UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


Washington ,
      D.C.20549





FORM
      10-QSB





(Mark One)


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


For the quarterly period ended April 30, 2007


OR


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


For the transition period from




Commission
      File Number  000-29313




CRYSTAL
      INTERNATIONAL TRAVEL GROUP, INC.


**Delaware**
            **20-0121007**(State
                or other jurisdiction of incorporation or organization)
            (I.R.S.
                Employer Identification No.)


2160
      HeadquartersPlaza, 10th
      Floor, Morristown, New Jersey07960 (Address
      of principal executive offices & zip code)


973-644-0900 Registrant's
      telephone number, including area code:


(Former
      Name or Former Address, if Changed Since Last Report)




Check whether the issuer (1)
      filed
      all reports required to be filed by Section 13 or 15(d) of the Exchange Act
      during the past 12 months (or for such shorter period that the registrant was
      required to file such reports), and (2) has been subject to such filing
      requirements for the past 90 days.


x Yes


o No




Indicate by check mark whether
      the
      registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).


o Yes


x No




Indicate by check mark whether
      the
      registrant has filed all documents and reports required to be filed by Sections
      12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the
      distribution of securities under a plan confirmed by a court.


o Yes


o No




State the number of shares
      outstanding of each of the issuer's classes of common equity, as of the latest
      practicable date:   23,965,290


Transitional Small Business
      Disclosure Format (Check one):


o Yes


x No












**PART
      I
      - FINANCIAL INFORMATION**


**CRYSTAL
        INTERNATIONAL TRAVEL GROUP, INC. AND SUBSIDIARIES**
 **(A
        Development Stage Company)**
 **(Formerly
        Mobile Reach International, Inc.)**
 **INDEX
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **April
        30, 2007**
 **(Unaudited)**
 
 PagesINDEX
              F1FINANCIAL
                  STATEMENTS:Condensed
                  Consolidated Balance Sheet
              F2Condensed
                  Consolidated Statements of Income
              F3
                  - F4Condensed
                  Consolidated Statement of Stockholders’ Deficit
              F5
                  - F6Condensed
                  Consolidated Statements of Cash Flows
              F7
                  - F8Notes
                  to Condensed Consolidated Financial Statements
              F9
                  - F16
 
 F-1
   **CRYSTAL
        INTERNATIONAL TRAVEL GROUP, INC. AND SUBSIDIARIES**
 **(A
        Development Stage Company)**
 **(Formerly
        Mobile Reach International, Inc.)**
 **CONDENSED
        CONSOLIDATED BALANCE SHEET**
 **April
        30, 2007**
 **(Unaudited)**
 
 **ASSETS**
 **CURRENT
                  ASSETS:**Cash
              
              $
              14,538Prepaid
                  insurance
              
              
              13,431Total
                  current assets
              
              
              
              
              $
              27,969**PROPERTY
                  AND EQUIPMENT -**net
                  of accumulated depreciation
              
              
              
              
              
              41,977**OTHER
                  ASSETS:**Deposits
              
              
              11,856Intangibles
                  - net of amortization
              
              
              25,144Goodwill
              
              
              80,596117,596$
              187,542
 **LIABILITIES
        AND STOCKHOLDERS’ EQUITY**
 **CURRENT
                  LIABILITIES:**Current
                  portion long-term debt
              
              $
              499,079Short-term
                  notes payable
              
              
              484,733Accounts
                  payable
              
              
              1,096,201Notes
                  payable - related parties
              
              
              132,808Accrued
                  liabilities
              
              
              1,650,096Total
                  current liabilities
              
              
              
              
              $
              3,862,917**LONG-TERM
                  LIABILITIES:**Long-term
                  debt
              
              
              4,552,228Convertible
                  debentures
              
              
              3,356,5657,908,793**STOCKHOLDERS’
                  EQUITY:**Preferred
                  stock; $.0001 par value; 100,000,000 shares authorized
              
              
              0Common
                  stock; par value $0.001; 500,000,000 shares authorized, 22,235,674
                  issued
                  and outstanding, 30,625 shares to be issued
              
              
              24,054Paid-in
                  capital
              
              
              3,302,709Deficit
                  accumulated during the development stage
              
              
              (14,910,931
              )(11,584,168
              )$
              187,542
  See
        Notes to Condensed Consolidated Financial
        Statements
  F-2
 **CRYSTAL
        INTERNATIONAL TRAVEL GROUP, INC. AND SUBSIDIARIES**
 **(A
        Development Stage Company)**
 **(Formerly
        Mobile Reach International, Inc.)**
 **CONDENSED
        CONSOLIDATED STATEMENTS OF INCOME**
 **(Unaudited)**
  For
                  the Quarter
              
              Year
                  to Date
              
              From
                  InceptionThree
                  Months Ended April 30, 2007
              
              Three
                  Months Ended April 30, 2006
              
              Nine
                  Months Ended April 30, 2007
              
              Period
                  from December 8, 2005 (Date of Inception) through April 30,
                  2006
              
              Period
                  from December 8, 2005 (Date of Inception) through April 30,
                  2007**REVENUE:**Sales
              
              $
              51,380
              
              $
              0
              
              $
              107,073
              
              $
              0
              
              $
              107,073License
                  and fees
              
              
              14,762
              
              
              0
              
              
              14,762
              
              
              0
              
              
              21,39066,142
              
              
              0
              
              
              121,835
              
              
              0
              
              
              128,463**COST
                  AND EXPENSES:**Cost
                  of goods sold
              
              
              29,875
              
              
              152,620
              
              
              60,799
              
              
              152,620
              
              
              60,799Sales
                  and marketing
              
              
              0
              
              
              0
              
              
              0
              
              
              0
              
              
              0General
                  and administrative expenses
              
              
              638,244
              
              
              659,298
              
              
              2,041,691
              
              
              736,169
              
              
              9,220,361668,119
              
              
              811,918
              
              
              2,102,490
              
              
              888,789
              
              
              9,281,160**OPERATING
                  LOSS**
              
              
              (601,977
              )
              
              (811,918
              )
              
              (1,980,655
              )
              
              (888,789
              )
              
              (9,152,697
              )**OTHER
                  INCOME (EXPENSES)**Interest
                  expense
              
              
              (44,768
              )
              
              (47,530
              )
              
              (1,880,859
              )
              
              (47,530
              )
              
              (3,258,841
              )Other
                  expenses
              
              
              0
              
              
              0
              
              
              (22,082
              )
              
              0
              
              
              (22,082
              )(44,768
              )
              
              (47,530
              )
              
              (1,902,941
              )
              
              (47,530
              )
              
              (3,280,923
              )**NET
                  LOSS BEFORE INCOME TAXES**
              
              
              (646,745
              )
              
