##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-QSB
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2007
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number: 0-25092
 ProLink Holdings Corp.
  Delaware
    
    30-0280392(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)410 South Benson Ln., Chandler, AZ
    
    85224(Address of principal executive offices)
    
    (Zip Code)
 (480) 961-8800
  þ o
  o þ
  Class
    
    Outstanding at May 15, 2007Common Stock, $.0001 par value per share
    
    37,653,099
 Yes o No þ




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##### 



PROLINK HOLDINGS CORP
TABLE OF CONTENTS
 PART IPageItem 1.
    
    Financial StatementsCondensed Consolidated Balance Sheets at March 31, 2007 (unaudited) and December 31, 2006
    
    
    3Unaudited Condensed Consolidated Statement of Operations for the three months ended March 31, 2007 and April 1, 2006
    
    
    4Unaudited Condensed Consolidated Statements of Stockholders Equity for the three months ended March 31, 2007
    
    
    5Unaudited Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2007 and April 1, 2006
    
    
    6Notes to Unaudited Consolidated Financial Statements
    
    
    7Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    19Item 3.
    
    Controls and Procedures
    
    
    22PART IIItem 1.
    
    Legal Proceedings
    
    
    22Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    22Item 3.
    
    Defaults Upon Senior Securities
    
    
    23Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    23Item 5.
    
    Other Information
    
    
    23Item 6.
    
    Exhibits
    
    
    23Signatures
    
    
    24Exhibit 31.1Exhibit 31.2Ehxibit 32.1
   2




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 
 ProLink Holdings Corp.  CONDENSED CONSOLIDATED BALANCE SHEETS
 March 31, 2007
    
    
    December 31, 2006(Unaudited)ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    1,337,714
    
    
    $
    2,448,354Accounts receivable, net of an allowance for doubtful accounts of $690,333
and $628,660
    
    
    6,233,931
    
    
    
    2,701,343Inventories, net of an allowance of $365,350 and $410,055
    
    
    2,431,573
    
    
    
    2,364,236Prepaid expenses and other current assets
    
    
    342,720
    
    
    
    559,562TOTAL CURRENT ASSETS
    
    
    10,345,938
    
    
    
    8,073,495PROPERTY AND EQUIPMENT, net
    
    
    969,755
    
    
    
    855,383INTANGIBLE ASSETS, net of accumulated amortization of $815,631 and $726,465
    
    
    2,424,606
    
    
    
    2,308,239INTEREST IN RESIDUAL LEASE EQUIPMENT
    
    
    4,425,787
    
    
    
    4,404,366DEPOSITS AND OTHER ASSETS
    
    
    994,399
    
    
    
    960,078GOODWILL
    
    
    205,533
    
    
    
    TOTAL ASSETS
    
    $
    19,366,018
    
    
    $
    16,601,561LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIES:Current maturities of long-term debt and short-term financing
    
    $
    1,549,717
    
    
    $
    5,485,188Accounts payable
    
    
    3,652,261
    
    
    
    4,586,311Accrued liabilities
    
    
    1,622,533
    
    
    
    1,914,662Deferred revenue
    
    
    107,626
    
    
    
    316,276TOTAL CURRENT LIABILITIES
    
    
    6,932,137
    
    
    
    12,302,437LONG-TERM DEBT, net of current maturities
    
    
    3,202,352
    
    
    
    3,708,805TOTAL LIABILITIES
    
    
    10,134,489
    
    
    
    16,011,242COMMITMENTS AND CONTINGENCIESMEZZANINE
FINANCING (1,142 Shares of Series C Convertible Preferred Stock)
    
    
    7,920,013
    
    
    
    STOCKHOLDERS EQUITY:Common stock, par value $.0001, 200,000,000 shares authorized;
37,606,225 and 34,927,781 issued and outstanding at March 31, 2007
and December 31, 2006
    
    
    3,761
    
    
    
    3,493Additional paid-in capital
    
    
    22,818,769
    
    
    
    16,323,377Accumulated deficit
    
    
    (21,511,014
    )
    
    
    (15,736,551
    )TOTAL STOCKHOLDERS EQUITY
    
    
    1,311,516
    
    
    
    590,319TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
    
    $
    19,366,018
    
    
    $
    16,601,561
 The
accompanying notes are an integral part of these condensed consolidated financial statements.
  3




