**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


WASHINGTON,
      D.C. 20549





**FORM
      10-KSB/A**


(Amendment
      No. 1)





x **ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
      EXCHANGE**


**ACT
      OF 1934**





**FOR
      THE FISCAL YEAR ENDED JUNE 30, 2006**





o **TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
      EXCHANGE**


**ACT
      OF 1934**





**FOR
      THE TRANSITION PERIOD FROM ______________
      TO________________**





*COMMISSION
      FILE NO. 0-31949*





**INNOFONE.COM,
      INCORPORATED**


(NAME
      OF
      SMALL BUSINESS ISSUER IN ITS CHARTER)




Nevada
            
            98-0202313(STATE
                OR OTHER JURISDICTION
            
            (IRS
                EMPLOYEROF
                INCORPORATION OR ORGANIZATION)
            
            IDENTIFICATION
                NUMBER)




**1431
      Ocean Avenue, Suite 1100, Santa Monica, CA 90401**


(ADDRESS
      OF PRINCIPAL EXECUTIVE OFFICES)





(310)
      458-3233


(ISSUER'S
      TELEPHONE NUMBER)





Securities
      registered under Section 12(b) of the Securities Exchange Act


of
      1934,
      as amended ("Exchange Act"): NONE.





Title
      of
      each class name of each exchange on which registered Securities


registered
      under Section 12(g) of the Exchange Act:





COMMON
      STOCK, PAR VALUE $0.001 PER SHARE.





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





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





Check
      if
      there is no disclosure of delinquent filers in response to Item 405 of
      Regulation S-B is not contained in this form, and no disclosure will be
      contained, to the best of Issuer'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 Yes o No





The
      Issuer had $624,907 revenues for the fiscal year ended June 30, 2006. The
      aggregate market value of the voting stock held by non-affiliates of the Issuer
      based upon the last sale price of our common stock on September 25, 2006 was
      approximately $33,974,389.80. Shares of common stock held by each executive
      officer and director and by certain persons who own 5% or more of the
      outstanding common stock have been excluded in that such persons may be deemed
      to be affiliates. This determination of affiliate status is not necessarily
      a
      conclusive determination for other purposes.





Number
      of
      shares outstanding of Issuer's common stock, $0.001 par value, outstanding
      on
      September 25, 2006: 74,435,328.





Documents
      Incorporated by Reference: NONE





Transitional
      Small Business Disclosure Format (Check one): Yes o ;
      No x








TABLE
      OF
      CONTENTS


PART
                IItem
                1. Business
            1Item
                1A. Risk Factors
            10Item
                2. Description of Property
            14Item
                3. Legal Proceedings
            14Item
                4. Submission of Matters to a Vote of Security Holders
            14PART
                IIItem
                5. Market for Common Equity and Related Stockholder
                Matters
            15Item
                6. Management's Discussion and Analysis of Financial Condition or
                Plan of
                Operation.
            18Item
                7. Financial Statements
            25Item
                8. Changes in and Disagreements With Accountants on Accounting and
                Financial Disclosure .
            26Item
                8A. Controls and Procedures
            27PART
                IIIItem
                9.   Directors, Executive Officers, Promoters and Control
                Persons; Compliance With Section 16(a) of the Exchange Act
            29Item
                10. Executive Compensation
            29Item
                11. Security Ownership of Certain Beneficial Owners and Management
                and
                Related Stockholder Matters
            30Item
                12. Certain Relationships and Related Transactions
            31Item
                13. Exhibits and Reports on Form 8-K
            32Item
                14. Principal Accountant Fees and Services
            33Signatures
            37











**Explanatory
      Note**


This
        Amendment No. 1 to Form 10-KSB is being filed to reflect certain revisions
        to
        Innofone.com, Incorporated’s Form 10-KSB filed on September 29, 2006 (the
“Original Filing”). This Amendment No. 1 shall amend and restate in its entirety
        the Original Filing.




**PART
      I**





**ITEM
      1. BUSINESS**





**History**





On
      August
      8, 2005, Innofone.com, Incorporated (“Innofone,” the “Company,” “we,” “us” and
“our”) entered into a stock purchase agreement with Mr. Alex Lightman, our
      President and Chief Executive Officer, to purchase the total issued and
      outstanding shares of IPv6 Summit Inc. (“IPv6 Summit”), an entity engaged in
      developing new technology referred to as Internet Protocol version 6. At the
      time of the Agreement, Mr. Lightman was the President, Treasurer, Director
      and
      sole shareholder of IPv6 Summit and was not an officer or director of Innofone.
      Pursuant to the agreement, on October 12, 2005 we issued to Mr. Lightman a
      promissory note in the principal amount of $1,000,000 with interest at the
      rate
      of four percent (4%) per annum and issued to him approximately 33,333,000 shares
      of our restricted common stock in exchange for 100% of the issued and
      outstanding shares of IPv6 Summit. On October 17, 2005, we amended and restated
      the note to provide for the repayment to coincide with our receipt of the
      traunches as indicated herein. As a result of the stock purchase agreement,
      IPv6
      Summit became our wholly owned subsidiary. Prior to this acquisition, we
      operated as a holding company for companies involved in technology and financial
      services.




**Overview**





The
      Internet as we know it today is based on Internet Protocol version 4, more
      commonly referred to as IPv4, a 33-year-old protocol. The IPv4 Internet is
      beginning to receive a major upgrade, with a new format for packets of data
      called Internet Protocol version 6, or IPv6. We believe that IPv6, sometimes
      called the New Internet, presents many new business opportunities, in roughly
      the same manner that the existing Internet did when it first hit the mainstream
      in the mid-1990s.




In
      the
      past, we have offered three related services that are relevant to IPv6 and
      allowed us to refine our expertise and recognition as experts in the IPv6
      industry; (i) conference management for conferences dedicated to IPv6 technology
      and deployment, (ii) consulting for companies seeking IPv6 strategies and
      solutions and (iii) training of company personnel regarding IPv6 technology
      and
      applications. We have also been in the process of developing a fourth service,
      testing for devices which are IPv6 capable. Currently, we are largely utilizing
      acquisitions of other companies to enhance our business model and shift from
      a
      conference/training/consulting/testing firm to a technology development,
      business products and services solutions enterprise. For example, our first
      acquisition, Mobile Technology Group, LLC (“MTG”), closed on August 4, 2006 and
      as a result we now own and operate MTG as a wholly owned subsidiary dedicated
      to
      providing mobile based SMS services and products as well as mobile transactions
      such as mobile ticketing. On May 10, 2006, the Company executed an amended
      binding term sheet to acquire all of the issued and outstanding capital stock
      of
      InfoWeapons, Inc., a producer of IPv6 dual-stack servers and routers in the
      Philippines. A Merger Agreement was executed on or about August 16, 2006. The
      sole remaining closing requirement in the Merger Agreement is the delivery
      of
      InfoWeapon’s US GAAP audited financial statements which are expected in the
      normal course.




We
      believe that we have deep expertise in IPv6 so as to allow us to integrate
      each
      acquisition and focus same on our ultimate goal which is to create a company
      consisting of the best of the breed profitable technologies enabling all forms
      of communication and transactions and all utilizing IPv6 for its distinguishing
      features of security, quality of service and enhanced features. Although to
      date
      we have derived 69% of our revenues from our conference management services
      and
      31% of our revenues from our consulting services we anticipate this dramatically
      changing in the coming quarters such that total
      consulting/training/conference/testing revenue will be rapidly outstripped
      by
      sales of technology products and services.





**Recent
      Developments**





On
      September 8, 2006, we issued a promissory note to Mr. Lawrence Hughes in the
      principal face amount of $2,000,000. The note bears interest at LIBOR plus
      one
      percent (1%) per annum and matures on the earlier of: (i) sixty (60) days from
      the issuance date; or (ii) December 1, 2006 or as agreed by the parties.
      Additionally, Mr. Hughes has invested $4,000,000 in our common stock in June
      2006 and is also the Chairman and CTO of one of our intended acquisitions,
      InfoWeapons, Inc. We have also placed much smaller loans with other
      sophisticated accredited investors over the past 90 days for a total $1,320,000
      at interest between 10% and 12% for between 6 and 12 months maturity date and
      with warrants to purchase our common stock at $1.00.




Between
        August 8, 2006 and September 6, 2006, we issued a several promissory notes
        to
        numerous accredited investors (the “Investors”) in the aggregate principal
        amount of $320,000, with interest at 10% per annum (collectively, the “Notes”).
        The Maturity Dates of the Notes varies but is either six or twelve months
        from
        the date of issuance. The Company may, at our option, prepay any and all
        of the
        amounts owing under the Notes, in full or the part, without penalty. In
        connection with the issuance of the Notes, we issued five-year warrant to
        the to
        purchase shares of our common stock at $1.00 per share; the amount of shares
        underlying the warrants is equal to the dollar amount of the respective Notes
        without interest thereon. We have granted certain piggyback registration
        rights
        with respect to some of the shares underlying the warrants. Moreover, each
        of
        the Notes are secured by shares of our restricted common stock and shares
        of
        restricted common stock owned by Mr. Alex Lightman, our Chief Executive Officer
        and President.


1




On
      August
      4, 2006, Innofone completed the acquisition of Mobile Technology Group, Inc.
      (“MTG”) through the merger of MTG into a newly formed wholly-owned subsidiary of
      Innofone pursuant to an Agreement and Plan of Merger, dated July 1, 2006 (the
      “Agreement”). In accordance with the terms and provisions of the Agreement, in
      exchange for all for of the capital stock of MTG, Innofone paid (a) $7,500
      in
      cash; and (b) issued a total of 1,441,441 shares of its common stock valued
      at
      the time of the execution of the Agreement at $1,500,000.00 (the “Common
      Stock”). All of the shares issued to pursuant to the MTG Acquisition Agreement
      carried a restricted securities legend. MTG did not receive any cash proceeds
      from the transaction. The Company did not use any underwriter or broker-dealer
      in connection with the issuance of the shares to MTG and except for certain
      legal fees and stock transfer agent fees, no other material costs or expenses
      were incurred in connection with the issuance of the shares. The shares issued
      to the MTG Shareholders were issued under a claim of exemption pursuant to
      Section 4(2) of the Securities Act of 1933.





On
          July
          10, 2006, we issued a promissory note to 55 South Investments in the face
          amount of $500,000, with interest at 12% per annum. The Maturity Date shall
          be
          the earlier of: (a) one (1) year from the commencement of that certain
          equity
          swap transaction (“Swap”) whereby 30 days have expired thereafter the date in
          which the Company is granted effectiveness by the Securities and Exchange
          Commission on a registration statement filed pursuant to certain agreements
          made
          in connection with an equity swap made by and between the Company and Cogent
          Capital Financial, LLC and its affiliates as of June 2, 2006 (defined herein
          as
          the “Swap Start Date”); or (b) December 1, 2007, whichever is earlier. Repayment
          of the Principal by Innofone to the Holder shall commence within ten (10)
          days
          of the Swap Start Date and shall continue thereafter in equal pro rata
          monthly
          installments on the same date of each subsequent month thereafter for the
          successive eleven (11) months thereafter the Swap Start Date and continue
          until
          all principal payments are paid in full. The Principal shall be repaid
          in full
          no later than the Maturity Date. Should the Swap Start Date not occur prior
          to
          the Maturity Date, then the entirety of Principal shall be due and payable
          to
          Holder on the Maturity Date. Further Innofone may, at its option, prepay
          all
          amounts owing under this Note prior to the Maturity Date, in whole or in
          part,
          without payment of any premium or penalty, after giving written notice
          thereof
          to the Holder at least one (1) day prior to the date selected for prepayment.
          In
          connection with the issuance of the note, we issued (i) a five-year warrant
          to
          55 South Investments for the right to purchase up to 2,000,000 shares of
          common
          stock at $1.00 per share; and (ii) a five year warrant to Millennium Investment
          Services, Inc., an affiliate of 55 South, for the right to purchase 500,000
          shares of common stock at $1.00 per share. We have granted certain piggyback
          registration rights with respect only to the shares underlying the warrant
          issued to 55 South. The note is secured with approximately $2,000,000 worth
          of
          our restricted common stock and $2,000,000 worth of restricted common stock
          owned by Mr. Lightman, our Chief Executive Officer and President. On July
          14,
          2006, we issued an additional promissory note for $500,000 on the same
          terms. In
          connection with the issuance of the note, we issued 55 South Investments
          a five
          year warrant to purchase up to $2,000,000 shares of common stock at an
          exercise
          price of $1.00 per share. The Company has the right to redeem 1,400,000
          of such
          warrants for $250,000 until July 13, 2007 except for the right to redeem
          a
          portion of the warrants, the deal is on the same terms as the July 10th
          transaction. We have granted certain demand registration rights with respect
          to
          all shares issued as security under the notes. Further, we have agreed
          to pay to
          55 South approximately $40,000 representing an origination fee and a due
          diligence fee.
  On
          June
          2, 2006, pursuant to a securities purchase agreement, we sold in a private
          placement to Cogent Capital Investments LLC (“CCI”) (i) 1,850,000 shares of our
          common stock (“Common Stock”) and (ii) 4,815,000 shares of our Series A
          Convertible Preferred Stock (“Preferred Stock”) for an aggregate purchase price
          of $50,000,000, which was paid in the form of U.S. Treasury Bonds (the
“Bonds”).
          Pursuant to an Amended and Restated Certificate of Designation filed by
          Innofone, the Preferred Stock issued to Cogent has no voting rights, no
          dividend
          rights (unless the Board of Directors elects otherwise) and each shares
          of
          Preferred Stock shall be convertible into ten (10) shares of Common Stock,
          subject to certain adjustments (“Conversion Ratio”). Further, no sooner than two
          years after June 2, 2006, the issuance date, Innofone has the option to
          redeem
          all (but not less than all) of the outstanding Preferred Stock by paying
          in cash
          the market price (the trailing ten (10) average of the Common Stock) multiplied
          by the Conversion Ratio. The Preferred Stock shall rank, with respect to
          the
          payment of dividends and the distribution of assets, senior to any other
          security issued by Innofone.
 Concurrently
        with the consummation of the private placement to CCI, we entered into an
        equity
        swap transaction with Cogent Capital Financial LLC (“CCF”), an affiliate of CCI
        (the “Equity Swap”). The Equity Swap is a fixed versus floating price swap with
        respect to a notional amount of 37,500,000 shares of our Common Stock, with
        CCF
        being the floating equity price payor and Innofone being the fixed
        equity price payor. The fixed price under the Equity Swap is $1.333 per
        share. The Equity Swap has a maturity date of December 2, 2010, though under
        certain conditions this date can be extended, and provides for periodic
        settlements and reductions of the notional amount of the Equity Swap over
        a 30
        month period, provided that Innofone has satisfied certain conditions. Among
        these conditions is a requirement that Innofone maintain an effective
        registration statement with respect to specified portions of the Common Stock
        purchased by CCI and the Common Stock into which the Preferred Stock purchased
        by CCI is convertible. The portion of such Common Stock to be covered by
        the
        registration statement increases over a 30 month period to a maximum of
        55,000,000 shares. This registration statement is being provided by Innofone
        to
        satisfy, on an initial basis, this condition of the Equity Swap. Continued
        satisfaction of this condition will depend on the maintenance of this
        registration statement and the provision at later dates of one or more
        additional registration statements. To secure Innofone's performance of the
        Equity Swap, Innofone has pledged to CCF, and deposited in a custodian account
        subject to a lien in favor of CCF, the Bonds. As the notional amount of the
        Equity Swap is reduced, a corresponding portion of the pledged Bonds are
        to be
        released to Innofone, subject to any required partial settlement of the Equity
        Swap resulting from the reduction in the notional amount.
 
 In
        connection with and as consideration for CCF's obligations under the Equity
        Swap, Innofone paid to CCF an initial amount consisting of (i) $568,750 (out
        of
        approximately $1,375,000 to be paid); (ii) 5,000,000 shares of Common Stock;
        and
        (iii) a warrant to purchase 5,000,000 shares of Common Stock, during a 5-year
        term, at an initial exercise price per share of $1.20. The remaining
        approximately $806,250 (of the $1,375,000) due is accruing interest and will
        be
        deducted and paid from the first 3 collateral releases.  Innofone and CCF
        entered into a registration rights agreement granting CCF certain demand
        and
        piggyback registration rights with respect to these shares of Common
        Stock.




2




Further,
        upon the effective date of the merger, the officers and directors of MTG
        became
        the officers and directors of the surviving company, Mobile Tech Acquisition
        Corp. Inc. (“Mobile Tech”). Specifically, Kirk Anderson, James Tyner, and
        Ricardo Micheri, all former officers of MTG, are now officers and directors
        of
        Mobile Tech. Innofone is in the process of entering new employment agreements
        with Messrs. Anderson, Tyner, and Micheri. Further, the parties to the MTG
        Acquisition Agreement acknowledged that potential conflicts may arise by
        virtue
        of the fact that Gerard N. Casale Jr. was a shareholder of both MTG and Innofone
        and has also acted in the past as corporate counsel to MTG and is currently
        General Counsel and Vice President of Business & Legal Affairs at Innofone.
        Accordingly, Gerard N. Casale Jr. abstained from any affirmative vote or
        consent
        or approval of the MTG Acquisition Agreement or the contemplated MTG merger
        transaction with us.


On
      May
      25, 2006, we entered into a Letter Agreement (“Agreement”) with the NIR Group
      for the repayment (the “Repayment”) of certain notes (“Notes”) and cancellation
      of certain warrants (“Warrants”) issued on or about August 31, 2005 and October
      31, 2005 pursuant to that certain Securities Purchase Agreement (the “SPA”) by
      and between Innofone and AJW Partners, LLC (“Partners”), New Millennium Capital
      Partners, II, LLC (“Millennium”), AJW Offshore, Ltd. (“Offshore”) and AJW
      Qualified Partners, LLC (“Qualified, with Partners, Millennium and Offshore,
      collectively, the “NIR Group”). The Repayment was applied to the outstanding
      principal and interest owing under the Notes and as consideration for the
      cancellation of the Warrants issued to the NIR Group, and the termination of
      any
      and all UCC-1s filed in favor of NIR. Further, in connection with the SPA,
      Notes
      and Warrants, the following ancillary documents were executed and/or filed:
      (1)
      Guaranty and Pledge Agreement, dated August 31, 2005, by and between Innofone,
      Mr. Alex Lightman, Innofone's President and Chief Executive Officer, and NIR
      (“Pledge Agreement”); (2) Security Agreement by and between Innofone and NIR,
      dated August 31, 2005 (“Security Agreement”); and (3) UCC-1 Financing Statements
      (“UCC-1s”) filed by NIR in Nevada (the Notes, SPA, Warrants, Pledge Agreement
      and Security Agreement are referred to collectively as “Original
      Documents”).





In
      connection with the Repayment, Innofone and NIR executed and delivered the
      Agreement, a new promissory note (the “New Notes”), a new stock purchase warrant
      (the “New Warrants”), and a new registration rights agreement (“New Registration
      Agreement”) (the Agreement, New Notes, New Warrants and New Registration
      Agreement and the UCC-3s shall be referred to collectively as the “New
      Documents”, each of which is filed herewith as an Exhibit). Further, NIR is
      required to file UCC-3 Termination Statements (“UCC-3s”) necessary to terminate
      any perfected security interest they had obtained pursuant to the Security
      Agreement.




The
      terms
      of the Repayment, as provided in the Agreement are as follows: (a) upon signing
      of Agreement, Innofone made a cash Payment to NIR in the amount of $2,635,400
      to
      be applied to the repayment of all amounts of principal and interest owing
      and
      outstanding under the Notes; (b) upon signing of the Agreement, Innofone issued
      to NIR the New Notes in the aggregate amount of $1,200,000. The New Notes are
      self-amortizing over a one-year time period commencing on July 1, 2006, with
      each installment payment, of $100,000 in the aggregate for all New
      Notes, due on the twelve consecutive monthly anniversaries beginning July 1,
      2006. The New Notes may be prepaid by Innofone at anytime without penalty;
      (c)
      upon signing of the Agreement, Innofone shall issued to NIR the New Warrants
      exercisable into an aggregate of 750,000 shares of Innofone's Common Stock
      (the
“Warrant Shares”). The New Warrants shall have a term of five years and an
      exercise price equal to $1.79. The New Warrants may be exercised on a cashless
      basis only in the event that there is no effective registration statement
      covering the Warrant Shares. NIR may exercise the New Warrants by utilizing
      any
      amounts still owing under the




3




New
      Notes. Innofone may buy back all of the New Warrants from NIR for an aggregate
      of $100,000 at any time prior to the New Warrants being exercised; (d) upon
      signing of the Agreement, Innofone and NIR executed and delivered the New
      Registration Agreement providing for the registration of the Warrant Shares
      with
      the Securities and Exchange Commission. The New Registration Agreement provides
      for one piggyback registration right no sooner than six months from the date
      of
      hereof; (e) NIR agrees not to sell Innofone's Common Stock short, either
      directly or indirectly through its affiliates, principals or advisors; (f)
      the
      Original Documents were terminated in all respects, and were rendered null
      and
      void and no longer binding NIR or Innofone to any obligations, duties and
      responsibilities contained therein. Further, NIR and Innofone mutually agree
      that the New Documents shall supersede the Original Documents in all respects;
      (g) Innofone filed a Form AW to withdraw the Registration Statement on Form
      SB-2
      currently on file with the Securities and Exchange Commission covering the
      shares of common stock underlying the Notes and the Warrants; (h) All security
      interests perfected by NIR on the “Collateral” (as defined in the Security
      Agreement), pursuant to the Original Documents, including the Security
      Agreement, shall be terminated. Accordingly, NIR agreed to file within (2)
      days
      of the Agreement, UCC-3 Termination Statement. To date, we have paid NIR a
      total
      of $300,000 under the NIR New Notes and a total $900,000 remains to be
      paid.




On
      April
      27, 2006, Innofone entered into a term sheet with Mr. Lawrence Hughes providing
      for an investment by Mr. Hughes in the aggregate amount of $4,000,000 in
      exchange for approximately 3,478,260 shares of Innofone's restricted common
      stock at $1.15 per share. We have agreed to register 500,000 shares of common
      stock. Further, pursuant to the term sheet, Innofone is to issue a warrant
      to
      purchase 400,000 shares of Innofone's restricted common stock at an exercise
      price equal to eighty percent (80%) of the five (5) day trading average close
      price of Innofone's common stock. We completed the transaction with Mr. Hughes
      relative to the term sheet in June 2006.





On
      March
      20, 2006, we entered into a transaction with Digital Presence, Inc., a recently
      formed Delaware corporation, whereby we agreed to purchase up to 66.67% of
      the
      total issued and outstanding common stock shares of Digital Presence, Inc.
      in
      return for cash investment of a total of $300,000  made in three (3)
      installment payments commencing on execution and ending on or about June 15,
      2006.  Digital Presence, Inc. is an entity which was formed for the purpose
      of creating a scalable and addressable IPv6 identity registry for application
      in
      various industries and government.  Digital Presence, Inc. will be managed
      by employees other than those of Innofone but Innofone has the ability to elect
      one (1) member of the Board of Directors of Digital Presence, Inc. and maintains
      other rights, preferences and privileges through the subject investment. As
      of
      June 30, 2006, we had paid the initial and second closing payments totaling
      $175,000, of which $125,000 was treated as a deposit since the related shares
      were not received as of June 30, 2006. We made the third and final payment
      of
      $125,000 on September 8, 2006.