              (859,448
              )
              
              (3,883,596
              )
              
              (936,319
              )
              
              (12,433,620
              )
  **See
          Notes to Condensed Consolidated Financial Statements**
 
 F-3
  **CRYSTAL
        INTERNATIONAL TRAVEL GROUP, INC. AND SUBSIDIARIES**
 **(A
        Development Stage Company)**
 **(Formerly
        Mobile Reach International, Inc.)**
 **CONDENSED
        CONSOLIDATED STATEMENTS OF INCOME**
 **(Continued)**
 **(Unaudited)**
 
  For
                  the Quarter
              
              Year
                  to Date
              
              From
                  InceptionThree
                  Months Ended April 30, 2007
              
              Three
                  Months Ended April 30, 2006
              
              Nine
                  Months Ended April 30, 2007
              
              Period
                  from December 8, 2005 (Date of Inception) through April 30,
                  2006
              
              Period
                  from December 8, 2005 (Date of Inception) through April 30,
                  2007**NET
                  LOSS BEFORE INCOME TAXES**
              
              
              (646,745
              )
              
              (859,448
              )
              
              (3,883,596
              )
              
              (936,319
              )
              
              (12,433,620
              )**INCOME
                  TAX (EXPENSE) BENEFIT**
              
              
              0
              
              
              0
              
              
              0
              
              
              0
              
              
              0**NET
                  LOSS**
              
              $
              (646,745
              )
              $
              (859,448
              )
              $
              (3,883,596
              )
              $
              (936,319
              )
              $
              (12,433,620
              )**WEIGHTED
                  AVERAGE NUMBER OF SHARES**
              
              
              15,751,948
              
              
              7,100,000
              
              
              14,791,904
              
              
              7,100,000
              
              
              12,062,919**LOSS
                  PER SHARE - BASIC AND DILUTED**
              
              $
              (0.04
              )
              $
              (0.12
              )
              $
              (0.26
              )
              $
              (0.13
              )
              $
              (1.03
              )
 **See
          Notes to Condensed Consolidated Financial Statements**
 F-4
   **CRYSTAL
        INTERNATIONAL TRAVEL GROUP, INC. AND SUBSIDIARIES**
 **(A
        Development Stage Company)**
 **(Formerly
        Mobile Reach International, Inc.)**
 **CONDENSED
        CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIT**
 **(Unaudited)**
 
 Common
                  StockShares
              
              Amount
              
              Paid-in
                  Capital
              
              Deficit
                  Accumulated During Development Stage
              
              Total**Balance
                  at December 8, 2005 (Date of Inception)**
              
              
              0
              
              $
              0
              
              $
              0
              
              $
              0
              
              $
              0Common
                  shares issued in formation of Crystal Hospitality Holdings,
                  Inc.
              
              
              200
              
              
              23,012
              
              
              0
              
              
              0
              
              
              23,012Shares
                  exchanged for common shares of Mobile Reach International,
                  Inc.
              
              
              (200
              )
              
              0
              
              
              0
              
              
              0
              
              
              0Common
                  shares issued to Crystal Hospitality Holdings, Inc.
                  stockholders
              
              
              7,100,000
              
              
              0
              
              
              0
              
              
              0
              
              
              0Common
                  shares owned by Mobile Reach International, Inc.
                  stockholders
              
              
              4,743,276
              
              
              0
              
              
              0
              
              
              0
              
              
              0Net
                  liabilities in excess of assets acquired in share exchange
              
              
              0
              
              
              0
              
              
              0
              
              
              (2,477,311
              )
              
              (2,477,311
              )Net
                  loss
              
              
              0
              
              
              0
              
              
              0
              
              
              (1,025,085
              )
              
              (1,025,085
              )
 
 **Balance
                  at April 30, 2006**
              
              
              11,843,276
              
              
              23,012
              
              
              0
              
              
              (3,502,396
              )
              
              (3,479,384
              )Fair
                  market value of warrants attached to short-term debt
                  issued
              
              
              0
              
              
              0
              
              
              68,000
              
              
              0
              
              
              68,000Fair
                  market value of beneficial conversion feature of convertible
                  debentures
              
              
              0
              
              
              0
              
              
              1,990,711
              
              
              0
              
              
              1,990,711Net
                  loss
              
              
              0
              
              
              0
              
              
              0
              
              
              (7,524,939
              )
              
              (7,524,939
              )**Balance
                  at July 31, 2006**
              
              
              11,843,276
              
              $
              23,012
              
              $
              2,058,711
              
              $
              (11,027,335
              )
              $
              (8,945,612
              )
  **See
          Notes to Condensed Consolidated Financial Statements**
 F-5
  **CRYSTAL
        INTERNATIONAL TRAVEL GROUP, INC. AND SUBSIDIARIES**
 **(A
        Development Stage Company)**
 **(Formerly
        Mobile Reach International, Inc.)**
 **CONDENSED
        CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIT**
 **(Continued)**
 **(Unaudited)**
 
 Common
                  StockShares
              
              Amount
              
              Paid-in
                  Capital
              
              Deficit
                  Accumulated During Development Stage
              
              Total**Balance
                  at July 31, 2006**
              
              
              11,843,276
              
              $
              23,012
              
              $
              2,058,711
              
              $
              (11,027,335
              )
              $
              (8,945,612
              )Share
                  based compensation agreement
              
              
              0
              
              
              0
              
              
              11,160
              
              
              0
              
              
              11,160Common
                  shares issued in connection with conversion of debentures
              
              
              562,518
              
              
              56
              
              
              228,779
              
              
              0
              
              
              228,835Fair
                  market value of beneficial conversion feature of convertible
                  debentures
              
              
              0
              
              
              0
              
              
              630,000
              
              
              0
              
              
              630,000Common
                  shares issued in connection with conversion of debentures
              
              
              1,400,873
              
              
              150
              
              
              35,735
              
              
              0
              
              
              35,885Fair
                  market value of warrants attached to short-term debt
                  issued
              
              
              0
              
              
              0
              
              
              16,480
              
              
              0
              
              
              16,480Net
                  loss
              
              
              0
              
              
              0
              
              
              0
              
              
              (3,236,851
              )
              
              (3,236,851
              )
 
 **Balance
                  at January 31, 2007**
              
              
              13,906,667
              
              
              23,218
              
              
              2,980,865
              
              
              (14,264,186
              )
              
              (11,260,103
              )Common
                  shares issued as fees for services
              
