to use short codes to develop value added services such as television voting and order premium content. We expect to bill at a higher rate for these services.  SALES OF MIXED MARTIAL ARTS PRODUCTS.  Through Legend Credit, we are developing television, DVD, and Internet programming based on mixed martial arts.  In October 2007, we taped an event called Champion CageFighters.  We are currently exploring opportunities to monetize this footage.   The MMA market is fragmented. According to MMA Weekly, the Ultimate Fighting Championship currently holds the first mover advantage and is the preeminent entity in the sport. In 2001, UFC was purchased from Semaphore Entertainment Group by ZUFFA, LLC, which is headed by Stations Casinos owners Frank Fertitta and Lorenzo Fertitta. The first event sold less than 4,000 tickets and took in just over $215,000 at the gate. A recent December 30, 2006 event sold approximately 12,000 tickets and took in over
$5.3 million at the gate. The Ultimate Fighting Championship's pay-per-view numbers also continue to rise, exemplifying the sport's increased popularity. UFC is now consistently doing pay-per-view business
on a similar level as big-time boxing. UFC has exceeded World Wrestling Entertainment in domestic orders. The Randy Couture-Chuck Liddell show in February 2006, which originally projected at 350,000 pay-per-view buys, is now estimated to top 400,000 buys. The final buy rate for the UFC 60 event
will be in the range of 615,000 to 625,000 pay-per-view buys and the gross pay-per-view revenue will be approximately $25 million. The initial buy rate estimate for UFC 61 is expected to top 775,000 buys which equals to approximately $31 million in gross pay-per-view revenue. UFC recently announced its intent to acquire PRIDE, a popular mixed martial arts company based in Japan. Other notable participants in the MMA market include ProElite, K-1, King of the Cage and Cage Rage.  In July 2007, we entered into a letter of intent with Ultimate Combat Inc. to develop television programming around its mixed martial arts events. We have not yet entered into a definitive agreement with Ultimate Combat Inc. and  are still in negotiations.  We are exploring other opportunities to develop television, Internet, and DVD products through licensing of existing events.  We have discontinued marketing prepaid and stored value cards.      MARKETING AND PROMOTION OF MOBILE PHONE PRODUCTS        We continually evaluate numerous ways to reach our potential customers and to promote our products. We intend  to promote our products through the following means  -Alternative ways of advertising such as My Space and You Tube; -Free products and promotions to early adopters and key influencers; -Sponsorship of events and onsite marketing to reach targeted demographics.   MARKETING AND PROMOTION OF MIXED MARTIAL ARTS PRODUCTS  We evaluate numerous ways to reach potential customers to promote our mixed martial arts products. We intend to promote our products through a number of avenues including:  1. Affinity relationships. We seek to develop programming that has a regional following and  that have a large base of customers to market to.  2. Co-marketing with brand partners and other licensees.  3. Public Relations. We anticipate adopt a very aggressive posture towards public relations for the launch of our card products.  4. Internet Marketing. We will use traditional and emerging methods to reach the emerging audience for mixed martial arts on the Internet.  5. Event Marketing. We look for opportunities to drive sales of our products at live events including fights, shopping malls, and fighter appearances  Do you have any info on the industry or competition?     RISKS THAT MAY AFFECT FUTURE RESULTS  The following risk factors and other information included in this Annual Report should be carefully considered. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business operations. If any of the following risks actually occur, our business, financial condition and operating results could be materially adversely affected.   WE HAVE AN ACCUMULATED DEFICIT AND ANTICIPATE FURTHER LOSSES.  We have incurred significant losses since we began doing business. For the year ended December 31, 2007 we incurred a net loss of 41,110,823.  There can be no assurance that our services and products will ever generate sufficient revenues or that our operations will ever be profitable. As of December 31, 2007, we had an accumulated deficit of$20,438,974_ We expect to incur operating losses for the near future until we can generate sufficient sales to cover our operating expenses.  We have generated limited revenues to date from the business we conduct and there can be no     assurance that we will ever generate sufficient revenues from the business we conduct to cover all of our operating expenses. We also expect to significantly increase our operating expenses to expand our sales and marketing operations, to fund greater levels of product development, and to develop other forms of revenue generating business and licensing of our proprietary materials to others.  WE RECEIVED AN OPINION FROM OUR ACCOUNTANTS FOR THE PERIOD ENDED DECEMBER 31, 2007, WHICH RAISED DOUBT ABOUT OUR ABILITY TO CONTINUE AFTER SUCH DATE AS A GOING CONCERN.  Our consolidated financial statements for the year ended December 31, 2007, which are included in this Form 10-KSB, indicate that there was substantial doubt as of December 31, 2007 about our ability to continue as a going concern due to our need to generate cash from operations and obtain additional financing. We have had a going concern opinion from our auditors since our inception in 1997.    WE NEED TO RAISE ADDITIONAL FUNDS TO FUND OUR BUSINESS OPERATIONS.  We need to raise additional funds because our cash flows have proven to be insufficient to fund operations, including our obligations to pay minimum royalties under our agreements. Several of our trade creditors and licensors have outstanding balances and may elect to sue to recover their amounts owed. Management feels that these can be defended or settled on favorable terms. There can be no assurance that additional financing will be available to us on commercially reasonable terms, or at all. We may raise funds through equity or debt financings, depending on our opportunities. If we raise additional funds by issuing equity securities, this will further dilute the interests of our current stockholders. If we raise additional funds by issuing debt securities, we will be subject to the risks associated with incurring substantial indebtedness, including the risks that interest rates may fluctuate and cash flow may be insufficient to pay principal and interest on any such indebtedness. We have no current arrangements with respect to, or sources of, additional financing, and it is not anticipated that our existing stockholders will provide any portion of our future financing requirements.  WE MAY NOT BE ABLE TO COMPETE SUCCESSFULLY IN THE MOBILE PHONE, MOBILE ACCESSORY, MOBILE DATA AND GAMING, AND OPERATING SYSTEM SOFTWARE MARKETS. THIS WOULD HAVE A MATERIAL ADVERSE EFFECT ON OR BUSINESS, RESULTS OF OPERATIONS AND FINANCIAL CONDITION.  As we attempt to expand into the mobile services software markets, our future growth will depend on the commercial success of our branded accessory products. The markets for these products and services are highly competitive and we expect competition to increase in the future. Most of our competitors in this market have significantly greater financial, technical and marketing resources than we do. This will make it difficult for us to compete successfully in the hand-held device and operating system software markets.  WE MAY NOT BE ABLE TO COMPETE SUCCESSFULLY IN THE MARTIAL ARTS  INDUSTRY.  In an attempt to diversify our business, we have entered into the mixed martial arts industry.  However, we have no prior experience in this industry. To date we have not derived any revenue       form the sale of mixed martial art products.  In order to compete successfully in this industry we will need to increase our brand recognition. The markets for these products and services are highly competitive and we expect competition to increase in the future. Most of our competitors in this market have significantly greater financial, technical and marketing resources than we do.  There can be no assurance that we will be able to develop brand recognition of our products in this industry or compete successfully.  THE LOSS OF OUR CHIEF EXECUTIVE OFFICER'S SERVICES WOULD HAVE A MATERIAL ADVERSE EFFECT ON US.  Our success will be largely dependent on the efforts of Peter Klamka, our Chairman, President and Chief Executive Officer, and his ability to forge new relationships with celebrities and to maintain such relationships, as well as to oversee the development and maintenance of our products. Our success will also be highly dependent on Mr. Klamka's ability, as well as the ability of others employed by us, to successful market new products and develop new products. The loss of his services would have a material adverse effect on our business and prospects.  We have not entered into an employment agreement with Mr. Klamka and Mr. Klamka has not entered into any agreement restricting his involvement in a business which competes with us. As a result, Mr. Klamka is an employee-at-will and has the right to leave us at any time. Mr. Klamka has informed us that he intends to devote a portion of his working time to our business and that he also intends to devote a portion of his time to other business interests that do not compete with our business. In addition, Mr. Klamka is not restricted from entering into a competing business after the term of his employment with us; provided, however, that he would not be permitted to use proprietary information and trade secrets belonging to us. Our success will also be dependent upon our ability to hire and retain marketing, financial and other personnel. Competition for qualified personnel is intense and there can be no assurance that we will be able to hire or retain additional qualified personnel. The loss of our Chief Executive Officers service would have a material adverse effect on us .  EMPLOYEES  As of December 31, 2007, we had a total of one full-time employee. None of our employees is covered by a collective bargaining agreement.    ITEM 2. DESCRIPTION OF PROPERTY.  We currently maintain our executive offices, consisting of  an executive office suite at 244 Fifth Avenue , Suite P203 in New York, New York . The monthly rent is variable based on usage and is renewable annually.   ITEM 3. LEGAL PROCEEDINGS.  The company is party to legal proceedings from time to time. None of the legal proceedings in managements opinion would have an adverse material impact on the company.  On June 14, 2005, Betty Brown Revocable Trust (the Trust) by and through Betty Brown, trustee, Betty Brown individually, and Nancy Larson filed suit in the Iowa District Court for Polk County, Iowa, against Legend Mobile and Peter Klamka, our CEO.  On January 10, 2007, the case against Legend Mobile and Peter Klamka was dismissed.      There are several judgments against our company that could effect our operations.    ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.  None.   PART II   ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.   MARKET INFORMATION  Our common stock is traded on NASD Electronic Bulletin Board under the symbol LGMB. Prior to July 5, 2002, it traded under the symbol PTMN. The following table sets forth the range of high and low bid quotations for each of the prior eight (8) fiscal quarters. The quotations represent inter-dealer quotations without adjustment for retail mark-ups, mark-downs or commissions and may not represent actual transactions.  FISCAL QUARTER ENDING                      HIGH BID          LOW BID

March 31, 2006.......................       $   0.06         $   0.06
June 30, 2006........................       $   0.08         $   0.08
September 30, 2006...................       $   0.04         $  0.039
December 31, 2006....................       $   0.05         $   0.04

March 31, 2007.......................       $   0.03         $   0.03
June 30, 2007........................       $   0.03         $   0.03
September 30, 2007...................       $   0.03         $  0.03