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ProLink Holdings Corp.  UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 For the Three Months EndedMarch 31,
    
    
    April 1,2007
    
    
    2006REVENUES:System sales
    
    $
    5,160,020
    
    
    $
    4,514,883Service
    
    
    530,877
    
    
    
    430,486Net financing revenue
    
    
    1,042,786
    
    
    
    808,913Total revenue
    
    
    6,733,683
    
    
    
    5,754,282COST OF REVENUES:System sales
    
    
    2,869,413
    
    
    
    2,761,727Service
    
    
    1,011,675
    
    
    
    979,724Total cost
    
    
    3,881,088
    
    
    
    3,741,451Gross margin
    
    
    2,852,595
    
    
    
    2,012,831OPERATING EXPENSES:Sales and marketing
    
    
    1,536,554
    
    
    
    585,370Partner management and customer support
    
    
    483,695
    
    
    
    235,118Research and development
    
    
    273,843
    
    
    
    187,121General and administrative
    
    
    1,976,007
    
    
    
    1,117,019Total operating expenses
    
    
    4,270,099
    
    
    
    2,124,628Loss from operations
    
    
    (1,417,504
    )
    
    
    (111,797
    )OTHER INCOME (EXPENSE):Investment income
    
    
    22,097
    
    
    
    15,343Interest expense
    
    
    (479,904
    )
    
    
    (83,454
    )Loss on disposal of assets
    
    
    
    
    
    
    (16,298
    )Gain on reduction of reserves, net
    
    
    
    
    
    
    530,000Other income
(expense), net
    
    
    1,349
    
    
    
    (3,855
    )Total other income (expense)
    
    
    (456,458
    )
    
    
    441,736Net income (loss)
    
    
    (1,873,962
    )
    
    
    329,939Dividends on Series C Preferred Shares
    
    
    (3,900,501
    )
    
    
    Net income (loss) attributable to
common shareholders
    
    $
    (5,774,463
    )
    
    $
    329,939WEIGHTED AVERAGE SHARES OUTSTANDING:BASIC
    
    
    36,749,626
    
    
    
    34,937,780DILUTED
    
    
    36,749,626
    
    
    
    40,370,488NET INCOME (LOSS) ATTRIBUTABLE TO
COMMON SHAREHOLDERS PER SHARE:BASIC
    
    
    ($0.16
    )
    
    $
    0.01DILUTED
    
    
    ($0.16
    )
    
    $
    0.01
 The
accompanying notes are an integral part of these condensed consolidated financial statements.
  4




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ProLink Holdings Corp.  UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
OF STOCKHOLDERS EQUITY
For the Three Months Ended March 31, 2007
 TotalCommon Stock
    
    
    Additional
    
    
    Accumulated
    
    
    StockholdersShares
    
    
    Amount
    
    
    Paid-In Capital
    
    
    Deficit
    
    
    EquityBalance at December 31, 2006
    
    
    34,927,781
    
    
    $
    3,493
    
    
    $
    16,323,377
    
    
    
    ($15,736,551
    )
    
    $
    590,319Issuance of warrants with Series C
Preferred Stock
    
    
    
    
    
    
    
    
    
    
    2,300,290
    
    
    
    
    
    
    
    2,300,290Exercises of options and warrants
    
    
    2,644,444
    
    
    
    265
    
    
    
    (265
    )
    
    
    
    
    
    
    Stock-based compensation
    
    
    34,000
    
    
    
    3
    
    
    
    336,457
    
    
    
    
    
    
    
    336,460Warrant issued for acquisition of Scorecast
    
    
    
    
    
    
    
    
    
    
    81,916
    
    
    
    
    
    
    
    81,916Dividends on Series C Preferred Shares
    
    
    
    
    
    
    
    
    
    
    3,776,994
    
    
    
    (3,900,501
    )
    
    
    (123,507
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,873,962
    )
    
    
    (1,873,962
    )Balance at March 31, 2007
    
    
    37,606,225
    
    
    $
    3,761
    
    
    $
    22,818,769
    
    
    
    ($21,511,014
    )
    
    $
    1,311,516
 The
accompanying notes are an integral part of these condensed consolidated financial statements.
  5




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ProLink Holdings Corp.  UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 For the Three Months EndedMarch 31, 2007
    
    
    April 1, 2006Net income (loss)
    