              
              1,000,000
              
              
              100
              
              
              56,900
              
              
              0
              
              
              57,000Common
                  shares issued for accrued wages to employees
              
              
              1,300,000
              
              
              130
              
              
              47,633
              
              
              0
              
              
              47,763Common
                  shares issued in settlement of litigation
              
              
              500,000
              
              
              50
              
              
              14,745
              
              
              0
              
              
              14,795Common
                  shares issued in settlement of short-term debt
              
              
              1,000,000
              
              
              100
              
              
              99,900
              
              
              0
              
              
              100,000Common
                  shares issued in settlement of debt to former employee
              
              
              350,000
              
              
              35
              
              
              30,999
              
              
              0
              
              
              31,034Common
                  shares issued on option exercise
              
              
              120,000
              
              
              12
              
              
              20,028
              
              
              0
              
              
              20,040Common
                  shares issued in connection with conversion of debentures
              
              
              4,089,632
              
              
              409
              
              
              51,639
              
              
              0
              
              
              52,048Net
                  loss
              
              
              0
              
              
              0
              
              
              0
              
              
              (646,745
              )
              
              (646,745
              )**Balance
                  at April 30, 2007**
              
              
              22,266,299
              
              $
              24,054
              
              $
              3,302,709
              
              $
              (14,910,931
              )
              $
              (11,584,168
              )
  **See
          Notes to Condensed Consolidated Financial Statements**
 
 F-6
   **CRYSTAL
        INTERNATIONAL TRAVEL GROUP, INC. AND SUBSIDIARIES**
 **(A
        Development Stage Company)**
 **(Formerly
        Mobile Reach International, Inc.)**
 **CONDENSED
        CONSOLIDATED STATEMENTS OF CASH FLOWS**
 **(Unaudited)**
 
 Nine
                  Months Ended April 30, 2007
              
              December
                  8, 2005 (Date of Inception) through April 30, 2006
              
              December
                  8, 2005 (Date of Inception) through April 30, 2007**Net
                  loss**
              
              $
              (3,883,596
              )
              $
              (936,319
              )
              $
              (12,433,620
              )**Adjustments
                  to reconcile net income to net cash used in operating
                  activities:**
              
              
              2,565,062
              
              
              652,846
              
              
              10,035,063**Net
                  cash used in operating activities**
              
              
              (1,318,534
              )
              
              (283,473
              )
              
              (2,398,557
              )**Cash
                  flows used in investing activities**
              
              
              (154,182
              )
              
              0
              
              
              (171,413
              )**Cash
                  flows provided by financing activities**
              
              
              1,451,765
              
              
              287,468
              
              
              2,584,508**Net
                  (decrease) increase in cash**
              
              
              (20,951
              )
              
              3,995
              
              
              14,538**Cash
                  - beginning of period**
              
              
              35,489
              
              
              0
              
              
              0**Cash
                  - end of period**
              
              $
              14,538
              
              $
              3,995
              
              $
              14,538
  **See
          Notes to Condensed Consolidated Financial
          Statements**
 F-7
   **CRYSTAL
        INTERNATIONAL TRAVEL GROUP, INC. AND SUBSIDIARIES**
 **(A
        Development Stage Company)**
 **(Formerly
        Mobile Reach International, Inc.)**
 **CONDENSED
        CONSOLIDATED STATEMENTS OF CASH FLOWS**
 **SUPPLEMENTAL
        DISCLOSURE INFORMATION**
 **(Continued)**
 **(Unaudited)**
 
 0
              
              
              Nine
                  Months Ended April 30, 2007
              
              
              December
                  8, 2005 (Date of Inception) through April 30, 2006
              
              
              December
                  8, 2005 (Date of Inception) through April 30, 2007
 **Non-cash
        activities:**
 Conversion
                  of debentures for common stock
              
              $
              311,769
              
              $
              0
              
              $
              311,769Refinancing
                  of short-term debt to convertible debt
              
              
              0
              
              
              0
              
              
              100,000Exchange
                  of debt for intangible assets
              
              
              0
              
              
              0
              
              
              5,021,307Settlement
                  of accrued wages for common stock
              
              
              47,763
              
              
              0
              
              
              47,763Settlement
                  of litigation for debt and common stock
              
              
              48,188
              
              
              0
              
              
              48,188Settlement
                  of related party debt for common stock
              
              
              100,000
              
              
              0
              
              
              100,000Settlement
                  of debt to former employee for stock and short-term note
                  payable
              
              
              40,834
              
              
              0
              
              
              40,834
 **Acquisition
        of Travel House, Inc.:**
 Purchase
                  price
              
              $
              123,500
              
              $
              0
              
              $
              123,500Add:Cash
              
              
              1,132
              
              
              0
              
              
              1,132Subtract:Accounts
                  payable
              
              
              (3,804
              )
              
              0
              
              
              (3,804
              )Goodwill
              
              $
              120,828
              
              $
              0
              
              $
              120,828
 **Acquisition
        of Mobile Reach International and Subsidiaries:**
 Assets
                  assumed:Cash
              
              
              
              
              $
              262
              
              $
              262Liabilities
                  assumed:Accounts
                  payable
              
              
              
              
              
              408,527
              
              
              408,527Accrued
                  expenses
              
              
              
              
              
              507,859
              
              
              507,859Short-term
                  debt
              
              
              
              
              
              294,169
              
              
              294,169Long-term
                  and convertible debt
              
              
              
              
              
              1,267,018
              
              
              1,267,0182,477,573
              
              
              2,477,573Net
                  liabilities exceeding net assets
              
              
              
              
              $
              2,477,311
              
              $
              2,477,311
 
 See
        Notes to Condensed Consolidated Financial
        Statements
  F-8
   **CRYSTAL
        INTERNATIONAL TRAVEL GROUP, INC. AND SUBSIDIARIES**
 **(A
        Development Stage Company)**
 **(Formerly
        Mobile Reach International, Inc.)**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **(Unaudited)**
 
 **Note
        1 - Summary of Accounting Policies:**
 
 **General:**
 
 The
        accompanying unaudited condensed consolidated financial statements have been
        prepared in accordance with the instructions to Form 10-QSB, and therefore,
        do
        not include all the information necessary for a fair presentation of financial
        position, results of operations and cash flows in conformity with accounting
        principles generally accepted in the United States of America.
 
 In
        the
        opinion of management, all adjustments (consisting of normal recurring accruals)
        considered necessary for a fair presentation have been included. Accordingly,
        the results from operations for the three month period ended April 30, 2007
        are
        not necessarily indicative of the results that may be expected for the year
        ended July 31, 2007. The unaudited consolidated financial statements should
        be
        read in conjunction with the July 31, 2006 financial statements and footnotes
        thereto included in the Company's SEC Form 10-KSB.
 
 **Business:**
 
 The
        Company was originally organized to develop and sell mobility software products
        and services in the United States and Europe. Its offices were located in
        Cary,
        North Carolina until the Exchange Agreement discussed below. Since the effective
        date of the Exchange Agreement, the Company moved its operations to Morristown,
        New Jersey. The principal focus of operations has been the development of
        travel
        products and services for sale to the general public in the United States
        through the utilization of registered agents and internet website booking
        services.
 