December 31, 2007....................       $   0.01         $   0.01    On April  9, 2007, the closing bid price for the common stock on the OTC Bulletin Board was $0.005  HOLDERS  As of March 31, 2008 there were 153 record holders of our common stock. This does not include shares held in street names.  DIVIDENDS  Since our inception, no cash dividends have been declared on our common stock.  SALES OF UNREGISTERED SECURITIES         ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.  FORWARD LOOKING STATEMENTS  This report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Shareholders are cautioned that all forward-looking statements involve risks and uncertainty, including without limitation, our ability to fully establish our proposed websites and our ability to conduct business with Palm, Inc. and be successful in selling products. Although we believe the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore, there can be no assurance that the forward-looking statements contained in the report will prove to be accurate.  GENERAL  The following discussion and analysis should be read in conjunction with our consolidated financial statements and related footnotes for the year ended December 31, 2007 elsewhere in this Annual Report on Form 10-KSB. The discussion of results, causes and trends should not be construed to imply any conclusion that such results or trends will necessarily continue in the future.  We were incorporated in Delaware on January 13, 1998 and are the successor to Interactive Entertainment Studio, Inc. (IES). IES was incorporated in the State of Nevada on May 27, 1997 and was merged into us in March 1998 for the sole purpose of changing the domicile of the company to Delaware. This merger was retroactively reflected in the December 31, 1997 financial statements. On June 27, 2002 we changed our name to Legend Mobile, Inc.  We are a developer and marketer of branded mobile phone products including faceplates, phone accessories, SMS services, and mobile data applications. Through our subsidiary Legend Credit, Inc. (which we own 50%), we also develop and market recorded entertainment programs related to mixed martial arts and combat sports.  Since our inception, we have incurred net losses of $20599,430 and at December 31, 2007 current liabilities exceeded current assets by $4,349,696. In addition, we are delinquent in certain payments due for license fees and notes payable. We may be unable to continue in existence unless we are able to arrange additional financing and achieve profitable operations. We plan to raise additional capital and expect to generate cash from the sale of the our SMS services and our mixed martial arts video products.  On December 29, 2000, we entered into a three-year license agreement with Michael Jordan, the National Basketball Association player, granting us the right to use Mr. Jordan's name, likeness and image in connection with the proposed advertisement, promotion and sale of certain branded Palm Inc. products, including the Palm Pilot series. In addition to the standard features of Palm products, we planned that the Michael Jordan edition include branding, identification and software applications that will appeal to the market segment associated with Mr. Jordan. On June 27, 2002, we entered into a settlement agreement with Michael Jordan pursuant to the aforementioned three year agreement. The settlement calls for us to pay Mr. Jordan $468,750, discontinue making any reference to Jordan's name, image, likeness and endorsement, and returning any products associated with Mr. Jordan's name. As a result of this settlement agreement, we have recognized a gain of $111,662 which was included in selling, general and administrative expenses in the statement of operations for the year ended December 31, 2002.     This gain resulted by removing the remaining license fee payable of $625,000, offset by the $468,750 accrual to settle the agreement and the return of $44,588 in inventory. The amount due to Mr. Jordan was to be paid $234,375 in October 2002 and the remaining $234,375 in January 2003. We have not made the payment due in October 2002 or the payment due in January 2003. Since we are in default on the amounts due to Mr. Jordan, we have accrued interest in accordance with the terms of the contract. update  Our business model is to grow in the area of mobile content and mixed martial arts programming. This business model includes seeking to obtain licenses with well-known motor entertainment figures, develop large promotional programs that permit us to market our products more effectively and develop other distribution channels. We also intend to license broadcast and DVD rights to mixed martial arts events.  We currently offer a free computer to SMS service called www.mmasms.com. We also own domain names for two services called www.hollywoodfone.com and www.poker2cell.com. .  We are also developing video programming aimed at fans of mixed martial arts.  Significant Accounting Policies and Estimates  Management's Discussion and Analysis of Financial Condition and Results of Operations discusses the Company's consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management bases its estimates and judgments on historical experiences and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The most significant accounting estimates inherent in the preparation of the Company's financial statements relate to the allowance for doubtful accounts. These accounting policies are described at relevant sections in this discussion and analysis and in the notes to the consolidated financial statements included in this Annual Report on Form l0-KSB for the year ended December 31, 2007.   Results of Operations  Year ended December 31, 2007 vs. December 31, 2006
Revenue for the year ended December 31, 2007 increased by $672 or 136 %
from $492  for the year ended December 31, 2006 to $1,164 for the year ended December 31, 2007. Revenue for the year ended December 31, 2006 was principally from sale of the Hello Kitty Debit card. Revenue for the year ended December 31, 2007 was from sales of the Apprentice Debit card.
Cost of revenue for the year ended December 31, 2006 increased by 92 from $0 for the year ended December 31, 2006 to $92 for the year ended December 31, 2007. This is a direct result of the increase in revenue. Cost of revenue as a percentage of revenue was 8% and 0% for the year ended December 31, 2007 and 2006, respectively.       Product development costs for the year ended December 31, 2006 decreased from   from $1,450 for the year ended December 31, 2006 to $0 for the year ended December 31, 2007. This is related to the Apprentice Debit card
Selling, general and administrative expenses for the year ended December 31, 2007 increased by $366,267 or 124% from $294,631 for the year ended December 31, 2006 to $660,898 for the year ended December 31, 2007. A majority of selling, general and administrative expenses in 2007 are related to professional and consulting fees paid with shares of our common stock.
Interest expense and financing costs for the year ended December 31, 2007 increased by $52,029 or 18% from $288,771 for the year ended December 31, 2006 to $340,800   for the year ended December 31, 2007. The difference is principally due to interest on notes payable
Equity loss in Legend Credit, Inc. was $0 for both the year ended December 31, 2006 and 2007. We own a 50% interest in Legend Credit, who started selling Hilary Duff Visa gift card in October 2003, and the Hello Kitty Debit MasterCard in September 2004. We account for Legend Credit using the equity method
and have recorded 50% of Legend Credits loss in our consolidated statements of operations.  Net loss for the year ended December 31, 2007 was $1,271,279 as compared with $632,548 for the year ended December 31, 2006.  The loss was attributable primarily to the increase in selling, general and administrative expenses.  LIQUIDITY AND CAPITAL RESOURCES  In 2007, we raised $0 from the sale of our common stock.  We have incurred net losses since our inception of $20,599,430. In order for us to continue in existence, we will have to raise additional capital through the sale of equity or debt or generate sufficient profits from operations, or a combination of both.   ITEM 7. FINANCIAL STATEMENTS.  See pages beginning with page F-1.   ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.  None    ITEM 8A(T).  CONTROLS AND PROCEDURES  Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that:      Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;  Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorization of our management and directors; and  Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisitions, use or disposition of our assets that could have a material effect on the financial statements.  Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations.  It is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures.  It also can be circumvented by collusion or improper management override.  Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting.  However, these inherent limitations are known features of the financial reporting process.  Therefore, it is possible to design into the process certain safeguards to reduce, thought not eliminate, this risk.  Management is responsible for establishing and maintaining adequate internal control over our financial reporting.  Management has used the framework set forth in the report entitled Internal Control  Integrated Framework published by the Committee of Sponsoring Organizations of the Treadway Commission, known as COSO, to evaluate the effectiveness of our internal control over financial reporting.  Based upon this assessment, management has concluded that our internal control over financial reporting was effective as of and for the year ended December 31, 2007 with the following exceptions:   As a part of our year end review of our disclosure controls and procedures, we determined that several of our procedures require additional documentation.  It is our belief that those control procedures are being performed, however documentation of their execution is not available.  We are implementing additional documentation procedures in order to address this weakness.  Management has concluded that other than as described above, our internal control over financial reporting was effective as of and for the year ended December 31, 2007.  The Company is not an accelerated filer for the 2006 fiscal year because it is qualified as a small business issuer. Hence, under current law, the internal controls certification and attestation requirements of Section 404 of the Sarbanes-Oxley act will not apply to the Company. This  Annual report on Form 10-KSB does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting.  Managements report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities Exchange Commission that permit us to provide only managements report in this Annual Report on Form 10-KSB.   PART III         ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.   DIRECTORS AND EXECUTIVE OFFICERS  Our executive officers and directors are:  NAME                 AGE     POSITION
----                 ---     --------

Peter Klamka          39     Chairman of the Board, CEO, President,
Treasurer & Secretary    The business experience, principal occupations and employment, as well as the periods of service, of our sole director and executive officer during the last five years are set forth below.  Peter Klamka has been our Chairman of the Board and Chief Executive Officer since our inception in May 1997. In 1994, Mr. Klamka founded Wilshire Fragrance, a company that developed and marketed men's fragrance products. Mr. Klamka was the chief executive officer of Wilshire Fragrance from 1994 through 1996. In connection with his fragrance business, in 1996, Mr. Klamka developed, what he believes to have been one of the first authorized celebrity web sites, featuring Anna Nicole Smith promoting fragrances for Wilshire Fragrance. Mr. Klamka continued working on this web site until early 1997. Mr. Klamka received his Bachelor of Arts degree from the University of Michigan.  EMPLOYMENT AND CONSULTING AGREEMENTS  We have no employment or other written agreement with Peter Klamka, our President and Chief Executive Officer. Mr. Klamka has an oral agreement with the Company to receive a base salary of $175,000 per year and such other compensation as the Board of Directors shall designate. The Company believes that Mr. Klamka will continue to waive a portion of the base salary for the foreseeable future, although no assurance thereof can be given.  Mr. Klamka is involved in other business ventures, including the ownership and management other private businesses.  Mr. Klamka is the President of two reporting, blank check companies, Solar Acquisition Corp. and Barton Solar Inc.  Mr. Klamka is also the President of Miss World Holdings Inc. a reporting company.  We have no employment or other written agreement with Mr. Klamka.  