U.S. SECURITIES AND EXCHANGE
                                   COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-QSB
                                   (Mark One)

|X|   QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
      OF 1934
      For the quarterly period ended September 30, 2005

|_|   TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE EXCHANGE ACT
      For the transition period from _________ to _________

                         Commission file number 0-25417

                              TORBAY HOLDINGS, INC.
        (Exact Name of Small Business Issuer as Specified in its Charter)

           DELAWARE                                              52-2143186
-------------------------------                              ------------------
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)

            140 OLD COUNTRY ROAD, SUITE 205, MINEOLA, NEW YORK 11501
                    (Address of principal executive offices)

                                  516-747-5955
                           (Issuer's Telephone Number)

                                 NOT APPLICABLE
              ----------------------------------------------------
              (Former Name, Former Address and Former Fiscal Year,
                          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. Yes |X| No |_|

The Company had 95,727,376 shares of common stock outstanding as of November 10,
2005.

TRANSITIONAL SMALL BUSINESS DISCLOSURE FORMAT (CHECK ONE): Yes |_| No |X|


                                       1
<PAGE>

                                      INDEX

                                                                        Page No.

PART 1 - FINANCIAL INFORMATION

Condensed consolidated balance sheet as of September 30, 2005 (unaudited)....  3

Condensed consolidated statements of operations and comprehensive loss
for the three and nine months ended September 30, 2005 and 2004 (unaudited)..  4

Condensed consolidated statements of cash flows for the nine months ended
September 30, 2005 and 2004 (unaudited) .....................................  5

Notes to condensed consolidated financial statements as of September 30,
2005 and 2004 (unaudited) ...................................................  6

Item 2.  Management's Discussion and Analysis or Plan of Operation .......... 10

Item 3.  Controls and Procedures ............................................ 23

PART 2 - OTHER INFORMATION

Item 1.  Legal Proceedings .................................................. 24

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds ........ 24

Item 3.  Defaults Upon Senior Securities .................................... 24

Item 4.  Submission of Matters to a Vote of Security Holders ................ 25

Item 5.  Other Information .................................................. 25

Item 6.  Exhibits  .......................................................... 25

Signatures................................................................... 26


                                       2
<PAGE>

PART I - FINANCIAL INFORMATION
Item 1. Financial Statements

                     TORBAY HOLDINGS, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                               SEPTEMBER 30, 2005
                                   (UNAUDITED)

                                     ASSETS
CURRENT ASSETS
 Cash                                                               $    14,056
 Accounts receivable                                                     84,687
 Inventory                                                               39,381
                                                                    -----------
     Total Current Assets                                               138,124
                                                                    -----------

PROPERTY AND EQUIPMENT - NET                                             16,545
                                                                    -----------

OTHER ASSETS
 Intangible assets - net                                                 73,659
 Deposits                                                                 6,795
 Deferred charges                                                        10,450
                                                                    -----------
     Total Other Assets                                                  90,904
                                                                    -----------

TOTAL ASSETS                                                        $   245,573
                                                                    ===========
                    LIABILITIES AND STOCKHOLDERS' DEFICIENCY

CURRENT LIABILITIES
 Accounts payable and accrued expenses                              $   255,974
 Advances payable - stockholders and related parties                     89,503
 Loan payable                                                            32,900
 Notes payable                                                          107,800
                                                                    -----------
     Total Current Liabilities                                          486,177
Advance received for sale of common stock                               200,000
                                                                    -----------
Total Liabilities                                                       686,177
                                                                    -----------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' DEFICIENCY
 Preferred stock, $.0001 par value, 20,000,000 shares
   authorized, 420,000 issued and outstanding                                42
 Common stock, $.0001 par value, 100,000,000 shares authorized,
   95,727,376 shares issued and 93,637,376 shares outstanding             9,364
 Common stock to be issued (500,000 shares)                                  50
 Additional paid-in capital                                           4,887,860
 Accumulated deficit                                                 (5,319,579)
 Accumulated other comprehensive loss                                   (18,341)
                                                                    -----------
TOTAL STOCKHOLDERS' DEFICIENCY                                         (440,604)
                                                                    -----------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY                      $   245,573
                                                                    ===========

     See accompanying notes to condensed consolidated financial statements.