 Subsequent
        to the share exchange mentioned below, Mobile Reach International, Inc. changed
        its name to Crystal International Travel Group, Inc.
 
 **Basis
        of presentation:**
 
 On
        April
        17, 2006, effective April 29, 2006, Crystal International Travel Group, Inc.
        and
        Subsidiaries (formerly Mobile Reach International, Inc.) (the "Company")
        completed a share exchange with the stockholders of Crystal Hospitality
        Holdings, Inc., a Delaware corporation ("CHH"), pursuant to a Share Exchange
        Agreement (the "Exchange Agreement"), by and among the Company, CHH and the
        holders of the outstanding capital stock of CHH (the "CHH Stockholders").
        As a
        result, CHH is now a wholly-owned subsidiary of the Company. The Company
        has
        accounted for this share exchange using the purchase method of accounting
        as
        prescribed by Statement of Financial Accounting Standards ("SFAS") No. 141,
        "Business Combinations". The share exchange has been treated as a reverse
        acquisition of the Company by CHH, due to the stockholders of CHH receiving
        60.4
        percent of the voting rights of the combined entity. The condensed consolidated
        financial statements include the results from operations for both companies
        from
        August 1, 2006 through April 30, 2007 and the financial statements of the
        survivor corporation, CHH for the period from inception (December 8, 2005)
        to
        April 30, 2006 and for the period from inception (December 8, 2005) through
        April 30, 2007.
 
 F-9
 During
        the quarter ended October 31, 2006, the Company established a subsidiary
        named
        Platinum Hospitality Holdings, Inc. (“PHH”), a Delaware corporation. Effective
        August 1, 2006, PHH purchased all of the outstanding stock of JRM, Inc. dba
        The
        Travel House (“TH”) for $123,500. TH is a New Jersey corporation that has been
        operating as a full service travel agency. The Company purchased TH in order
        to
        establish a direct retail outlet for the travel products it is developing
        or
        plans to develop. The Company accounted for this acquisition as prescribed
        by
        SFAS No. 141, “Business Combinations”. The Company recorded $80,596 in goodwill
        for this acquisition. The condensed consolidated financial statements include
        the results of operations for TH from August 4, 2006 to April 30,
        2007.
 
 **Development
        stage operations:**
 
 Since
        December 8, 2005 (date of inception), the Company has been concentrating
        its
        effort on raising capital and developing new travel related products for
        the
        retail market. As defined by SFAS No. 7 “Accounting and Reporting by Development
        Stage Enterprises”, the Company is a development stage company. Under SFAS No.
        7, a development stage enterprise is subject to the same accounting principles
        as a normal enterprise but are required to present a cumulative income statement
        showing revenues and expenses from inception.
 
 **Concentrations
        of credit risk:**
 
 The
        Company has no significant off-balance-sheet concentration of credit risk
        such
        as foreign exchange contracts, options contracts or other foreign hedging
        arrangements.
 
 The
        Company maintains its cash balances with multiple reputable financial
        institutions in the form of demand deposits.
 
 **Intangible
        assets:**
 
 The
        Company accounts for intangible assets under SFAS No. 142, “Goodwill and Other
        Intangible Assets”. Intangible assets are recorded at cost. Intangible assets
        subject to amortization include customer lists from business purchases. These
        costs are amortized over the asset’s estimated useful life of 24
        months.
 
 **Income
        taxes:**
 
 Deferred
        income taxes provide for temporary differences between the basis of the
        Company's assets and liabilities for financial reporting and income tax
        purposes. As of April 30, 2007, any deferred tax asset resulting from the
        three
        months of operating losses would be fully offset by a valuation allowance
        due to
        the uncertainty of realizing future tax benefits.
 
 F-10
 **Fair
        value of financial instruments:**
 
 At
        April
        30, 2007, the Company did not have any outstanding financial derivative
        instruments. The carrying amount of cash, receivables, payables and current
        liabilities approximate fair value due to the short maturity of these
        instruments.
 
 **Use
        of accounting estimates:**
 
 The
        preparation of financial statements in conformity with accounting principles
        generally accepted in the United States of America requires management to
        make
        estimates and assumptions that affect the reported amounts of certain assets
        and
        liabilities and disclosures. Accordingly, the actual amounts could differ
        from
        those estimates. Any adjustments applied to estimated amounts are recognized
        in
        the year in which such adjustments are determined.
 
 **Note
        2 - Going Concern:**
 
 The
        accompanying financial statements have been prepared in conformity with
        accounting principles generally accepted in the United States of America,
        which
        contemplates continuation of Crystal International Travel Group, Inc. and
        subsidiaries as a going concern. However, as a result of the merger discussed
        in
        Note 1, the Company has acquired debt on certain notes payable that are in
        default, payroll taxes and other payables owed by the acquired company.
        Additionally, the Company has used substantial amounts of working capital
        in
        start-up operations and has generated an operating loss leading to an
        accumulated stockholders’ deficit of $11,584,168 at April 30, 2007. Further, at
        April 30, 2007, the Company’s current liabilities exceeded current assets by
        $3,834,948. Based on these factors, the Company may not be able to continue
        as a
        going concern.
 
 With
        the
        merger discussed in Note 1, the Company’s management has taken over management
        of the acquired company and is changing the acquired company’s focus of
        operations. Plans include licensing out all software development and
        concentrating on the Company’s core business of providing travel packages to
        individuals. Management also plans on additional financing through the issuance
        of convertible debentures. However, no assurance can be given that the Company
        will continue as a going concern without the successful completion of additional
        financing and the commencement of management’s planned changes in operations.
        The accompanying financial statements do not include any adjustments that
        might
        be necessary if the Company is unable to continue as a going
        concern.
 
 As
        a
        result of delinquencies and defaults, the Company may be subject to collection
        actions whenever agreements cannot be reached, including, but not limited
        to,
        litigation, foreclosure and/or seizure of assets and bank accounts.
 
 F-11
 **Note
        3 - Property and Equipment:**
 
 The
        principal categories and estimated useful lives of property and equipment
        are as
        follows:
 
 April
                  30, 2007
              
              Estimated
                  Useful LivesOffice
                  and computer equipment
              
              $
              50,586
              
              
              3
                  to 7 yearsLess:
                  accumulated depreciation
              
              
              (8,609
              )$
              41,977
 
 **Note
        4 - Intangible Assets:**
 
 In
        August
        2006, the Company purchased all the outstanding shares of a fully operational
        travel agency for $123,500 in cash. At the time of the purchase, the Company
        was
        seeking to expedite the regulatory licensing process for travel agencies
        by
        purchasing an already licensed agency. In the exchange, the Company received
        an
        established customer database. Management valued the database at $40,231
        by
        discounting the estimated cash flow from commissions on sales to repeat
        customers. This customer database is amortized over an estimated useful life
        of
        twenty-four months.
 