AUDIT COMMITTEE FINANCIAL EXPERT The audit committee is responsible for recommending independent auditors and reviewing management actions in matters relating to audit functions. The committee reviews, with independent auditors, the scope and results of its audit engagement, the system of internal controls and procedures and reviews the effectiveness of procedures intended to prevent     violations of laws. The audit committee, consistent with the Sarbanes-Oxley Act of 2002 and the rules adopted thereunder, meets with management and the auditors prior to filing of officers certifications with the SEC to receive information concerning, among other things, significant deficiencies in the design or operation of internal controls. Our board of directors currently acts as our audit committee. Our audit committee member is not independent in accordance with rule 4200(a)(14) of the Nasdaq Marketplace Rules. Our board of directors does not have an audit committee financial  expert, within the meaning of that phrase under applicable regulations of the Securities and Exchange Commission, serving on the audit committee. The board of directors believes that the member of the audit committee is financially literate and experienced in business matters and is capable of (1) understanding generally accepted accounting principles (GAAP) and financial statements, (2) assessing the general application of GAAP principles in connection with our accounting for estimates, accruals and reserves, (3) analyzing and evaluating our financial  statements, (4) understanding our internal controls and procedures for financial reporting, and (5) understanding audit committee functions, all of which are attributes of an audit committee financial expert. However, the board of directors believes that no audit committee member has obtained these attributes through the experience specified in the SEC's definition of audit committee financial expert. Further, as is the case with many small companies, it would be difficult for us to attract and retain board members who qualify as audit committee financial experts, and competition for such individuals is significant. The board of directors believes that its current audit committee is able to fulfill its role under SEC regulations despite not having a designated audit committee financial expert.   CODE OF ETHICS  We have not yet adopted a code of ethics that applies to our principal executive officers, principal financial officer, principal accounting officer or controller, or persons performing similar functions, since we have been focusing our efforts on obtaining financing for the company. We expect to adopt a code by the end of the current fiscal year.   SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE  Section 16(a) of the Securities Exchange Act of 1934 requires our officers, directors, and persons who beneficially own more than 10% of our common stock to file reports of securities ownership and changes in such ownership with the Securities and Exchange Commission ("SEC"). Officers, directors and greater than 10% beneficial owners are also required by rules promulgated by the SEC to furnish us with copies of all Section 16(a) forms they file.  Based solely upon a review of the copies of such forms furnished to us, or written representations that no Form 5 filings were required, we believe that during the fiscal year ended December 31, 2003, there was compliance with all Section 16(a) filing requirements applicable to our officers, directors and greater than 10% beneficial owners.   ITEM 10. EXECUTIVE COMPENSATION.  The following table sets forth information the remuneration of our chief executive officer:         FIX Format of the table
SUMMARY COMPENSATION TABLE
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NAME AND
PRINCIPAL
POSITION                    ANNUAL COMPENSATION                       LONG TERM COMPENSATION
------------------ ----------------------------------------------- --------------------------------------
AWARDS             PAYOUTS
------------------------- ------------
OTHER      RESTRICTED   SECURITIES
ANNUAL       STOCK      UNDERLYING      LTIP        ALL OTHER
FISCAL                            COMPENSATION   AWARD(S)     OPTIONS/      PAYOUTS    COMPENSATION
YEAR    SALARY ($)    BONUS ($)       ($)          ($)       SARS (#)        ($)           ($)
------------------ -------- ------------ ------------ ------------ ------------ ------------ ------------ ------------
Peter Klamka, CEO   2007     $175,000 (1)    -0-          -0-          -0-         -0-           -0-          -0-
2006     $175,000 (2)    -0-          -0-          -0-          -0-        -0-          -0-
------------------ -------- ------------ ------------ ------------ ------------ ------------ ------------ ------------    (1) In 2006 and 2007, Mr. Klamka was not paid any of his salary, the total $175,000 has been accrued  OPTION/SAR GRANTS IN LAST FISCAL YEAR
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INDIVIDUAL GRANTS
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NUMBER OF SECURITIES      PERCENT OF TOTAL
UNDERLYING         OPTIONS/SARS GRANTED
OPTIONS/SARS GRANTED      TO EMPLOYEES IN         EXERCISE OR BASE
NAME                      (#)                 FISCAL YEAR             PRICE ($/SH)        EXPIRATION DATE
--------------------------- ----------------------- ----------------------- ----------------------- ------------------
Peter Klamka                -0-                       0%                    $
--------------------------- ----------------------- ----------------------- ----------------------- ------------------        AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
------------------------ ---------------------- ---------------------- ----------------------- -----------------------
NUMBER OF SECURITIES
UNDERLYING         VALUE OF UNEXERCISED
UNEXERCISED             IN-THE-MONEY
OPTIONS/SARS AT         OPTIONS/SARS AT
FISCAL YEAR END (#)     FISCAL YEAR END ($)
----------------------- -----------------------
SHARES ACQUIRED ON                                  EXERCISABLE/            EXERCISABLE/
NAME                 EXERCISE (#)          VALUE REALIZED ($)         UNEXERCISABLE           UNEXERCISABLE
------------------------ ---------------------- ---------------------- ----------------------- -----------------------
Peter Klamka                 -0-                    -0-               1,240,500/-0-            260,505/-0-
------------------------ ---------------------- ---------------------- ----------------------- -----------------------    COMPENSATION OF DIRECTORS  Directors do not receive compensation but are reimbursed for their expenses for each meeting of the board that they attend.    STOCK OPTION PLANS  The Company adopted the 1998 Stock Option Plan and the Year 2000 Stock Option Plan (the Plans), which provides for the grant of options to purchase up to 1,250,000 shares of the Company's common stock. Under these Plans incentive stock options may be granted to employees and non-statutory stock options may be granted to employees and non-employees. During the year ended December 31, 2007, 0 options were granted under this plan.   ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.  The following table sets forth certain information regarding our Common Stock beneficially owned on March 31, 2008 (i) each person who is known by us to own beneficially or exercise voting or dispositive control over 5% or more of our Common Stock, (ii) each Director and (iii) all executive officers and Directors as a group. Except as otherwise indicated, all stockholders have sole voting and investment power with respect to the shares listed as beneficially owned by them, subject to the rights of spouses under applicable community property laws.   Name and Address(1)Amount and
Nature         Of
Beneficial
OwnershipPercentage
of Class(1)Peter Klamka1,240,500 Common(2)1.8%850,000 Series B Preferred(3)100%147,775 Series C Preferred(4)100%1,000,000 Series D Preferred(5)100%Barton PK, LLC4,000,000 Common(6)6.2%  (1)  Figures based on an estimated 70,398,679 shares of common stock outstanding as of December 31, 2007. (2)  Includes 1,125,000 currently exercisable options to purchase 1,125,000, shares of the Company's common stock, and 115,500 currently exercisable warrants to purchase 115,500 shares of the Company's common stock. The number of common shares beneficially owned does not included 4,000,000 shares transferred by Mr. Klamka to Barton PK, LLC, a limited liability company owned and controlled by Mr. Klamka. (3) Series B preferred stock is entitled to 10 votes per share. (4) Series C preferred stock is entitled to 100 votes per share. (5) Series D preferred stock is entitled to vote 135 votes per share. (6) Barton PK, LLC is a limited liability company owned and controlled by Mr. Klamka.       EQUITY COMPENSATION PLANS  As of December 31, 2007, our equity compensation plans were as follows:      ------------------------------- ---------------------------- ---------------------------- ----------------------------
NUMBER OF SECURITIES TO BE    WEIGHTED AVERAGE EXERCISE
ISSUED UPON EXERCISE OF       PRICE OF OUTSTANDING         NUMBER OF SECURITIES
OUTSTANDING OPTIONS,         OPTIONS, WARRANTS AND       REMAINING AVAILABLE FOR
PLAN CATEGORY               WARRANTS AND RIGHTS                RIGHTS                   FUTURE ISSUANCE
------------------------------- ---------------------------- ---------------------------- ----------------------------
Equity compensation plans
approved by security holders             1,150,000                      $0.10                        None
------------------------------- ---------------------------- ---------------------------- ----------------------------

Equity compensation plans not
approved by security holders               None                          N/A                         None
------------------------------- ---------------------------- ---------------------------- ----------------------------

Total                                    1,150,000                      $0.10                        None
------------------------------- ---------------------------- ---------------------------- ----------------------------     ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.  In June 1997, Mr. Klamka, the Company's Chief Executive Officer, purchased 2,117,008 shares of our Common Stock for an aggregate purchase price, paid by delivery of a promissory note of $2,117.01. In June 1997 Chris Giordano, the Company's former Chief Operating Officer, purchased 540,340 shares of our Common Stock for an aggregate purchase price, paid by delivery of a promissory note, of $540.34. In June 1997 Michael Giordano, the brother of Mr. Chris Giordano, purchased 300,000 shares of our Common Stock for an aggregate purchase price, paid by delivery of a promissory note, of $300.00. All three promissory notes have been paid in full. Messrs. Klamka, Chris Giordano and Michael Giordano are each deemed to be founders and promoters of the Company.  In April 1998, Mr. Klamka provided the Company with a revolving credit line with a maximum of $500,000 available. In September 1998, the Board of Directors of the Company authorized an increase in this line to $610,000, and in November and December 1998, further increases to $1,000,000 were authorized. Loans drawn on the credit line bear interest at a rate of 9% per annum from the date they are made and are payable by May 2001. Monies loaned were used to make certain payments to Niki Taylor's company, to provide a payment required under the Calendar Agreement with Claudia Schiffer, and for working capital. In January 2000 the then current balance of $548,500 owed to Mr. Klamka was converted into 110,000 shares of Common Stock.            ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.  (a) Exhibits to this Form 10-KSB:       REGULATION                                                   EXHIBIT
S-B NUMBER
------------------- --------------------------------------------------------------------------------------------------
Certificate of Incorporation of PTN Media, Inc. dated as of January 13, 1998 (1)
----------------------------------------------------------------------------------------------------------------------
1.1
Certificate Of Designations Of  Class A Convertible Preferred Stock
1.2
Certificate  Of Decrees of Class A Convertible Preferred Stock
1.3
Certificate Of Designations Of  C Convertible Preferred Stock


------------------- --------------------------------------------------------------------------------------------------
3.5          By-Laws of PTN Media, Inc. (1)
------------------- --------------------------------------------------------------------------------------------------
4.2          PTN Media, Inc. 2000 Stock Option Plan (2)
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10.1         Amendment to Palm, Inc. and PTN Media, Inc. Agreement of October 5, 2000 (3)
------------------- --------------------------------------------------------------------------------------------------
10.2         License Agreement dated February 19, 2001 between 3 Wishes Production f/s/o Christina Aguilera
and PTN Media, Inc. (3)
------------------- --------------------------------------------------------------------------------------------------
10.3         General Agreement dated July 28, 2000, between PTN Media, Inc. and NeoHand, Inc. (4)
------------------- --------------------------------------------------------------------------------------------------
10.4         Partnering Agreement dated October 27, 2000, between PTN Media, Inc. and TWEC.com, LLC (4)
------------------- --------------------------------------------------------------------------------------------------
10.5         Palm, Inc. OEM Partner Agreement dated October 5, 200, between PTN Media, Inc. and Palm, Inc. (4)
------------------- --------------------------------------------------------------------------------------------------