**Our
      Services**





We
      began
      our conference services from our date of incorporation on July 9, 2003 after
      we organized the first Ipv6 Summit in the United States that attracted over
      300
      people. Our conference revenue comes from charging individuals and corporations
      an admission fee of approximately $200 to $500 per person for each event and
      from charging corporations from $4,000 to $18,000 each for sponsorship that
      include an exhibit booth. There are slight variations in these charges depending
      on how many benefits are included. We
      currently have two conferences scheduled over the next 12 months: (i) Asia
      Ipv6
      Summit booked for February 19-21, 2007 at the Makati Shangri-la Hotel with
      projected attendees of 500 people; and (ii) US Ipv6 Summit booked for March
      27-29, 2007at the Hyatt Reston in Virginia with projected attendees of 700
      people.




We
      began
      offering our training services with the US IPv6 Summit in December 2003 with
      the
      tutorial that preceded the three-day IPv6 Summit by adding a day of activity
      for
      people who needed initial training, and who wanted to know more about security
      than could be described in the Summit format. We added a separate training
      event, the Federal Chief Information Officer workshop, in October 2005. We
      anticipate that revenues from training services will come from admission
      fees to the events and are in the hundreds of dollars per person. Our chief
      officer responsible for the training and consulting, Dale Geesey, resigned
      in
      August 2006 and we replaced him immediately with James Bacchus, CEO of Digital
      Presence, Inc.





We
      began
      offering our consulting services in August 2005 with the sales of consulting
      agreements by our Chief Executive Officer domestically to the US Department
      of
      Defense IPv6 Transition Office, as a subcontractor to SI International
      and to Juniper Networks and internationally to North Atlantic Treaty
      Organization. Revenues from consulting are based on man-days and/or negotiated
      fees typically in the tens of thousands of dollars per engagement.





**New
      Services in Development**





We
      are in
      the early phases of developing our testing service. No revenues have been
      received, though we have received interest from a large public company to
      provide free test equipment. Testing revenues will not be generated until our
      test center is built and the first customers contracted. Revenues will come
      from, a fixed price schedule with payments in the thousands to tens of thousands
      of dollars per product or service tested in our lab.





4





**IPv6:
      The New Internet**





The
      first
      major customers for the New Internet in the US were the Department of Defense,
      which in June 2003 mandated a transition within the department that would make
      it “IPv6-capable” by 2008, and the Office of Management and Budget, on behalf of
      the Federal Government, which recently also mandated transition to IPv6, and
      the
      hundreds of large companies that supply these two entities. Many, but not all,
      major technology companies have appointed IPv6 points of contact and developed
      IPv6-related marketing messages, including Microsoft, Cisco, Juniper, Nokia,
      Hewlett-Packard and about fifty others in the US.





In
      2005,
      as in 1995, we believe that the IPv6 will be seized by first movers that both
      take advantage of the opportunities offered by the new technology and have
      a
      sound business plan to offer needed products and services to the U.S. and
      global markets. It is forecast that the IPv6 will see some of the same rapid
      rise as the existing Internet did between 1995 and 2000, quickly growing from
      millions to billions, and potentially trillions of dollars in global revenues
      impacted by the Internet. The Japanese government, for instance, which has
      done
      a great deal of research into the upcoming IPv6 market, estimates the market
      size of IPv6-ready goods/services in the year 2010 to be 170 trillion yen,
      or
      about $1.55 trillion in US currency.





The
      advantages of IPv6 over the existing protocol are significant and can be
      summarized as “security, mobility, and ad hoc networking.” These advantages are
      described in many articles and in over 244 presentations. In summary, some
      of
      the major new features are:




a)
            A
                vast increase of trillions of Internet addresses, resulting in what
                will
                seem to be almost unlimited Internet Protocol (IP) address availability,
                which will enable each customer to have many such addresses, inexpensively
                - for cell phones, game consoles, home appliances, consumer electronics
                and automobiles (getting such addresses with today's Internet is
                difficult, and costly in most parts of the
                world);





b)
            More
                secure wired and wireless communications (this is one reason the
                military
                has mandated this protocol, to send top secret information) in part
                because greater identity is possible with more
                addresses;




c)
            Mobile
                wireless online access (this is more difficult to do with
                IPv4);




d)
            Television
                and voice over the Internet Protocol, or VoIP (very difficult and
                expensive to do well with IPv4 without
                multicast);





e)
            The
                online connection of many wireless devices, such as security cameras.
                Some
                forecasts estimate over one trillion Internet connected devices by
                2015,
                an impossibility with only an IPv4 platform;
                and





f)
            Online
                connection of smart tags such as Radio Frequency Identification (RFID),
                which could enable tracking inventory and products as an essential
                part of
                any Enterprise Resource Program
                (ERP).





Simply
      put, one of the limitations of today's Internet is a shortage of addresses,
      so
      that the hardware or software equivalents of “middle men” are put into the
      system to let many people use one address, not unlike the old telephone party
      lines, where many people had the same “number,” and everyone could listen in.
      The party line system had the advantage that a lot of people could be connected
      with few switched lines, but led to problems, such as lack of security. There
      was no way to assure that one person would be speaking with only one person
      at
      the other end. When every phone user got his/her own address, it led to many
      great new capabilities - such as privacy, the ability to deliver new services
      such as telefax messages to a particular person, and the ability to go mobile
      with cell phones, and caller ID, which enabled people to screen their calls,
      accepting only those they wanted to at that moment.




Similarly,
      the New Internet will give everyone his or her personal address (or thousands
      of
      them, as needed), which enables the potential for “end-to-end” connectivity.
      Each individual can know for certain who the specific receiver at the other
      end
      is, and this allows the system to check for service quality, and allows much
      easier mobile use and roaming. The difference between IPv6 and IPv4 is
      thought by some to be as dramatic as the difference between the phones with
      individual numbers that we have today and the phones with party lines of
      yesteryear.




5


**Corporate
      Headquarters in Southern California (Santa Monica, CA)**





We
      moved
      our headquarters to Southern California on or about October 18, 2005. Our
      California headquarters is responsible for our overall management as well
      as marketing communications and support materials. It is anticipated that we
      will hire a Vice President of Business Development who will manage our Santa
      Monica office in the future. Further, the Vice President of Consulting, and
      when
      hired, the Vice President of Business Development will identify and secure
      consulting opportunities within the different customer communities, by phone
      calls and other communications, attending conferences, and advertisements.
      This
      office will also house consultants for the Southern California customer area,
      including military bases and major aerospace firms such as Northrop
      Grumman.





**Mergers
      and Acquisitions**





On
      August
      4, 2006, we closed the acquisition of Mobile Technology Group, LLC, a mobile
      SMS
      messaging and ticketing/transactions company located in Las Vegas, Nevada
      (“MTG”). MTG maintains clients such as Luxor, Mandalay Bay hotels, United Coin,
      Inc., and the Las Vegas Monorail as well as OAG and Verizon. Currently, MTG
      sells services related to SMS messaging for concierge, travel and other services
      for its customers. MTG is also engaged in a venture with the Las Vegas Monorail
      to deploy the first US ticketless transport system using mobile phones and
      electronic ticketing in lieu of paper tickets. We anticipate MTG and its
      President, Kirk Anderson, to lead MTG in the development of our entire mobile
      strategy including the integration of IPv6 into mobile applications enhancing
      security and making mobile telephony more robust.


On
        May
        10, 2006 the Company executed an amended binding term sheet to acquire all
        of
        the issued and outstanding capital stock of InfoWeapons Inc., a producer
        of IPv6
        dual-stack servers and routers in the Philippines. The consideration for
        the
        purchase is cash in the amount of $50,000 and common stock of the Company
        in the
        amount of $8,500,000. A Merger Agreement was executed on or about August
        16,
        2006 incorporating these terms. The sole remaining closing requirement in
        the
        Merger Agreement is the delivery of InfoWeapon’s US GAAP audited financial
        statements which are expected in the normal course. A shareholder of the
        Company
        is the Chairman of InfoWeapons Inc.




**Eastern
      Seaboard Offices**





Our
      former Vice President of Consulting had established our Washington, DC area
      offices. The Vice President of Consulting resigned in August 2006 and we
      replaced him with James Bacchus, CEO of Digital Presence, Inc. We are in the
      process of re-organizing our Consulting division.





Once
      restructured, the Eastern Seaboard offices will support the consultant staff
      for
      the Eastern United States, and will be used for meetings with customers. The
      office suite will have a conference room capable of holding 20-30 people, with
      a
      projector and large screen, and high speed IPv4 and IPv6 Internet connectivity,
      so that IPv6 capabilities such as Television delivered over the Internet (IPTV)
      and IPv6-enabled video security cameras can be demonstrated.




We
      will
      offer and manage our consulting, training, and conference management
      services from two corporate offices: our corporate headquarters in Santa Monica,
      California, and our Eastern Seaboard Office to be restructured by James
      Bacchus.





**Consulting
      Division**





Our
      consulting division, directed by our new VP of Consulting Services James
      Bacchus, serves major clients that need help with IPv6, especially executives
      of
      government agencies that suddenly must come up with plans on how to switch
      to
      the New Internet, and have to come up with detailed budgets and plans for doing
      so. Innofone will also serve the executive management of the aerospace and
      IT
      companies that do business with the government.





Our
      Consulting Division seeks to provide consulting services aimed at assisting
      with
      the transition from IPv4 to IPv6. The consulting contracts will be
      either directly with the end client (usually the case with public corporations)
      or, in the case of certain government offices, as a subcontractor to a company
      that has an existing “open ordering agreement” with such an offices. We are
      very familiar with this process and have consulted to clients both directly
      and
      as a subcontractor to other companies. We will attempt to obtain our own
      open ordering agreement contracts, both via SETAs and by getting onto the
      Government Services Administration (GSA) schedule; we anticipate that both
      of
      these will take 1-2 years to complete.




6





An
      important part of the consulting process will be identifying potential clients
      that need training, and recommending them to our Training Division. Likewise,
      the consultants will promote our conferences and other services, as will all
      of
      its employees.





In
      addition to conducting presentations and briefings, both on-site at customer
      facilities and off-site at hotels and other facilities, we may rent space from
      certain consultants. Also, the consultants will recommend various products,
      such as Panasonic IPv6-enabled video cameras for security, that may be available
      for sale on our website. At present and subject to change, our role will be
      purely that of a pass-through; we will not conduct the sale, shipping or
      customer support of these products. Although we will receive a commission
      on sales, our main interest for the products available on our website will
      be the convenience of the customer. There will usually be several brands of
      an
      IPv6 product available on the website, so that we do not show favoritism to
      one
      supplier (and perhaps lose competitors as sponsors for its
      conferences).





The
      consultants will price their services by job or by time. They will deliver
      white
      papers (technical background documents) and reports, as well as videos and
      multimedia presentations. In addition to face-to-face contact with customers,
      the consultants will also generate video presentations of certain basic
      technical materials, and will make these available to remote customer sites.
      All
      consultant work by us for the foreseeable future will be unclassified. We will
      investigate applying for clearances if necessary for government work, and
      whether the additional costs of secured offices, locking safes, etc. can be
      justified.




**Training
      Division**





Our
      Training Division performs two types of training services - one in the form
      of executive training (including introductions to the technology and outlines
      of
      new business opportunities) and the other in the form of business management
      training (including project management, and conformance of proposals with IPv6
      contractual requirements) and technologist, system administration and engineer
      training (with certificates similar to those awarded for Cisco or Microsoft
      system mastery).





We
      estimate that the Eastern Office will eventually support a manager and up to
      ten
      training personnel, and the headquarters offices in Santa Monica will have
      a
      manager and up to eight trainers, a combination of employees and independent
      contractors. The Santa Monica Headquarters will coordinate the generation of
      courseware and other training materials, especially during the beginning of
      Year
      1 (when basic courseware for classes has to be generated) and at the beginning
      of Year 3 (when online courseware will be generated in order to leverage
      trainers for a wider audience).





Most
      training courses will be of a one-week duration, but there will also be two-day
      Boot Camps (typically on weekends), and one-day and part-day trainings for
      management and executives. We will utilize our other partners including
      potentially InfoWeapons, Inc. for its management expertise to assist in our
      testing, training and consulting as required.





**Conference
      Management Division**




Our
      Conference Management Division focuses on establishing conferences related
      to
      IPv6.




Conference
      Management will be conducted mainly from the Santa Monica office, with the
      assistance of consultants that are local to conference locations, such as Press
      Relations managers for areas such as Washington, D.C. or Bonn, Germany. We
      do not currently have any agreements with any local consultants but typically
      retain them around the time of our conference to assist in aspects of conference
      including temporary workers to work the conferences. In addition to expanding
      the two events in Reston, VA (by adding more materials oriented towards upcoming
      military programs and toward the consumer electronics market), we plan to add
      a
      yearly event in California, which should attract the many aerospace and IT
      companies on the West Coast, as well as the military bases in the
      area.





Additional
      specialized conferences planned for the US will address the market areas of
      NCO
      (Network Centric Operations), RFIDs, Transition to IPv6, Contracts issues,
      and
      Consumer Electronics; they will be held in different cities, including New
      York,
      Chicago, San Jose, Las Vegas, and Washington, D.C.





We
      currently have two conferences scheduled over the next 12 months: (i) Asia
      IPv6
      Summit booked for February 19-21, 2007 at the Makati Shangri-la Hotel with
      projected attendees of 500 people; and (ii) US IPv6 Summit booked for March
      27-29, 2007at the Hyatt Reston in Virginia with projected attendees of 700
      people.





**Testing
      Division**




Through
      our v6 Transition division, we are in the process of establishing a world-class
      IPv6 Test and Certification Center in the Northern Virginia area. Once fully
      operational, the Test Center will provide numerous services to Federal,
      Department of Defense and commercial entities. The services to be provided
      will
      include:




7





·
            Product
                testing and certification;




·
            Interoperability
                testing;




·
            Performance
                testing; and




·
            Demonstration
                and proof-of-concept.





The
      Test
      Center will provide a neutral facility where customers and vendors can identify
      and demonstrate solutions required to support the transition to IPv6. Through
      its partnership with Spirent Federal, the Test Center will have the broad range
      of equipment necessary to support a full range of testing services.




We
      have
      entered a Teaming Agreement with Spirent Federal to provide for the development
      of an electronic device testing center which is intended to provide a place
      in
      which companies can contract to have their devices tested and approved for
      capability in an IPv6 Internet environment.  We are in negotiations with
      Spirent Federal to amend our Teaming Agreement to state that a physical testing
      center location shall be launched and operating no later than December 31,
      2006
      or the Teaming Agreement shall expire.   Spirent Federal has allocated
      and reserved and stored over $1M in testing equipment dedicated for such a
      center.  It is intended that such a center be leased or owned by Innofone
      on the Eastern seaboard and potentially near the government beltway in the
      Washington D.C. area.   Such a testing center, if launched, would
      provide a forum for discussion on IPv6 devices, creation of a standard for
      IPv6
      capability, a place for IPv6 authentication of devices and any company,
      government, person or other entity could pay under contract to have such a
      center test and approve its devices.




**Our
      Corporate Strategy**





Our
      corporate strategy has five thrust areas:





*Conduct
      and publicize the major IPv6 conference.*




The
      goodwill that is being built up at these conferences is key to achieving
      corporate goals. The government and corporate executives who are featured as
      speakers build up goodwill because they have been invited to speak. We believe
      the conferences help the audience see us as an authority figure and one of
      the
      positive, constructive, community building leaders in the IPv6 area. We gain
      deep knowledge of the status of organizations regarding IPv6, and who needs
      help
      (such as consulting and training), as well as what best practices for IPv6
      adoption are being developed and working in the field. The past conferences
      have
      also incorporated training sessions, where we obtained experience in what
      training was necessary and desired by the community. Finally, the list of
      attendees at the conferences represent a unique database for us of both
      executives and working-level technologists, as well as marketing and other
      staffers. We believe our work in the conferencing business has provided us
      with
      the credibility in the IPv6 marketplace which will allow us to make successful
      acquisitions.





*Support
      completion of the IPv6 standard.*





We
      have a relationship to the IPv6 Association; a neutral body that could help
      formulate and provide input to the issues of what “IPv6-capable” means and how
      it will be implemented, with respect to the IETF and other standards bodies.
      The
      precise formulation of standards for IPv6 implementation in specific
      applications (such as use in cellphones, wireless video cameras, home appliances
      or video transmission) by an internationally accepted expert group that is
      not
      prone to favor a particular manufacturer is important to us in several ways.
      First, such standards must exist and be unambiguous so that our consultants
      are
      able to clearly define to clients what specific standards they have to get
      their
      company to meet. Second, our Training arm must have such standards to
      relate to in order to train its clients to levels that are universally
      understood and accepted, and in order to issue Certificates of Completion after
      students have achieved a defined level of expertise.





*Be
      a
      first mover.*





We
      are
      seeking to establish a dominate foothold now because the IPv6 space is not,
      as
      of yet, overly populated with competitors. We believe this prime time period
      where the market share is ripe for the taking will be long gone by the 2010
      time
      period.




*Build
      a solid base, and look for targets of opportunity.*





We
      will
      build a business base of steady growth in a strategic and profitable area,
      and
      will then acquire a target of opportunity that offers fast leveraged growth
      in a
      related area. Part of this effort will be the support of the IPv6 industry
      by
      promotion (such as Conferences) and by garnering political support (such as
      Congressional Hearings). In this way, we believe that we will not just help
      the growth of IPv6, but will have our “hand on the pulse” of the Industry,
      to know what related services will soon be sought very actively.




8




*Seek
      Growth through Acquisition.*





We
      intend
      to expand beyond being just a conference and consulting business by seeking
      to
      acquire strong companies with similar corporate cultures that each can either
      benefit directly from the implementation of IPv6, having an existing subscriber
      base capable of leveraging IPv6, and/or enable a broader usage of IPv6. We
      have
      announced the binding term sheets for the acquisition of both Mobile Technology
      Group, Inc., a mobile messaging and electronic payment provider based in Las
      Vegas, Nevada and InfoWeapons, Inc. an Atlanta Georgia Internet appliance maker
      with operations in the Philippines.  As of the date of this Report, we
      have closed on the acquisition of Mobile Technology. On August 16, 2006,
      InfoWeapons, Inc. and the Company executed a Merger Agreement and the sole
      material outstanding closing requirement is InfoWeapons, Inc. delivery to the
      Company of US GAAP audited financial statements. We
      believe we will receive such audited financial statement in the October 2006
      time frame. Each
      of
      the acquisitions are strategic in that, they both intend to produce or do
      currently produce IPv6 capable products.   Mobile Technology Group
      satisfies Innofones needs as a center for mobile services and transactions
      and
      InfoWeapons will give Innofone the ability to actually produce IPv6 products
      once we close that acquisition.





**Competition**





Our
      competition could be considered broadly to include information technology
      companies in general, since, sooner or later, they will need to enter into
      our
      market for products, services and usage. Each company that could be seen as
      a
      competitor could also at some point become a customer, since Ipv6 knowledge
      is
      currently rare and precious, and deployed Ipv6-centric products and networks
      are
      few and far between. In the future, after the acquisition of InfoWeapons, Inc.,
      we will face competition from networking equipment vendors including Cisco,
      Juniper, Redback Networks, and Nokia; appliance vendors such as Bluecat and
      InfoBolox, and operating systems such as Microsoft and Red Hat. As a result
      of
      the acquisition of MTG, we now face competition from Mobiqua and to a lesser
      extent, in international markets, its US pasrtner, Swiftpass UK, related to
      mobile ticketing and mobile commerce. Prior to the acquisition of InfoWeapons,
      we have three business divisions, all of them related to IPv6 technology:
      Consulting (this includes consulting to corporate executives, as well as
      offering IPv6-related equipment from 3 rd parties
      on our website), training and conference management. The only other company
      in
      the US that specializes in IPv6 consulting at present is Native6, Inc. of
      Seattle, which is essentially a small two-man company that we believe is not
      financially structured for the sort of growth that we anticipate
      (see: http://www.native6.com ). 
      Some of our other competitors in IPv6 consulting are SI International, Book
      Allen Hamilton, SRI and Lockheed Martin and we believe we are ranked fifth
      in
      terms of revenues.  We believe that our chief competitors in IPv6
      training are Sunset Learning (which does not specialize in IPv6; its main
      business is Cisco-related training - see: http://www.sunsetlearning.com )
      and
      Native6, Inc. and is ranked third among these competitors in terms of
      revenues. The competitors for IPv6 conferences are: IGI (Information
      Gatekeepers, Inc. - see: http://www.igigroup.com ),
      which
      has recently started to put on small IPv6 technical conferences in the US;
      the
      IPv6 Forum, a loosely organized group based in Luxembourg which supports small
      technical conferences put on worldwide, usually by affiliated local groups
      (for
      instance, its California conference is organized by IGI, mentioned above);
      and,
      Consul Intel, a small company that conducts a yearly IPv6 conference in Spain
      (see: http://www.consulintel.es ).
      We
      believe that we are one of the top ranked conference providers in terms of
      revenues.





**Intellectual
      Property**





We
      have
      registered, and/or have applied to register, trademarks and service marks in
      the
      United States for the marks: INNOFONE, IPv6 SUMMIT INC., NORTH AMERICAN IPv6
      SUMMIT, v6 TRANSITION, and numerous other trademarks and service marks relating
      to certain aspects of our conference management, consultation services, training
      services, and IPv6 compatible computer hardware systems and software.





**Employees**





We
      have
      10 employees in the Santa Monica office and one employee in the Eastern Seaboard
      office. Our wholly owned subsidiary, MTG, has 5 employees
      currently.





None
      of
      our employees are covered by a collective bargaining agreement. We have never
      experienced a work stoppage and we believe that we have satisfactory working
      relations with our employees.





9


**ITEM
      1A. RISK FACTORS**







**RISKS
      RELATED TO OUR BUSINESS**





**WE
      HAVE INCURRED HISTORICAL LOSSES AND WE MAY NOT BE ABLE TO GENERATE PROFITS,
      SUPPORT OUR OPERATIONS, OR ESTABLISH A RETURN ON INVESTED
      CAPITAL** .





We
      incurred net losses in fiscal 2006 of $9,026,031. In addition, we expect some
      increase in our infrastructure and operating expenses to fund our anticipated
      growth. We may not be able to generate net profits in 2007 or thereafter and
      may
      not be able to support our operations, or otherwise establish a return on
      invested capital. We cannot assure you that any of our business strategies
      will
      be successful or that significant revenues or profitability will ever be
      achieved or, if they are achieved, that they can be consistently sustained
      or
      increased on a quarterly or annual basis.