 Intangible
        assets at April 30, 2007 consisted of the following:
 
 April
                  30, 2007
              
              Estimated
                  Useful LivesCustomer
                  database
              
              $
              40,231
              
              
              2
                  yearsLess:
                  accumulated amortization
              
              
              (15,087
              )$
              25,144Unamortized
                  intangibles:Goodwill
                  - Travel House
              
              $
              80,596
 
 Amortization
        expense amounted to $5,029 for the three months ended April 30, 2007, $15,087
        for the nine months ended April 30, 2007 and $15,087 for the period from
        December 8, 2005 (date of inception) through April 30, 2007.
 
 **Note
        5 - Accrued Liabilities:**
 
 At
        April
        30, 2007, accrued expenses consisted of the following items:
 
 Salary
                  and wages payable
              
              $
              289,757Accrued
                  and withheld taxes
              
              
              515,842Accrued
                  interest
              
              
              438,042Accrued
                  service expense
              
              
              395,480Other
                  accrued expenses
              
              
              10,975$
              1,650,096
 
 F-12
 Accrued
        and withheld taxes primarily consist of delinquent payroll taxes withheld
        and
        accrued on former employees of Mobile Reach International, Inc. (“MRI”) and its
        subsidiaries. Penalties and interest calculated through April 30, 2007 are
        included in the reported balance.
 
 **Note
        6 - Short-term Notes Payable:**
 
 The
        balances on these notes at April 30, 2007 are as follows:
 Note
                  payable due to a vendor dated February 2005; due in eighteen monthly
                  installments of $1,007 including interest at ten percent; note
                  is in
                  default.
              
              $
              5,524Note
                  payable for accrued wages dated August 2002; bearing interest at
                  six
                  percent; due and payable with interest at the earliest of (a) Company
                  obtaining debt or equity funding greater than $1,000,000 in a quarter
                  or
                  (b) Company earns revenues of $1,000,000 in a quarter; note is
                  in
                  default.
              
              
              49,908Note
                  payable to a vendor dated December 2004; due in six monthly installments
                  of $2,836 including interest at eighteen percent; note is in
                  default.
              
              
              17,027Note
                  payable to former employees for accrued wages and expenses dated
                  February
                  and March 2005;bearing
                  no interest and due and payable at the earliest of (a) Company
                  obtaining
                  debt or equity funding greater than $1,000,000 in a quarter or
                  (b) Company
                  earns revenues of $1,000,000 in a quarter; note is in
                  default.
              
              
              24,000Note
                  payable to a vendor dated March 2005; bearing no interest due in
                  four
                  equal monthly payments of $14,000; note is in default.
              
              
              56,000Note
                  payable to former employee dated April 2005; bearing no interest
                  and due
                  in six monthly installments of $5,000; note is in default.
              
              
              30,000Note
                  payable to a vendor dated July 2005; due in eighteen monthly installments
                  of $390 including interest at eight percent; note is in
                  default.
              
              
              6,243Note
                  payable to vendor dated July 2005; due in eleven monthly installments
                  of
                  $1,500; note is in default.
              
              
              15,888Notes
                  payable to former employees dated March 2006; due in a single payment
                  on
                  June 30, 2006; notes are in default.
              
              
              29,449Note
                  payable dated November 2006; due in a single payment with interest
                  accrued
                  at twelve percent on March 31, 2007.
              
              
              200,000Note
                  payable to former employee dated February 2007; bearing eight percent
                  interest and seven monthly payments of $6,000.
              
              
              40,893Note
                  payable to former employee dated February 2007; bearing eight percent
                  interest and five monthly payments of $2,000.
              
              
              9,801$
              484,733
 
 F-13
 As
        part
        of the short-term note payable dated November 2006, the Company executed
        a
        Security Agreement in which all of the Company’s assets are pledged as
        collateral.
 
 **Note
        7 - Convertible Debentures:**
 
 During
        the three months ended April 30, 2007, holders of the June 2006 debenture
        issuance converted $52,048 worth of debentures to 4,089,632 shares of common
        stock. The conversion price ranged from $0.0105 to $0.0152 per
        share.
 
 Under
        the
        Security Agreement attached to the debentures issued under the June 2006
        debenture offering, all of the Company’s assets are pledged as collateral.
 
 **Note
        8 - Stockholders’ Equity:**
 
 For
        the
        period ended April 30, 2007, the Company’s common stock issued and outstanding
        was 22,235,674 with an additional 30,625 shares to be issued. During the
        period
        the Company issued 4,089,632 common shares in connection with converted
        debentures (Note 7).
 
 In
        February 2007, the Company settled a lawsuit and debt of $55,688 with a former
        officer for 500,000 shares of restricted common stock and a note payable
        of
        $40,893 (Note 6).
 
 In
        February 2007, the Company settled debt of $40,834 with a former officer
        for
        350,000 shares of restricted common stock and a note payable of $9,801 (Note
        6).
 
 In
        February 2007, the Company settled debt of $45,000 with a vendor for 900,000
        shares of restricted common stock.
 
 In
        February 2007, the Company settled accrued wages worth $47,763 with 1,300,000
        shares of restricted common stock.
 
 In
        February 2007, the Company settled debt with a related party of $100,000
        with
        1,000,000 shares of restricted common stock.
 
 In
        February 2007, options for 120,000 shares of restricted common stock were
        exercised (Note 9).
 
 In
        March
        2007, the Company recorded expenses for services from consultants for investor
        relations fees of $12,000 in exchange for 100,000 shares of restricted common
        stock.
 
 F-14
 
 **Note
        9 - Stock Options:**
 
 The
        Company records stock options as required by Statement of Financial Accounting
        Standards No. 123(R), “Share-Based Payments”. This Statement requires the
        Company “to measure the cost of employee services received in exchange for an
        award of equity instruments based on the grant-date fair value of the award.
        The
        cost will be recognized over the period during which an employee is required
        to
        provide service in exchange for the award.”
 
 During
        the nine months ended April 30, 2007, the Company issued options to an employee
        of the Company. The options granted total 400,000 shares of common stock
        with an
        option price of $.26 per share. The Company determined that the options issued
        had a value of $37,200 using the Black-Scholes pricing model and a thirty
        percent volatility factor at the date of grant. The options become vested
        over a
        period of three years and expire five years after the agreement date. During
        the
        period ended April 30, 2007, options of 120,000 shares had vested and were
        exercised, the remaining balance of 280,000 was forfeited.
 