10.6         Merchant and Partner Network Agreement dated May 8, 2000, between PTN Media, Inc.
and Dynamic Trade Inc. (4)
------------------- --------------------------------------------------------------------------------------------------
10.7         License Agreement dated January 4, 2001 between PTN Media, Inc. and Michael Jordan (5)
------------------- --------------------------------------------------------------------------------------------------
10.8         License Supply and Distributor Agreement between PTN Media, Inc. and Motorola, Inc. dated
February 25, 2002 (6)
------------------- --------------------------------------------------------------------------------------------------
10.9         License Amendment between PTN Media, Inc. and Christina Aguilera (6)
------------------- --------------------------------------------------------------------------------------------------
21.1         List of Legend Mobile Subsidiaries (7)
------------------- --------------------------------------------------------------------------------------------------
------------------- --------------------------------------------------------------------------------------------------
31.1         Rule 13a-14(a) Certification of Chief Executive Officer and Chief Financial Officer (7)
------------------- --------------------------------------------------------------------------------------------------
32.1         Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 of Chief Executive Officer and Chief Financial Officer (7)
------------------- --------------------------------------------------------------------------------------------------
41.1                          Consent of Independent Certified Public Accountants (7)            (1) Incorporated by reference from the Company's Registration Statement on Form SB-2 (File #333-51933).  (2) Incorporated by reference from the Company's Definitive Proxy Statement filed on July 24, 2000.  (3) Incorporated by reference from the Company's Form 10-KSB for the fiscal year ended December 31, 2000.  (4) Incorporated by reference from the Company's Registration Statement on Form S-3 filed on December 11, 2000.  (5) Incorporated by reference from the Company's Form 8-K filed January 9, 2001.  (6) Incorporated by reference from the Company's Form 10-KSB filed April 16, 2002  (7) Filed herewith.  (b) Reports on Form 8-K  None     ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.  AUDIT FEES  For the audited fiscal years ended December 31, 2006 and 2007, our principal accountants have billed approximately $7,250 and approximately $7,250, respectively, for the audit of our annual financial statements and Form 10-KSB and review of financial statements included in our Form 10-QSB filings.  AUDIT-RELATED FEES  There were no fees billed for services reasonably related to the performance of the audit or review of our financial statements outside of those fees disclosed above under "Audit Fees" for fiscal years 2007 and 2006.  TAX FEES  There were not fees billed for the fiscal years ended December 31, 2007 and 2006, for tax compliance, tax advice, and tax planning services.  ALL OTHER FEES  There were no fees billed for services by our principal accountant, other than those disclosed     above.  PRE-APPROVAL POLICIES AND PROCEDURES  Prior to engaging our accountants to perform a particular service, our board of directors obtains an estimate for the service to be performed.     SIGNATURES  In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.  LEGEND MOBILE, INC.  Date:   April 15, 2008            By:      /s/ Peter Klamka
------------------------------------------
Peter Klamka, Chairman, President,
Secretary and Chief Executive Officer    In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.  SIGNATURE                    TITLE                       DATE
---------                    -----                       ----

Chairman, President,
Secretary and
Chief Executive Officer
/s/ Peter Klamka                (Principal Executive
----------------------------    and Accounting Officer)         April 15,2008
Peter Klamka                         Legend Mobile, Inc. and Subsidiaries Consolidated Financial Statements Years Ended December 31, 2007 and 2006          Contents  Page  Report of Independent Registered Public Accounting Firm F-1  Financial Statements:  Consolidated Balance Sheet as of December 31, 2007 and 2006 F-2  Consolidated Statements of Operations for the years ended December 31, 2006 and 2007 F-3  Consolidated Statement of Stockholders' Deficit for the years ended December 31, 2006 and 2007 F-4  Consolidated Statements of Cash Flows for the years ended December 31, 2006 and 2007 F-5 - F-6  Notes to Consolidated Financial Statements F-7                               REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM  TO THE BOARD OF DIRECTORS AND STOCKHOLDERS OF LEGEND MOBILE, INC. AND SUBSIDIARIES  We have audited the accompanying consolidated balance sheets of Legend Mobile, Inc. and Subsidiaries as of December 31, 2007 and 2006 and the related consolidated statements of operations,   stockholders (deficit),  and cash flows  for the years then ended.  These financial statements are the responsibility of the Companys management.   Our responsibility is to express an opinion on these  financial statements based on our audit.  We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform an audit of the Company's internal control over its financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as  evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.       In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Legend Mobile, Inc. and Subsidiaries as of December 31, 2007 and 2006 and the results of its consolidated operations and cash flows for the years then ended  in conformity with accounting principles generally accepted in the United States of America.  The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  As described in Note 1 to the financial statements conditions exist which raise substantial doubt about the Companys ability to continue as a going concern unless it is able to generate sufficient cash flows to meet its obligations and sustain its operations.  Those conditions raise substantial doubt about its ability to continue as a going concern.  Managements plans regarding those matters are also described in Note 1.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.   Gruber & Company, LLC Lake Saint Louis, Missouri April 8, 2008   Member:  American Institute of Certified Public Accountants  Registered:  Public Company Accounting Oversight Board  (PCAOB)            LEGEND MOBILE, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETAS OF DECEMBER 31, 2007 AND 2006ASSETS20072006CURRENT ASSETS:Cash$              47$            386Inventory-20,034TOTAL CURRENT ASSETS4720,420FIXED ASSETS - at costComputer and office equipment52,93052,930Less: Accumulated depreciation(52,231)(51,695)NET FIXED ASSETS6991,235INVESTMENTS29,562-TOTAL ASSETS$       30,308$       21,655LIABILITIES AND STOCKHOLDERS' DEFICITCURRENT LIABILITIES:Accounts payable$     190,635$     194,635Accrued expenses555,908686,908Accrued interest1,113,330772,530Accrued derivative liability250,744-License fees payable200,000200,000Due to related parties83,68879,730Advances from an officer95,30088,950Notes payable565,750676,250Note payable - officer1,229,649288,496Note payable - other95,000758,920TOTAL CURRENT LIABILITIES4,380,0043,746,419COMMITMENTS AND CONTINGENCIES-STOCKHOLDERS' DEFICITSeries A Preferred Stock, $0.001 par value, 1,000,000 sharesauthorized; 2,225 shares issued and outstanding2222Series B Convertible Preferred Stock, $0.01 par value; 850,000shares authorized; 850,000 shares issued and outstandingauthorized; 1,000,000 Class A shares issued and outstanding8,5008,500Series C Convertible Preferred Stock, $0.01 par value; 147,775shares authorized; 147,775 shares issued and outstanding1,4781,478Common stock; $0.01 par value; 75,000,000 sharesauthorized;71,513,521( December 31, 2006 - 25,298,021)         shares71,51325,298issued and outstandingAdditional paid-in capital16,324,52115,724,389Stock subscription receivable(156,300)(156,300)Accumulated deficit(20,599,430)(19,328,151)TOTAL STOCKHOLDERS' DEFICIT(4,349,696)(3,724,764)TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT$       30,308$       21,655                                                      LEGEND MOBILE, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENT OF OPERATIONSYEAR ENDEDDECEMBER 31,20072006REVENUE$         1,164$             492COST OF REVENUE92-GROSS PROFIT1,072492EXPENSES:Selling, general and administrative660,898294,631Impairment of goodwill-48,188Impairment of inventory19,909-Product development-1,450TOTAL EXPENSES680,807344,269LOSS FROM OPERATIONS(679,735)(343,777)OTHER INCOME (EXPENSE):Interest expense and financing costs(340,800)(288,771)Change in derivative liability(250,744)-Other income (expense), net--TOTAL OTHER INCOME (EXPENSE)(591,544)(288,771)LOSS BEFORE PROVISION FOR INCOME TAXES(1,271,279)(632,548)PROVISION FOR INCOME TAXES--NET LOSS$ (1,271,279)$    (632,548)BASIC AND DILUTED LOSS PERCOMMON SHARE45,005,00824,464,688WEIGHTED AVERAGE NUMBER OFCOMMON SHARES OUTSTANDING -BASIC AND DILUTED$          (0.03)$          (0.04)        LEGEND MOBILE, INC. AND SUBSIDIARIESCONSOLIDATED  STATEMENT OF STOCKHOLDERS' DEFICITFROM DECEMBER 31, 2005 TO DECEMBER 31, 2007Preferred StockSeries ASeries BSeries CSharesAmountSharesAmountSharesAmountBalance, December 31, 20052,225$            22850,000$      8,500$       147,775$         1,478Shares issued for cash------Fair value of warrants issuedas penalty------Net Loss------Balance - December 31, 20062,22522850,0008,500147,7751,478Shares issued in payment ofprofessional services------Shares issued for cash------Shares issued for services renderedFair value of warrants issuedas penalty------Net Loss------Balance - December 31, 20072,225$            22850,000$      8,500147,775$         1,478AdditionalCommon StockPaid-InShareholderAccumulatedSharesAmountCapitalReceivableDeficitTotalBalance, December 31, 200520,298,021$     20,298$ 15,704,389$ (156,300)$ (18,695,603)$ (3,127,216)Shares issued in payment of  notesand interest5,000,0005,00020,000--25,000Net Loss----(632,548)(632,548)Balance - December 31, 200625,298,02125,29815,724,389(156,300)(19,328,151)(3,734,764)Shares issued in payment of  notes25,110,00025,110121,390--146,500      Shares issued for services and expenses14,995,50014,995454,852--469,847Shares issued to reduce accrued expenses6,000,0006,00024,000--30,000Shares issued to satisfy amounts not------not given110,000110(110)---Net Loss----(1,271,279)(1,271,279)Balance - December 31, 200771,513,521$     71,51316,324,521$ (156,300)$ (20,599,430)$ (4,349,697)                                                          LEGEND MOBILE, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWSYEAR ENDEDDECEMBER 31,20072006CASH FLOWS FROM OPERATING ACTIVITIES:Net loss$ (1,271,279)$    (632,548)Adjustment to reconcile net loss to net cashused in operating activities:Depreciation536536Change in derivative liability250,744-Impairment of goodwill-48,188Impairment of inventory19,909Issuance of common stock for services and expenses469,84813,250Issuance of stock to pay down note payable146,50011,750Issuance of stock to pay down accrued expenses30,000-Changes in operating assets and liabilities:Inventory125(20,034)Accounts payable(4,000)(30,000)Accrued expenses(131,000)-Accrued interest340,800275,521Net cash used in operating activities(147,817)(333,337)CASH FLOWS FROM INVESTING ACTIVITIES:Investment(29,562)-Net cash used in investing activities(29,562)-CASH FLOWS FROM FINANCING ACTIVITIES:Advances from related parties3,95820,204Advances from an officer6,35044,600Note payable issued for salary expense(110,500)268,918Net change in notes payable - other277,232-Net cash provided by financing activities177,040333,722INCREASE (DECREASE) IN CASH(339)385NET CASH USED IN DISCONTINUED OPERATIONS--CASH, Beginning of period3861CASH, End of period$               47$             386SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION:      Interest paid$      340,800$                -Income taxes paid--Notes payable issued to reduce accrued expenses$      275,000$      490,002          LEGEND MOBILE, INC. and SUBSIDIARIES CONSOLIDATED NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2007  Note 1 - Organization and Significant Accounting Policies  Organization and Lines of Business  Legend Mobile,  Inc.,  formerly,  PTN Media, Inc. (the "Company"),  was  incorporated  in Delaware on January 13, 1998 and is the  successor  to Interactive  Entertainment  Studio, Inc. (IES). IES was incorporated in the State of Nevada on May 27,  1997 and was merged into the Company in March 1998 for the sole purpose of changing the domicile of the Company  to Delaware.  