                                       3
<PAGE>

                     TORBAY HOLDINGS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                             AND COMPREHENSIVE LOSS
         FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                       For the Three    For the Three    For the Nine     For the Nine
                                                       Months Ended     Months Ended     Months Ended     Months Ended
                                                       September 30,    September 30,    September 30,    September 30,
                                                           2005             2004             2005             2004
                                                       -------------    -------------    -------------    -------------
<S>                                                     <C>              <C>              <C>              <C>
SALES, NET                                              $    127,543     $     37,887     $    299,408     $    197,424

COST OF SALES                                                 26,092           18,961           74,523           64,693
                                                        ------------     ------------     ------------     ------------

GROSS PROFIT                                                 101,451           18,926          224,885          132,731
                                                        ------------     ------------     ------------     ------------

OPERATING EXPENSES
 Selling                                                      33,046           21,800          102,985           95,112
 Consulting fees                                                  --               --               --            6,300
 Professional fees                                            13,815           16,037          106,931           71,850
 Compensation                                                 19,711           29,399           70,994           72,409
 Other general and administrative                             73,230           57,403          216,237          176,307
                                                        ------------     ------------     ------------     ------------
       Total operating expenses                              139,802          124,639          497,147          421,978
                                                        ------------     ------------     ------------     ------------

LOSS FROM OPERATIONS                                         (38,351)        (105,713)        (272,262)        (289,247)
                                                        ------------     ------------     ------------     ------------

OTHER INCOME (EXPENSE)
 Interest and financing costs, net                               779           (3,423)          (9,422)        (182,152)
 Gain on extinguishment of debt, net                              --               --               --          243,800
 Cancellation of stock issued for consulting fees                 --               --               --           15,000
                                                        ------------     ------------     ------------     ------------
       Total other income (expense)                              779           (3,423)          (9,422)          76,648
                                                        ------------     ------------     ------------     ------------

NET LOSS                                                     (37,572)        (109,136)        (281,684)        (212,599)

OTHER COMPREHENSIVE INCOME/(LOSS)
 Foreign currency translation income (loss)                    2,909              551           11,349           (1,475)
                                                        ------------     ------------     ------------     ------------

COMPREHENSIVE LOSS                                      $    (34,663)    $   (108,585)    $   (270,335)    $   (214,074)
                                                        ============     ============     ============     ============

NET LOSS PER COMMON SHARE - BASIC AND DILUTED           $         --     $         --     $         --     $         --
                                                        ============     ============     ============     ============

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
 - BASIC AND DILUTED                                      91,817,811       89,443,596       91,175,838       86,662,944
                                                        ============     ============     ============     ============
</TABLE>

     See accompanying notes to condensed consolidated financial statements.


                                       4
<PAGE>

                     TORBAY HOLDINGS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                  2005          2004
                                                                                ---------     ---------
<S>                                                                             <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:

 Net loss                                                                       $(281,684)    $(212,599)
 Adjustments to reconcile net loss to net cash used in operating activities:
  Depreciation and amortization                                                    40,321        27,974
  Amortization of loan costs                                                        6,863           650
  Gain on extinguishment of debt, net                                                  --      (243,800)
  Common stock issued for services                                                  1,000           300
  Deferred equity based costs recognized                                           55,145       192,180
  Financing costs - shares sold below market value                                     --        48,258
  Cancellation of shares issued for services                                           --       (15,000)
 Changes in operating assets and liabilities:
    (Increase) decrease in accounts receivable                                    (48,476)        3,295
    (Increase) decrease in inventory                                              (14,282)       34,362
    Increase in deposit for inventory                                                  --       (19,000)
    (Decrease) increase in accounts payable and accrued expenses                  (66,054)       26,818
                                                                                ---------     ---------
       Net cash used in operating activities                                     (307,167)     (156,562)
                                                                                ---------     ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
 Increase in intangible assets                                                    (11,000)      (26,750)
 Purchase of property and equipment                                                (1,305)       (5,447)
                                                                                ---------     ---------
       Net cash used in investing activities                                      (12,305)      (32,197)
                                                                                ---------     ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
 Proceeds from issuance of common stock                                           100,000       186,940
 Advance received for sale of common stock                                        189,550        50,000
 Principal payments on settlement payable                                         (63,328)      (79,158)
 Proceeds from issuance of notes and loans payable                                 32,900        52,020
 Loan and stock subscription costs                                                     --       (10,200)
 Advances received from stockholder and related party                              45,629            --
 Repayment of advances received from stockholder and related party                 (2,083)           --
                                                                                ---------     ---------
       Net cash provided by financing activities                                  302,668       199,602
                                                                                ---------     ---------

EFFECT OF EXCHANGE RATE CHANGES ON CASH                                            11,349        (1,475)
                                                                                ---------     ---------

(DECREASE) INCREASE IN CASH                                                        (5,455)        9,368

CASH - BEGINNING OF PERIOD                                                         19,511        12,387
                                                                                ---------     ---------

CASH - END OF PERIOD                                                            $  14,056     $  21,755
                                                                                =========     =========

Interest paid                                                                   $   3,339     $   4,175
                                                                                =========     =========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.