**WE
      EXPECT OUR OPERATING LOSSES TO CONTINUE AND WE CAN NOT ASSURE YOU THAT WE WILL
      EVER GENERATE SIGNIFICANT REVENUES.**





Innofone
      expects to incur increased operating expenses during the next year. The amount
      of net losses and the time required for Innofone to reach and sustain
      profitability are uncertain. The likelihood of Innofone's success must be
      considered in light of the problems, expenses, difficulties, and delays
      frequently encountered in connection with a new business, including, but not
      limited to uncertainty as to development and acquisitions and the time required
      for Innofone's planned production to become available in the marketplace. There
      can be no assurance that Innofone will ever generate significant revenues
      or achieve profitability at all or on any substantial basis which could cause
      a
      decrease in your entire investment in our shares.




**WE
      HAVE A LIMITED AMOUNT OF CASH AND ARE LIKELY TO REQUIRE ADDITIONAL CAPITAL
      TO
      CONTINUE OUR OPERATIONS** . **THEREFORE, FAILURE TO OBTAIN ADDITIONAL CAPITAL MAY RESULT IN US HAVING TO
      CURTAIL OUR BUSINESS.**





We
      have a
      limited amount of available cash and will likely require additional capital
      to
      successfully implement our business plan.  Although, subject to our
      satisfying certain conditions under the Equity Swap (as defined below),
      including the effectiveness and maintenance of a registration statement, we
      will
      begin to have access to the $50 million in U.S. Treasury Bonds pledged to secure
      our obligations under the Equity Swap, such pledged bonds are to be released
      over a thirty (30) month period in specified percentages and in exact amounts
      per month that depend on our stock price and will be sufficient to sustain
      our
      operations for such 30 month period only if our stock price remains stable.
      There can be no assurance that we will be able to obtain additional funding
      when
      needed if needed, or that such funding, if available, will be obtainable on
      terms acceptable to us. Moreover, we are subject to certain restrictions in
      the
      Securities Purchase Agreement which may limit or prohibit us from raising
      additional funds through future equity and debt financings. In the event that
      our operations do not generate sufficient cash flow, or we cannot obtain
      additional funds if and when needed, we may be forced to curtail or cease our
      activities, which would likely result in the loss to investors of all or a
      substantial portion of their investment. ****





**WE
      RELY HEAVILY ON OUR MANAGEMENT, THE LOSS OF WHICH COULD HURT OUR BUSINESS,
      OPERATING RESULTS AND FINANCIAL CONDITION** .





Our
      future success is dependent on having capable seasoned executives with the
      necessary business knowledge and relationships to execute our business plan.
      Accordingly, the services of our management and our board of directors are
      deemed essential to maintaining the continuity of our operations. If we were
      to
      lose their services, our business could be harmed. We have executed an
      employment agreement with Mr. Alex Lightman, our Chief Executive Officer,
      President, and Principal Accounting Officer, and with Mr. Gerard
      Casale, our Vice President of Business Affairs. Our performance will also depend
      on our ability to find, hire, train, motivate and retain other executive
      officers and key employees. The Company currently does not have a chief
      financial officer which requires that our chief executive officer, Alex
      Lightman, to perform those duties. To the extent that Mr. Lightman will have
      to
      perform the duties of the principal accounting officer, he will not be able
      to
      perform his duties as the chief executive officer and vice versa. We are
      currently searching for a chief financial officer.





We
      must
      continually implement and improve our services, operations, operating procedures
      and quality controls on a timely basis, as well as expand, train, motivate
      and
      manage our work force in order to accommodate anticipated growth and compete
      effectively in our market segment. Successful implementation of our strategy
      also requires that we establish and manage a competent, dedicated work force
      and
      employ additional key employees. There can be no assurance that our personnel,
      systems, procedures and controls will be adequate to support our existing and
      future operations. Any failure to implement and improve such operations could
      cause operating results and financial condition to worsen.




10





Further,
      our future success depends on the continued services of executive management.
      We
      currently maintain key-man insurance on certain executives, including Mr.
      Alex Lightman, our Chief Executive Officer, President, and Principal Accounting
      Officer. Our future success is also dependent on our ability to identify, hire,
      train and retain other qualified managerial and other employees. Competition
      for
      these individuals is intense and increasing. The loss of any of their services
      would be detrimental to us and could have a harmful effect on our business
      development





**WE
      OPERATE IN A HIGHLY COMPETITIVE ENVIRONMENT WHICH COULD SIGNIFICANTLY AFFECT
      OUR
      BUSINESS INITIATIVES WHICH COULD NEGATIVELY IMPACT YOUR INVESTMENT IN OUR
      SHARES.**





We
      have
      competitors in each of our three business divisions. Our conference division
      competes with IPv6 Forum; our training division computers with Sunset Learning
      and Nativ6, and our consulting division competes with Booz Allen Hamilton,
      ST
      International, SRI and Lockheed Martin. Our competitors are larger, have
      substantially greater resources and better known brand and reputation. Our
      competitors may be able to adapt more quickly to changes in customer needs
      or to
      devote greater resources than we can to developing and expanding our services.
      Such competitors could also attempt to increase their presence in our markets
      by
      forming strategic alliances with other competitors, by offering new or improved
      products or services by increasing their efforts to gain and retain market
      share
      through competitive pricing. As the market for our services matures, price
      competition and penetration into the market will intensify. There can be no
      assurance that we will be able to continue to compete successfully with existing
      or new competitors. Such competition may hamper our ability to generate
      profits.





**RISK
      FACTORS AFFECTING OUR FUTURE RESULTS OF OPERATIONS**





Due
      to
      our limited operating history, it is difficult to predict accurately future
      revenues. This may result in one or more future quarters where our financial
      results may fall below the expectation of management and investors. However
      firmly management may believe in its prospects, we could fail. Operating results
      may vary, depending upon a number of factors, many of which are outside our
      control. Material factors expected to impact our operating results include,
      legal costs expansion activities, increased interest and expenses for borrowings
      and possible hiring of additional full time employees. Every investor should
      evaluate the risks, uncertainties, expenses and difficulties frequently
      encountered by companies in the early stage of development.





**WE
      ARE ATTEMPTING TO EXPAND OUR BUSINESS AND ANY FAILURE TO DO SO COULD HURT OUR
      BUSINESS**





We
      expect
      that expansion will be required to address potential growth. This need for
      expansion will continue to place a significant strain on our management and
      financial resources. Our business strategy includes entering into business
      partnerships and acquiring future businesses. We may be unable to complete
      suitable business partnerships and acquisitions on commercially reasonable
      terms, if at all. Competition could impair our ability to successfully pursue
      these aspects of this business strategy. Failure to manage growth or
      successfully pursue aspects of our business strategy could prevent us from
      generating revenues.





Business
      partnerships or acquisitions could disrupt ongoing business, distract management
      and employees and increase expenses. If we make an acquisition, we could
      face difficulties assimilating that company's personnel and operations. Key
      personnel of the acquired company may decide not to work for us. Acquisition
      of
      additional services or technologies also involves risk of incompatibility and
      lack of integration into existing operations. If we finance the acquisitions
      by
      issuing equity securities, this could dilute existing stockholders positions.
      Additionally, funding instruments may have rights, preferences or privileges
      senior to those of our stockholders, which would impact an investment in our
      shares.





**WE
      HAVE LIMITED HISTORICAL FINANCIAL DATA WHICH MAKE IT DIFFICULT TO EVALUATE
      AN
      INVESMENT IN OUR SHARES**





As
      a
      result of its limited operating history, we have limited historical financial
      data upon which to forecast revenues and results of operation. The actual effect
      of these factors on the price of stock will be difficult to assess. Results
      of
      operation may fall well below the expectations of and the trading price of
      our common stock may drop. As a result, any investment in our common stock
      could
      result in losses to the investor.





11








**RISKS
      RELATED TO HOLDING OUR SECURITIES**





**THERE
      ARE A LARGE NUMBER OF SHARES UNDERLYING OUR SERIES A PREFERRED STOCK THAT MAY
      BE
      AVAILABLE FOR FUTURE SALE AND THE SALE OF THESE SHARES MAY DEPRESS THE MARKET
      PRICE OF OUR COMMON STOCK** .





As
      of
      June 2006, we have 4,815,000 Series A Convertible Preferred Stock, $0.01 par
      value per share, issued and outstanding which may be converted into an estimated
      48,150,000 shares of our Common Stock at a conversion ratio of ten (10) shares
      of common stock for each shares of Series A Convertible Preferred Stock. Upon
      the effectiveness of our registration statement, 41,300,000 shares may
      be sold without restriction upon conversion. Further, shares of our common
      stock
      may be shorted which could depress the price of our stock. The sale of these
      shares may cause the market price of our Common Stock to decrease.





**THE
      ISSUANCE OF SHARES UPON CONVERSION OF THE SERIES A CONVERTIBLE PREFERRED STOCK
      MAY CAUSE IMMEDIATE AND SUBSTANTIAL DILUTION TO OUR EXISTING
      STOCKHOLDERS** .





The
      issuance of shares upon conversion of the Series A Convertible Preferred Stock
      may result in substantial dilution to the interests of other stockholders since
      the selling stockholders may ultimately convert and sell the full amount
      issuable on conversion. The investors may convert their Series A shares at
      a
      conversion ratio equal to ten shares of common stock for each Series A share.
      The conversion of the Series A shares will represent approximately 39.28% of
      our
      issued and outstanding common stock.




**THE
      PROCEEDS FROM THE PRIVATE PLACEMENT WITH COGENT CAPITAL INVESTMENTS LLC HAVE
      BEEN PLEDGED AS COLLATERAL FOR AN EQUITY SWAP AND THE AVAILABALITY OF THOSE
      PROCEEDS IS SUBJECT TO THE CONDITIONS OF AND OUR OBLIGATIONS UNDER THE EQUITY
      SWAP**




As
      described more fully below under “Cogent Transaction”, concurrently with the
      consummation of the private placement of shares of our common stock and Series
      A
      Convertible Preferred Stock to Cogent Capital Investments LLC, we entered into
      an equity swap with Cogent Capital Financial LLC relating to a notional amount
      of 37,500,000 shares of our common stock.  To secure our performance under
      this equity swap, we pledged the $50,000,000 of U.S. Treasury securities we
      received as the purchase price in the private placement.  Our ability to
      access the pledged U.S. Treasury securities will depend on the satisfaction
      of
      various conditions under the equity swap as well as the ultimate determination
      of the fixed versus floating price settlement amounts due under the equity
      swap
      in connection with each reduction of the notional amount thereunder.  As a
      result, the portion of the pledged U.S. Treasury securities that we will be
      able
      to deploy for our operational needs is uncertain and may be reduced if we fail
      to satisfy the conditions under the equity swap or the settlement payments
      under
      the equity swap are not in our favor.




**WE
      ARE SUBJECT TO PENNY STOCK REGULATIONS AND RESTRICTIONS.**





Our
      common stock is approved for quotation on the NASD OTC Bulletin Board. Since
      our
      common stock trades below $5.00 per share (the last reported bid price for
      our
      common stock on September 25, 2006, was $0.90), it is considered a "penny stock"
      and is subject to SEC rules and regulations that impose limitations on the
      manner in which it can be publicly traded.





These
      regulations require the delivery, prior to any transaction involving a penny
      stock, of a disclosure schedule explaining the penny stock market and the
      associated risks. Potential investors in our common stock are urged to obtain
      and read this disclosure carefully before purchasing any shares that are deemed
      to be "penny stock." Also under these regulations, certain brokers who recommend
      a penny stock to persons other than established customers or certain accredited
      investors must make a special written suitability determination regarding the
      purchaser and receive the purchaser's written agreement to a transaction prior
      to sale. These procedures require the broker-dealer to:





·
            obtain
                from the investor information concerning his or her financial situation,
                investment experience and investment
                objectives;





·
            reasonably
                determine, based on that information, that transactions in penny
                stocks
                are suitable for the investor and that the investor has sufficient
                knowledge and experience as to be reasonably capable of evaluating
                the
                risks of penny stock transactions;





12





·
            provide
                the investor with a written statement setting forth the basis on
                which the
                broker-dealer has made the determination of suitability;
                and





·
            receive
                a signed and dated copy of the statement from the investor, confirming
                that it accurately reflects the investor's financial situation, investment
                experience and investment
                objectives.





These
      regulations have the effect of limiting the trading activity of our common
      stock
      and reducing the liquidity of an investment in our common stock.





Stockholders
      should be aware that, according to SEC Release No. 34-29093, the market for
      penny stocks has suffered in recent years from patterns of fraud and
      abuse.





Our
      "penny stock" designation may adversely affect the development or continuation
      of the public market for our common stock.




**BROKER-DEALER
      REQUIREMENTS MAY AFFECT TRADING AND LIQUIDITY.**





Section
      15(g) of the Securities Exchange Act of 1934, as amended, and Rule 15g-2
      promulgated thereunder by the SEC require broker-dealers dealing in penny stocks
      to provide potential investors with a document disclosing the risks of penny
      stocks and to obtain a manually signed and dated written receipt of the document
      before effecting any transaction in a penny stock for the investor's account.
      Potential investors in our common stock are urged to obtain and read such
      disclosure carefully before purchasing any shares that are deemed to be "penny
      stocks." Moreover, Rule 15g-9 requires broker-dealers in penny stocks to approve
      the account of any investor for transactions in such stocks before selling
      any
      penny stock to that investor. This procedure requires the broker-dealer to
      (i)
      obtain from the investor information concerning his or her financial situation,
      investment experience and investment objectives; (ii) reasonably determine,
      based on that information, that transactions in penny stocks are suitable for
      the investor and that the investor has sufficient knowledge and experience
      as to
      be reasonably capable of evaluating the risks of penny stock transactions;
      (iii)
      provide the investor with a written statement setting forth the basis on which
      the broker-dealer made the determination in (ii) above; and (iv) receive a
      signed and dated copy of such statement from the investor, confirming that
      it
      accurately reflects the investor's financial situation, investment experience
      and investment objectives. Compliance with these requirements may make it more
      difficult for holders of our common stock to resell their shares to third
      parties or to otherwise dispose of them in the market or otherwise.




**OUR
      COMMON STOCK MAY BE VOLATILE, WHICH SUBSTANTIALLY INCREASES THE RISK THAT YOU
      MAY NOT BE ABLE TO SELL YOUR SHARES AT OR ABOVE THE PRICE THAT YOU MAY PAY
      FOR
      THE SHARES.**





Because
      of the limited trading market expected to develop for our common stock, and
      because of the possible price volatility, you may not be able to sell your
      shares of common stock when you desire to do so. The inability to sell your
      shares in a rapidly declining market may substantially increase your risk of
      loss because of such illiquidity and because the price for our common stock
      may
      suffer greater declines because of its price volatility.





The
      price
      of our common stock that will prevail in the market after this offering may
      be
      higher or lower than the price you may pay. Certain factors, some of which
      are
      beyond our control, that may cause our share price to fluctuate significantly
      include, but are not limited to, the following:




· variations in our quarterly operating results;


· loss of a key relationship or failure to complete significant
      transactions;


· additions or departures of key personnel; and


· fluctuations in stock market price and volume.




Additionally,
      in recent years the stock market in general, and the over-the-counter markets
      in
      particular, have experienced extreme price and volume fluctuations. In some
      cases, these fluctuations are unrelated or disproportionate to the operating
      performance of the underlying company. These market and industry factors may
      cause our stock price to decline, regardless of our operating
      performance.




13





In
      the
      past, class action litigation often has been brought against companies following
      periods of volatility in the market price of those companies' common stock.
      If
      we become involved in this type of litigation in the future, it could result
      in
      substantial costs and diversion of management attention and resources, which
      could have a further negative effect on your investment in our
      stock.





****** ***Special
      Note Regarding Forward-Looking Statements***





This
      10-KSB contains “forward-looking statements” and information relating to our
      business that are based on our beliefs as well as assumptions made by us or
      based upon information currently available to us. When used in this 10-KSB,
      the
      words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,”
“project”, “should” and similar expressions are intended to identify
      forward-looking statements. These forward-looking statements include, but are
      not limited to, statements relating to our performance in “Business” and
“Management's Discussion and Analysis of Financial Condition and Results of
      Operation”. These statements reflect our current views and assumptions with
      respect to future events and are subject to risks and uncertainties. Actual
      and
      future results and trends could differ materially from those set forth in such
      statements due to various factors. Such factors include, among others: general
      economic and business conditions; industry capacity; industry trends;
      competition; changes in business strategy or development plans; project
      performance; the commercially viability of our products and offerings;
      availability, terms, and deployment of capital; and availability of qualified
      personnel. These forward-looking statements speak only as of the date of this
      10-KSB. Subject at all times to relevant federal and state securities law
      disclosure requirements, we expressly disclaim any obligation or undertaking
      to
      disseminate any update or revisions to any forward-looking statement contained
      herein to reflect any change in our expectations with regard thereto or any
      changes in events, conditions or circumstances on which any such statement
      is
      based. In addition, we cannot assess the impact of each factor on our business
      or the extent to which any factor, or combination of factors, may cause actual
      results to differ materially from those contained in any forward-looking
      statements.





**ITEM
      2.** **DESCRIPTION OF PROPERTY**





Innofone
      does not own any real estate. Innofone currently rents approximately 2,800
      square feet of space at 1431 Ocean Avenue, Suite 1100, Santa Monica, California
      90401. The lease is currently on a month-to-month basis and Innofone is paying
      approximately $6,000 per month for five offices.





We
      believe that the premises leased are adequate for our current and near term
      requirements.





**ITEM
      3.** **LEGAL PROCEEDINGS**





We
      are
      not currently involved in any material real or threatened legal
      proceedings.







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





There
      were no matters submitted for stockholders' vote during the fourth quarter
      of
      the fiscal year 2005.






14





**PART
      II**





**ITEM
      5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS**





Our
      common stock is currently quoted on the National Association of Securities
      Dealers Over the Counter Bulletin Board under the symbol “INFN” ("OTC Bulletin
      Board"). The common stock had previously been quoted on the OTC
      Bulletin Board and was delisted on September 1, 1999. From September 1, 1999
      until the re-listing on the OTC Bulletin Board on March 27, 2001, our
      common stock was quoted in the over-the-counter Pink Sheets market in
      the United States.




The
      closing price of our common stock on the OTC Bulletin Board on  September
      25, 2006 was $0.90 per share.





The
      price
      ranges of quotations in Innofone's common stock during the last two fiscal
      years and the subsequent interim period are as follows:














2006
            
            High
            
            Low1/1/06-3/31/06
            
            $
            .60
            
            $
            .244/1/06-6/30/06
            
            
            1.89
            
            
            .607/1/06-9/26/06
            
            
            1.25
            
            
            .652005
            
            
            High
            
            
            Low1/1/05
                - 3/31/05
            
            $
            .85
            
            $
            .854/1/05
                - 6/30/05
            
            
            1.69
            
            
            1.507/1/05
                - 9/30/05
            
            
            2.50
            
            
            2.3610/1/05
                - 12/31/05
            
            
            1.64
            
            
            .4220041/1/04
                - 3/31/04
            
            $
            2.50
            
            $
            2.354/1/04
                - 6/30/04
            
            
            2.50
            
            
            2.357/1/04
                - 9/30/04
            
            
            2.50
            
            
            2.35




As
      of September 20, 2006, we had issued and outstanding 74,435,328
      shares of common stock, held by approximately 180 holders of record. Further,
      we
      have 4,815,000 shares of Series A Preferred Stock issued and outstanding.
 There have been no cash dividends declared by us since our inception.




The
      source of these high and low prices was the OTC Bulletin Board. These quotations
      reflect inter-dealer prices, without retail mark-up, markdown or commissions
      and
      may not represent actual transactions. The high and low prices listed have
      been
      rounded up to the next highest two decimal places.





The
      market price of our common stock is subject to significant fluctuations in
      response to variations in our quarterly operating results, general trends in
      the
      market for the products we distribute, and other factors, over many of which
      we
      have little or no control. In addition, broad market fluctuations, as well
      as
      general economic, business and political conditions, may adversely affect the
      market for our common stock, regardless of our actual or projected
      performance.




We
      currently have no compensation plans.





15


**Recent
      Sales of Unregistered Securities**





On
      September 7, 2006, we issued a promissory note to Mr. Lawrence Hughes in the
      principal face amount of $2,000,000. The note bears interest at LIBOR plus
      one
      percent (1%) per annum and matures on the earlier of: (i) sixty(60) days from
      the issuance date; or (ii) December 1, 2006 or as agreed by the parties. Mr. Hughes
      has invested in our common stock prior and is also the Chairman and CTO of
      one
      of our intended acquisitions, InfoWeapons, Inc.


Between
        August 8, 2006 and September 6, 2006, we issued a several promissory notes
        to
        numerous accredited investors (the “Investors”) in the aggregate principal
        amount of $320,000, with interest at 10% per annum (collectively, the “Notes”).
        The Maturity Dates of the Notes varies but is either six or twelve months
        from
        the date of issuance. The Company may, at our option, prepay any and all
        of the
        amounts owing under the Notes, in full or the part, without penalty. In
        connection with the issuance of the Notes, we issued five-year warrant to
        the to
        purchase shares of our common stock at $1.00 per share; the amount of shares
        underlying the warrants is equal to the dollar amount of the respective Notes
        without interest thereon. We have granted certain piggyback registration
        rights
        with respect to some of the shares underlying the warrants. Moreover, each
        of
        the Notes are secured by shares of our restricted common stock and shares
        of
        restricted common stock owned by Mr. Alex Lightman, our Chief Executive Officer
        and President.


On
      July
      10, 2006, we issued a promissory note to 55 South Investments in the face amount
      of $500,000. The note bears interest at 12% per annum and matures by December
      1,
      2007. We have the right to repay the note without penalty. In connection with
      the issuance of the note, we issued (i) a five-year warrant to 55 South
      Investments for the right to purchase up to 2,000,000 shares of common stock
      at
      $1.00 per share; and (ii) a five year warrant to Millennium Investment Services,
      Inc., an affiliate of 55 South, for the right to purchase 500,000 shares of
      common stock at $1.00 per share. We have granted certain piggyback registration
      rights with respect only to the shares underlying the warrant issued to 55
      South. The note is secured with approximately $2,000,000 worth of our restricted
      common stock and $2,000,000 worth of restricted common stock owned by Mr.
      Lightman, our Chief Executive Officer and President. We have granted certain
      demand registration rights with respect to all shares issued as security under
      the note. Further, we have agreed to pay to 55 South approximately $40,000
      representing an origination fee and a due diligence fee. On July 14, 2006,
      we
      issued an additional promissory note for $500,000 on the same terms. In
      connection with the issuance of the note, we issued 55 South Investments a
      five
      year warrant to purchase up to $2,000,000 shares of common stock at an exercise
      price of $1.00 per share. The Company has the right to redeem 1,400,000 of
      such
      warrants for $250,000 until July 13, 2007 except for the right to redeem a
      portion of the warrants, the deal is on the same terms as the July 10th
      transaction. We have granted certain demand registration rights with respect
      to
      all shares issued as security under the notes. Further, we have agreed to pay
      to
      55 South approximately $40,000 representing an origination fee and a due
      diligence fee.