This merger was  retroactively  reflected in the December  31, 1997  financial  statements.  On June 27, 2002, the Company filed a  Certificate of Amendment to its Certificate of  Incorporation  to amend the Company's Certificate of Incorporation name from PTN Media, Inc. to Legend Mobile, Inc.  The  Company  is a  developer  and  marketer  of branded  mobile  phone products,  including faceplates,  phone accessories,  SMS services, and mobile data  applications.  Through the Company's 50% owned subsidiary, Legend Credit,  Inc.,  (formerly PTN Wireless,  Inc. ("Legend Credit"), the Company  also  develops and markets  stored value cards,  including gift cards bearing the Visa and MasterCard logo.  Effective  October 1, 2004,  Mr.  Klamka,  the Company's CEO and 60% owner of Legend  Credit, contributed an additional 10% interest in Legend Credit to the Company. Legend  Credit  currently  markets  the Hello  Kitty  reloadable  debit MasterCard   card.   The   Hello   Kitty   card   is   sold   via   the www.hellokittycard.com.  Hello  Kitty  is one of  the  most  recognized animated  characters  in the world.  The  Company's  Hello  Kitty Debit MasterCard  card  generate  revenue by charging  cardholders a suite of fees including an initial  processing fee of up to $14.95,  a per month fee of up to  $2.95  and  an ATM  withdrawal  fee of up to  $1.50.  The Company  derives  limited  revenues  from the sale of covers for mobile phones.  The Company's  suppliers require it to purchase these products and resell them to  consumers  and  wholesalers.  The  Company  created products  under its licenses from athletes,  entertainers,  and popular trademarks.  The Company  also sells a  NASCAR-themed,  SMS-based  text messaging service called "Racemobile.com".  The Company also is seeking to sell mobile application software either via over-the-air download or bundled with a particular mobile phone.  These applications may be sold as a subscription or as a single download. The Company has entered into an  agreement  with the  American  Society of  Composers,  Authors  and Publishers  ("ASCAP") for the licensing of ring tones for mobile phones.  ASCAP maintains the rights to 8 million copyrighted musical works.      In February  2001,  the Company  formed Legend Credit as a wholly owned subsidiary.  On April 1, 2003,  Mr. Peter  Klamka,  CEO of the Company, contributed  the rights to an affinity  credit card business  valued at $37,000 to Legend Credit. Mr. Klamka's contribution has been determined pursuant to Accounting  Principles  Board Opinion No. 29,  "Non monetary Transactions,"  using his cost  basis in the  investment,  which is the most readily  determinable  cost.  In exchange  for this  contribution, Legend  Credit  issued  to Mr.  Peter  Klamka  60% of  the  issued  and outstanding shares of Legend Credit common stock and the Company issued to Mr. Klamka 850,000 shares of Series B convertible  preferred  stock. These issuances were valued at $22,200 and $14,800,  respectively.  The Company  retains a 40%  minority  interest  in Legend  Credit  which is accounted for using the equity method.  Effective  October 1, 2004, Mr. Klamka  contributed  an additional 10% interest in Legend Credit to the Company at was valued at $3,700 (10% of $37,000,  the original value of the affinity credit card business).  In July 1999,  the  Company  formed  Legend  Studios,  Inc.  (formerly FragranceDirect.com,   Inc.)  ("Legend  Studios"),   a  majority  owned subsidiary.  Through this entity, the Company sold fragrance products over the Internet.  On June 28, 2004,  the Company,  through its Legend Studios  subsidiary,  entered  into a  definitive  agreement  to  begin operating seven radio stations owned by Quorum Radio Partners, Inc. and Quorum  Radio  Partners  of  Virginia,  Inc.  Under  the  terms  of the agreement,  Legend Studios will operate for a 12-month term,  beginning July 1, 2004,  seven  stations  located in Virginia,  West Virginia and Missouri.  Legend  Studios paid  $50,000  pursuant to the terms of this agreement to operate the ratio stations  which is being  amortized over for a 12-month  period.  In the 4th quarter of 2004, the Company claims that the  owners of the radio  stations  failed to honor the  operating agreement  by  failing  to allow  the  Company  to  control  the  radio stations. As a result, the Company has expensed the unamortized portion of  the  $50,000  payment  pursuant  to  the  operating  agreement  and discontinued the recognition of revenue since the Company was no longer able to control the radio operations. (See Note 12).  Basis of Presentation  The accompanying  consolidated  financial statements have been prepared in conformity  with  accounting  principles  generally  accepted in the United States of America, which contemplate continuation of the Company as a going concern.  The Company incurred a net loss for the year ended December  31, 2007 of  $1,381,476  and at  December  31,  2007,  had an accumulated  deficit of $20,709,627 and a working  capital  deficit of $4,379,957. In addition, the Company generates minimal revenue from its operations and is in default on the payment of notes payable and license fee payable obligations. These conditions raise substantial doubt as to the  Company's   ability  to  continue  as  a  going   concern.   These consolidated  financial  statements do not include any adjustments that might result from the outcome of this uncertainty.  These  consolidated financial  statements  do not include any  adjustments  relating to the recoverability and classification of recorded asset amounts, or amounts and  classification  of liabilities  that might be necessary should the Company be unable to continue as a going concern.  The Company plans to take the following  steps that it believes will be  sufficient  to provide  the  Company  with the  ability to  continue in  existence.  The Company,  through its subsidiary,  Legend Credit, Inc., continues  to sell  branded  debit  cards.  The Company is also seeking additional  equity  capital to expand its cellular  phones  faceplates, mobile data services, and mobile applications business.         Principles of Consolidation  The accompanying consolidated financial statements include the accounts of the Company and its 91%-owned subsidiary, Legend Studios and its 50% owned subsidiary, Legend Credit.  Stock Based Compensation  SFAS No. 123,  "Accounting for Stock-Based  Compensation,"  establishes and encourages the use of the fair value based method of accounting for stock-based compensation  arrangements under which compensation cost is determined using the fair value of stock-based  compensation determined as of the date of grant and is recognized over the periods in which the related services are rendered.  The statement also permits companies to elect to continue using the current  intrinsic value accounting  method specified  in  Accounting  Principles  Board  ("APB")  Opinion  No. 25, "Accounting  for Stock Issued to Employees," to account for stock-based compensation.  The Company has elected to use the intrinsic value based method and has  disclosed  the pro forma effect of using the fair value based  method to account  for its  stock-based  compensation  issued to employees. For options granted to employees where the exercise price is less than the fair value of the stock at the date of grant, the Company recognizes an expense in accordance with APB 25. For non-employee stock based compensation the Company recognizes an expense in accordance with SFAS No. 123 and values the equity  securities  based on the fair value of the security on the date of grant. For stock-based  awards the value is based on the market  value for the stock on the date of grant and if the stock has restrictions as to transferability a discount is provided for lack of  tradability.  Stock  option  awards are  valued  using the Black-Scholes option-pricing model.  If the Company had elected to recognize compensation expense based upon the fair value at the grant date for awards under the Stock Option Plan consistent  with  the  methodology  prescribed  by SFAS  No.  123,  the Company's net loss and loss per share would be reduced to the pro forma amounts indicated below for the year ended December 31, 2007 and 2006:  2007 2006  Net loss As reported  $(1,279,279)   $(632,548) Compensation recognized under APB 25 - - Compensation recognized under SFAS 123 - -  -----------    ------------- Pro forma $(1,271,279)  $(632,548)   Basic and diluted loss per common share: As reported $     (0.03)    $     (0.02) Pro forma $     (0.03)    $     (0.02)  Use of Estimates  The preparation of consolidated financial statements in conformity with accounting  principles  generally  accepted  in the  United  States  of America  requires  management to make  estimates and  assumptions  that affect the reported  amounts of assets and  liabilities and disclosures of contingent  assets and  liabilities at the date of the  consolidated financial  statements and the reported  amounts of revenue and expenses during the reporting periods. As of December 31,     2007, the Company used estimates  in   determining   the  value  of  common  stock  issued  to consultants  for  services.  Actual  results  could  differ  from these estimates.  Fair Value of Financial Instruments  For certain of the Company's  financial  instruments,  including  cash, inventory, accounts  payable,  accrued  expenses,  accrued  interest,  license fee payable, due to related parties, and advances from an officer,  the carrying  amounts  approximate fair value due to their short  maturities.  The amounts shown for notes payable also  approximate fair value because current interest rates and terms  offered to the Company for similar  debt are  substantially  the same.  Cash and Cash Equivalents  For purposes of the statements of cash flows,  the Company defines cash equivalents  as all highly  liquid debt  instruments  purchased  with a maturity of three months or less, plus all certificates of deposit.  Concentration of Credit Risk  Financial  instruments,   which  potentially  subject  the  Company  to concentrations of credit risk,  consist of cash. The Company places its cash with high quality  financial  institutions and at times may exceed the FDIC $100,000  insurance limit. The Company extends credit based on an evaluation of the customer's financial condition,  generally without collateral.  Exposure to losses on receivables is principally dependent on each  customer's  financial  condition.  The  Company  monitors  its exposure for credit losses and  maintains  allowances  for  anticipated losses, as required.  Comprehensive Income  The Company has adopted SFAS No. 130, "Reporting Comprehensive  Income." This statement establishes standards for reporting comprehensive income and its components in a financial statement. Comprehensive income as defined includes all changes in equity (net assets) during a period from non-owner sources. Examples of items to be included in comprehensive income, which are excluded from net income, include foreign currency translation adjustments and unrealized gains and losses on available-for-sale securities. Comprehensive income (loss) is not presented in the Company's financial statements since there is no difference between net loss and comprehensive loss in any period presented  Fixed Assets  Fixed  assets are  recorded  at cost.  