    $
    (1,873,962
    )
    
    $
    329,939Adjustments to reconcile net income (loss) to cash used in operating activities:Depreciation and amortization
    
    
    170,367
    
    
    
    138,399Stock-based compensation
    
    
    284,780
    
    
    
    31,654Loss on disposal of equipment
    
    
    
    
    
    
    16,298Residual value of leases
    
    
    (21,421
    )
    
    
    Provision for uncollectible receivables
    
    
    61,673
    
    
    
    15,403Provision for obsolete and slow moving inventory
    
    
    (44,705
    )
    
    
    Accretion of discount on notes payable
    
    
    375,606
    
    
    
    Gain on reduction of reserves
    
    
    
    
    
    
    (530,000
    )Changes in working capital components:Accounts receivable
    
    
    (3,594,261
    )
    
    
    (2,472,578
    )Inventories
    
    
    (22,632
    )
    
    
    (126,113
    )Prepaid expenses and other assets
    
    
    (36,522
    )
    
    
    (11,068
    )Accounts payable
    
    
    (934,050
    )
    
    
    832,597Accrued liabilities
    
    
    (415,636
    )
    
    
    (1,015,366
    )Deferred revenue
    
    
    (208,650
    )
    
    
    (146,525
    )Net cash used in operating activities
    
    
    (6,259,413
    )
    
    
    (2,937,360
    )CASH FLOWS FROM INVESTING ACTIVITIES:Purchase of property and equipment
    
    
    (95,573
    )
    
    
    (65,798
    )Purchase of Scorecast
    
    
    (429,150
    )
    
    
    Asset acquisition
    
    
    
    
    
    
    (1,600,000
    )Proceeds from the sale of fixed assets
    
    
    
    
    
    
    13,464Net cash used in investing activities
    
    
    (524,723
    )
    
    
    (1,652,334
    )CASH FLOWS FROM FINANCING ACTIVITIES:Principal payments on debt
    
    
    (4,817,530
    )
    
    
    (725,477
    )Proceeds from sale of common stock and receipt of stock subscriptions receivable
    
    
    
    
    
    
    4,260,000Proceeds from sale of Series C Preferred Stock
    
    
    11,420,000
    
    
    
    Fees paid in connection with financing transactions
    
    
    (928,974
    )
    
    
    (40,000
    )Proceeds from borrowings on notes payable
    
    
    
    
    
    
    97,339Net cash provided by financing activities
    
    
    (5,673,496
    )
    
    
    3,591,862NET DECREASE IN CASH AND CASH EQUIVALENTS
    
    
    (1,110,640
    )
    
    
    (997,832
    )CASH and cash equivalents, at beginning of the period
    
    
    2,448,354
    
    
    
    2,102,454CASH and cash equivalents, at end of the period
    
    $
    1,337,714
    
    
    $
    1,104,622
 The
accompanying notes are an integral part of these condensed consolidated financial statements.
  6




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Prolink
Holdings Corp.  NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 1. NATURE OF BUSINESS AND BASIS OF PRESENTATION:
 Basis of Presentation
  Reclassification
 Use of Estimates .
 Net Income or Loss Per Share
 2. ADOPTED ACCOUNTING
  
    
    an allocation or a shift of income between taxing jurisdictions,
  7




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
    
    the characterization of income or a decision to exclude reporting taxable income in a tax
return, or
    
    a decision to classify a transaction, entity, or other position in a tax return as tax exempt.
     3. RELATED PARTY TRANSACTIONS:
 FOC Financial LP.
 Andrew Wing.
  8




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4. ACQUISITION OF SCORECAST
  Purchase Price:Cash
    
    $
    429,150Stock warrants issued
    
    
    81,916Total purchase price
    
    
    511,066Allocated as follows:Property and equipment
    
    
    100,000Net book value of assets acquired
    
    
    100,000Excess purchase price to be allocated
    
    $
    411,066Allocated as follows:Goodwill
    
    $
    205,533Other intangible assets
    
    
    205,533Total allocated
    
    $
    411,066
   5. PREPAID EXPENSES AND OTHER CURRENT ASSETS:
  March 31,
    
    
    December 31,2007
    
    
    2006(unaudited)Prepaid rent
    
    $
    82,762
    
    
    $
    25,366Prepaid investor relations
    
    
    71,679
    
    
    