On
      June
      2, 2006, pursuant to a securities purchase agreement, we sold in a private
      placement to Cogent Capital Investments LLC (“CCI”) (i) 1,850,000 shares of our
      common stock (“Common Stock”) and (ii) 4,815,000 shares of our Series A
      Convertible Preferred Stock (“Preferred Stock”) for an aggregate purchase price
      of $50,000,000, which was paid in the form of U.S. Treasury Bonds (the “Bonds”).
      Pursuant to an Amended and Restated Certificate of Designation filed by
      Innofone, the Preferred Stock issued to Cogent has no voting rights, no dividend
      rights (unless the Board of Directors elects otherwise) and each shares of
      Preferred Stock shall be convertible into ten (10) shares of Common Stock,
      subject to certain adjustments (“Conversion Ratio”). Further, no sooner than two
      years after June 2, 2006, the issuance date, Innofone has the option to redeem
      all (but not less than all) of the outstanding Preferred Stock by paying in
      cash
      the market price (the trailing ten (10) average of the Common Stock) multiplied
      by the Conversion Ratio. The Preferred Stock shall rank, with respect to the
      payment of dividends and the distribution of assets, senior to any other
      security issued by Innofone.




On
      June
      2, 2006, pursuant to a securities purchase agreement, we sold in a private
      placement to Cogent Capital Investments LLC (“CCI”) (i) 1,850,000 shares of our
      common stock (“Common Stock”) and (ii) 4,815,000 shares of our Series A
      Convertible Preferred Stock (“Preferred Stock”) for an aggregate purchase price
      of $50,000,000, which was paid in the form of U.S. Treasury Bonds (the “Bonds”).
      Pursuant to an Amended and Restated Certificate of Designation filed by
      Innofone, the Preferred Stock issued to Cogent has no voting rights, no dividend
      rights (unless the Board of Directors elects otherwise) and each shares of
      Preferred Stock shall be convertible into ten (10) shares of Common Stock,
      subject to certain adjustments (“Conversion Ratio”). Further, no sooner than two
      years after June 2, 2006, the issuance date, Innofone has the option to redeem
      all (but not less than all) of the outstanding Preferred Stock by paying in
      cash
      the market price (the trailing ten (10) average of the Common Stock) multiplied
      by the Conversion Ratio. The Preferred Stock shall rank, with respect to the
      payment of dividends and the distribution of assets, senior to any other
      security issued by Innofone.





On
      May
      25, 2006, in connection with the Repayment, Innofone issued a new promissory
      notes (the “New Notes”), and new stock purchase warrants (the “New Warrants”) to
      NIR. The New Notes are self-amortizing over a one-year time period commencing
      on
      July 1, 2006, with each installment payment due on the twelve consecutive
      monthly anniversaries beginning July 1, 2006. Further, pursuant to the New
      Notes, Innofone will pay to NIR an aggregate of $100,000 per month. The New
      Notes may be prepaid by Innofone at anytime without penalty; (c) upon signing
      of
      the Agreement, Innofone shall issued to NIR the New Warrants exercisable into
      an
      aggregate of 750,000 shares of Innofone's Common Stock (the “Warrant Shares”);
      the New Warrants. The New Warrants shall have a term of five years and an
      exercise price equal to $1.79. The New Warrants may




16




be
      exercised on a cashless basis only in the event that there is no effective
      registration statement covering the Warrant Shares. NIR may exercise the New
      Warrants by utilizing any amounts still owing under the New Notes. Innofone
      may
      buy back all of the New Warrants from NIR for an aggregate of $100,000 at any
      time prior to the New Warrants being exercised.





On
      April
      27, 2006, Innofone entered into a term sheet with Mr. Lawrence Hughes providing
      for an investment by Mr. Hughes in the aggregate amount of $4,000,000 in
      exchange for approximately 3,478,260 shares of Innofone's restricted common
      stock at $1.15 per share. Further, pursuant to the term sheet, Innofone is
      to
      issue a warrant to purchase 400,000 shares of Innofone's restricted common
      stock
      at an exercise price equal to eighty percent (80%) of the five (5) day trading
      average close price of Innofone's common stock. Definitive agreements between
      Innofone and Mr. Hughes are being finalized.




In
      connection with our Stock Purchase Agreement, dated August 8, 2005, we issued
      securities to Mr. Alex Lightman in exchange for 100% of the issued and
      outstanding shares of IPv6 Summit, Inc. Specifically, we issued a promissory
      note in the principal face amount of $1,000,000 and issued 33,333,000 shares
      of
      our restricted common stock. On October 17, 2005, we amended and restated our
      promissory note originally issued to Mr. Alex Lightman on October 12, 2005.
      The
      principal face amount of the note is $1,000,000 and bears interest at the rate
      of four percent (4%) per annum The note was amended and restated to provide
      for
      a repayment schedule which is to coincide with the timing that Innofone receives
      the Traunches.











17





**ITEM
      6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF
      OPERATIONS**







**Forward-Looking
      Statements**





The
      information set forth in Management's Discussion and Analysis of Financial
      Condition and Results of Operations ("MD&A") contains certain
      "forward-looking statements" within the meaning of Section 27A of the Securities
      Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934,
      as
      amended, and the Private Securities Litigation Reform Act of 1995, including,
      among others (i) expected changes in the Company's revenues and profitability,
      (ii) prospective business opportunities and (iii) the Company's strategy for
      financing its business. Forward-looking statements are statements other than
      historical information or statements of current condition. Some forward-looking
      statements may be identified by use of terms such as "believes", "anticipates",
      "intends" or "expects". These forward-looking statements relate to the plans,
      objectives and expectations of the Company for future operations. Although
      the
      Company believes that its expectations with respect to the forward-looking
      statements are based upon reasonable assumptions within the bounds of its
      knowledge of its business and operations, in light of the risks and
      uncertainties inherent in all future projections, the inclusion of
      forward-looking statements in this report should not be regarded as a
      representation by the Company or any other person that the objectives or plans
      of the Company will be achieved.





**Overview**





You
      should read the following discussion and analysis in conjunction with the
      Financial Statements in this Form 10-KSB and Notes hereto, and the other
      financial data appearing elsewhere in this Form 10-KSB Report.





The
      Company's revenues and results of operations could differ materially from those
      projected in the forward-looking statements as a result of numerous factors,
      including, but not limited to, the following: the risk of significant natural
      disaster, the inability of the Company to insure against certain risks,
      inflationary and deflationary conditions and cycles, currency exchange rates,
      changing government regulations domestically and internationally affecting
      the
      New Internet, including various taxing authorities, VAT, OSHA, and general
      market conditions, competition and pricing, changes in external competitive
      market factors, termination of certain agreements, protocol, or inability to
      enter into strategic agreements, inability to satisfy anticipated working
      capital or other cash shortage requirements, changes in or developments under
      domestic or foreign laws, regulations, governmental requirements or in the
      IT
      industry, changes in the Company's business strategy or an inability to execute
      its strategy due to unanticipated changes in the market. In light of these
      risks
      and uncertainties, there can be no assurance that actual results, performance
      or
      achievements of the Company will not differ materially from any future results,
      performance or achievements expressed or implied by such forward-looking
      statements.





The
      Company is currently reviewing and implementing new disclosure controls and
      procedures to ensure that they fully comply with the new Securities Exchange
      Act
      Rules 13a-15 and 15d-15.





The
      Company currently operates one wholly owned subsidiary, IPv6 Summit, Inc.,
      based
      in Santa Monica, California and anticipates seeking certain other strategic
      acquisitions. The Company also anticipates organizing an additional subsidiary
      to be located in Virginia, which will conduct trainings, workshops, and provide
      consulting services. We have closed the acquisition of Mobile Technology Group,
      LLC, a mobile SMS and ticketing provider in Las Vegas, Nevada and operate this
      entity as a wholly owned subsidiary.




The
      Internet as we know it today is based on Internet Protocol version 4, more
      commonly referred to as IPv4, a 33-year-old protocol. The IPv4 based Internet
      is
      beginning to receive a major upgrade, with a new format established in computer
      operating systems for packets of data called Internet Protocol version 6, or
      IPv6 (also called the “New Internet” when referring to a fully implemented IPv6
      network environment). Simply put, one of the limitations of today's Internet
      is
      a shortage of addresses, so that the hardware or software equivalents of “middle
      men” are put into the system to let many people use one address, not unlike the
      old telephone party lines, where many people had the same “number,” and everyone
      could listen in. The party line system had the advantage that a lot of people
      could be connected with few switched lines, but led to problems, such as lack
      of
      security. There was no way to assure that one person would be speaking with
      only
      one person at the other end. When every phone user received their own address,
      it led to many great new capabilities - such as enhanced privacy, the ability
      to
      deliver new services such as telefax messages to a particular person, and the
      ability to go mobile with cell phones, and caller ID, which enabled people
      to
      screen their calls, accepting only those they wanted to at that
      moment.




18




The
      advantages of IPv6 over the existing IPv4 are significant and can be summarized
      as that which provides greater security, mobility, and *ad
      hoc* networking capability which is a temporary network link initiated for a
      particular purpose. Specifically, IPv6 will give everyone his or her personal
      address (or thousands of them, as needed), which enables the potential for
      “end-to-end” connectivity. Each individual can know for certain who the specific
      receiver at the other end is which in turn allows the system to check for
      service quality and much easier mobile use and roaming. Furthermore, this
      connectivity facilitates multiple layers of individual security measures rather
      than today's firewalls or Network Address Translation, which offer little
      protection once a hacker has broken through the protective wall.





One
      new
      feature of IPv6 is the vast increase of trillions of Internet addresses,
      resulting in what will seem to be almost unlimited Internet Protocol (IP)
      address availability and which will enable each customer to have many such
      addresses for each cell phone, game console, home appliance, consumer
      electronics and automobiles in the household and/or at the office. Doing this
      today in the IPv4 environment is difficult and costly.





IPv6
      is
      also more secure for wired and wireless communications in part because greater
      identity is possible with more addresses and in part because currently there
      are
      no known cases of spoofing an IPv6 address as occurs in IPv4. While being more
      secure, IPv6 will also provide greater access to mobile wireless online service,
      television and voice over Internet protocol (or “VoIP”) given its structure
      resulting in more mobile online users with greater overall trust in a secure
      network. Ultimately, even advanced online connections such as smart tags which
      utilize Radio Frequency Identification (RFID) to enable real-time inventory
      tracking will be able to be deployed in IPv6 efficiently and broadly. To do
      so
      under an IPv4 system would not be practical from a cost
      perspective.





We
      believe that IPv6 will present many new business opportunities in roughly the
      same manner that the existing Internet did when it first reached the mainstream
      in the mid-1990s. We intend to start addressing such business opportunities
      by
      initially focusing on training, consulting, conference management and testing
      all related specifically to IPv6. By developing expertise and leadership in
      each
      of these areas, Innofone will gain the credibility needed in a newly developing
      IPv6 environment to allow later rapid growth in areas such as product
      development, services and strategic acquisitions. We are currently filling
      a
      void in our areas of expertise related to IPv6 in the United States. There
      are
      few competitors providing services to American businesses seeking advice on
      how
      to transition from IPv4 to IPv6. There are few competitors which understand
      the
      U.S. government's role in supporting IPv6. There are few competitors providing
      credible testing facilities for IPv6 enabled products. There are few competitors
      providing training to employees in American businesses on the IPv6 environment
      and its advantages, product possibilities and/or network solutions. By doing
      business in these areas with sparse competition and by holding regular summit
      conferences throughout the country, Innofone intends to take and maintain the
      lead in all business specifically related to IPv6.





Innofone
      currently offers and manages these services from two corporate centers: our
      corporate headquarters offices in Santa Monica, California and virtually through
      our Eastern seaboard based employee.




**2.
      Business Combination**





On
      August 8, 2005, the Innofone.com entered into a stock purchase agreement with
      Mr. Alex Lightman, our Chief Executive Officer and President, to purchase 100%
      of the issued and outstanding shares of IPv6 Summit Inc. (“IPv6 Summit”), an
      entity engaged in providing conference management services related to Internet
      Protocol version 6 or IPv6. At the time of the Agreement, Mr. Lightman was
      the
      President, Treasurer, Director and sole shareholder of IPv6 Summit, and was
      neither an officer nor a director of Innofone. Pursuant to the Agreement, on
      October 12, 2005, which was amended on October 17, 2005, we issued to Mr.
      Lightman a promissory note in the principal face amount of $1,000,000 with
      interest at the rate of 4% per annum. Further, we issued to Mr. Lightman
      approximately 33,333,000 shares of our restricted common stock. As a result
      of
      the stock purchase agreement, IPv6 Summit became a wholly-owned subsidiary
      of
      Innofone. IPv6 has been accounted for as the accounting acquirer similar to
      a
      reverse merger transaction and the historical accounting information of IPv6
      is
      now that of Innofone. As of June 30, 2006, we had made payments against Mr.
      Lightman's promissory note totaling $600,000 accordingly, our current balance
      owed to him totals $400,000.





**3.
      Current Business Operations**





We
      currently employ ten individuals in our Santa Monica, California headquarters
      offices located at 1431 Ocean Avenue, Suite 1100, Santa Monica, California
      90401
      and employ one individual on the Eastern seaboard in and around the Northern
      Virginia area.





19


Innofone
      operates its wholly owned subsidiary, IPv6 Summit, Inc., in Santa Monica,
      California and its division styled as “v6 Transition” which is based in Clifton,
      Virginia. V6 Transition was managed by our Vice President of Consulting, Dale
      Geesey, through August 14, 2006. Mr. Geesey provided notice of his resignation
      as of June 15, 2006 with an effective date of August 14, 2006. Thereafter,
      James
      Bacchus will preside as Vice President of Consulting for our v6 Transition
      division in place of Mr. Geesey.




On
      August
      4, 2006, we closed the acquisition of Mobile Technology Group, LLC (“MTG”), a
      mobile SMS service and ticketing provider based in Las Vegas, Nevada. We intend
      for MTG to serve as our mobile division and seek growth through acquisitions
      in
      being the leading provider of IPv6 based technology for mobile
      telephony.





Innofone
      anticipates seeking certain other strategic acquisitions and investments over
      the next twelve months in an effort to increase overall operations. Our ability
      to execute this goal will be largely based upon whether we can raise adequate
      capital to successfully close such acquisitions.




IPv6
      Summit, Inc. is currently our primary source of revenue and focus of operations.
      IPv6 Summit, Inc. organizes and produces conference events related to IPv6
      technology and the transition from IPv4 to IPv6.




v6
      Transition has begun organizing trainings, workshops, and consulting services
      related to IPv6. v6 Transition has announced a three-year series of Federal
      Chief Information Officer IPv6 Workshops with the first event having taken
      place
      in Arlington, Virginia on October 11, 2005 and our next event, the Federal
      IPv6
      Summit to take place May 17, 2006 through May 19, 2006 in Reston, Virginia.
      v6
      Transition completed the three consulting projects it initiated last quarter
      and
      has added an additional six consulting and/or training projects with Juniper
      Networks, Microsoft and Avocent.




A
      final
      core activity of this quarter was planning and research related to further
      development of our strategy for potential mergers and acquisitions of technology
      companies. On September 10, 2006, we completed an investment in Digital
      Presence, Inc., a Delaware start-up corporation, recently formed for the
      purpose of creating a scalable addressable IPv6 identity registry. On March
      7,
      2006, Innofone entered into a Common Stock Purchase Agreement to purchase a
      total of 66.67% of the outstanding common stock of Digital Presence, Inc. in
      consideration of cash totaling $300,000 made in installment payments. The
      payment terms for the purchase are as follow: (a) $50,000 which was due on
      the
      initial closing on March 7, 2006; (b) $125,000 due on second closing of May
      15,
      2006; and (c) $125,000 due on third closing of June 15, 2006 or on such
      other date as Digital Presence and the Company mutually agree upon. As
      of
      June 30, 2006, we had paid the initial and second closing payments
      totaling $175,000, of which $125,000 was treated as a deposit since the related
      shares were not received as of June 30, 2006. We  made the third and
      final payment of $125,000 on September 8, 2006.


On
        May
        10, 2006 the Company executed an amended binding term sheet to acquire all
        of
        the issued and outstanding capital stock of InfoWeapons Inc., a producer
        of IPv6
        dual-stack servers and routers in the Philippines. The consideration for
        the
        purchase is cash in the amount of $50,000 and common stock of the Company
        in the
        amount of $8,500,000. A Merger Agreement was executed on or about August
        16,
        2006 incorporating these terms. The sole remaining closing requirement in
        the
        Merger Agreement is the delivery of InfoWeapon’s US GAAP audited financial
        statements which are expected in the normal course. A shareholder of the
        Company
        is the Chairman of InfoWeapons Inc.





**4.
      Future Business Operations**




We
      anticipate that our principal business activities for the coming months will
      include the refinement of our strategic approach to realizing the potential
      of
      the IPv6 industry and as such intend to focus on the following areas of business
      growth:




1.  Organic
      growth, via our existing business divisions:




A.
            Conferences,
                including the U.S. IPv6 Summit, Coalition Summit for IPv6, as well
                as
                anticipated events in Asia starting in
                2006/2007.







B.
            Training,
                including the one day Federal Chief Information Officer IPv6 Transition
                Workshops and anticipated five day and customized trainings for both
                technology and business aspects of
                IPv6.







C.
            Consulting,
                including IPv6 Transition Plans, Project Plans and approximately
                a dozen
                other possible types of IPv6 related consulting
                engagements.







D.
            Testing,
                including the proposed establishment of what could become the first
                for-profit IPv6 test business in the US, in association with a leading
                test equipment manufacturer.







2.
      Product Development and new Organic Growth Areas. Innofone has initiated the
      development of an internal research and development capability that we
      anticipate will generate a new products at regular intervals starting in the
      near future. Innofone also intends to develop new centers for revenue in the
      second fiscal quarter of 2006 related to IPv6 for mobile applications and
      Internet applications.




20


3.
      Strategic Mergers and Acquisitions: Innofone is considering several potential
      private companies which Management believes could lead to the consummation
      of
      certain transactions that could result in the positioning of Innofone for
      accelerated growth in specific areas, such as secure Internet applications,
      video-over-IPv6, search engine marketing and optimization, and mobile phone
      applications that will be potentially enhanced by using IPv6. We have started
      on
      this path via the acquisition of Mobile Technology Group, LLC.




**5. Results
      of Operations**




On
      August
      8, 2005, Innofone purchased 100% of the issued and outstanding shares of IPv6
      Summit, Inc. As a result, IPv6 has been accounted for as the accounting acquirer
      similar to a reverse merger in that the historical accounting information is
      that of IPv6. Accordingly, the results of operation discussion for the years
      ended June 30, 2006 and 2005 are that of IPv6.




For
      the
      Years Ended June 30, 2006 and 2005





Revenues
      and Cost of Revenues





Innofone
      derives revenues primarily from attendance fees of summit conferences held,
      corporate sponsorships related to such summits, and consulting fees. Attendance
      fees are recognized when the conference has been held. Cost of revenues
      primarily relate to summit conference room rentals, food accommodations and
      advertising. Additional contracts were signed for workshops and consulting
      engagements. For the years ended June 30, 2006 and 2005, the revenues were
      $624,907 and $545,588, respectively The increase in revenues compared to the
      prior year of $79,000 primarily related to the increase in consulting revenues
      of $147,000, offset by a slight decrease in conference revenues of
      $68,000.




We
      currently have two conferences scheduled over the next 12 months: (i) Asia
      IPv6
      Summit booked for February 19-21, 2007 at the Makati Shangri-la Hotel with
      projected attendees of 500 people; and (ii) US IPv6 Summit booked for March
      27-29, 2007at the Hyatt Reston in Virginia with projected attendees of 700
      people. We are in the process of re-organizing our Consulting
      division.




Selling,
      General and Administrative Expenses





Selling,
      general and administrative expenses totaled $4,506,159 and $466,914 for the
      years ended June 30, 2006 and 2005, respectively. The increase of $4,039,245
      primarily related to costs incurred during the year to secure new debt financing
      resulting in $392,000 in commissions, increased legal fees and professional
      fees
      associated with the acquisitions and SEC filings of $831,000, increased salary
      of $2,027,685 and other expenses to support the growth in the current
      year.




Net
      Loss





Net
      losses totaling $9,026,031, and $55,469 for the years ended June 30, 2006 and
      2005, respectively, increased by $8,970,562 as result of the factors previously
      mentioned above.





**6.
      Liquidity and Capital Resources**




As
      of
      June 30, 2006, the Company had total current assets of $344,014 and total
      current liabilities of $3,180,232 resulting in a working capital deficit of
      $2,836,218. As of June 30, 2006, the Company had cash totaling $100,172. Our
      cash flow from operating activities for the year ended June 30, 2006 resulted
      in
      a deficit of $3,847,340. Our cash flow from investing activities resulted in
      a
      deficit of $1,070,328. Our cash flows from financing activities resulted in
      a
      surplus of $5,000,000. Overall, the Company’s cash flows for the year ended June
      30, 2006 netted a surplus of $82,332.




Subsequent
      to June 30, 2006, the Company raised approximately $3,320,000 through debt
      financing. Furthermore, the acquisition of InfoWeapons, Inc is anticipated
      to be
      completed in October 2006. The Company believes the cash flow from current
      operating activities and operating activities of InfoWeapons, Inc. for the
      next
      twelve months, and capital raised subsequent to June 30, 2006 of approximately
      $3,320,000 through debt financing will be sufficient to provided necessary
      capital for the Company’s operations for the next twelve months. Additionally,
      the Equity Swap agreement should provide funds to the Company within the next
      twelve months.


On
        June
        2, 2006, we entered into an equity swap arrangement (“Swap Transaction”) with
        Cogent Capital Investments LLC and Cogent Capital Financial LLC (collectively,
        “Cogent”) pursuant to which Innofone issued (i) 1,850,000 shares of common stock
        (“Common Stock”); and (ii) 4,815,000 shares of Innofone’s Series A Convertible
        Preferred Stock (“Preferred Stock”) for an aggregate purchase price of
        $50,000,000 in the form of U.S. Treasury Bonds. The initial price per share
        is
        $1.333333 per share, subject to certain adjustments. The Common Stock, Preferred
        Stock and Bonds are to be delivered pursuant to that certain escrow agreement
        between Innofone and Cogent. Partial settlements of the equity swap and related
        collateral releases (together the "Swap Settlements") commence 30 days
        subsequent to the effective date of this registration statement. Through
        the
        Swap Settlements, we may sell a fixed percentage of the Treasury Bonds
        against a fixed reference price for our common stock shares at any time
        thereafter, and use any cash proceeds from such sales for working capital
        purposes. Further, in connection with the Swap Transaction, we issued to
        Cogent
        5,000,000 shares of our Common Stock (“Exchange Shares”) and a warrant to
        purchase 5,000,000 shares of Common Stock (“Warrant Shares”). The Swap
        Transaction closed on June 5, 2006.