Depreciation  is  provided  on a straight-line  basis  over  estimated  useful  lives of the  assets  as follows:  Computer equipment 3 years Furniture and fixtures 5 years  Expenditures  for  maintenance and repairs are charged to operations as incurred  while renewals and  betterments  are  capitalized.  Gains and losses on disposals are included in the results of operations.        Impairment of Long-Lived Assets  In  October  2001,  the FASB  issued  SFAS  No.  144,  "Accounting  for  Impairment or Disposal of Long-Lived Assets", which supersedes SFAS No. 121,  "Accounting  for the  Impairment  of  Long-Lived  Assets  and for Long-Lived  Assets to Be Disposed Of", and the accounting and reporting provision   of  APB   Opinion   No.   30,"Reporting   the   Results  of Operations-Reporting  the  Effects  of  Disposal  of  a  Segment  of  a Business, and Extraordinary,  Unusual and Infrequently Occurring Events and  Transactions",  for the disposal of a segment of a business.  This statement also amends ARB No. 51, "Consolidated  Financial Statements", to eliminate the exception to consolidation  for a subsidiary for which control is likely to be impaired. SFAS No. 144 requires that long-lived assets  to be  disposed  of by sale,  including  those of  discontinued operations,  be measured at the lower of carrying  amount or fair value less cost to sell,  whether  reported in  continuing  operations  or in discontinued  operations.  SFAS  No.  144  broadens  the  reporting  of discontinued  operations  to include all  components  of an entity with operations  that can be  distinguished  from the rest of the entity and that will be eliminated from the ongoing  operations of the entity in a disposal  transaction.  SFAS No. 144 also establishes a "primary-asset" approach to determine  the cash flow  estimation  period for a group of assets and  liabilities  that  represents  the unit of accounting for a long-lived asset to be held and used. The Company's  adoption effective January  1,  2002  did not  have a  material  impact  to the  Company's financial position or results of operations.   Revenue Recognition  The  Company  generates  revenue  from the sale of  products on its web sites and through other channels,  the sale of  advertisements on radio stations it operated and service fees from the sale of debit cards. The Company  recognizes revenue for these product sales when the product is shipped to the customer.  The Company recognizes revenue from the radio stations  it  operated  when  advertisements  were  aired.  The Company recognizes service fee revenue from the sale of debit cards at the time the customer is sent the debit card.  Shipping  and handling  costs are recorded as revenue and related costs are charged to cost of sales.      Income Taxes  The Company  accounts for income taxes in accordance with SFAS No. 109, "Accounting  for Income  Taxes."  Deferred  taxes are  provided  on the liability  method  whereby  deferred  tax  assets  are  recognized  for deductible  temporary  differences,  and deferred tax  liabilities  are recognized for taxable temporary differences. Temporary differences are the differences  between the reported amounts of assets and liabilities and their tax bases.  Deferred  tax assets are  reduced by a  valuation allowance  when, in the opinion of  management,  it is more likely than not  that  some  portion  or all of the  deferred  tax  assets  will be realized.  Deferred  tax assets and  liabilities  are  adjusted for the effects of changes in tax laws and rates on the date of enactment.  Earnings (Loss) Per Share  The Company  reports  earnings (loss) per share in accordance with SFAS No. 128,  "Earnings  per  Share."  Basic  earnings  (loss) per share is  computed by dividing income (loss) available to common  shareholders by the  weighted  average  number  of  common  shares  available.  Diluted earnings (loss) per share is computed  similar to basic earnings (loss) per share  except  that the  denominator  is  increased  to include the number of additional  common shares that would have been outstanding if the  potential  common  shares had been  issued  and if the  additional common shares were dilutive.  Diluted earnings (loss) per share has not been  presented  since the effect of the assumed  conversion of options and  warrants to purchase  common  shares  would have an  anti-dilutive effect.  The following  potential common shares have been excluded from the  computation  of  diluted  net loss per  share  for the year  ended December  31,  2007  and  2006  because  the  effect  would  have  been  anti-dilutive:    2007          2006   Conversion of Series A preferred stock  44,500          44,500  Conversion of Series B convertible preferred stock 8,500,000     8,500,000 Conversion of Series C convertible preferred stock         14,777,500   14,777,500 Stock options issued to employees and consultants under the Company's stock option plan  -                 1,150,000 Warrants issued to officers -                    231,000 Warrants issued for services -                      50,000 Warrants issued with notes -                    100,000 Warrants issued for penalty/interest -                    234,000 Warrants issued with note conversion3 -  300,000   23,322,000  25,387,000  All warrants and stock options were cancelled during the year ended December 31, 2007.   Minority Interest  Minority interest represents the minority  shareholders'  proportionate share of the equity of Legend  Studios.  During the year ended December 31, 2000, the Company sold 410,000 or 17%       of the common stock of Legend Studios.  Legend Studios,  on a stand-alone  basis, had a shareholders' deficit. As a result, the Company's  investment in Legend Studios had a negative  carrying  value.  The  increase in  capitalization  of Legend Studios  resulting  from the sale of 410,000  shares of common stock to outside investors benefited the Company in that it reduced the negative carrying  value  of  the  Company's   investment  in  Legend   Studios. Accordingly,   the  Company  has   accounted  for  the  change  in  its proportionate  share  of  Legend  Studios'  equity  resulting  from the issuance of stock to outside  investors as an increase in shareholders' equity  and  a  reduction  in  minority   interest   liability  in  the consolidated  financial  statements.  During 2001,  three of the Legend Studios shareholders  exchanged 173,999 shares of Legend Studios common stock for 173,999  shares of the Company's  common stock.  During 2002, one of the Legend Studios shareholders exchanged 1,000 shares of Legend  Studios  common stock for 1,000 shares of the  Company's  common stock. The  accompanying  consolidated  financial  statements do not reflect a minority interest  liability as of December 31, 2005 as Legend Studios, on a stand-alone  basis,  had a stockholders'  deficit as of such date. The  accompanying  consolidated  statements of operations for the years ended December 31, 2005 and 2004 do not reflect the minority interest's share of Legend  Studios'  losses for said years as the related accrual would  result  in the  Company's  recordation  of a  minority  interest receivable.  In addition,  during the year ended  December 31, 2004,  the  Company's ownership in Legend  Credit  increased to 50%  resulting in the Company consolidating  the  financial  statement  of  Legend  Credit  with  the Company.  The  accompanying  consolidated  financial  statements do not reflect a minority interest liability as of December 31, 2006 or December 31, 2005 as Legend  Credit, on a stand-alone basis, had a stockholders'  deficit as of such date. The  accompanying  consolidated  statements of operations for the year ended  December  31, 2006 or December 31, 2005 do not reflect the  minority  interest's share of Legend  Credits'  losses for 2006 or 2006 as the related accrual would result in the Company's recordation of a minority interest receivable.  Recently Issued Accounting Pronouncements   In February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid Financial Instruments - an amendment of FASB Statements No. 133 and 140". This Statement permits fair value of re-measurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation; clarifies which interest-only strips and principal-only strips are not subject to the requirements of SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities"; establishes a requirement to evaluate interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation; clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives; and amended SFAS No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities", to eliminate the prohibition on a qualifying special-purpose entity from holding a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument. SFAS No. 155 is effective for all financial instruments acquired, issued, or subject to a re-measurement (new basis) event occurring after the beginning of an entity's first fiscal year that begins after September 15, 2006. The Company is currently reviewing the effect, if any, the proposed guidance will have on its financial position and operations.  In March 2006, the FASB issued SFAS No. 156, "Accounting for  Servicing of Financial Assets", which amends SFAS No. 140, "Accounting for Transfers and Servicing of Financial Assets and     Extinguishments of Liabilities". In a significant change to current guidance, SFAS No. 156 permits an entity to choose either of the following subsequent  measurement methods for each class of separately recognized servicing assets and servicing liabilities: (1) Amortization Method or (2) Fair Value Measurement Method. SFAS No. 156 is effective as of the beginning of an entity's first fiscal year that begins after September 15, 2006. The Company is currently reviewing the effect, if any, the proposed guidance will have on its financial position and operations.  In July 2006, the FASB issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprises' financial statements in accordance with SFAS No. 109, "Accounting for Income Taxes". FIN 48 prescribes a recognition threshold and measurement attributable for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FIN 48 also provides guidance on derecognizing, classification, interest and penalties, accounting in interim periods, disclosures and transitions. FIN 48 is effective for fiscal years beginning after December 15, 2006. The Company is  currently reviewing the effect, if any, FIN 48 will have on its financial position and operations.  In September 2006, the FASB issued SFAS No. 157, "Fair Value Measures" ("SFAS No. 157"). SFAS No157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles ("GAAP"), expands disclosures about fair value measurements, and applies under other accounting pronouncements that require or permit fair value measurements. SFAS No. 157 does not require any new fair value measurements, however the FASB anticipates that for some entities, the application of SFAS No. 157 will change current practice. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, which for the Company would be its fiscal year beginning November 1, 2008. The implementation of SFAS No. 157 is not expected to have a material impact on the Company's results of operations and financial condition.  In September 2006, the Financial Accounting Standards Board ("FASB") issued SFAS No. 158, "Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans - an amendment of FASB Statements No. 87, 88, 106, and 132(R)". This statement requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multi-employer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity or changes in unrestricted net assets of a not-for-profit organization. This statement also requires an employer to measure the funded status of a plan as of the date of its year-end statement of financial position, with limited exceptions. The provisions of SFAS No. 158 are effective for employers with publicly traded equity securities as of the end of the fiscal year ending after December 15, 2006. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations.  In September 2006, the Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin No. 108 (Topic 1N), "Quantifying Misstatements in Current Year Financial Statements" ("SAB No. 108"). SAB No. 108 addresses how the effect of prior year uncorrected misstatements should be considered when quantifying misstatements in current year financial statements. SAB No. 108 requires SEC registrants (i) to quantify misstatements using a combined approach which considers both the balance sheet and income statement approaches; (ii) to evaluate whether either approach results in quantifying an error that is material in light of relevant quantitative and qualitative factors; and (iii) to adjust their financial statements if the new combined approach       results in a conclusion that an error is material. SAB No. 108 addresses the mechanics of correcting misstatements that include effects from prior years. It indicates that the current year correction of a material error that includes prior year effects may result in the need to correct prior year financial statements even if the misstatement in the prior year or years is considered immaterial. Any prior year financial statements found to be materially misstated in years subsequent to the issuance of SAB No. 108 would be restated in accordance with SFAS No. 154, "Accounting Changes and Error Corrections." Because the combined approach represents a change in practice, the SEC staff will not require registrants that followed an acceptable approach in the past to restate prior years' historical financial statements. Rather, these registrants can report the cumulative effect of adopting the new approach as an adjustment to the current year's beginning balance of retained earnings. If the new approach is adopted in a quarter other than the first quarter, financial statements for prior interim periods within the year of adoption may need to be restated. SAB No. 108 is effective for fiscal years ending after November 15, 2006, which for Company would be its fiscal year beginning December 1, 2007. The implementation of SAB No. 108 is not expected to have a material impact on the Company's results of operations and financial condition.  In October 2006, the Financial Accounting Standards Board (FASB) issued FASB Staff Position (FSP) Financial Accounting Standard (FAS) 123(R)-5, Amendment of FSP FAS 123(R)-1, (FSP FAS 123(R)-5) to address whether a change to an equity instrument in connection with an equity restructuring should be considered a modification for the purpose of applying FSP No. FAS 123(R)-1, Classification and Measurement of Freestanding Financial Instruments Originally Issued in Exchange for Employee Services under FAS Statement No 123(R) (FSP FAS 123(R)-1). FSP FAS 123(R)-1 states that financial instruments issued to employees in exchange for past or future services are subject to the provisions of SFAS 123(R) unless the terms of the award are modified when the holder is no longer an employee. In FSP FAS 123(R)-5, the FASB staff concluded that changes to the terms of an award that are made solely due to an equity restructuring are not considered modifications as described in FSP FAS 123(R)-1 unless the fair value of the award increases, anti-dilution provisions are added, or holders of the same class of equity instruments are treated unequally. FSP FAS 123(R)-5 is effective for the first reporting period beginning after October 10, 2006. The adoption of FSP FAS 123(R)-5 did not have a material impact on the Companys condensed consolidated financial statements.   On February 15, 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Liabilities (SFAS No. 159). Under this Standard, the Company may elect to report financial instruments and certain other items at fair value on a contract-by-contract basis with changes in value reported in earnings. This election is irrevocable. SFAS No. 159 provides an opportunity to mitigate volatility in reported earnings that is caused by measuring hedged assets and liabilities that were previously required to use a different accounting method than the related hedging contracts when the complex provisions of SFAS No. 133 are not met. SFAS No. 159 is effective for years beginning after November 15, 2007. The Company does not believe it will have an impact on its consolidated financial statements.  In December 2007, the FASB issued SFAS No. 141(R), Business Combinations (SFAS 141R). SFAS 141R amends SFAS 141 and provides guidance for recognizing and measuring identifiable assets and goodwill acquired, liabilities assumed, and any non-controlling interest in the acquiree. It also provides disclosure requirements to enable users of the financial statements to evaluate the nature and financial effects of the business combination. SFAS 141R will be     effective for fiscal years beginning on or after December 15, 2008 and will be applied prospectively. In December 2007, the FASB issued SFAS No. 160, Non-Controlling Interests in Consolidated Financial Statementsan amendment of ARB No. 51 (SFAS 160). SFAS 160 requires that ownership interests in subsidiaries held by parties other than the parent, and the amount of consolidated net income, be clearly identified, labeled and presented in the consolidated financial statements. It also requires once a subsidiary is deconsolidated, any retained non-controlling equity investment in the former subsidiary be initially measured at fair value. Sufficient disclosures are required to clearly identify and distinguish between the interests of the parent and the interests of the non-controlling owners. SFAS 160 is effective for fiscal years beginning on or after December 15, 2008 and requires retroactive adoption of the presentation and disclosure requirements for existing minority interests. All other requirements shall be applied prospectively.   Note 2 - Fixed Assets  Fixed assets at December 31, 2007 consisted of the following:  Computer equipment $    49,478 Furniture and fixtures 3,452 52,930 Less accumulated depreciation (52,231)  Net Fixed Assets $          699  Depreciation expense for the years ended December 31, 2007 and 2006 was $536 and $536, respectively.  Note 3 - Investment in/Consolidation of Legend Credit, Inc.  On April 1, 2003, the Company's CEO, Mr. Peter Klamka,  contributed the rights to an affinity credit card business at his historical cost basis of  $37,000  to  Legend  Credit.  Mr.  Klamka's  contribution  has been determined  pursuant to  Accounting  Principles  Board  Opinion No. 29, "Nonmonetary  Transactions,"  using his cost  basis in the investment, which is the most  readily  determinable  cost.  In  exchange  for this contribution,  Legend  Credit  issued to Mr. Peter  Klamka,  60% of the issued and outstanding shares of common stock and the Company issued to Mr. Klamka 850,000 shares of Series B convertible  preferred stock that were valued at $22,200 and $14,800, respectively, pro rata based on the percentage of interest  owned.  Effective  October 1, 2004,  Mr. Klamka contributed  an additional 10% interest in Legend Credit to the Company at was valued at $3,700  (10% of  $37,000,  the  original  value of the affinity credit card  business).Mr.  Klamka received  147,775 shares of the Company's Series C convertible preferred stock in exchange for this contribution.   Effective   October  1,  2004,   the   Company   began consolidating  the  operations  of  Legend  Credit.  Note 4 - Accrued Expenses        Accrued expenses at December 31, 2007, consist of the following:  Michael Jordan settlement $   468,750 Miscellaneous 87,158  $  555,908  Note 5 - Notes Payable - Officer  As of September 30, 2004,  the Company  converted  $291,000 of advances from its CEO, Mr.  Klamka,  into a note payable that bears  interest at 21% per annum and is payable  upon  demand.  As of December  31,  2007, the balance on this note is $263,496 with accrued interest related to this note amounted to $192,832.  During the year ended December 2006  the Company converted certain of the accrued amounts owing to the CEO and for salaries payable to the CEO into a note totaling $758,920.  This note is unsecured and bears interest at the rate of 21% per annum.  Accrued interest to date is $159,373.  Additional notes were issued during 2007 to Peter Klamka for unpaid salaries of $175,000 bearing interest at the rate of 8% per annum, interest accrued to date is $5,250, a note for expenses paid by Mr. Klamka on behalf of the Company totaling $24,733 bearing interest at 10% per annum, interest accrued to date is $478.  Note 6 - Notes Payable  In July and August  1997,  the  Company  received  $56,250  through the issuance of 8% promissory  notes and common stock purchase  warrants to acquire Company stock.  The notes and accrued  interest are payable one year from the date of issuance  or the closing of an equity  funding of the Company of a minimum of $500,000, whichever is sooner. In 1999, one of the note  holders  converted  $25,000  of  principal  and  $5,500 of accrued  interest into 6,100 shares of the Company's  common stock. The remainder  of the notes,  which  amounts to  $31,250,  continues  to be outstanding  notwithstanding the fact that payments owed by the Company thereunder are now past due.  Interest  accrued as of December 31, 2007 aggregated to $33,500.  In July and August of 1999, the Company's Subsidiaries,  Legend Studios issued 10% promissory notes aggregating to $160,000.  The notes are due the earlier of one year or the completion of an initial public offering of Legend Studios common stock.  In addition,  Legend Studios issued to the note  holders  an  aggregate  of  96,000  two-year  stock  purchase warrants to purchase  Legend  Studios  common stock at $3.50 per share.   During the year ended  December  31, 2002,  two note holders  converted principal  and accrued  interest  of $35,000  and  $13,358  into 48,358 shares of the Company's common stock. As of December 31, 2007, $125,000 of these notes and accrued  interest of $92,709 are still  outstanding. These notes are in default at December 31, 2006.  In August  2001,  the Company  issued  notes  payable for  $100,000 and $300,000  which  were  due in 60 days  and 14  days,  respectively.  In connection  with the issuance of the $300,000 note, the Company granted the note  holders an  aggregate  of 80,000  warrants  to  purchase  the Company's common stock at $1 per share. The Company has determined that the fair value of these  warrants to be $99,317 and has  recognized the expense in the  accompanying  statement of  operations  during the year ended  December 31, 2001. The Company used the  Black-Scholes     model to determine  the  fair  value  of  these   warrants  with  the  following assumptions:  (i) dividend  yield of 0%, (ii)  expected  volatility  of 118%,  (iii)  weight-average  risk-free  interest rate of approximately 4.0%,  and (iv)  expected  life of 3 years.  In July 2002,  the Company converted the $300,000 note into 300,000 shares of its common stock and issued  300,000  warrants to purchase the Company's  common stock at $1 per share.  The value of the warrants issued of $244,701 was determined using the  Black-Scholes  model and this  amount has been  recorded  as financing costs in the accompanying  statement of operations during the year ended  December 31, 2002. The following  assumptions  were used to determine the fair value of these 300,000 warrants:  (i) dividend yield of 0%, (ii) expected volatility of 129%, (iii) weight-average risk-free interest rate of approximately 3.5%, and (iv) expected life of 5 years. The  Company did not repay the  $100,000  note on its due date (and has not yet repaid the note) and issued the investor during the years ended December  31, 2004,  2003 and 2002,  respectively,  72,000,  72,000 and 90,000  warrants as a penalty  valued at $7,443,  $13,685 and  $80,870, respectively.  In September  2002,  the Company issued a note payable in the amount of $400,000  that accrues  interest at 10% per annum.  