 Compensation
        expense related to these options is recorded in the period in which the holders
        become vested. For the nine months ended April 30, 2007, $11,160 of compensation
        expense was recorded related to these options.
 
 **Note
        10 - Related Party Transactions:**
 
 During
        the period ended April 30, 2007, a limited liability company related through
        common ownership and another corporation that is a stockholder in the Company
        had made advances to the Company. Principal and interest of five percent
        is due
        on each note one year from the date of the note. The balance of these notes
        at
        April 30, 2007 is $132,808. Interest accrued on these notes through April
        30,
        2007 is $9,273 and is included in accrued expenses.
 
 During
        the period ended April 30, 2007, a limited liability company that is related
        through common ownership has paid bills on behalf of the company. The Company
        expenses these costs with the liability being included in accounts payable.
        The
        total of these costs included in accounts payable are $91,321.
 
 **Note
        11 - Pro-Forma Financial Information:**
 
 The
        following pro-forma financial information summarizes the results of operations
        for the nine months ended April 30, 2007, as if the merger between MRI and
        CHH
        had been completed August 1, 2005:
 
 Nine
                  Months Ended April 30, 2007
              
              Nine
                  Months Ended April 30, 2006Net
                  revenues
              
              $
              121,835
              
              $
              374,426Operating
                  loss
              
              
              (3,883,596
              )
              
              (3,502,131
              )Loss
                  per share - basic and diluted
              
              
              (0.27
              )
              
              (0.30
              )
 
 F-15
 **Note
        12 - Other Matters:**
 
 **Commitments
        and legal proceedings:**
 
 In
        March
        2006, the Company purchased intangible assets consisting of web sites, phone
        numbers, registered trademark names and a customer database from FS Suntours.
        Subsequent to the purchase, FS Suntours delayed turning over control of the
        phone numbers, websites and never released the customer database to the Company.
        In June 2006, FS Suntours was forced into bankruptcy by its creditors. Later,
        FS
        Suntours’ parent corporation filed voluntary bankruptcy proceedings. In July
        2006, as a result of the bankruptcy filings, legal proceedings resulting
        from
        the intangible asset purchase and the failure to gain control over the
        intangible assets, the Company recognized an impairment charge against the
        value
        of the intangible assets.
 
 Also
        in
        March 2006, the Company had entered into a service contract with a former
        vendor
        of FS Suntours in expectation of capitalizing on the benefits of the intangible
        assets mentioned above. This contract was a seven year contract with minimum
        base payments due in monthly installments for the service and an annual per
        passenger charge due in November of each year. Since the signing of the
        agreement in March 2006, no services have been provided by the vendor.
 
 As
        a
        result of the failure of FS Suntours to turn over the intangible assets and
        the
        bankruptcy filing mentioned above, the Company ceased accruing service expenses
        related to the contract and interest expense related to the FS Suntours
        liability.
 
 In
        February 2007, the Company settled a lawsuit brought by a former officer
        of a
        former subsidiary of MRI. The suit was settled for debt (Note 6) and common
        stock (Note 8).
 
 **Unsecured
        creditors of the company:**
 
 The
        Company is delinquent with a number of unsecured creditors for which no payment
        arrangements exist or for which no agreement to forestall collection action
        has
        been agreed upon. Whenever feasible the Company negotiates with these creditors
        to reach settlement agreements that are acceptable to the Company.
 
 As
        a
        result of the delinquencies and defaults, the Company may be subject to
        collection actions whenever agreements cannot be reached, including, but
        not
        limited to, litigation, foreclosure and/or seizure of assets and bank
        accounts.
 
 F-16





Item 2. Management's
      Discussion and Analysis of Financial Condition and Results of Operations.





We
      are a development stage company and
      as such, you should read the following discussion of the Company's business
      and
      results of operations in conjunction with the consolidated unaudited financial
      statements attached herein.




Forward
      Looking Statements




This
      portion of this Quarterly Report on Form 10-QSB includes statements
      that constitute "forward-looking statements." These forward-looking statements
      are often characterized by the terms "may," "believes," "projects," "expects,"
      or "anticipates," and do not reflect historical facts. Specific forward-looking
      statements contained in this portion of the Quarterly Report include, but are
      not limited to the Company's expectation that it will begin generating
      significant revenues from the sale of its products rather than from equity
      or
      debt financings. Forward-looking statements involve risks, uncertainties and
      other factors, which may cause our actual results, performance or achievements
      to be materially different from those expressed or implied by such
      forward-looking statements. Factors and risks that could affect our results
      and
      achievements and cause them to materially differ from those contained in the
      forward-looking statements include, but are not limited to the risks and
      uncertainties set forth below in the section titled "Risk Factors," as well
      as
      other factors that we are currently unable to identify or quantify, but may
      exist in the future.




In
      addition, the foregoing factors may affect generally our business,
      results of operations and financial position. Forward-looking statements speak
      only as of the date the statement was made. We do not undertake and specifically
      decline any obligation to update any forward-looking statements.




We are
      a
      development stage company and as such, you should read the following discussion
      of the Company's business and results of operations in conjunction with the
      consolidated unaudited financial statements attached herein.




Financial Discussion




On April
      17,
      2006, we completed a reverse merger with Crystal Hospitality Holdings, Inc.
      (Crystal). The shareholders of Crystal acquired approximately 60.4% of our
      voting shares. As discussed in the Liquidity and Capital Resources section
      below, the new management has arranged for short term financing. No other equity
      in the Company has been sold. We have been able to stabilize the operations
      of
      the Company and no new defaults on existing Mobile Reach debts have occurred.
      Significant market risk exists as a result of our previously existing financial
      issues, the change in ownership and the change in business focus.




2


As of the
      date
      of this filing, we have not gained complete control over the intangible assets
      associated with Crystal’s purchase of FS Suntours’ Suntrips intellectual
      property.  The customer database has not been delivered; the phone numbers
      and the trademarks are still in control of FS Suntours. Therefore, we recorded
      an asset impairment charge of $4,896,666 in relation to these assets for the
      year end July 31, 2006.




Our lack
      of
      complete control over the Suntrips assets has had a material impact on our
      business plan relating to the use of these assets. We have been able to operate
      and derive marginal revenue from the web portal and have focused the company’s
      efforts in the development efforts of incubating the IntelliFaresTM
product.  Moreover, on December 8, 2006, the United States Bankruptcy Court
      of the Western District of Texas entered an order requiring the return of the
      assets in question, which we expected to occur no later than December 31, 2006
      but due to the complexity of the bankruptcy case this has not yet
      occurred.  As of the date of this filing we have serious concerns as to
      whether we will be able to acquire any of the additional assets. Additionally,
      we are currently evaluating possible causes of action we may have against FS
      Suntours but have not initiated any action to date.  At this time, we are
      unable to estimate any future cash flows, if any, relating to the SunTrips
      assets.  However, we are pursuing additional acquisitions candidates which
      we hope might create revenue in the near term.