21


Between
      August 8, 2006 and September 6, 2006, we issued a several promissory notes
      to
      numerous accredited investors (the “Investors”) in the aggregate principal
      amount of $320,000 with interest at 10% per annum (collectively, the “Notes”).
      The Maturity Dates of the Notes varies but is either six or twelve months from
      the date of issuance. The Company may, at our option, prepay any and all of
      the
      amounts owing under the Notes, in full or the part, without penalty. In
      connection with the issuance of the Notes, we issued five-year warrant to the
      to
      purchase shares of our common stock at $1.00 per share; the amount of shares
      underlying the warrants is equal to the dollar amount of the respective Notes
      without interest thereon. We have granted certain piggyback registration rights
      with respect to some of the shares underlying the warrants. Moreover, each
      of
      the Notes are secured by shares of our restricted common stock and shares of
      restricted common stock owned by Mr. Alex Lightman, our Chief Executive Officer
      and President.





On
      July
      10, 2006, we issued a promissory note to 55 South Investments in the face
      amount of $500,000, with interest at 12% per annum. The Maturity Date shall
      be
      the earlier of: (a) one (1) year from the commencement of that certain equity
      swap transaction (“Swap”) whereby 30 days have expired thereafter the date in
      which the Company is granted effectiveness by the Securities and Exchange
      Commission on a registration statement filed pursuant to certain agreements
      made
      in connection with an equity swap made by and between the Company and Cogent
      Capital Financial, LLC and its affiliates as of June 2, 2006 (defined herein
      as
      the “Swap Start Date”); or (b) December 1, 2007, whichever is earlier. Repayment
      of the Principal by Innofone to the Holder shall commence within ten (10) days
      of the Swap Start Date and shall continue thereafter in equal pro rata monthly
      installments on the same date of each subsequent month thereafter for the
      successive eleven (11) months thereafter the Swap Start Date and continue until
      all principal payments are paid in full. The Principal shall be repaid in full
      no later than the Maturity Date. Should the Swap Start Date not occur prior
      to
      the Maturity Date, then the entirety of Principal shall be due and payable
      to
      Holder on the Maturity Date. Further Innofone may, at its option, prepay all
      amounts owing under this Note prior to the Maturity Date, in whole or in part,
      without payment of any premium or penalty, after giving written notice thereof
      to the Holder at least one (1) day prior to the date selected for prepayment.
      In
      connection with the issuance of the note, we issued (i) a five-year warrant
      to
      55 South Investments for the right to purchase up to 2,000,000 shares of common
      stock at $1.00 per share; and (ii) a five year warrant to Millennium Investment
      Services, Inc., an affiliate of 55 South, for the right to purchase 500,000
      shares of common stock at $1.00 per share. We have granted certain piggyback
      registration rights with respect only to the shares underlying the warrant
      issued to 55 South. The note is secured with approximately $2,000,000 worth
      of
      our restricted common stock and $2,000,000 worth of restricted common stock
      owned by Mr. Lightman, our Chief Executive Officer and President. On July 14,
      2006, we issued an additional promissory note for $500,000 on the same terms.
      In
      connection with the issuance of the note, we issued 55 South Investments a
      five
      year warrant to purchase up to $2,000,000 shares of common stock at an exercise
      price of $1.00 per share. The Company has the right to redeem 1,400,000 of
      such
      warrants for $250,000 until July 13, 2007 except for the right to redeem a
      portion of the warrants, the deal is on the same terms as the July 10th
      transaction. We have granted certain demand registration rights with respect
      to
      all shares issued as security under the notes. Further, we have agreed to pay
      to
      55 South approximately $40,000 representing an origination fee and a due
      diligence fee.





On
      May
      25, 2006, we entered into a Letter Agreement (“Agreement”) with the NIR Group
      for the repayment (the “Repayment”) of certain notes (“Notes”) and cancellation
      of certain warrants (“Warrants”) issued on or about August 31, 2005 and October
      31, 2005 pursuant to
      that
      certain Securities Purchase Agreement (the “SPA”) by and between Innofone and
      AJW Partners, LLC (“Partners”), New Millennium Capital Partners, II, LLC
      (“Millennium”), AJW Offshore, Ltd. (“Offshore”) and AJW Qualified Partners, LLC
      (“Qualified, with Partners, Millennium and Offshore, collectively, the “NIR
      Group”). The Repayment was applied to the outstanding principal and interest
      owing under the Notes and as consideration for the cancellation of the Warrants
      issued to the NIR Group, and the termination of any and all UCC-1s filed in
      favor of NIR. Further, in connection with the SPA, Notes and Warrants, the
      following ancillary documents were executed and/or filed: (1) Guaranty and
      Pledge Agreement, dated August 31, 2005, by and between Innofone, Mr. Alex
      Lightman, Innofone’s President and Chief Executive Officer, and NIR (“Pledge
      Agreement”); (2) Security Agreement by and between Innofone and NIR, dated
      August 31, 2005 (“Security Agreement”); and (3) UCC-1 Financing Statements
      (“UCC-1s”) filed by NIR in Nevada (the Notes, SPA, Warrants, Pledge Agreement
      and Security Agreement are referred to collectively as “Original
      Documents”).





In
      connection with the Repayment, Innofone and NIR executed and delivered the
      Agreement, a new promissory note (the “New Notes”), a new stock purchase warrant
      (the “New Warrants”), and a new registration rights agreement (“New Registration
      Agreement”) (the Agreement, New Notes, New Warrants and New Registration
      Agreement and the UCC-3s shall be referred to collectively as the “New
      Documents”, each of which is filed herewith as an Exhibit). Further, NIR is
      required to file UCC-3 Termination Statements (“UCC-3s”) necessary to terminate
      any perfected security interest they had obtained pursuant to the Security
      Agreement.




22


The
      terms
      of the Repayment, as provided in the Agreement are as follows: (a) upon signing
      of Agreement, Innofone made a cash Payment to NIR in the amount of $2,635,400
      to
      be applied to the repayment of all amounts of principal and interest owing
      and
      outstanding under the Notes; (b) upon signing of the Agreement, Innofone issued
      to NIR the New Notes in the aggregate amount of $1,200,000. The New Notes are
      self-amortizing over a one-year time period commencing on July 1, 2006, with
      each installment payment due on the twelve consecutive monthly anniversaries
      beginning July 1, 2006. Further, pursuant to the New Notes, Innofone will pay
      to
      NIR an aggregate of $100,000 per month. The New Notes may be prepaid by Innofone
      at anytime without penalty; (c) upon signing of the Agreement, Innofone shall
      issued to NIR the New Warrants exercisable into an aggregate of 750,000 shares
      of Innofone’s Common Stock (the “Warrant Shares”). The New Warrants shall have a
      term of five years and an exercise price equal to $1.79. The New Warrants may
      be
      exercised on a cashless basis only in the event that there is no effective
      registration statement covering the Warrant Shares. NIR may exercise the New
      Warrants by utilizing any amounts still owing under the New Notes. Innofone
      may
      buy back all of the New Warrants from NIR for an aggregate of $100,000 at any
      time prior to the New Warrants being exercised; (d) upon signing of the
      Agreement, Innofone and NIR executed and delivered the New Registration
      Agreement providing for the registration of the Warrant Shares with the
      Securities and Exchange Commission. The New Registration Agreement provides
      for
      one piggyback registration right no sooner than six months from the date of
      hereof; (e) NIR
      agrees not to sell Innofone's Common Stock short, either directly or indirectly
      through its affiliates, principals or advisors; (f) the
      Original Documents were terminated in all respects, and were rendered null
      and
      void and no longer binding NIR or Innofone to any obligations, duties and
      responsibilities contained therein. Further, NIR and Innofone mutually agree
      that the New Documents shall supersede the Original Documents in all respects;
      (g) Innofone
      filed a Form AW to withdraw the Registration Statement on Form SB-2 currently
      on
      file with the Securities and Exchange Commission covering the shares of common
      stock underlying the Notes and the Warrants; (h) All security interests
      perfected by NIR on the “Collateral” (as defined in the Security Agreement),
      pursuant to the Original Documents, including the Security Agreement, shall
      be
      terminated. Accordingly, NIR agreed to file within (2) days of the Agreement,
      UCC-3 Termination Statement.




On
      April
      27, 2006, Innofone entered into a term sheet with Mr. Lawrence Hughes providing
      for an investment by Mr. Hughes in the aggregate amount of $4,000,000 in
      exchange for approximately 3,478,260 shares of Innofone’s restricted common
      stock at $1.15 per share. Further, pursuant to the term sheet, Innofone is
      to
      issue a warrant to purchase 400,000 shares of Innofone’s restricted common stock
      at an exercise price equal to eighty percent (80%) of the five (5) day trading
      average close price of Innofone’s common stock. Definitive agreements between
      Innofone and Mr. Hughes will be entered forthwith.





On
      October 17, 2005 we amended and restated our promissory note issued to Mr.
      Alex
      Lightman, our Chief Executive Officer and President, dated October 12, 2005,
      in
      connection with our Stock Purchase Agreement dated August 8, 2005 (“Acquisition
      Note”). The principal face amount of the “Acquisition Note” is $1,000,000 and
      bears interest at the rate of four percent (4%) per annum. The Acquisition
      Note
      was amended and restated to provide for a repayment schedule that is to coincide
      with the timing that Innofone receives the tranches. Specifically, we will
      make
      monthly installment payments equal to $83,333.33 for each successive month
      starting on the date of execution of the note and ending January 17, 2006.
      As of
      March 31, 2006, the remaining balance related to the Acquisition Note with
      Mr.
      Lightman totaled $500,000. On or about April 1, 2006, Mr. Lightman agreed to
      a
      forbearance of the Acquisition Note until further notice.





On
      April
      18, 2006, Company has entered a second Promissory Note with its CEO, Alex
      Lightman, in connection with Mr. Lightman's loan of $400,000 (“Lightman Note”)
      to Innofone. The Lightman Note principal is to be repaid at the earlier of
      either the next financing after the closing of the NIR final payment or April
      18, 2007 as is to be repaid with interest at the rate of 5% simple interest
      per
      annum plus the issuance of 800,000 restricted shares of common stock of
      Innofone. The proceeds of the Lightman Note will assist us in our liquidity
      needs and need for operating capital going forward.





**Critical
      Accounting Policies**





23


The
      preparation of our financial statements requires our management to make
      estimates and assumptions that affect the reported amounts on our financial
      statements. Management bases its estimates and judgments on historical
      experience and on various other factors that are believed to be reasonable
      under
      the circumstances. Actual results may differ from these estimates under
      different assumptions or conditions.




The
      Notes
      to the consolidated financial statements included in this filing contain a
      discussion of our significant accounting policies and recent accounting
      pronouncements applicable to us.




**Recent
      Accounting Pronouncements**




In
      May
      2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections."
      This statement applies to all voluntary changes in accounting principle and
      requires retrospective application to prior periods' financial statements of
      changes in accounting principle, unless this would be impracticable. This
      statement also makes a distinction between "retrospective application" of an
      accounting principle and the "restatement" of financial statements to reflect
      the correction of an error. This statement is effective for accounting changes
      and corrections of errors made in fiscal years beginning after December 15,
      2005. This statement is not expected to have a material effect on the Company's
      consolidated financial position or results of operations.




In
      February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid
      Financial Instruments". SFAS No. 155 amends SFAS No 133, "Accounting for
      Derivative Instruments and Hedging Activities", and SFAF No. 140, "Accounting
      for Transfers and Servicing of Financial Assets and Extinguishments of
      Liabilities". SFAS No. 155, permits fair value remeasurement 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, establishes a
      requirement to evaluate interest 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 amends SFAS No. 140 to eliminate the prohibition on the
      qualifying special-purpose entity from holding a derivative financial instrument
      that pertains to a beneficial interest other than another derivative financial
      instrument. This statement is effective for all financial instruments acquired
      or issued after the beginning of the Company's first fiscal year that begins
      after September 15, 2006. This statement is not expected to have a material
      effect on the Company's consolidated financial position or results of
      operations.




In
      June
      2005, the EITF reached consensus on Issue No. 05-6, Determining the Amortization
      Period for Leasehold Improvements ("EITF 05-6.") EITF 05-6 provides guidance
      on
      determining the amortization period for leasehold improvements acquired in
      a
      business combination or acquired subsequent to lease inception. The guidance
      in
      EITF 05-6 will be applied prospectively and is effective for periods beginning
      after June 29, 2005. EITF 05-6 is not expected to have a material effect on
      the
      Company's consolidated financial position or results of operations.




In
      September 2006, the FASB issued SFAS No. 157 “Fair Value Measurements”. SFAS No.
      157 defines fair value, establishes a framework for measuring fair value in
      generally accepted accounting principles and expands disclosure about fair
      values. This statement is effective for financial statements issued for fiscal
      years beginning after November 15, 2007, and interim periods within those fiscal
      years. Management believes that the adoption of SFAS No. 157 will not have
      a
      material impact on the consolidated financial results of the
      Company.










24


**Item
      7. Financial Statements.**





The
      Consolidated Financial Statements are included after the Exhibit Index.





PageNumberINNOFONE.COM,
                  INCORPORATEDReport
                of Independent Certified Public Accounting Firm
            F-1Consolidated
                Balance Sheet as of June 30, 2006
            F-2Consolidated
                Statements of Operations for the Years Ended June 30, 2006
                and 2005
            F-3Consolidated
                Statements of Stockholders’
                Equity for the Years Ended June 30, 2006 and 2005
            F-4Consolidated
                Statements of Cash Flows for the Years Ended June 30, 2006 and 2005
            F-5Notes
                to the Consolidated Financial Statements
            F-7-15




25


**ITEM
      8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
      DISCLOSURE**





None. ****





**ITEM
      8A. CONTROLS AND PROCEDURES**





The
      Company's principal executive officer and principal financial officer, based
      on
      his evaluation of the Company's disclosure controls and procedures (as defined
      in Rules 13a-14(c) and 15d-14(c) of the Securities Exchange Act of 1934, as
      amended) as of June 30, 2006 have concluded that the Company's disclosure
      controls and procedures are adequate and effective to ensure that material
      information relating to the Company are recorded, processed, summarized and
      reported within the time periods in which this Annual Report has been prepared.





The
      Company's principal executive officer, who is also our principal financial
      officer, has concluded that there were no significant changes in the Company's
      internal controls or in other factors that could significantly affect these
      controls for the year ended June 30, 2006, the date of his most recent
      evaluation of such controls, and that there were no significant deficiencies
      or
      material weaknesses in the Company's internal controls.







26


**PART
      III**





**ITEM
      9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
      WITH
      SECTION 16(A) OF THE EXCHANGE ACT.**








The
      following table sets forth the name, age and position of each of the members
      of
      our board of directors, executive officers and promoters as of September 28,
      2006:





Name
            
            Age
            
            PositionAlex
                Lightman
            
            44
            
            Chief
                Executive Officer, President, Principal Accounting Officer and
                DirectorJim
                Bacchus(1)
            
            44
            
            Vice
                President of ConsultingPaul
                Shephard
            
            50
            
            Chief
                Operating Officer and SecretaryGerard
                Casale
            
            39
            
            Vice
              President of Business and Legal Affairs





(1)
      Mr.
      Jim Bacchus assumed full responsibility as our Vice President of Consulting
      on
      August 14, 2006.





The
      principal occupations and brief summary of the background of each executive
      officer and director of Innofone is as follows:





Mr.
      Alex
      Lightman has been our President, CEO and a director since August 2005. Upon
      the resignation of Ms. Karen Rosolowski in January 2006, Mr. Lightman took
      on
      the position of Principal Accounting Officer until such time as a suitable
      replacement can be found. From June 2003 to July 2005 he was the founding CEO
      and Chairman of IPv6 Summit, Inc., a leading organizer of international
      IPv6 events and consultants to government and industry on IPv6 applications,
      training, and promotion. From May 1999 to Present Mr. Lightman has been the
      CEO
      of Charmed Technology, (www.charmed.com). He is the founding director of The
      4G
      Society and the first Cal- (IT)2 Scholar at the California Institute for
      Telecommunications and Information Technology, a joint program of UCSD and
      UCI
      (www.calit2.net). Mr. Lightman has nearly 20 years of high technology management
      experience and, in addition, has experience in politics (including work for
      a US
      Senator), consulting, the oil drilling industry, and the renewable energy
      industry. He also produced the 100 Brave New Unwired World fashion shows,
      featuring wearable and pervasive computing, which included many of Lightman's
      own inventions and designs, such as the patented Charmed Viewer display and
      the
      first Internet jewelry. Harvard Business School featured Lightman and Charmed
      in
      a case study that recognized Lightman's pioneering innovation of presenting
      computers as fashion. Both the show and Lightman's designs are now copied
      worldwide. Mr. Lightman is the author of Brave New Unwired World (Wiley, 2002)
      and a 1983 graduate of the Massachusetts Institute of Technology. He has
      attended graduate school at the Kennedy School of Government (Harvard
      University) and the University of Phoenix.




Mr.
      Lightman devotes approximately ninety percent (90%) of his time to us and
      the remaining ten percent (10%) on outside endeavors, including Charmed
      Technology and 4G Society. Mr. Lightman's term of office is for two
      years.




Mr.
      Jim
      Bacchus was hired as the Vice President of Consulting in June 2006 for an
      effective date of employment as of August 14, 2006 coinciding with the
      resignation effective date of Dale Geesey. Mr. Jim Bacchus has over 20 years
      experience in technology programs ranging from advanced communications to space
      craft. He has held executive positions at GE, Lockheed Martin and Ingersoll
      Rand. In addition to his corporate experience he has worked in several high
      tech
      capacities for the armed services and is currently a Colonel in the Marine
      Corps
      Reserve. Most recently he was recalled to active duty for service in Iraq
      and with the Joint Chiefs of Staff at the Pentagon. Bacchus holds a JD from
      Widener University School of Law, MS from the University of Southern California,
      and a BA from Drew University.





Mr.
      Paul
      Shepherd has been our Secretary and Chief Operating Officer and since August
      2005.  From July 2003 to August 2005, Mr. Shephard was the secretary
      of IPv6 Summit, Inc. From October 2002 to July 2003, Mr. Shephard was a
      marketing consultant for Charmed Technology. From October 2000 to October 2002,
      Mr. Shepherd was the secretary of Pacific Goldstar, Inc.  Mr. Shepherd
      holds an Associate in Arts in Business Administration at Santa Monica College.
      Mr. Shepherd is an “at will” employee.




Mr.
        Gerard Casale has been the VP of Business and Legal Affairs for the
        Company since August, 2005 and is responsible for its overall general
        counsel duties and business affairs including contractual, corporate
        affairs and management of all material business transactions. From 1993-2005,
        Casale was Managing Partner and Founder of Casale Alliance, LLP  [formerly
        Casale Coffee Nojima, LLP], where he practiced with a focus on corporate
        law and M&A and throughout this period was involved in over $600
        million of financing and M&A transactions. From 2000-2003, Casale
        founded and was CEO and Chairman of X-laboratories, LLC, a partnership
        with Hughes Research Labs [HRL] in Malibu, CA, where he developed, financed
        and spun-off non-core high-tech intellectual property assets of HRL as a
        partnership between Boeing, Raytheon and General Motors. The company was
        sold in 2003. Mr. Casale has been featured by many news programs including
        CNN, Investor Business Daily, Darwin Magazine, Red Herring, EE Times and
        many
        others. He has a B.A. in Economics from Fairfield University, Fairfield,
        CT and a Juris Doctor Degree from the Pepperdine University School of
        Law. Mr. Casale has also served as adjunct professor of law at Pepperdine
        University, School of Law writing the coursebook and teaching *Venture
        Finance and the Law* .
  **ITEM
      10.** **EXECUTIVE COMPENSATION**





27


The
      following table sets forth the aggregate cash compensation paid by Innofone
      to:
      (i) its Chief Executive Officer, Chairman; and (ii) its most highly compensated
      officers whose cash compensation exceeded $100,000 for services performed from
      August 8, 2005, the date we completed our acquisition of IPv6 Summit,
      through  September 28, 2006 .




Name
                and Principal Position
            
            Year
            
            Salary($)
            
            Bonus($)
            
            Other
                Annual
              Compensation($)
            
            Restricted
              Stock
              Award(s)
              ($)
            
            Securities
              Underlying
              Options
              SARs(#)
            
            LTIP
              Payouts($)
            
            All
                Other
              Compensation
              ($)Alex
                Lightman
            
            
            2006
            
            $
            269,333
            
            $
            43,0002005
            
            $
            37,000Dale
                Geesey (1)
            
            
            2006
            
            $
            117,115
            
            $
            12,468
            
            
            --
            
            $
            4,158
            
            
            --
            
            
            --
            
            
            --2005Gerard
              Casale(2)
            
            
            2006
            
            $
            230,572
            
            $
            15,000
            
            
            
            
            $
            633,250




(1)
            Mr.
                Geesey resigned from Innofone in June 2006 effective August 14,
                2006.(2)
            Mr.
              Casale became our VP of Business and Legal Affairs on December 1,
              2005. The Restricted Stock Award represents the issuance of 700,000 shares of our restricted Common Stock.




**COMPENSATION
      PLANS**





We
      do not
      have any option, annuity, retirement, pension or deferred compensation plan
      or
      other arrangements under which an executive officer is entitled to participate
      without similar participation by other employees.




**DIRECTOR
      COMPENSATION**




We
      do not
      have any agreement to compensate our directors at this time, however we have
      paid a one-time advance payment of $25,000 to Mr. Maddocks for his board
      representation for the fiscal year ended June 30, 2006.





**EMPLOYMENT
      AGREEMENTS**





On
      September 22, 2005, Innofone entered into an employment agreement with Frederick
      Dale Geesey, our Vice President of Consulting. The term of the agreement is
      for
      one year and provides for an annual base salary of $150,000 with certain
      performance based target bonuses consisting of (a) a cash target bonus equal
      to
      35% of total annual salary, as determined by the Board of Directors and (b)
      a
      performance bonus paid in cash equal to 35% of total annual salary for each
      and
      every merger and/or acquisition made by us. The target bonus and the performance
      bonus may not exceed 100% of annual salary. The agreement also provides for
      the issuance of options to purchase 200,000 shares of restricted common stock.
      The options vest over a period of three years.





On
      September 6, 2005, Innofone entered into an employment agreement with Gerard
      Casale, Esq., our Corporate Counsel. The agreement provides for an initial
      part
      time term during which Mr. Casale shall be our Corporate General Counsel with
      an
      annual salary of $142,500 and shall be issued 50,000 shares of restricted common
      stock. On December 1, 2005, Mr. Casale became our Vice President of
      Business and Legal Affairs with an annual salary of $285,000 and was issued
      700,000 shares of our restricted common stock.




28


On
      October 31, 2005, we entered into an employment agreement (the “Agreement”) with
      Mr. Alex Lightman, our Chief Executive Officer, President and Principal
      Accounting Officer. Pursuant to the Agreement, Mr. Lightman will serve as Chief
      Executive Officer and Chairman of the Board and will receive annual base
      compensation of $295,000. Mr. Lightman will also be eligible for executive
      bonus
      compensation as follows: (a) a Target Bonus paid in cash equal to 35% of the
      total cash value of his annual salary, as determined by the Board of Directors,
      50% of which may be paid in shares of Innofone's common stock; and (b) a
      Performance Bonus paid in cash equal to 35% of the total cash value of his
      annual salary for each and every merger and/or acquisition made by Innofone
      of a
      non-affiliated third party entity (such potential target must provide no less
      than $1,000,000 of estimated annual accretive EBITDA to Innofone). The total
      amount of the Target Bonus and Performance Bonus paid to Mr. Lightman shall
      not
      exceed 100% of his annual compensation in any 12 month period. Mr. Lightman
      is
      also eligible to participate in any other bonus or incentive programs
      established by Innofone. The term of the Agreement is for two years and may
      renew for additional two year periods thereafter unless notice of non-renewal
      is
      given within six months of the end of the then current term.