The  principal  and accrued  interest is to be repaid one-half on February 28, 2003 and the remaining  balance  on May 31,  2003.  The  Company  has not  made  the February 28, 2003 nor the May 31, 2003 payments. Interest accrued as of December  31,  2007  amounted  to  $173,333.  This note is in default at December 31, 2007. The note has been sold to other parties.  The Company does not have to accrue any more interest on the note and has paid down $110,500 of the principal balance by issuing shares of common stock at .005 a share  outstanding leaving a balance of $ 289,500.   In October  2003,  the Company  issued a note  payable in the amount of $20,000.  The note was due 45 days  after  issuance.  This note has not currently  been repaid.  There is no stated  interest rate on the note, but the Company did issue to the investor  100,000 warrants to purchase shares of the Company's  common stock for $0.35 per share.  The Company used the  Black-Scholes  model  to  determine  the fair  value of these 100,000 warrants with the following assumptions:  (i) dividend yield of 0%, (ii) expected volatility of 118%, (iii) weighted-average  risk-free interest rate of approximately 3.5%, and (iv) expected life of 3 years. The  value of these  warrants  of  $24,890  was has  been  recorded  as interest expense in the accompany consolidated statements of operations during the year ended  December  31,  2003.  This note is in default at December 31, 2007.  Note 7  Notes Payable - Other   The Company issued  a note to Eric Joffe for unpaid salaries for 2006 for $100,000 of which $5,000 was repaid, bearing interest at 7% per annum  and accrued interest to date of $2,490.  Note 8 - Profit Participation Obligation   On  November  22,  2000  the  Company  issued a  promissory  note to an investor in the amount of  $1,000,000.  The note bore interest at 9.25% and was due on April 1, 2001.  The holder of the note had the option of converting  the  note  to  a  royalty   participation   certificate  or converting into shares of the Company's common stock at a 20% discount. In  addition,  the holder of the note was issued a two-year  warrant to purchase  100,000  shares of the  Company's  common  stock at $3.00 per share.        During 2001, the note holder converted the full amount of the note into a profit  participation  obligation  that  provides  for the  holder to receive 7.5% of the profits from the sale of the Claudia  Schiffer Palm Pilot,  the Michael Jordan Palm Pilot and any other  celebrity  branded Palm Pilot that the Company sells. In connection with this  conversion, the Company  issued the holder a warrant to purchase  200,000 shares of the Company's  common stock at $1.50.  The warrant  expires three years from the date of grant. The $1,000,000 profit participation  obligation will be reduced as profits payments are made to the holder.  Due to the  lack of  communication  with  the  holder  of  this  profit participation  obligation and the Company has  discontinued the sale of Palm  products  and does not expect to sell them in the future.  During 2004 the  Company  removed  the  profit  participation  obligation  and recorded a corresponding increase to additional paid in capital.  Note 9 - Stockholders' Deficit  Series A Preferred Stock  The Company has 1,000,000 shares of $0.001 par value Series A Preferred Stock  ("Series  A")  authorized  of which 2,225  shares are issued and outstanding  at  December  31,  2006  Each  share  of  Series A can be converted into 20 shares of common stock.  Series B Convertible Preferred Stock  The Company has 850,000  shares of $0.01 par value Series B Convertible Preferred  Stock  authorized  of which  850,000  shares  are issued and outstanding at December 31, 2006.  In the event of a voluntary or involuntary liquidation,  dissolution or winding  up of the  Company,  prior to the time  the  Series B  becomes convertible  into  common  shares,  the  holders  of  Series B shall be entitled to $0.01 per share. In the event of a voluntary or involuntary liquidation,  dissolution  or winding up of the Company  after the time the Series B becomes  convertible  into common  shares,  the holders of Series B shall be entitled  to share with the  holders of common  stock pari  passu in the assets of the  Company,  on an as  converted  basis, whether such assets are capital or surplus of any nature.  The Series B shall be  convertible  upon the  earlier  to occur of: (i) the date the Company generates net profits in any two consecutive fiscal quarters or (ii) April 1, 2006.  The  conversion  of  Series B shall be on the  basis of ten  shares  of common  stock for one Series B share,  as may be adjusted  from time to time. Upon  conversion,  the holder of the Series B will be required to pay to the Company a  conversion  price for each share of common  stock equal to $0.10.  The holders of the Series B shall vote on all matters  with the holders of the common  stock  (and not as a separate  class) on a ten votes per share  basis.  The holders of the Series B shall be entitled to receive all  notices  relating  to  voting as are  required  to be given to the holders of the common stock.  During 2003, the Company issued to Mr. Peter Klamka, the Company's CEO, 850,000 shares of Series B as consideration  for the contribution of an affinity credit card business to Legend Credit. (See Note 3)  Series C Convertible Preferred Stock      The Company has 147,775  shares of $0.01 par value Series C Convertible Preferred  Stock  authorized  of which  147,775  shares  are issued and outstanding at December 31, 2006.  In the event of a voluntary or involuntary liquidation,  dissolution or winding  up of the  Company  prior  to the time  the  Series C  becomes convertible  into  common  shares,  the  holders  of  Series C shall be entitled to $0.01 per share. In the event of a voluntary or involuntary liquidation,  dissolution  or winding up of the Company  after the time the Series C becomes  convertible  into common  shares,  the holders of Series C shall be  entitled  to share  with the  holders  of  shares of common stock and Series B convertible preferred stock pari passu in the assets of the Company,  on an as converted  basis,  whether such assets are  capital  or  surplus  of any  nature.  . The  Series  C  shall  be convertible  upon the  earlier  to occur of:  (i) the date the  Company generates  net profits in any two  consecutive  fiscal  quarters;  (ii) April 1,  2006;  or (iii) any date that the  market  price per share of common stock equals or exceeds $0.50.  The  conversion  of  Series C shall be on the  basis of one hundred  shares  of common  stock for one Series C share,  as may be adjusted  from time to time. Upon  conversion,  the holder of the Series C will be required to pay to the Company a  conversion  price for each share of common  stock equal to $0.10.  The holders of the Series C shall vote on all matters  with the holders of the common  stock  (and not as a separate  class) on a ten votes per share  basis.  The holders of the Series C shall be entitled to receive all  notices  relating  to  voting as are  required  to be given to the holders of the common stock.  During 2004, the Company issued to Mr. Peter Klamka, the Company's CEO, 147,775 shares of Series C as consideration  for the contribution of an additional 10% ownership in Legend Credit. (See Note 3)  Common Stock  The Company issued a total of 46,215,500 during the current fiscal year for a total consideration of $646,348 of which $30,000 was to reduce accounts payable, $469,848 was for services and reimbursements of expenses, and $146,500 was to reduce notes payable.        Stock Option Plan  The Company  adopted the 1998 Stock Option Plan and the Year 2000 Stock Option Plan (the  Plans),  which  provides  for the grant of options to purchase up to 1,250,000  shares of the Company's  common stock.  Under these Plans  incentive  stock  options may be granted to employees  and non-statutory   stock   options  may  be  granted  to   employees   and non-employees.  The following is table summarizes the options and warrants outstanding:  Weighted-               Weighted-  Stock       Average                 Average Option     Exercise                Exercise Plan      Price   Warrants  Price  Balance, December 31, 2006                   1,150,000   $  0.10     915,000    $    0.78  Shares cancelled during 2007                (1,150,000)     (0.10)   (915,000)      (0.78)  Exercisable, December 31, 2007 --------------   -- ---------   --------------------------     Note 10 - Income Taxes  Deferred  income  taxes  reflect  the  net  tax  effects  of  temporary differences  between the carrying amounts of assets and liabilities for financial  statement  purposes  and the  amounts  used for  income  tax purposes.   Significant   components  of  the  Company's  deferred  tax liabilities and assets as of December 31, 2007 are as follows:     Deferred tax assets: Federal and state net operating loss $         568,348 Equity instruments issued for compensation 432,278   Total deferred tax assets 1,000,626 Less valuation allowance (1,000,626) $         --==== For the year ended  December 31, 2007,  the Company had federal and state net  operating loss   ("NOL")   carryforwards   of   approximately   $16,593,000   and $15,068,350,  respectively.  Federal NOLs could,  if unused,  expire in varying amounts in the years 2012 through 2021.  State NOLs, if unused, could expire in varying amounts from 2012 through 2021.  The valuation  allowance increased by $1,000,626 and $632,548 during 2007 and 2006,  respectively.  The  Company  has  provided a 100%  valuation allowance  on the  deferred  tax assets at December  31, 2007 to reduce such asset to zero,  since there is no assurance  that the     Company will generate  future taxable income to utilize such asset.  Management will review  this  valuation  allowance  requirement  periodically  and make adjustments as warranted.  The  reconciliation  of the  effective  income tax rate to the  federal statutory  rate for the years  ended  December  31, 2007 and 2006 is as follows:  2007         2006 ----------   ----------  Federal income tax rate (34.0%)      (34.0%) State tax, net of federal benefit (2.0%)       (2.0%) Equity instruments issued for compensation 25.2%         25.2% Increase in valuation allowance 11.8%       11.8%  Effective income tax rate 0.0%       0.0%  Note 12 - Commitments and Contingencies  Litigation  Legend  Studios,  Inc. vs. Quorum Radio  Partners,  Inc.,  Quorum Radio Partners of Virginia, Inc. and Quorum Communications, Inc.  Legend Studios lawsuit arises from  defendants'  breach of the parties' Asset Purchase  Agreement and Time Brokerage  Agreement that govern the sale,  programming,  operations  and revenues of certain radio stations (KELE-AM,  KELE-FM, WIQO, WKEY and WKCI). Legend Studios seeks specific performance of the agreements,  as well as in excess of $1.5 million in damages.  Defendants have been served with the complaint,  but have not filed  answers  and may be subject to entry of  default.  Quorum  Radio Partners of Virginia,  Inc., however, filed a bankruptcy petition after being  served  with  the  complaint,   which  stays  Legend   Studios's proceedings solely against that entity.  In the ordinary course of business, the Company is generally subject to claims, complaints, and legal actions. At December 31, 2007, management believes that the Company is not a party to any action which would have a  material  impact on its  financial  condition,  operations,  or cash flows.  In September, 2007, Legend Credit, Inc. entered into an agreement with UCE, Inc. in which the Company agreed to contribute $500,000 toward production, marketing and promotion costs for a weekly mixed martial arts events scheduled and produced by UCE, Inc.  The company receives 80% revenue related to broadcast ,DVD or other media sales of the telecast. The Company has contributed $29,562 toward the agreed-upon amount as of December 31, 2007, which is included as investments on the Companys balance sheet