IntelliFares
      Limited is a company registered in the Democratic Republic of Ireland and
      resides at Ulysses House, Foley Street, Dublin 1 and is a wholly owned
      subsidiary of Crystal.  Initially, income from IntelliFares will be
      realized from the commercialization of a suite of products marketed under the
      brand name IntelliFares.  The products are derived from a business
      methodology described more fully in both United States and International Patent
      Applications entitled “Subscription Management For Periodic Travel
      Services.”  IntelliFares is a product offering wherein travelers who
      participate in predictable, recurring travel patterns, such as timeshare or
      second homeowners, college students, business travelers and the like will be
      able to contract with us for the future purchase of five years of future air
      travel at or below comparable open market air ticket prices, and fix that price
      for the five year period, by contracting with IntelliFares to arrange for the
      purchase of airfare on their behalf, after depositing the full five years of
      payment with IntelliFares.  Deposits will be managed through a depository
      relationship with UBS AG.





Revenue
      for
      IntelliFares will be recognized from the assessment of an initial registration
      fee, a minimal account administration fee (currently planned at 3% of the
      initial 5 year deposit), and various exception fees, including cancellation
      charges.  It is intended that the future growth in air ticket prices, if
      any, will be offset by income derive from the depository relationship with
      UBS.  For the purpose of confidentiality and the maintenance of first mover
      advantage, complete details on how the product works from a financial
      perspective will be released after the product is fully launched, which was
      planned for late spring 2007.  Due to the complexity of the product, and
      the time required to assemble our distribution network for the product,
      management believes first revenue from distributor sales will occur sometime
      between June and October 2007.  Details will concurrently be made available
      to shareholders and the investing public. Consumer and distributor features
      and
      benefits are now available on the company’s website at
      http://www.intellifares.com.  The product will be sold through
      distributors, as such consumers will be able to purchase it through traditional
      travel agents and time share operators (developers, vacation clubs,
      exchanges).  The first such distributor that has entered into a
      distribution agreement with IntelliFares is Flying Dutchmen Travel of Santa
      Rosa
      California.




3


Sources of Revenue




On March
      10,
      2006, Mobile Reach Technologies, Inc. entered into a License Agreement with
      Spectrum Mobile, Inc. whereby it licensed certain of its assets to Spectrum
      Mobile, including, but not limited to, its Splitwave Server, Splitwave Server
      Plug-In Modules, Splitwave Client for Blackberry, Splitwave Client for Windows
      and Pocket PC and Split Forms Wizard. The License Agreement provides for a
      sliding scale of 5% of license fees received by Spectrum Mobile for the first
      two years of the License Agreement, 4% of licenses fees for the third year
      of
      the License Agreement and 3% of licenses fees for the fourth year of the License
      Agreement. Due to unclear payment terms and the belief that we can obtain better
      financial terms from Spectrum Mobile, we renegotiated the License Agreement
      and
      executed it on June 15, 2007.  This amended agreement improves the overall
      terms potentially allowing the company to recover its prior investments in
      developing the software.




The License
      Agreement with Spectrum Mobile had the effect of significantly reducing our
      revenue as well operating expenses relating to the Mobile Reach Technology
      assets. Prior to the License Agreement, we received all of the license revenue
      associated with sales to customers. Under the terms of the License Agreement
      described above, we receive a much smaller percentage of the license revenues.
      However, we are not responsible for any of the operating costs associated with
      delivery of products and services to Spectrum Mobile customers.




Revenues
      for
      the quarter period January 1,, 2007 to April 30,, 2007
      were generated from the sale of travel and travel related products. For the
      nine
      months ending April 30, 2007 revenue was composed of both travel related and
      MRI
      licensing activity.  Ongoing licensing revenue, if any, will be recognized
      as per the terms of the amended agreement referenced above.




Our revenue stream for the
      travel operations are derived from commissions on sales of travel components
      (for example air tickets, hotel rooms, car rental, etc.), margins built into
      packages (for example air plus hotel plus transfers plus excursions), production
      overrides from travel product supplier sales and service fees.




4


CRITICAL ACCOUNTING
      POLICIES




In preparing the consolidated
      financial statements in conformity with accounting principles generally accepted
      in the United States, we make estimates, assumptions and judgments that can
      have
      a material impact on its net revenue, operating income and net income (loss),
      as
      well as on the value of certain assets on our consolidated balance sheet. We
      believe that the estimates, assumptions and judgments involved in the accounting
      policies described herein have the greatest potential impact on our consolidated
      financial statements. We consider these to be its critical accounting policies.
      The policies described herein are not intended to be a comprehensive list of
      all
      our accounting policies. In many cases, the accounting treatment of a particular
      transaction is specifically dictated by generally accepted accounting
      principles, with no need for management judgment in their application. There
      are
      also areas in which management judgment in selecting any available alternative
      would not produce a materially different result. Our audited consolidated
      financial statements and notes thereto contain significant accounting policies
      and other disclosures required by generally accepted accounting principles.
      The
      accounting policies that are considered critical to an understanding of the
      consolidated financial statements are highlighted below.




Results of Operations




Revenues and expenses presented
      on
      the consolidated statement of income for January 31, 2007, represent the results
      of operations for Crystal International for the period November 1,,
      2006 through January 31,, 2007, the results of operations for Crystal
      Hospitality Holdings, Inc. for the period November 1, 2005 through January
      31,
      2006, and the results of operations for Mobile Reach International, Inc. for
      the
      period November 1, 2005 through January 31, 2006.




REVENUES :




Our revenues for the quarter
      ending April 30, 2007 were $66,142.00 and were generated from the travel related
      services provided as compared to revenues of $0.00 during the comparable quarter
      ending April 30, 2007 when revenues were primarily comprise of licensing and
      services fees, which we recognize as revenue when the product or services are
      provided to the client. For the nine months ending April 30, 2007 revenue was
      $121,835.00, composed of the travel related revenue of $107,073.00 and license
      and fee revenue of $14,762.00 as compared to $0 revenue for the prior year
      period.  The unaudited consolidated financial data; is provided for
      comparative purpose only and does not claim to be indicative of our actual
      financial position or results carry forward operations.