**ITEM
      11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
      STOCKHOLDER MATTERS.**





The
      following table sets forth certain information regarding the beneficial
      ownership of Innofone's Common Stock by each person or group that is known
      by
      Innofone to be the beneficial owner of more than five percent of its outstanding
      Common Stock, each director of Innofone, each person named in the Summary
      Compensation Table, and all directors and executive officers of Innofone as
      a
      group as of September 20, 2006. Unless otherwise indicated, Innofone
      believes that the persons named in the table below, based on information
      furnished by such owners, have sole voting and investment power with respect
      to
      the Common Stock beneficially owned by them, where applicable. As
      of September 25, 2006, there were 74,435,328 shares of common stock
      issued and outstanding.





Name/Address
                of
              Beneficial
                Owner
            
            Position
                with
              Company
            
            Amount
                and Nature
              of
                Beneficial
              Ownership
                of Class
              A
                common Stock (1)
            
            Percentage
                of
              Securities
                (1)Alexander
                Lightman(2)/*
            
            Chief
                Executive Officer
              and
                President
            
            34,448,108
            
            46.28%Peter
                Maddocks*/
            
            Director
            
            0
            
            0Dale
                Geesey*/(3)
            
            VP
                of Consulting(3)
            
            45,314
            
            **Paul
                Shephard*
            
            Secretary
            
            500,000
            
            0.67%Jim
                Bacchus*/(4)
            
            VP
                of Consulting
            
            0
            
            0Gerard
                Casale
            
            VP
                Business and Legal Affairs
            
            967,648
            
            1.3%Abby
                International Holdings, Ltd.(5)
              c/o
                UK Administration Office, Suite 363
              78
                Marylebone High Street
              London,
                W1U5AP United Kingdome
            
            --
            
            20,500,000
            
            27.54%Cogent
                Capital Investments, LLC (6)(7)
              11444
                South 1780 East
              Sandy,
                Utah 84092
            
            --
            
            1,850,000
            
            2.49%Cogent
                Capital Financial LLC (7)
            
            
            
            5,000,000
            
            6.72%All
                executive officers and Directors as a group(5
                persons)
            
            
            
            35,415,756
            
            47.58%





29


*  
      Address of all holders is c/o Innofone.com, Incorporated, 1431 Ocean Avenue,
      Suite 1100, Santa Monica, California 90401.


**
      Less
      than one percent.





(1)
      Pursuant to the rules of the Securities and Exchange Commission, a person is
      deemed to "beneficially own" shares of common stock over which the person has
      or
      shares investment or voting power, or has the right to acquire such power within
      60 days. The percentage of common stock owned is calculated based on the number
      of shares of common stock outstanding, plus in the case of each person the
      number of shares of common stock issuable only to such person upon the exercise
      of options or warrants and the conversion of convertible debt
      securities.





(2)
      Includes 27,000,000 shares owned by Equitocracy Trust. Mr. Lightman is the
      trustee of Equitocracy Trust and is deemed the beneficial owner of such
      shares.





(3)
      Mr.
      Dale Geesey resigned as the Vice President of Consulting in June 2006, which
      will become effective as of August 14, 2006.





(4)
      Mr.
      Jim Bacchus was hired in June 2006 to replace Mr. Dale Geesey effective August
      14, 2006





(5)
      Mr.
      Irving Aronson has the voting and dispositive power over the shares beneficially
      owned by Abbey International, an entity formed under the laws of Belize, by
      virtue of being a director of that entity.





(6) Cogent
      Capital Investments and Cogent Capital Financial are affiliated entities and
      Greg Kofford and Mark W. Holden have the voting and dispositive power of all
      6,850,000 shares of common stock.  The address of CCI and CCF is 11444
      South 1780 East, Sandy, Utah 84092.




(7) CCI
      owns approximately 4,815,000 shares of our Series A Convertible Preferred Stock
      which is convertible into 48,150,000 shares of our Common Stock, subject to
      certain limitations on convertibility as more fully described in this
      prospectus.  CCF holds a warrant exercisable unto 5,000,000 shares of our
      Common Stock; the exercise of this warrant is subject to certain limitations
      pertaining to the amount of shares CCF may beneficially own.





**ITEM
      12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS**





On
      August
      8, 2005, we entered into a stock purchase agreement with Mr. Alex Lightman
      to
      purchase the total issued and outstanding shares of IPv6 Summit Inc., an entity
      engaged in developing new technology referred to as Internet Protocol version
      6.
      Pursuant to the agreement, we agreed to pay Mr. Lightman $1,000,000 in the
      form
      of a promissory note and issue to him approximately 33,333,000 shares of our
      restricted common stock in exchange for 100% of the issued and outstanding
      shares of IPv6. As a result of the stock purchase agreement, IPv6 Summit Inc.
      became a wholly owned subsidiary of Innofone and Mr. Lightman became our
      President and Chief Executive Officer. Prior to this acquisition, we operated
      as
      a holding company for companies involved in technology and financial services.
      Pursuant to the Repayment of NIR, Mr. Lightman's pledged shares were released
      and he no longer guarantees Innofone's obligation to NIR.




On
      August
      31, 2005, Mr. Lightman pledged 3 million shares to support obligations under
      the
      Notes issued to AJW Partners, LLC, AJW Offshore Ltd., AJW Qualified Partners
      and
      New Millenium Capital Partners, II, LLC on August 31, 2005. Specifically,
      pursuant to a Guaranty and Pledge Agreement, Mr. Lightman has agreed to
      unconditionally guarantee the timely and full satisfaction of all of our
      obligations, whether matured or unmatured, now or hereafter existing or created
      and becoming due and payable to the investors under the Notes.




On
      October 17, 2005, we amended and restated our promissory note issued to Mr.
      Alex
      Lightman, our Chief Executive Officer, President, and Principal Accounting
      Officer, on October 12, 2005, in connection with our Stock Purchase Agreement
      dated August 8, 2005. The principal face amount of the note is $1,000,000 and
      bears interest at the rate of four percent (4%) per annum. The note was amended
      and restated to provide for a repayment schedule which was to coincide with
      the
      timing that Innofone receives the Traunches. Specifically, we will make monthly
      installment payments equal to $83,333.33 for each successive month starting
      on
      the date of execution of the note and ending January 17, 2006. We agreed that
      upon the filing of this registration statement and receipt of the second
      Traunche, we would make monthly installment payments of $83,333.33 for the
      four
      (4) successive months thereafter. Further, upon the effectiveness of this
      registration statement and receipt of the third Traunche, we would make
      monthly installment payments of $83,333.33 for the four (4) successive months
      thereafter. As of March 2006, we have repaid approximately $500,000 of Mr.
      Lightman's note. Mr. Lightman has agreed to defer any additional payments until
      our financial condition allows for the continuation of such
      payments.





30


On
      July
      10, 2006, we issued a promissory note to 55 South Investments in the face amount
      of $500,000. The note is secured by approximately $2,000,000 worth of our
      restricted common stock and $2,000,000 worth of restricted common stock owned
      by
      Mr. Lightman, our Chief Executive Officer and President. Pursuant to a Guaranty
      and Pledge Agreement, Mr. Lightman has agreed to unconditionally guarantee
      the
      timely and full satisfaction of all of our obligations, whether matured or
      unmatured, now or hereafter existing or created and becoming due and payable
      to
      the investors under the note.




Between
      August 8, 2006 and September 6, 2006, we issued a several promissory notes
      to
      numerous accredited investors (the “Investors”) in the aggregate principal
      amount of $290,000, with interest at 10% per annum (collectively, the “Notes”).
      The Maturity Dates of the Notes varies but is either six or twelve months from
      the date of issuance. The Company may, at our option, prepay any and all of
      the
      amounts owing under the Notes, in full or the part, without penalty. In
      connection with the issuance of the Notes, we issued five-year warrant to the
      to
      purchase shares of our common stock at $1.00 per share; the amount of shares
      underlying the warrants is equal to the dollar amount of the respective Notes
      without interest thereon. We have granted certain piggyback registration rights
      with respect to some of the shares underlying the warrants. Moreover, each
      of
      the Notes are secured by shares of our restricted common stock and shares of
      restricted common stock owned by Mr. Alex Lightman, our Chief Executive Officer
      and President.





COMPLIANCE
      WITH SECTION 16(a) OF THE EXCHANGE ACT





Under
      the
      securities laws of the United States, our directors, our executive (and certain
      other) officers, and any persons holding ten percent or more of our shares
      of
      common stock must report on their ownership of our shares of common stock and
      any changes in that ownership to the Securities and Exchange Commission.
      Specific due dates for these reports have been established. During the fiscal
      year ended June 30, 2006, based solely on a review of filings made with the
      SEC,
      we believe that all reports required to be filed by Section 16(a) were filed
      on
      a timely basis. The Company’s current officers and directors are currently
      working to make all appropriate filings in order to be compliant with Section
      16(a).










31


**ITEM
      13. EXHIBITS AND REPORTS ON FORM 8-K**





All
      references to the Company's Forms 8-K, 10-QSB and 10-KSB include reference
      to
      File No. 0-31949





Exhibit
                No.
            
            Document3.1
            
            Articles
                of Incorporation of Innofone.com, Incorporated,as amended (incorporated
                by
                reference to Exhibit 3.1 filed with Innofone's Form 10-KSB on October
                14,
                2005)*3.1(a)
            
            Amended
                and Restated Certificate of Designation of Series A Convertible Preferred
                Stock of Innofone.com, Incorporated (filed as Exhibit 3.1 to Current
                Report on Form 8-k filed June 8, 2006 and incorporated herein by
                reference)3.2
            
            Bylaw,
                as amended (incorporated by reference to Exhibit 3.1 filed with Innofone's
                Form 10-KSB on October 14, 2005)*4
            
            Specimen
                of Common Stock certificate *10.1
            
            Employment
                Agreement between Innofone and Gerard Casale, Jr., dated September
                6, 2005
                (incorporated by reference to Exhibit 3.1 filed with Innofone's Form
                10-KSB on October 14, 2005)*10.2
            
            Employment
                Agreement between Innofone and Frederic D. Geesey, dated September
                22,
                2005 (incorporated by reference to Exhibit 3.1 filed with Innofone's
                Form
                10-KSB on October 14, 2005)*10.3
            
            Stock
                Purchase Agreement between Innofone and Alex Lightman, dated August
                8,
                2005 (incorporated by reference to Exhibit 10.1 filed with Innofone's
                Form
                8-K on August 19, 2005 (“August 8-K”) as amended on October 31, 2005
                (incorporated by reference to Exhibit 10.1 to Form 8-K filed on November
                4, 2005)*10.4
            
            Investment
                Agreement between Innofone and Alex Lightman, dated August 8, 2005
                (incorporated by reference to Exhibit 10.2 filed with Innofone's
                August
                8-K)*10.5
            
            Form
                of Callable Secured Convertible Note, dated August 31, 2005
                (2)10.6
            
            Stock
                Purchase Agreement between Innofone and various investors, dated
                August
                31, 2005 (2)10.7
            
            Security
                Agreement between Innofone and certain secured parties, dated August
                31,
                2005 (2)10.8
            
            Guaranty
                and Pledge Agreement between Innofone, Alex Lightman and certain
                Pledgees,
                dated August 31, 2005 (2)10.9
            
            Form
                of Stock Purchase Warrant issued by Innofone to various investors,
                dated
                August 31, 2005 (2)10.10
            
            Commercial
                Lease between Innofone and Barrington Pacific, LLC, dated October
                7, 2003
                (incorporated by reference to Exhibit 3.1 filed with Innofone's Form
                10-KSB on October 14, 2005)*10.11
            
            Form
                of Promissory Note, dated October 12, 2005 issued to Alex Lightman
                (incorporated by reference to Exhibit 3.1 filed with Innofone's Form
                10-KSB on October 14, 2005)*




32




10.12
            
            Amended
                and Restated Promissory Note, dated October 17, 2005 issued to Alex
                Lightman (2)10.13
            
            Intellectual
                Property Security Agreement (filed as Exhibit 99.4 to Current Report
                on
                Form 8-K, filed August 31, 2005 and incorporated herein by
                reference)*10.14
            
            Registration
                Rights Agreement between Innofone and various investors, dated August
                31,
                2005 (2)10.15
            
            Common
                Stock Purchase Agreement between Innofone and Digital Presence, Inc.,
                dated March 7, 2006 (2)10.16
            
            Registration
                Rights Agreement between Innofone and digital Presence, Inc., dated
                March
                7, 2006 (2)10.17
            
            Letter
                Agreement, dated as of May 25, 2006, by and between Innofone and
                the NIR
                Group (filed as Exhibit 10.1 to Current Report on Form 8-k, dated
                June 1,
                2006 and incorporated herein by reference)*10.18
            
            Form
                of Note issued by Innofone, dated May 25, 2006 (filed as Exhibit
                10.2 to
                Current Report on Form 8-k, dated June 1, 2006 and incorporated herein
                by
                reference)*10.19
            
            Form
                of Warrant issued by Innofone, dated May 25, 2006 (filed as Exhibit
                10.3
                to Current Report on Form 8-k, dated June 1, 2006 and incorporated
                herein
                by reference)*10.20
            
            Registration
                Rights Agreement, dated May 25, 2006, by and between Innofone and
                the NIR
                Group 2006 (filed as Exhibit 10.3 to Current Report on Form 8-k,
                dated
                June 1, 2006 and incorporated herein by reference)*10.21
            
            Securities
                Purchase Agreement by and between Innofone and Cogent Capital Investments
                LLC and Cogent Capital Financial LLC, dated June 2, 2006 (filed as
                Exhibit
                10.1 to Current Report on Form 8-k, dated June 8, 2006 and incorporated
                herein by reference)*10.22
            
            Escrow
                Agreement by and between Innofone and Cogent Capital Investments
                LLC and
                Cogent Capital Financial LLC, dated June 2, 2006 (filed as Exhibit
                10.2 to
                Current Report on Form 8-k, dated June 8, 2006 and incorporated herein
                by
                reference)*10.23
            
            ISDA
                Master Agreement by and between Innofone and Cogent Capital Financial
                LLC,
                dated June 2, 2006 (filed as Exhibit 10.3 to Current Report on Form
                8-k,
                dated June 8, 2006 and incorporated herein by
                reference)*10.24
            
            Equity
                Swap Confirmation by and between Innofone and Cogent Capital Financial
                LLC, dated June 2, 2006 (filed as Exhibit 10.4 to Current Report
                on Form
                8-k, dated June 8, 2006 and incorporated herein by
                reference)*10.25
            
            Credit
                Support Annex by and between Innofone and Cogent Capital Financial
                LLC,
                dated June 2, 2006 (filed as Exhibit 10.5 to Current Report on Form
                8-k,
                dated June 8, 2006 and incorporated herein by
                reference)*10.26
            
            Registration
                Rights Agreement, by and between Innofone and Cogent Capital Investments
                LLC and Cogent Capital Financial LLC, dated June 2, 2006 (filed as
                Exhibit
                10.6 to Current Report on Form 8-k, dated June 8, 2006 and incorporated
                herein by reference)*10.27
            
            Warrant
                issued by Innofone to Cogent Capital Financial LLC, dated June 2,
                2006
                (filed as Exhibit 10.7 to Current Report on Form 8-k, dated June
                8, 2006
                and incorporated herein by
                reference)*




33




10.28
            
            Promissory
                Note issued to 55 South Investment, dated July 10, 2006 (filed as
                Exhibit
                10.1 to Current Report on Form 8-K, dated July 13, 2006 (“July 8-K”) and
                incorporated herein by reference)*10.29
            
            Registration
                Rights Agreement between Innofone and 55 South Investments, dated
                July 10,
                2006 (filed as Exhibit 10.2 to the July 8-K and incorporated herein
                by
                reference)*10.30
            
            Guaranty
                and Pledge Agreement between Innofone, Alex Lightman and 55 South
                Investments, dated July 10, 2006 (filed as Exhibit 10.3 to the July
                8-K
                and incorporated herein by reference)*10.31
            
            Warrant
                issued to 55 South Investment, dated July 10, 2006 (filed as Exhibit
                10.4
                to the July 8-K and incorporated herein by reference)*10.32
            
            Warrant
                issued to Millennium Investment Service, Inc., dated July 10, 2006
                (filed
                as Exhibit 10.5 to the July 8-K and incorporated herein by
                reference)*





10.33
            
            Agreement
                and Plan of Merger, dated July 1, 2006, by and among Innofone.com,
                Mobile
                Tech Acquisition Corp; a wholly owned subsidiary of Innofone, Mobile
                Technology Group, Inc. and its shareholders (Filed as Exhibit 10.1
                to the
                August 10, 2006 Form 8-K and incorporated herein by
                reference)*10.34
            
            Promissory
                Note issued to Keiran Gaffney Weinroth and Paul Weinroth, (the
                "Weinroths") dated August 8, 2006 (1)10.35
            
            Registration
                Rights Agreement between Innofone and the Weinroths, dated August
                8, 2006
                (1)10.36
            
            Guaranty
                and Pledge Agreement between Innofone and the Weinroths, dated August
                8,
                2006 (1)10.37
            
            Warrant
                issued to the Weinroths, dated August 8, 2006
                (1)





21
            
            List
                of Company's subsidiaries (incorporated by reference to Exhibit 3.1
                filed
                with Innofone's Form 10-KSB on October 14, 2005)*31.1
            
            Certification
                of Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
                (1)31.2
            
            Certification
                Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002 (1)




*   
       Incorporated by reference as stated therein


(1) 
      Filed herewith


(2) 
      Previously filed with Registration Statement on Form SB-2 on October 27, 2005
      and Incorporated herein by reference.




34


**ITEM
      14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.**




The
      Company paid audit fees and related fees of approximately $34,500 and $17,200
      to
      Danziger and Hochman for its June 30, 2006 and 2005, respectively,
      audit.





The
      Company paid the audit fees of approximately $15,000 to De Joya Griffith &
Company LLC in connection with the audit of IPv6 Summit, its wholly owned
      subsidiary for the year ended June 30, 2006:








35




**SIGNATURES**





Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, as amended, the Company has duly caused this amended report to be signed
      on its behalf by the undersigned, thereunto duly authorized on
      the 3rd day
      of October 2006.




**INNOFONE.COM,
                INCORPORATED**By:
            /s/ AlexLightmanChief
                Executive Officer, President, Principal Financial Officerand
                Director





Pursuant
      to the requirements of the Securities Exchange Act of 1934, as amended, this
      amended report has been signed by the following persons in the capacities and
      on
      the dates indicated.




Signature
            
            Title
            
            Date/s/Alex
                Lightman
            
            Chief
                Executive Officer,
              President,
                Principal
              Accounting
                Officer and
            
            October
                3, 2006Alex
                Lightman
            
            Director/s/
                Peter Maddocks
            
            Director
            
            October
                  3, 2006Peter
                Maddocks/s/Jim
                Bacchus
            
            Vice-President
                of Consulting
            
            October
                  3, 2006Jim
                Bacchus/s/
                Paul Shepherd
            
            Secretary
            
            October
                  3, 2006Paul
                Shephard











36





**INDEX
      TO FINANCIAL STATEMENTS**




PageNumberINNOFONE.COM,
                    INCORPORATEDReport
                  of Independent Certified Public Accounting Firm
              F-1Consolidated
                  Balance Sheet as of June 30, 2006
              F-2Consolidated
                  Statements of Operations for the Years Ended June 30, 2006
                  and 2005
              F-3Consolidated
                  Statements of Stockholders’
                  Equity for the Years Ended June 30, 2006 and 2005
              F-4Consolidated
                  Statements of Cash Flows for the Years Ended June 30, 2006 and
                  2005
              F-5Notes
                  to the Consolidated Financial Statements
              F-7-15


F-1




**REPORT
        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
  To
        the
        Board of Directors and
 Stockholders
        of Innofone.com, Incorporated
  We
        have
        audited the accompanying consolidated balance sheet of Innofone.com,
        Incorporated as of June 30, 2006, and the related consolidated statements
        of
        operations, stockholders’ equity, and cash flows for the year ended June 30,
        2006. 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 audits. The statements of operations, stockholders'
        equity and cash flows disclosed as comparative figures for the year ended
        June
        30, 2005 are those of IPv6 Summit, Inc., a subsidiary of Innfone.com,
        Incorporated, were audited by other auditors whose report dated September
        9,
        2005, expressed an unqualified opinion.
  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. 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 financial position of Innofone.com, Incorporated as
        of
        June 30, 2006, and the results of its operations and its cash flows for the
        year
        ended June 30, 2006 in conformity with accounting principles generally accepted
        in the United States of America.
  /s/
        Danziger & Hochman
  **Chartered
        Accountants**
 **Toronto,
        Ontario**
 **August
        30, 2006**




INNOFONE.COM,
        INCORPORATED
 CONSOLIDATED
        BALANCE SHEET
 AS
        OF
        JUNE 30, 2006
  ASSETSCurrent
                    assetsCash
                
                $
                100,172Accounts
                    receivable
                
                
                32,000Prepaid
                    expenses and other assets
                
                
                211,842Total
                    current assets
                
                
                344,014Fixed
                    assets, net
                
                
                16,397Investment
                    in U.S. Treasury Bonds - restricted
                
                
                49,998,571Investment
                    in Digital Presence, Inc., equity method
                
                
                38,646Unamortized
                    debt discount and finance cost
                
                
                2,315,589Deposits
                    for pending acquisitions
                
                
                304,500Intangible
                    asset
                
                
                25,000Total
                    assets
                
                $
                53,042,717LIABILITIES
                    AND STOCKHOLDERS' EQUITYCurrent
                    liabilitiesAccounts
                    payable and accrued liabilities
                
                $
                1,156,981Accrued
                    interest payable
                
                
                123,251Due
                    to related party
                
                
                800,000Notes
                    payable - current portion
                
                
                1,100,000Total
                    current liabilities
                
                
                3,180,232Long-term
                    liabilitiesLiability
                    on equity swap agreement
                
                
                3,469,223Notes
                    payable - long term portion
                
                
                100,000Total
                    liabilities
                
                
                6,749,455Stockholders'
                    equityPreferred
                    stock; $0.01 par value; 4,815,000 sharesauthorized,
                    issued and outstanding
                
                
                48,150Common
                    stock; $0.001 par value; 950,000,000 sharesauthorized,
                    72,858,345 issued and outstanding
                
                
                72,858Additional
                    paid-in capital
                
                
                62,944,096Unamortized
                    fee associated with Equity Swap Agreement paidwith
                    common stock and warrants
                
                
                (7,500,698
                )Stock
                    payable for 71,000 shares of common stock
                
                
                58,395Related
                    party stock payable for 800,000 shares of common stock
                