    Prepaid insurance
    
    
    66,227
    
    
    
    89,823Prepaid benefits
    
    
    52,657
    
    
    
    Prepaid advertising
    
    
    33,333
    
    
    
    Unamortized loan costs
    
    
    
    
    
    
    285,723Prepaid trade show
    
    
    
    
    
    
    81,170Other prepaid expenses
    
    
    36,062
    
    
    
    77,480$
    342,720
    
    
    $
    559,562
  9




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6. PROPERTY AND EQUIPMENT
  March 31,
    
    
    December 31,2007
    
    
    2006(unaudited)Manufacturing equipment
    
    $
    95,992
    
    
    $
    87,521Course assets
    
    
    25,024
    
    
    
    25,024Office equipment & fixtures
    
    
    104,152
    
    
    
    104,152Computer hardware
    
    
    263,325
    
    
    
    224,226Computer software
    
    
    847,644
    
    
    
    699,642Leasehold improvements
    
    
    94,089
    
    
    
    94,089Total property and equipment
    
    
    1,430,226
    
    
    
    1,234,654Less: Accumulated depreciation
    
    
    (460,471
    )
    
    
    (379,271
    )Property and equipment, net
    
    $
    969,755
    
    
    $
    855,383
  7. INTANGIBLE ASSETS
  March 31,
    
    
    December 31,2007
    
    
    2006(unaudited)Optimal license
    
    $
    1,900,000
    
    
    $
    1,900,000GPSI license
    
    
    1,134,704
    
    
    
    1,134,704Customer lists and relationships
    
    
    205,533
    
    
    
    Subtotal
    
    
    3,240,237
    
    
    
    3,034,704Less: Accumulated amortization
    
    
    (815,631
    )
    
    
    (726,465
    )Intangible assets, net
    
    $
    2,424,606
    
    
    $
    2,308,239
 8. INTEREST IN RESIDUAL LEASE EQUIPMENT
  March 31,
    
    
    December 31,2007
    
    
    2006(unaudited)Residual interests in equipment purchased from E-Z-GO
    
    $
    1,595,772
    
    
    $
    1,760,152Parview residuals acquisition
    
    
    552,270
    
    
    
    601,061Residuals recognized on system sales
    
    
    1,886,445
    
    
    
    1,626,365Yamaha residuals acquisition
    
    
    391,300
    
    
    
    416,788Interest in residual lease equipment , net
    
    $
    4,425,787
    
    
    $
    4,404,366
  10




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9. DEPOSITS AND OTHER ASSETS
  March 31,
    
    
    December 31,2007
    
    
    2006(unaudited)Deposits
    
    $
    43,798
    
    
    $
    1,532Course holdbacks, net of reserve
    
    
    67,083
    
    
    
    67,083Deferred loan costs
    
    
    27,108
    
    
    
    35,053Accounts receivable  long term portion
    
    
    856,410
    
    
    
    856,410Deposits and other assets
    
    $
    994,399
    
    
    $
    960,078
 10. ACCRUED LIABILITIES
  March 31,
    
    
    December 31,2007
    
    
    2006(unaudited)Wages, commissions and related benefits
    
    $
    718,075
    
    
    $
    928,253Professional fees
    
    
    233,486
    
    
    
    183,446Accrued vendor liability
    
    
    184,529
    
    
    
    307,294Accrued liability for predecessor claims
    
    
    98,182
    
    
    
    200,000Accrued interest payable
    
    
    65
    
    
    
    65Accrued liability for lease buyouts
    
    
    167,852
    
    
    
    281,754Sales tax payable
    
    
    53,044
    
    
    
    13,850Series C Preferred dividends payable
    
    
    123,507
    
    
    
    Other accrued expenses and current liabilities
    
    
    43,793
    
    
    
    Total accrued expenses and other current liabilities
    
    $
    1,622,533
    
    
    $
    1,914,662
  11




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11. DEBT
  March 31,
    
    
    December 31,2007
    
    
    2006(unaudited)Senior Secured Credit Facilities:Revolving credit facility
    
    $
    
    
    
    $
    Term loan facility, monthly payments of principal of
$52,083 plus accrued interest at an annual rate of
9.25%, due September 30, 2009
    
    
    2,239,583
    
    
    
    2,395,834Senior secured notes, fixed interest rate of 12%, due
April 11, 2007, net of warrant discount of $360,376
    