GENERAL AND ADMINISTRATIVE
      EXPENSES :




Combined
      general and administrative expenses of Crystal for the Quarter ended April
      30,
      2007 were $638,244.00 representing a decrease of 3.2% over Mobile Reach
      International's $659,298.00 for the three-month period ended April 30, 2006.
      General and administrative consisting primarily of compensation, Professional
      fees including both legal and accounting, costs associated with Securities
      agreements and compliance reporting. The decrease in general and administrative
      reflects  the change in the mix of professional fees associated with the
      salaries of personnel, professional and legal fees associated with litigation,
      and development costs associated with IntelliFaresTM, vs. similar expenses to
      operate Mobile Reach.




5


LIQUIDITY AND CAPITAL
      RESOURCES




As of April
      30,2007, we had an accumulated deficit of $12,433,620.00 and a working capital
      deficit of $3,280,923.00. Our independent auditors, who audited our financial
      statements for the period ended July 31, 2006, expressed substantial doubt
      about
      our ability to continue as a going concern given our recurring losses from
      operations, negative working capital and net stockholders' deficit.




We are
      currently burning $150,000 per month and our goal is to begin generating
      sufficient revenues to support operations by September 2007. We believe this
      goal is obtainable as the months of October through April are traditionally
      months of both heavy travel and heavy booking, although the level of either
      is
      not currently quantifiable. If this does not occur, we will anticipate we will
      need an additional $1 to $2 million debt or equity financing to implement our
      business plan over the next six to eighteen months. Should this become necessary
      we cannot be certain of the terms and conditions under which such capital could
      become available, if at all.




OTHER SIGNIFICANT
      MATTERS




On July
      3,
      2006 the Company executed a financing agreement whereby the company issued
      notes
      convertible into Company’s common shares and warrants for additional common
      shares of the Company.  The agreement provided for a total investment
      of$2,000,000, of which $700,000 was received by the Company on July 3, 2006,
      and
      an additional $600,000 was received by the Company on August 3, 2006.  The
      Company has filed a registration statement which includes the shares issue
      able
      by the Company upon conversion of the outstanding notes which became effective
      on January 19, 2007.  The Company received the remaining balance of
      $700,000 on February 1, 2007.


Item 3. Controls and
      Procedures.




EVALUATION
      OF OUR DISCLOSURE CONTROLS AND PROCEDURES





As
      of
      the end of the period covered by this report, we carried out an evaluation
      of
      the effectiveness of the design and operation of our disclosure controls and
      procedures (as defined in Exchange Act Rule 13-d-15(e) and 15d-15(e)). Based
      upon that evaluation and management's assessment of the potential effect of
      the
      material weakness described below, our Chief Executive Officer (and Principal
      Accounting Officer) concluded that as of the end of the period covered by this
      Quarterly Report on Form 10-QSB our disclosure controls and procedures were
      effective to enable us to record, process, summarize and report information
      required to be included in our periodic SEC filings within the required time
      period.




6


DISCLOSURE
      CONTROLS AND INTERNAL CONTROLS





Disclosure
      Controls are procedures that are designed with the objective
      of ensuring that information required to be disclosed in our reports filed
      under
      the Securities Exchange Act of 1934 ("Exchange Act"), such as this quarterly
      report, is recorded, processed, summarized and reported within the time periods
      specified in the SEC's rules and forms. Disclosure Controls are also designed
      with the objective of ensuring that such information is accumulated and
      communicated, as appropriate to allow timely decisions regarding required
      disclosure. Internal Controls are procedures which are designed with the
      objective of providing reasonable assurance that (1) our transactions are
      properly authorized, recorded and reported; and (2) our financial statements
      are
      presented in conformity with generally accepted accounting principles.


PART II - OTHER
      INFORMATION


**Item
      1. Legal Proceedings.**




From time to time the Company subject to litigation which,
      if
      successful, could exceed applicable insurance coverage. With the exception
      of
      the below, the Company is not currently a party to any legal proceedings which
      are not incidental to the Company’s routine business or that the Company
      believes will have a material adverse affect on its results of operations.


On July 26, 2006 in the United States District Court for
      the Middle District of Florida, Michael J. Hewitt filed a Complaint and Demand
      for Jury Trial against the Company alleging that on or about August 4, 2004
      he was terminated by the Company without just cause. Mr. Hewitt is seeking
      approximately $1.1 million in damages. The Company believes this suit to be
      without merit and plan to defend it vigorously.




Item 1A. Risk Factors.




The following are additional risk factors the Company
      faces.  These should be read in connection with the entire set of risk
      factors set for the Company Annual Report for the year ended July 31, 2006
      filed
      on Form 10-KSB on November 14, 2006 with the Securities and Exchange
      Commission.




7


We have been unable to gain complete control of
      the
      SunTrips, and are continued inability may have a materially adverse impact
      on
      our operations.




As
      of the date of the Quarterly Report, we have not gained complete
      control over the intangible assets associated with our purchase of FS Suntours’
intellectual property.  The customer database has not been delivered; the
      phone numbers and the trademarks are still in control of FS Suntours. Therefore,
      we recorded an asset impairment charge of $4,896,666 in relation to these assets
      for the year ended July 31, 2006.  Our lack of complete control over the
      Suntrips assets has had a material impact on our business plan relating to
      the
      use of these assets. We have been able to operate and derive marginal revenue
      from the web portal.  We are attempting to secure complete control of the
      intangible assets.  On December 8, 2006, the United States Bankruptcy Court
      of the Western District of Texas entered an order requiring the return of the
      SunTrips assets in question, which we expected to occur no later than December
      31, 2006 but due to the complexity of the bankruptcy case this has not yet
      occurred.  In the event the assets are not returned, our operations will
      continue to be materially adversely affected and increases the likelihood we
      will not continue as a going concern.




Due to the fact we
      do not
      have complete control of the SunTrips assets, we have developed a product called
      IntelliFares.  If IntelliFares is not widely accepted in the marketplace,
      it will have a material adverse affect on our operations.




We believe IntelliFares to
      be a
      unique and novel product for travelers.  However, in order for it to be
      successful, it will need to be adopted by a significant portion of predictable,
      pattern travelers.  In the event it is not accepted by predictable, pattern
      travelers, it will have a materially adverse affect on our business
      operations.




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


Not applicable.


**Item
      3. Defaults Upon Senior
      Securities.**




Not applicable.


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


Not applicable.


**Item
      5. Other Information.**


Not
      applicable.





8


**Item
      6. Exhibits and Reports on Form 8-K.**




31
            
            Certification pursuant
                to
                SEC Release No. 33-8238, as adopted pursuant to Section 302 of the
                Sarbanes-Oxley Act of 200232
            
            Certification pursuant
                to 18
                U.S.C. Section 1350, as adopted pursuant to Section 906 of the
                Sarbanes-Oxley Act of 2002


9




**SIGNATURES**




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




Date: June 20, 2007
            By:
            /s/Fabrizzio
                Busso CampanaFabrizzio Busso
                Campana
                Chief Executive Officer


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