                
                544,000Accumulated
                    deficit
                
                
                (9,873,539
                )Total
                    stockholders' equity
                
                
                46,293,262Total
                    liabilities and stockholders' equity
                
                $
                53,042,717
  See
          Accompanying Notes to Consolidated Financial Statements
 
  INNOFONE.COM,
            INCORPORATED
 CONSOLIDATED
            STATEMENTS OF OPERATIONS
 FOR
            THE
            YEARS ENDED JUNE 30, 2006 AND 2005
 2006
                  
                  
                  2005Revenues
                  
                  $
                  624,907
                  
                  $
                  545,588Cost
                      of revenues
                  
                  
                  158,636
                  
                  
                  118,164Gross
                      profit
                  
                  
                  466,271
                  
                  
                  427,424Operating
                      expensesDepreciation
                  
                  
                  7,521
                  
                  
                  2,941Selling,
                      general and administrative
                  
                  
                  4,506,159
                  
                  
                  466,914Total
                      operating expenses
                  
                  
                  4,513,680
                  
                  
                  469,855Income
                      (loss) from operations
                  
                  
                  (4,047,409
                  )
                  
                  (42,431
                  )Other
                      income (expense)Interest
                      income
                  
                  
                  214,767
                  
                  
                  3Interest
                      expense and finance cost
                  
                  
                  (1,428,795
                  )
                  
                  --Unrealized
                      loss on equity swap agreement
                  
                  
                  (3,469,223
                  )Amortization
                      expense of fee associated withequity
                      swap agreement
                  
                  
                  (218,134
                  )Other
                      expense
                  
                  
                  (77,237
                  )
                  
                  (2,756
                  )Total
                      other income (expense)
                  
                  
                  (4,978,622
                  )
                  
                  (2,753
                  )Net
                      income (loss) before provision for income taxes
                  
                  
                  (9,026,031
                  )
                  
                  (45,184
                  )Provision
                      for income taxes
                  
                  
                  --
                  
                  
                  10,285Net
                      income (loss)
                  
                  $
                  (9,026,031
                  )
                  $
                  (55,469
                  )Net
                      income (loss) per common share - basic and diluted
                  
                  $
                  (0.15
                  )
                  $
                  (0.00
                  )Weighted
                      average common shares outstanding -basic
                      and diluted
                  
                  
                  58,528,680
                  
                  
                  33,333,333
 See
            Accompanying Notes to Consolidated Financial Statements
 INNOFONE.COM,
            INCORPORATED
 CONSOLIDATED
            STATEMENT OF STOCKHOLDERS' EQUITY
 FOR
            THE
            YEARS ENDED JUNE 30, 2006 AND 2005
 Unamortized
                        feeAssociated
                        withEquity
                        Swap
                    
                    
                    
                    
                    
                    RelatedAdditional
                    
                    
                    Agreement
                    
                    
                    
                    
                    
                    Party
                    
                    
                    
                    
                    
                    TotalPreferred
                        Stock
                    
                    
                    Common
                        Stock
                    
                    
                    Paid-in
                    
                    
                    Paid
                        with
                    
                    
                    Stock
                    
                    
                    Stock
                    
                    
                    Accumulated
                    
                    
                    Stockholders'Shares
                    
                    
                    Amount
                    
                    
                    Shares
                    
                    
                    Amount
                    
                    
                    Capital
                    
                    
                    Stock
                    
                    
                    Payable
                    
                    
                    Payable
                    
                    
                    Deficit
                    
                    
                    EquityBalance,
                        June 30, 2004
                    
                    
                    --
                    
                    $
                    --
                    
                    
                    33,333,000
                    
                    $
                    33,333
                    
                    $
                    (31,333
                    )
                    $
                    --
                    
                    $
                    --
                    
                    $
                    --
                    
                    $
                    75,076
                    
                    $
                    77,076Net
                        income (loss)
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (55,469
                    )
                    
                    (55,469
                    )Balance,
                        June 30, 2005
                    
                    
                    --
                    
                    
                    --
                    
                    
                    33,333,000
                    
                    
                    33,333
                    
                    
                    (31,333
                    )
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    19,607
                    
                    
                    21,607Issuance
                        of stock related to reverse-mergerwith
                        Innofone.com, Incorporated
                    
                    
                    --
                    
                    
                    --
                    
                    
                    28,005,270
                    
                    
                    28,005
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    28,005Distribution
                        related to reverse-merger
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    (132,885
                    )
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    (867,115
                    )
                    
                    (1,000,000
                    )Issuance
                        of common stock and warrants for$4,000,000
                        in cash
                    
                    
                    --
                    
                    
                    --
                    
                    
                    3,478,261
                    
                    
                    3,478
                    
                    
                    3,996,522
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    4,000,000Issuance
                        of stock for services
                    
                    
                    --
                    
                    
                    --
                    
                    
                    1,191,814
                    
                    
                    1,192
                    
                    
                    853,496
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    854,688Issuance
                        of warrants for services
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    140,199
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    140,199Issuance
                        of warrants related to new NIR Groupdebt
                        totaling $1,200,000
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    476,121
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    476,121Vesting
                        of employee stock options
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    13,335
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    13,335Issaunce
                        of 4,815,000 preferred stock and6,850,000
                        common stock for $50,000,000in
                        U.S. Treasury Bonds
                    
                    
                    4,815,000
                    
                    
                    48,150
                    
                    
                    6,850,000
                    
                    
                    6,850
                    
                    
                    49,945,000
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    50,000,000Issuance
                        of common stock and warrants forfee
                        related to Equity Swap Agreementwith
                        Cogent Capital Financial, LLC
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    7,683,641
                    
                    
                    (7,683,641
                    )
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --Stock
                        payable for 71,000 shares of commonstock
                        related to services
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    58,395
                    
                    
                    --
                    
                    
                    --
                    
                    
                    58,395Related
                        party stock payable for 800,000shares
                        of common stock related to$400,000
                        loan
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    544,000
                    
                    
                    --
                    
                    
                    544,000Amortization
                        expense of fee
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    182,943
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    182,943Net
                        income (loss)
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    --
                    
                    
                    (9,026,031
                    )
                    
                    (9,026,031
                    )Balance,
                        June 30, 2006
                    
                    
                    4,815,000
                    
                    $
                    48,150
                    
                    
                    72,858,345
                    
                    $
                    72,858
                    
                    $
                    62,944,096
                    
                    $
                    (7,500,698
                    )
                    $
                    58,395
                    
                    $
                    544,000
                    
                    $
                    (9,873,539
                    )
                    $
                    46,293,262
  See
            Accompanying Notes to Consolidated Financial Statements
 
  INNOFONE.COM,
                INCORPORATED
 CONSOLIDATED
              STATEMENTS OF CASH FLOWS
 FOR
              THE
              YEARS ENDED JUNE 30, 2006 AND 2005
 2006
                    
                    2005Cash
                        flows from operating activities:Net
                        income (loss)
                    
                    $
                    (9,026,031
                    )
                    $
                    (55,469
                    )Adjustments
                        to reconcile net income (loss) to netcash
                        used in operating activities:Depreciation
                    
                    
                    7,521
                    
                    
                    2,941Amortization
                        of premium on U.S. Treasury Bonds
                    
                    
                    1,429
                    
                    
                    --Amortization
                        of debt discount and finance cost
                    
                    
                    365,475
                    
                    
                    --Unrealized
                        loss on equity swap agreement
                    
                    
                    3,469,223
                    
                    
                    --Loss
                        on disposal of assets
                    
                    
                    --
                    
                    
                    2,756Loss
                        on equity investment in Digital Presence, Inc.
                    
                    
                    11,354
                    
                    
                    --Stock
                        based expenses
                    
                    
                    1,036,227
                    
                    
                    --Changes
                        in operating assets and liabilities:Change
                        in accounts receivable
                    
                    
                    14,980
                    
                    
                    69,548Change
                        in prepaid expenses
                    
                    
                    (199,112
                    )
                    
                    3,050Change
                        in other assets
                    
                    
                    --
                    
                    
                    (919
                    )Change
                        in accounts payable and accrued liabilities
                    
                    
                    289,948
                    
                    
                    (22,513
                    )Change
                        in accrued interest payable
                    
                    
                    123,251
                    
                    
                    --Change
                        in stock payable
                    
                    
                    58,395
                    
                    
                    --Net
                        cash used in operating activities
                    
                    
                    (3,847,340
                    )
                    
                    (606
                    )Cash
                        flows from investing activities:Purchase
                        of fixed assets
                    
                    
                    (19,078
                    )
                    
                    (2,165
                    )Capital
                        outlay for intangible assets
                    
                    
                    (25,000
                    )
                    
                    --Capital
                        outlay for Digital Presence, Inc.
                    
                    
                    (175,000
                    )
                    
                    --Capital
                        outlay for Equity Swap Agreement
                    
                    
                    (671,750
                    )
                    
                    --Deposits
                        for pending acquisitions
                    
                    
                    (179,500
                    )
                    
                    --Net
                        cash used in investing activities
                    
                    
                    (1,070,328
                    )
                    
                    (2,165
                    )Cash
                        flows from financing activities:Proceeds
                        from notes payable
                    
                    
                    3,000,000
                    
                    
                    --Proceeds
                        from related party notes payable
                    
                    
                    500,000
                    
                    
                    --Proceeds
                        from issuance of common stocks
                    
                    
                    4,000,000
                    
                    
                    --Payments
                        on notes payable
                    
                    
                    (1,800,000
                    )Payments
                        on related party notes payable
                    
                    
                    (700,000
                    )
                    
                    (39,139
                    )Net
                        cash provided by (used in) financing activities
                    
                    
                    5,000,000
                    
                    
                    (39,139
                    )Net
                        change in cash
                    
                    
                    82,332
                    
                    
                    (41,910
                    )Cash,
                        beginning of period
                    
                    
                    17,840
                    
                    
                    59,750Cash,
                        end of period
                    
                    $
                    100,172
                    
                    $
                    17,840Supplemental
                        disclosure of cash flow information:Cash
                        paid for interest
                    
                    $
                    --
                    
                    $
                    --Schedule
                        of non-cash financing and investing activities:Issuance
                        of $1,000,000 note payable to Alex Lightmanrelated
                        to reverse-merger and accounted for as adistribution
                    
                    $
                    1,000,000
                    
                    $
                    --Debt
                        discount related to beneficial conversionfeature
                        of convertible debt
                    
                    $
                    1,893,526
                    
                    $
                    --Finance
                        cost related to warrants issuedassociated
                        with convertible debt
                    
                    $
                    664,125
                    
                    $
                    --Issuance
                        of 4,185,000 shares of preferred stock and6,850,000
                        shares of common stock for $50,000,000U.S.
                        Treasury Bonds
                    
                    $
                    50,000,000
                    
                    $
                    --
  See
            Accompanying Notes to Consolidated Financial
            Statements
 INNOFONE.COM,
                    INCORPORATED
 NOTES
                    TO
                    CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                    30,
                    2006
 1.
              DESCRIPTION
                  OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT ACCOUNTING
                  POLICIES
 
 Description
        of business -
        Innofone.com, Incorporated (the “Company”) was incorporated on December 19,
        1995. On August 19, 2005, the Company consummated a Stock Purchase Agreement
        (the “Agreement”) with Alexander Lightman to acquire 100% of the outstanding
        capital stock of IPv6 Summit, Inc. (“IPv6”). The fundamental terms of the
        purchase agreement provide for the Company to deliver a promissory note in
        the
        sum of $1,000,000 as partial consideration of the purchase price and to issue
        33,333,000 shares of restricted common stock of the Company to satisfy the
        balance of the purchase price in full (the “IPv6 Transaction”). As a result,
        IPv6 has become a wholly owned subsidiary of the Company. Prior to the IPv6
        Transaction, the Company was non-operating public company with no operations
        or
        assets; 28,005,270 shares of common stock issued and outstanding; and IPv6
        was a
        privately held operating company. The IPv6 Transaction is considered to be
        a
        capital transaction in substance, rather than a business combination. Inasmuch,
        the IPv6 Transaction is equivalent to the issuance of shares by a private
        company (IPv6) for the non-monetary assets of a non-operational public company,
        accompanied by a recapitalization. The accounting for IPv6 Transaction is
        similar to that resulting from a reverse acquisition, except goodwill is
        not
        recorded. Accordingly, the historical financial information of the accompany
        financial statements are that of IPv6 which the 33,333,000 shares issued
        by the
        Company are considered the historical outstanding shares of IPv6 for accounting
        purposes. The partial consideration of $1,000,000 promissory note has been
        accounted for as a distribution as if IPv6 had returned capital to its previous
        sole shareholder in the form of a distribution. The Company’s operating
        activities are conducted through its wholly owned subsidiary, IPv6 Summit,
        Inc.
 
 IPv6
        Summit, Inc., a Nevada corporation located in Santa Monica, California was
        incorporated on July 9, 2003. The Company is among the leading organizers
        of
        IPv6 conference events in the world. IPv6 stands for Internet Protocol version
        6
        and is the successor protocol to the current Internet, Internet Protocol
        version
        4, which was introduced in June 1973 and turned 33 years old this summer.
        IPv4
        is a 32-bit protocol, while IPv6 is a 128-bit protocol allowing for 3.4 x
        10 to
        the 38th power new IP addresses, and thus allowing for a vast increase in
        connecting people, places, and things to the Internet.
 
 The
        Company derives revenue from Sponsorships, Conference Attendee Fees, Training
        Fees, and Consulting to Governments.
 
 Liquidity
        and capital resources - As of
        June 30, 2006, the Company had total current assets of $344,014 and total
        current liabilities of $3,180,232 resulting in a working capital deficit
        of
        $2,836,218. As of June 30, 2006, the Company had cash totaling $100,172.
        Our
        cash flow from operating activities for the year ended June 30, 2006 resulted
        in
        a deficit of $3,847,340.
        Our cash flow from investing activities resulted in a deficit of $1,070,328.
        Our
        cash flows from financing activities resulted in a surplus of $5,000,000.
        Overall, the Company’s cash flows for the year ended June 30, 2006, netted a
        surplus of $82,332. Subsequent to June 30, 2006 as further discussed in Note
        12,
        the Company raised approximately $3,140,000 through debt financing. Furthermore,
        the acquisition of InfoWeapons, Inc. as discussed in Note 11, is anticipated
        to
        be completed in September 2006. The Company believes the cash flow from current
        operating activities and operating activities of InfoWeapons, Inc. for the
        next
        twelve months, and capital raised subsequent to June 30, 2006 of approximately
        $3,140,000 through debt financing will be sufficient to provide necessary
        capital for the Company’s operations for the next twelve months. Additionally,
        the Equity Swap agreement, as more fully described in Note 7, should provide
        funds to the Company within the next twelve months.
 
 INNOFONE.COM,
                INCORPORATED
 NOTES
                TO
                CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                30,
                2006
  Use
        of
        estimates - The
        preparation of consolidated financial statements in conformity with accounting
        principles generally accepted in the United States requires management to
        make
        estimates and assumptions that affect the reported amounts of assets and
        liabilities and disclosure of contingent assets and liabilities at the date
        of
        the consolidated financial statements and the reported amounts of revenue
        and
        expenses during the reporting period. Actual results could differ from those
        estimates.
 
 Year
        end - The
        Company’s year end is June 30.
  Principles
        of consolidation - The
        accompanying consolidated financial statements include the accounts of
        Innofone.com, Incorporated and its wholly owned subsidiary, IPv6 Summit,
        Inc.
        The accompanying consolidated financial statements have been prepared in
        accordance accounting principles generally accepted in the United States.
        All
        material inter-company accounts and transactions have been eliminated in
        consolidation.
 
 Revenue
        and expense recognition - The
        Company recognizes revenue from services provided once all of the following
        criteria for revenue recognition have been met: 1) pervasive evidence of an
        agreement exists, 2) the services have been delivered, 3) the price is
        fixed and determinable and not subject to refund or adjustment and
        4) collection of the amounts due is reasonably. Overhead and administrative
        costs are recognized when incurred and direct event c osts
        and
        expenses are recognized during the period in which the event they are associated
        with occurs.
 
 Cash - Cash
        equivalents consist of highly liquid investments with maturities of three
        months
        or less when purchased. Cash and cash equivalents are on deposit with financial
        institutions without any restrictions.
 
 Allowance
        for doubtful accounts - The
        allowance for doubtful accounts is an estimate made by management, based
        upon
        current information, to reserve for potential credit losses in the future. 
While these losses have been within management's expectations in the past,
        it is
        reasonably possible that the allowance for doubtful accounts will need to
        be
        revised in the future to reflect changing information and
        conditions.
 
 Fixed
        assets - Fixed
        assets are stated at cost less accumulated depreciation. Depreciation is
        provided principally on the straight-line method over the estimated useful
        lives
        of the assets, which are generally 3 years. The cost of repairs and maintenance
        is charged to expense as incurred. Expenditures for property betterments
        and
        renewals are capitalized. Upon sale or other disposition of a depreciable
        asset,
        cost and accumulated depreciation are removed from the accounts and any gain
        or
        loss is reflected in other income (expense).
 
 The
        Company periodically evaluates whether events and circumstances have occurred
        that may warrant revision of the estimated useful life of fixed assets or
        whether the remaining balance of fixed assets should be evaluated for possible
        impairment. The Company uses an estimate of the related undiscounted cash
        flows
        over the remaining life of the fixed assets in measuring their
        recoverability.
 INNOFONE.COM,
                  INCORPORATED
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                  30,
                  2006
 
 Goodwill
        and intangible asset - In
        July 2001, the Financial Accounting Standards Board (“FASB”) issued
        Statement of Financial Accounting Standards (“SFAS”) No. 141, “Business
        Combinations” and No. 142, “Goodwill and Other Intangible Assets.” SFAS No. 141
        requires all business combinations initiated after June 30, 2001 to be accounted
        for using the purchase method. Under SFAS No. 142, goodwill and intangible
        assets with indefinite lives are no longer amortized but are reviewed annually
        (or more frequently if impairment indicators arise) for impairment.
 
 According
        to this statement, goodwill and intangible assets with indefinite lives are
        no
        longer subject to amortization, but rather an annual assessment of impairment
        by
        applying a fair-value based test. Fair value for goodwill is based on discounted
        cash flows, market multiples and/or appraised values as appropriate. Under
        SFAS
        No. 142, the carrying value of assets are calculated at the lowest level
        for
        which there are identifiable cash flows.
 
 The
        Company has intangible assets totaling $25,000 as of June 30, 2006. which
        in the
        opinion of management, no impairment is deemed necessary.
 
 SFAS
        142
        requires the Company to compare the fair value of the reporting unit to its
        carrying amount on an annual basis to determine if there is potential
        impairment. If the fair value of the reporting unit is less than its carrying
        value, an impairment loss is recorded to the extent that the fair value of
        the
        goodwill within the reporting unit is less than its carrying value.
 
 
 INNOFONE.COM,
                INCORPORATED
 NOTES
                TO
                CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                30,
                2006
  Income
        taxes - The
        Company accounts for its income taxes in accordance with Statement of Financial
        Accounting Standards No. 109, which requires recognition of deferred tax
        assets
        and liabilities for future tax consequences attributable to differences between
        the financial statement carrying amounts of existing assets and liabilities
        and
        their respective tax bases and tax credit carry-forwards. Deferred tax assets
        and liabilities are measured using enacted tax rates expected to apply to
        taxable income in the years in which those temporary differences are expected
        to
        be recovered or settled. The effect on deferred tax assets and liabilities
        of a
        change in tax rates is recognized in operations in the period that includes
        the
        enactment date. As June 30, 2006, the Company has available for federal income
        tax purposes a net operating loss carryforward of approximately $4,280,000,
        expiring in the year 2024, that may be used to offset future taxable income.
        The
        Company has provided a valuation reserve against the full amount of the net
        operating loss benefit, since in the opinion of management based upon the
        limited earning history of the Company, it is more likely than not that the
        benefits will not be realized.
 
 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 component of the Company’s
        deferred tax liabilities and assets as of June 30, 2006 are as
        follows:
  Deferred
                  tax assets:Net
                  operating loss
              
              $
              9,026,000Stock,
                  options and warrants issued for servicesand
                  financing costs
              
              
              (1,266,000
              )Unrealized
                  losses
              
              
              (3,469,000
              )Equity
                  investment losses
              
              
              (11,000
              )4,280,000Income
                  tax rate
              
              
              34
              %1,455,000Less
                  valuation allowance
              
              
              (1,455,000
              )$
              --
 
 The
        income tax rate to the federal statutory rate for the years ended June 30,
        2006
        and 2005 were 34% and 15%, respectively.
 
 Advertising
        costs - The
        Company recognizes advertising expenses in accordance with Statement of Position
        93-7 “Reporting on Advertising Costs.” Accordingly, the Company expenses the
        costs of producing advertisements at the time production occurs, and expenses
        the costs of communicating advertisements in the period in which the advertising
        space or airtime is used. The Company has recorded approximately $253,000
        and
        $148,000 of advertising costs for the years ended June 30, 2006 and 2005,
        respectively.
 
 Research
        and development costs -
        Research and development costs are charged to expense as incurred.
 
 Stock
        based compensation - On
        January 1, 2006, the Company adopted SFAS No. 123 (R) “Share-Based Payment”
which requires the measurement and recognition of compensation expense for
        all
        share-based payment awards made to employees and directors including employee
        stock options and employee stock purchases related to a Employee Stock Purchase
        Plan based on the estimated fair values.
 INNOFONE.COM,
                  INCORPORATED
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                  30,
                  2006
  The
        Company adopted SFAS No. 123(R) using the modified prospective transition
        method, which required the application of the accounting standard as of January
        1, 2006. The accompanying consolidated financial statements as of and for
        the
        year ended June 30, 2006 reflect the impact of SFAS No. 123(R). In accordance
        with the modified prospective transition method, the Company’s accompanying
        consolidated financial statements for the prior periods have not been restated,
        and do not include the impact of SFAS No. 123(R). Stock based compensation
        expense recognized under SFAS No. 123(R) for the year ended June 30, 2006
        totaled $13,335. Pro forma stock based compensation for the year ended June
        30,
        2005 totaled $-0-.
 