    
    
    
    
    
    4,139,624License agreement payable, monthly payments of principal
and interest of $24,800, interest at an annual rate of 4.75%,
due June 1, 2011
    
    
    1,108,344
    
    
    
    1,169,021License agreement payable, quarterly payments of principal and
interest of $52,500, interest at an annual rate of 4.0%, due
February 2013
    
    
    804,975
    
    
    
    842,244Notes payable, Microsoft Capital, monthly payments of principal
and interest of $5,451, interest at an annual rate of 7.75%, due
November 2010, collateralized by certain equipment
    
    
    208,140
    
    
    
    221,398Notes payable, Microsoft Capital, monthly payments of principal
and interest of $5,563, interest at an annual rate of 7.75%, due
January 2011, collateralized by certain equipment
    
    
    224,846
    
    
    
    232,062Notes payable, Microsoft Capital, monthly payments of principal
and interest of $2,064, interest at an annual rate of 8.75%,due
August 2011, collateralized by certain equipment
    
    
    91,825
    
    
    
    94,603Notes Payable, First Insurance Funding Corp., monthly payments of
principal and interest of $6,096, interest rate at an annual
rate of 10.7%, due September 2007, collateralized by security
interest in insurance policies financed.
    
    
    35,464
    
    
    
    52,500Capital lease obligations
    
    
    38,892
    
    
    
    46,708Total debt
    
    
    4,752,069
    
    
    
    9,193,993Less: Current portion
    
    
    (1,549,717
    )
    
    
    (5,485,188
    )Long-term debt, net of current maturities
    
    $
    3,202,352
    
    
    $
    3,708,805
    12




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Repayment of Senior Secured Notes
 12. COMMITMENTS AND CONTINGENCIES
 Litigation
  13




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Registration Payment Arrangements
     14




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Letter of Intent with Elumina 
 13. MEZZANINE FINANCING
       15




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14. STOCKHOLDERS EQUITY
     Options
    
    
    Options Vested and
    
    
    OptionsOutstanding
    
    
    Expected to Vest
    
    
    ExercisableTotal number of options
    
    
    9,088,155
    
    
    
    8,794,816
    
    
    
    6,114,051Aggregate intrinsic value of options
    
    $
    2,155,355
    
    
    $
    2,155,066
    
    
    $
    2,155,355Weighted average remaining
contractual term (years)
    
    
    9.3
    
    
    
    9.3
    
    
    
    9.0Weighted average exercise price
    
    $
    0.91
    
    
    $
    1.14
    
    
    $
    0.69
   16




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Warrants
 March 31,
    
    
    December 31,2007
    
    
    2006(unaudited)Number of
    
    
    Warrant
    
    
    Number of
    
    
    WarrantWarrants
    
    
    Price Ranges
    
    
    Warrants
    
    
    Price RangesWarrants outstanding at the beginning
of the year
    
    
    5,371,773
    
    
    $
    1.00 to $2.00
    
    
    
    3,080,121
    
    
    $
    1.00 to $1.50Warrants issued during the period
    
    
    4,419,801
    
    
    $
    1.40 to $1.60
    
    
    
    2,291,652
    
    
    $
    1.35 to $2.00Warrants outstanding at the end of the
period
    
    
    9,791,574
    
    
    $
    1.00 to $2.00
    
    
    
    5,371,773
    
    
    $
    1.00 to $2.00Warrants exercisable at the end of the
period
    
    
    9,358,241
    
    
    $
    1.00 to $2.00
    
    
    
    4,938,440
    
    
    $
    1.00 to $2.00
  15. CONCENTRATIONS
 International Revenue
 Significant Vendor
 16. SALES AND MARKETING AND FINANCING AGREEMENTS
 E-Z-Go Sales and Marketing Agreement
  17




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Purchase of Assets from E-Z-GO
  Financing Agreement
    17. SUBSEQUENT EVENTS
   18




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Item 2.
Managements Discussion and Analysis of Financial Condition and
Results of Operations.
  Overview
       19




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RESULTS OF OPERATIONS
  Three Months Ended
    
    
    ChangeMarch 31,
    
    
    April 1,2007
    
    
    2006
    
    
    Amount
    
    
    PercentREVENUES:System sales
    
    $
    5,160,020
    
    
    $
    4,514,883
    
    
    $
    645,137
    
    
    