 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 exercise of options and warrants to purchase
        common shares would have an anti-dilutive effect.
  Recent
        accounting pronouncements - In May
        2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections."
        This statement applies to all voluntary changes in accounting principle and
        requires retrospective application to prior periods' financial statements
        of
        changes in accounting principle, unless this would be impracticable. This
        statement also makes a distinction between "retrospective application" of
        an
        accounting principle and the "restatement" of financial statements to reflect
        the correction of an error. This statement is effective for accounting changes
        and corrections of errors made in fiscal years beginning after December 15,
        2005. This statement is not expected to have a material effect on the Company's
        consolidated financial position or results of operations.
  In
        February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid
        Financial Instruments". SFAS No. 155 amends SFAS No 133, "Accounting for
        Derivative Instruments and Hedging Activities", and SFAF No. 140, "Accounting
        for Transfers and Servicing of Financial Assets and Extinguishments of
        Liabilities". SFAS No. 155, permits fair value remeasurement 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, establishes a
        requirement to evaluate interest 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 amends SFAS No. 140 to eliminate the prohibition on the
        qualifying special-purpose entity from holding a derivative financial instrument
        that pertains to a beneficial interest other than another derivative financial
        instrument. This statement is effective for all financial instruments acquired
        or issued after the beginning of the Company's first fiscal year that begins
        after September 15, 2006. This statement is not expected to have a material
        effect on the Company's consolidated financial position or results of
        operations.
 INNOFONE.COM,
                  INCORPORATED
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                  30,
                  2006
  In
        June
        2005, the EITF reached consensus on Issue No. 05-6, Determining the Amortization
        Period for Leasehold Improvements ("EITF 05-6.") EITF 05-6 provides guidance
        on
        determining the amortization period for leasehold improvements acquired in
        a
        business combination or acquired subsequent to lease inception. The guidance
        in
        EITF 05-6 will be applied prospectively and is effective for periods beginning
        after June 29, 2005. EITF 05-6 is not expected to have a material effect
        on the
        Company's consolidated financial position or results of operations.
  In
        September 2006, the FASB issued SFAS No. 157 “Fair Value Measurements”. SFAS No.
        157 defines fair value, establishes a framework for measuring fair value
        in
        generally accepted accounting principles and expands disclosure about fair
        values. This statement is effective for financial statements issued for fiscal
        years beginning after November 15, 2007, and interim periods within those
        fiscal
        years. Management believes that the adoption of SFAS No. 157 will not have
        a
        material impact on the consolidated financial results of the
        Company.
  INNOFONE.COM,
                  INCORPORATED
 NOTES
                  TO
                  CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                  30,
                  2006
  
 2.
              INVESTMENT
                  IN U.S. TREASURY BONDS -
                  RESTRICTED
 
 Investment
                  in U.S. Treasury Bonds - restricted totaling $49,998,571 at June
                  30, 2006,
                  consist of two bonds with a face value of $49,950,000 The bonds
                  have a
                  maturity date of May 31, 2008 and May 15, 2009 which are being
                  held to
                  maturity. These U.S. Treasury Bonds are considered restricted since
                  they
                  are posted in a collateral account as pledged assets related to
                  an Equity
                  Swap agreement as further discussed in Note 7. The Company has
                  accounted
                  for this investment in U.S. Treasury Bonds as investments available
                  for
                  sale. Accordingly, any changes in the market value of this investment
                  would be accounted for as an adjustment to other comprehensive
                  income
                  (loss).
 
 3.
              FIXED
                  ASSETS
 
 Fixed
        assets consist of the following as of June 30, 2006:
 
 Equipment
              
              $
              28,083Less:
                  accumulated depreciation
              
              
              11,686Fixed
                  assets, net
              
              $
              16,397
 
 4.
              UNAMORTIZED
                  DEBT DISCOUNT AND FINANCE COST
 
 As
        of
        June 30, 2006, unamortized debt discount and finance cost totaling $2,315,589
        consist of the following:
 
 Investment
                  fee related to equity swap agreement, cash portion,see
                  Note 7
              
              $
              1,442,810Debt
                  discount related to notes payable, see Note 8
              
              
              442,112Debt
                  discount related to Alex Lightman note payable,see
                  Note 6 and 10
              
              
              430,667$
              2,315,589
 
 Unamortized
        debt discount and finance cost are being amortized over the term of the related
        agreements on a straight line basis.
 
 5.
              DEPOSITS
                  FOR PENDING ACQUISITIONS
 
 As
        June
        30, 2006, deposit for pending acquisition totaling $304,500 relates deposit
        paid
        to Digital Presence, Inc. for $125,000, Mobile Technology Group, LLC for
        $99,500
        and InfoWeapons, Inc. for $80,000 which had not been completed as of June
        30,
        2006, see Note 11 for additional discussion.
 INNOFONE.COM,
                    INCORPORATED
 NOTES
                    TO
                    CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                    30,
                    2006
 6.
                DUE TO RELATED
                    PARTY
 
 Due
        to
        related party as of June 30, 2006 are comprised of the following transactions
        with Alex Lightman, the Company’s Chief Executive Officer, President and
        shareholder:
 
 Note
                  payable to Alex Lightman related to Stock PurchaseAgreement(see
                  Note 1 for detailed discussion), interest rate at4%,
                  payable in monthly installment payments of $83,333(principal
                  only) for each successive month starting on the dateof
                  execution of the note contingent upon certain conditionshaving
                  been met, and ending October 17, 2006 which anyunpaid
                  principal and interest would be due at that date
              
              $
              400,000Note
                  payable to Alex Lightman, interest rate at 5%, unsecuredand
                  principal and interest due at maturity on April 17, 2007(see
                  Note 4 for additional discussion)
              
              
              400,000$
              800,000
 
 7.
              EQUITY
                  SWAP AGREEMENT
 
 On
        June
        2, 2006, the entered into a securities purchase agreement with Cogent Capital
        Investments LLC (“CCI”) for the sale of 1,850,000 shares of common stock
        (“Common Stock”) and 4,815,000 shares of Series A Convertible Preferred Stock
        (“Preferred Stock”) for an aggregate purchase price of $50,000,000, which was
        paid in the form of U.S. Treasury Bonds. The Preferred Stock issued to CCI
        has
        no voting rights, no dividend rights and each share of Preferred Stock is
        convertible into ten (10) shares of common stock.
 
 Concurrently
        with the consummation of the securities purchase agreement, the Company entered
        into an equity swap agreement (“Equity Swap”) with Cogent Capital Financial LLC
        (“CCF”) an affiliate of CCI which such transaction is considered to be a
        derivative. The Equity Swap is a fixed versus floating price swap with respect
        to a notional stock amount of 37,500,000 shares of common stock , with Cogent
        being the floating equity payor and the Company being the fixed equity price
        payor. The fixed price under the Equity Swap is $1.333 per share. The Equity
        Swap has a maturity date of December 2, 2010, through certain conditions
        this
        date can be extended, and provides for periodic settlements and reductions
        of
        the notional amount of the Equity Swap over a 30 month period beginning one
        month after the Trigger Date, provided that the Company has satisfied certain
        conditions. The Trigger Date is the first date as of which the Resale Condition
        has been satisfied with respect to at least 10,000,000 shares. The Resale
        Condition shall be deemed satisfied as of any day with respect to the number
        of
        equity shares that, as of such day, are then subject to an effective resale
        registration statement under the Securities Act of 1933, as amended, with
        the
        holders of such shares being named therein as selling shareholders or fully
        eleigible for resale under Rule 144 adopted under the Securities Act of 1933.
        The Company agreed to pay CCF an amount equal to the decrease in value of
        the
        notional stock amount of 37,500,000 below $1.333 per share at each settlement
        date during the 30 month period beginning one month after the Trigger Date.
        Under the terms of the Equity Swap, the Company agreed to pay CCF an amount
        equal to in interest on $50,000,000, at Libor plus 1.45%, up through the
        Trigger
        Date then decreasing for the next 30
 INNOFONE.COM,
                    INCORPORATED
 NOTES
                    TO
                    CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                    30,
                    2006
  months
        based upon the decrease value in the notional stock amount. Among these
        conditions is a requirement that the Company maintain an effective registration
        statement with respect to specified portions of the Common Stock purchased
        by
        CCI and the Common Stock into which the Preferred Stock purchased is
        convertible. To secure the Company’s performance of the Equity Swap, the Company
        has pledged to CCF, and deposited in a collateral account subject to a lien
        in
        favor of CCF, the $50,000,000 in U.S. Treasury Bonds. As the notional amount
        of
        the Equity Swap is reduced, corresponding portion of the pledged U.S. Treasury
        Bonds are to be released to the Company, subject to any partial settlement
        of
        the Equity Swap resulting from the reduction in the notional amount. In the
        event the Company is required pay an amount equal to the decrease in value
        of
        the notional stock during each settlement date, it would do so through the
        liquidation of the U.S. Treasury Bonds which would then be recorded within
        the
        statement of operations as part earnings (loss).
 
 Since
        the
        Equity Swap is considered to be a derivative transaction, the Equity Swap
        is
        recorded at fair value at the end of each reporting period. Effective changes
        in
        fair value of the Equity Swap is recorded within the statement of operations
        as
        part earnings (loss). As of June 30, 2006, the Company recorded a liability
        on
        equity swap agreement of $3,469,223 which correspondingly an unrealized loss
        on
        equity swap agreement was reflected within the statement of operations. The
        fair
        value of the Equity Swap is determined using Black-Scholes based on the
        following assumptions: stock price of $1.14 based upon the date of this
        reporting period; term based upon the settlement period; volatility rate
        of
        235%; discount rate of 3.5% and no dividends.
 
 In
        connection with and as consideration to CCF under the Equity Swap as its
        fee,
        the Company is obligated to pay to CCF an amount consisting of: (i) $1,375,000
        (which $568,750 was paid at closing); (ii) 5,000,000 shares of common stock
        and
        (iii) warrant for 5,000,000 shares of common stock with an exercise price
        of
        $1.20 and term of 5 year. The fair value of the common stock and warrant
        given
        as consideration totaled $7,683,641. In addition, the Company paid CCF $103,000
        as an initial fee. Collectively, the value of cash, common stock and warrant
        totaled $9,161,641. The Company has accounted for the fee to CCF as an
        investment fee which has been capitalized and shall be amortized over the
        term
        of the Equity Swap on a straight line basis. As of June 30, 2006, the Company
        had amortization expense of $218,134 and unamortized fee balance of $8,943,507
        which $1,422,810 is included within “unamortized debt discount and finance cost”
of $2,315,589 and $7,500,698 is reflected within the stockholders’ equity
        section as “unamortized fee associated with equity swap agreement paid with
        common stock and warrants”. The fair value of the warrants has been determined
        using Black-Scholes based on the following assumptions: stock price based
        on the
        date of grant; term of 3 years; volatility rate of 229%; discount rate of
        3.5%
        and no dividends.
 
 8.
              NOTES
                  PAYABLE
 
 On
        May
        25, 2006, the Company entered into a Letter Agreement the NIR Group for the
        repayment of convertible notes and warrants issued on or about August 31,
        2005
        and October 15, 2005 pursuant to a Securities Purchase Agreement by and between
        the Company and AJW Partners, LLC, New Millennium Capital Partners II, LLC,
        AJW
        Offshore, Ltd. and AJW Qualified Partners, LLC (collectively, the “NIR Group”).
        The repayment was applied to the outstanding principal and interest owing
        under
        the convertible notes and as consideration for the cancellation of the
        associated warrants for 1,000,000 shares of common stock issued to the NIR
        Group, and the termination of any and all Uniform Commercial Code filings
        in
        favor of the NIR Group. In connection with the repayment, the Company and
        the
        NIR Group executed and delivered the Letter Agreement, a new promissory note
        (“new notes”), a new stock purchase warrant (“new warrants”), and new
        registration rights agreement (“new registration agreement”).
 INNOFONE.COM,
                    INCORPORATED
 NOTES
                    TO
                    CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                    30,
                    2006
 
 The
        terms
        of the repayment, as provided in the Letter Agreement are as follows: (a)
        upon
        signing of the Letter Agreement, the Company made a cash payment to the NIR
        Group in the amount of $2,635,400 which was applied to the repayment of all
        amounts of principal and interest owing and outstanding under previous
        convertible note balances; (b) the issuance of new notes in the aggregate
        amount
        totaling $1,200,000. The new notes are self-amortizing over a one year period
        commencing on July 1, 2006, with each installment payment due on the twelve
        consecutive monthly anniversaries beginning July 1, 2006. Further , pursuant
        to
        the new notes, the Company will pay to the NIR Group an aggregate of $100,000
        per month. Additionally, the Company issued to the NIR Group new warrants
        for
        750,000 shares of common stock with an exercise price of $1.79 and a term
        of
        five years. The new warrants may be exercised on a cashless basis only in
        the
        event that there is no effective registration statement covering the shares
        underlying the warrants. The Company may buy back all the new warrants from
        the
        NIR Group for an aggregate of $100,000 at any time prior to the new warrants
        being exercised. The fair value of the new warrants totaled $476,121 was
        determined using Black-Scholes option pricing model based on the following
        assumptions: term of 2 years, volatility rate of 229%, risk free interest
        rate
        of 3.5% and dividend yield of 0%. The fair value of the new warrants totaling
        $476,121 have been accounted for as debt discount which have been capitalized
        and amortized over the term the new notes on a straight line basis. As of
        June
        30, 2006, the unamortized debt discount balance totaled $442,112, see Note
        4.
 
 9.
              STOCKHOLDERS’
                  EQUITY
 
 Stock
        options - In
        December 2005, the Company had granted an employee a stock option for 100,000
        shares of common stock which vest over a twenty four (24) month period. The
        stock option has been valued at $45,718 using the Black-Scholes option pricing
        model based upon the following assumptions: term of 4 years, a risk free
        interest rate of 3.5%, a dividend yield of 0% and volatility of 169%. The
        Company has recorded an expense of $13,335 for the year ended June 30, 2006
        based upon the vested portion of the stock option totaling 29,167 up through
        June 30, 2006.
 
 Warrants - In
        August 2005, the Company had issued warrants for 34,286 shares of common
        stock
        with an exercise price of $3.50 to an entity for services provided. The warrants
        have been valued at $102,000 using the Black-Scholes option
        pricing model based upon the following assumptions: term of 3 years, a risk
        free
        interest rate of 3.5%, a dividend yield of 0% and volatility of 162%. The
        entire
        amount of $102,000 has been expensed as of June 30, 2006.
 
 As
        discussed in Note 8, the Company had issued warrants in May 2006 for 750,000
        shares of common stock with a fair value of $476,121. The Company has recorded
        an expense associated with these warrants totaling $34,009 for the year ended
        June 30, 2006 related to the fair value of these warrants.
 
 In
        June
        2006, the Company issued 3,478,261 shares of common stock for a total cash
        consideration of $4,000,000. In addition, the Company had issued a warrant
        for
        400,000 shares of common stock with an exercise price of 80% of the 5 day
        average closing price prior to the date of exercise notification and expiring
        in
        two years. The fair value of the warrant totaled $272,843 which is considered
        as
        part of the overall consideration given for the $4,000,000 cash received
        by the
        Company. Accordingly, the value of the warrant has been netted against of
        the
        offering proceeds associated with the common stock issuance.
 INNOFONE.COM,
                    INCORPORATED
 NOTES
                    TO
                    CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                    30,
                    2006
 
 As
        discussed in Note 7, the Company issued a warrant for 5,000,000 shares of
        common
        stock associated with the Equity Swap agreement. The warrant has been valued
        at
        $3,733,641. The Company has recorded an expense associated with this warrant
        totaling $88,896 for the year ended June 30, 2006.
 
 In
        June
        2006, the Company has issued warrants for 35,000 shares of common stock for
        legal services provided. The warrants have been valued at $38,431 using the
        Black-Scholes option pricing model based upon the following assumptions:
        term of
        3 years, risk free interest rate of 3.5%, a dividend yield of 0% and volatility
        of 235%. The entire amount of the $38,431 has been expensed as of June 30,
        2006.
 
 The
        following is a summary of warrants activity during the year ended June 30,
        2006:
 
 Balance
                  outstanding at June 30, 2005
              
              $
              --Shares
                  related to warrants granted
              
              
              7,219,286Forfeited
                  or cancelled
              
              
              (1,000,000
              )Exercised
              
              
              --Balance
                  outstanding at June 30, 2006
              
              $
              6,219,286
 
 All
        of
        the outstanding warrants for shares of common stock totaling 6,219,286 are
        exercisable as of June 30, 2006.
 
 10.
              STOCK
                  PAYABLE
 
 During
        the year ended June 30, 2006, the Company entered in various agreement with
        consultants whereby compensation for such services would be either be paid
        partially or fully with shares of common stock. As of June 30, 2006, the
        Company
        had stock payable for 71,000 shares of common stock due to these consultants
        with a total value of $58,395.
 
 In
        April
        2006, the Company entered into a promissory note with Alex Lightman, as noted
        in
        Note 6, whereby as consideration, aside interest and repayment of the note,
        Mr.
        Lightman is entitled to receive 800,000 shares of common stock valued at
        $544,000 and considered as a loan fee, see Note 4. As of June 30, 2006, the
        800,000 shares of common stock had not been issued and has been recorded
        as a
        stock payable.
 
 11.
              BUSINESS
                  ACQUISITIONS
 
 On
        March
        7, 2006, the Company entered into a Common Stock Purchase Agreement to purchase
        a total of 66.67% of the outstanding common stock of Digital Presence, Inc.
        (“Digital”) in consideration of cash totaling $300,000 made in installment
        payments. The payment terms for the purchase are as follow: (a) $50,000 which
        was due on the initial closing on March 7, 2006; (b) $125,000 due on second
        closing of May 15, 2006; and (c) $125,000 due on third closing of June 15,
 INNOFONE.COM,
                    INCORPORATED
 NOTES
                    TO
                    CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                    30,
                    2006
  2006.
        As
        of June 30, 2006, the Company has paid the initial and second closing payment
        totaling $175,000 of which $125,000 was treated as deposit since the related
        shares were not received as of June 30, 2006. As June 30, 2006, the Company
        had
        ownership interest in Digital which of approximately 25% which has been
        accounted for as an equity investment. The Company made the third and final
        payment of $125,000 and completed the acquisition on September 10, 2006.
        As of
        June 30, 2006, the Company has recorded total payments related to the
        acquisition of $50,000 as “Investment in Digital Presence” has accounted for
        such investment under the equity method. For the year ended June 30, 2006,
        the
        Company recorded its proportionate ownership interest of Digital’s net loss of
        $11,354 and reduced its investment in Digital to $163,646 at June 30,
        2006.
 On
          May
          10, 2006 the Company executed an amended binding term sheet to acquire
          all of
          the issued and outstanding capital stock of InfoWeapons Inc., a producer
          of IPv6
          dual-stack servers and routers in the Philippines. The consideration for
          the
          purchase is cash in the amount of $50,000 and common stock of the Company
          in the
          amount of $8,500,000. A Merger Agreement was executed on or about August
          16,
          2006 incorporating these terms. The sole remaining closing requirement
          in the
          Merger Agreement is the delivery of InfoWeapon’s US GAAP audited financial
          statements which are expected in the normal course. A shareholder of the
          Company
          is the Chairman of InfoWeapons Inc.
 
 On
        April
        21, 2006, the Company entered into a Non-binding term sheet to acquire all
        the
        outstanding capital of Mobile Technology Group, LLC in consideration of $7,500
        in cash payable on execution and shares of the Company’s common stock equal in
        value of $1,500,000. The Company completed its acquisition of Mobile Technology
        Group, LLC in August 4, 2006, see Note 12 for additional discussions.
 
 12.
              SUBSEQUENT
                  EVENTS
 
 In
        July
        2006, the Company issued 64,542 shares of common stock with a total value
        of
        $72,000 for services. During the same month, the Company issued 36,000 shares
        of
        common stock related to a stock payable amount totaling $24,480 outstanding
        at
        June 30, 2006, as reflected in Note 10.
 
 In
        July
        2006, the Company issued two promissory notes (the “Notes”) to 55 South
        Investments (“Holder”) totaling $1,000,000, with interest at 12% per annum. The
        Maturity Date shall be the earlier of: (a) one (1) year from the commencement
        of
        that certain Equity Swap transaction, as discussed in Note 7, whereby 30
        days
        have expired thereafter the date in which the Company is granted effectiveness
        by the Securities and Exchange Commission on a registration statement filed
        pursuant to certain agreements made in connection with an equity swap made
        by
        and between the Company and Cogent Capital Group, LLC and its affiliates
        as of
        June 2, 2006 (defined herein as the “Swap Start Date”); or (b) December 1, 2007,
        whichever is earlier. Repayment of the principal amounts of the Notes by
        the
        Company shall commence within ten (10) days of the Swap Start Date and shall
        continue thereafter in equal pro rata monthly installments on the same date
        of
        each subsequent month thereafter for the successive eleven (11) months
        thereafter the Swap Start Date and continue until all principal payments
        are
        paid in full. The principal shall be repaid in full no later than the maturity
        date. Should the Swap Start Date not occur prior to the maturity date, then
        the
        entirety of principal shall be due and payable on the maturity date. Further
        the
        Company may, at its option, prepay all amounts owing under the Notes prior
        to
        the maturity date, in whole or in part,
 INNOFONE.COM,
                    INCORPORATED
 NOTES
                    TO
                    CONSOLIDATED FINANCIAL STATEMENTS
 JUNE
                    30,
                    2006
  without
        payment of any premium or penalty, after giving written notice thereof to
        the
        Holder at least one (1) day prior to the date selected for prepayment. In
        connection with the Notes, the Company issued (i) a five-year warrants to
        55
        South Investments for the right to purchase up to 4,000,000 shares of common
        stock at $1.00 per share; and (ii) a five year warrants to Millennium Investment
        Services, Inc., an affiliate of 55 South, for the right to purchase 1,000,000
        shares of common stock at $1.00 per share. The Company has the right to redeem
        1,400,000 of such warrants for $250,000 until July 13, 2007. The note is
        secured
        with approximately $4,000,000 worth of the Company’s restricted common stock and
        $4,000,000 worth of restricted common stock owned by Alex Lightman, the
        Company’s Chief Executive Officer and President. Further, the Company has agreed
        to pay to 55 South approximately $40,000 representing an origination fee
        and a
        due diligence fee. The
        fair
        value of the warrants totaled $5,466,584 using the Black-Scholes option pricing
        model which will be capitalized and amortized on a straight line basis over
        the
        term of the Notes.
 
 In
        August
        2006, the Company filed a Form SB-2 registration statement with the U.S.
        Securities and Exchange Commission for the registration of 22,407,352 shares
        of
        common stock related to the Equity Swap agreement as discussed in Note
        7.
 
 In
        August
        2006, the Company completed is acquisition of Mobile Technology Group, LLC.
        The
        Company issued a total of 1,441,441 shares of common stock pursuant to the
        acquisition agreement with a total value of $1,500,000. In conjunction with
        the
        completion of the acquisition agreement, the Company issued 28,828 shares
        of
        common stock with a total value of $32,000 to the Company’s Vice President of
        Business and Legal Affairs for a bonus for sourcing and closing the acquisition
        transaction.
 
 In
        August
        2006, the Company issued promissory notes to three individuals totaling
        $140,000, with interest at 10% per annum and maturity dates starting from
        February 28, 2007 through August 30, 2007. The promissory notes are each
        secured
        by Company assets, restricted common stock of the Company and common stock
        of
        the Company owned by Alex Lightman equaling four times the principal amount
        of
        the note. Additionally, the Company has issued warrants for the purchase
        of
        180,000 shares of common stock with an exercise price of $1.00 and a term
        of
        five years. The fair value of the warrants totaled $199,883 using Black-Scholes
        option pricing model which will be capitalized and amortized on a straight
        line
        basis over the term of the promissory note.
 
 In
        September 2006, the Company issued a promissory note to an individual totaling
        $2,000,000, with interest at the London Interbank Offered Rate (LIBOR) plus
        one
        percent (1%) per annum and maturing on the earlier of 60 days or December
        1,
        2006. The promissory note is secured by Company assets.