    14.3
    %Service
    
    
    530,877
    
    
    
    430,486
    
    
    
    100,391
    
    
    
    23.3
    %Finance income
    
    
    1,042,786
    
    
    
    808,913
    
    
    
    233,873
    
    
    
    28.9
    %Total revenue
    
    
    6,733,683
    
    
    
    5,754,282
    
    
    
    979,401
    
    
    
    17.0
    %COST OF REVENUES:System sales
    
    
    2,869,413
    
    
    
    2,761,727
    
    
    
    107,686
    
    
    
    3.9
    %Service
    
    
    1,011,675
    
    
    
    979,724
    
    
    
    31,951
    
    
    
    3.3
    %Total cost of sales
    
    
    3,881,088
    
    
    
    3,741,451
    
    
    
    139,637
    
    
    
    3.7
    %Gross margin
    
    
    2,852,595
    
    
    
    2,012,831
    
    
    
    839,764
    
    
    
    41.7
    %OPERATING EXPENSES:Sales and marketing
    
    
    1,536,554
    
    
    
    585,370
    
    
    
    951,184
    
    
    
    162.5
    %Partner management and customer support
    
    
    483,695
    
    
    
    235,118
    
    
    
    248,577
    
    
    
    105.7
    %Research and development
    
    
    273,843
    
    
    
    187,121
    
    
    
    86,722
    
    
    
    46.3
    %General and administrative
    
    
    1,976,007
    
    
    
    1,117,019
    
    
    
    858,989
    
    
    
    76.9
    %Total expenses
    
    
    4,270,099
    
    
    
    2,124,628
    
    
    
    2,145,471
    
    
    
    101.0
    %Loss from operations
    
    
    (1,417,504
    )
    
    
    (111,797
    )
    
    
    (1,305,707
    )
    
    
    1167.9
    %Other income (expense)
    
    
    (456,458
    )
    
    
    441,736
    
    
    
    (898,194
    )
    
    
    -203.3
    %Net income (loss)
    
    
    (1,873,962
    )
    
    
    329,939
    
    
    
    (2,203,901
    )
    
    
    -668.0
    %Dividends on Series C Preferred
    
    
    (3,900,501
    )
    
    
    
    
    
    
    (3,900,501
    )
    
    
    100.0
    %Net income (loss) attributable to common shareholders
    
    $
    (5,774,463
    )
    
    $
    329,939
    
    
    $
    (6,104,402
    )
    
    
    -1850.2
    %
 Revenue
  Cost of Revenue
   20




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##### Table of Contents



Gross Margin
  OPERATING EXPENSES
 Total Operating Expenses
  Sales and Marketing
  General and Administrative
  Other Income (Expense)
  LIQUIDITY AND CAPITAL RESOURCES
       21




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##### Table of Contents



Item 3. Controls and Procedures
  
 
 PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    22




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##### Table of Contents



Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  
 Item 6. Exhibits:
 ExhibitNumber
    
    Title of Document
    
    Notes31.1
    
    
    Certification of Chief Executive Officer
Pursuant to Securities and Exchange Act Rule
13a-14, as Adopted Pursuant to Section 302
of Sarbanes-Oxley Act of 2002.
    
    *31.2
    
    
    Certification of Chief Financial Officer
Pursuant to Securities and Exchange Act Rule
13a-14, as Adopted Pursuant to Section 302
of Sarbanes-Oxley Act of 2002
    
    *32.1
    
    
    Certification Pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of
The Sarbanes-Oxley Act Of 2002
    
    *
 *
    
    Filed herewith
  23




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##### Table of Contents



SIGNATURES
 th
   
  24




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##### Table of Contents



SIGNATURES
 th
   
  25




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Title of Document
    
    Notes31.1
    
    
    Certification of Chief Executive Officer
Pursuant to Securities and Exchange Act Rule
13a-14, as Adopted Pursuant to Section 302
of Sarbanes-Oxley Act of 2002.
    
    *31.2
    
    
    Certification of Chief Financial Officer
Pursuant to Securities and Exchange Act Rule
13a-14, as Adopted Pursuant to Section 302
of Sarbanes-Oxley Act of 2002
    
    *32.1
    
    
    Certification Pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of
The Sarbanes-Oxley Act Of 2002
    
    *