                                       5
<PAGE>

                     TORBAY HOLDINGS, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            AS OF SEPTEMBER 30, 2005
                                   (UNAUDITED)

NOTE 1 BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

      (A) Basis of Presentation

      The accompanying condensed consolidated financial statements include the
      accounts of Torbay Holdings, Inc. and its wholly owned subsidiaries,
      Designer Appliances Limited and Designer Appliances, Inc. (collectively,
      the "Company"). These condensed consolidated financial statements have
      been prepared in accordance with accounting principles generally accepted
      in the United States of America for interim financial information and the
      instructions to Form 10-QSB and do not include all the information and
      footnotes required by accounting principles generally accepted in the
      United States of America for complete financial statements. In the opinion
      of management, all adjustments (consisting of normal recurring accruals)
      considered necessary for a fair presentation of the results for the
      interim periods have been included. Operating results for the nine months
      ended September 30, 2005 are not necessarily indicative of the results
      that may be expected for the year ending December 31, 2005. The
      accompanying condensed consolidated financial statements and the
      information included under the heading "Management's Discussion and
      Analysis" should be read in conjunction with the Company's audited
      consolidated financial statements and related notes included in the
      Company's Form 10-KSB for the year ended December 31, 2004.

      (B) Use of Estimates

      The preparation of condensed consolidated financial statements in
      conformity with accounting principles generally accepted in the United
      States of America requires management to make estimates and assumptions
      that affect the reported amounts of assets and liabilities and disclosures
      of contingent assets and liabilities at the date of the condensed
      consolidated financial statements and the reported amounts of revenues and
      expenses during the reporting period. Actual results could differ from
      those estimates.

      (C) Loss Per Share

      Basic and diluted loss per common share for all periods presented is
      computed based on the weighted average number of common shares outstanding
      during the periods presented as defined by SFAS No. 128, "Earnings Per
      Share". The assumed exercise of common stock equivalents was not utilized
      for the nine and three month periods ended September 30, 2005 and 2004
      since the effect would be anti-dilutive. There were 22,700,000 and
      5,200,000 common stock equivalents at September 30, 2005 and 2004,
      respectively.

      (D) Stock Options and Warrants

      The Company accounts for its stock-based employee compensation plans using
      the intrinsic value based method, under which compensation cost is
      measured as the excess of the stock's market price at the grant date over
      the amount an employee must pay to acquire the stock. Stock options and
      warrants issued to non-employees are accounted for using the fair value
      based method, under which the expense is measured as the fair value of the
      security at the date of grant based on the Black-Scholes pricing model.
      The Company had 18,500,000 warrants outstanding at September 30, 2005, and
      1,000,000 at September 30, 2004.


                                       6
<PAGE>

                     TORBAY HOLDINGS, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            AS OF SEPTEMBER 30, 2005
                                   (UNAUDITED)

      (E) Recent Accounting Pronouncements

      In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error
      Corrections" ("SFAS 154") which replaces Accounting Principles Board
      Opinions No. 20 "Accounting Changes" and SFAS No. 3, "Reporting Accounting
      Changes in Interim Financial Statements-An Amendment of APB Opinion No.
      28." SFAS 154 provides guidance on the accounting for and reporting of
      accounting changes and error corrections. It establishes retrospective
      application, or the latest practicable date, as the required method for
      reporting a change in accounting principle and the reporting of a
      correction of an error. SFAS 154 is effective for accounting changes and
      corrections of errors made in fiscal years beginning after December 15,
      2005 and is required to be adopted by the Company in the first quarter of
      fiscal 2007. The Company is currently evaluating the effect that the
      adoption of SFAS 154 will have on its consolidated results of operations
      and financial condition.

      In December 2004, the FASB issued SFAS No.123 (revised 2004), "Share-Based
      Payment". SFAS 123(R) will provide investors and other users of financial
      statements with more complete and neutral financial information by
      requiring that the compensation cost relating to share-based payment
      transactions be recognized in financial statements. That cost will be
      measured based on the fair value of the equity or liability instruments
      issued. SFAS 123(R) covers a wide range of share-based compensation
      arrangements including share options, restricted share plans,
      performance-based awards, share appreciation rights, and employee share
      purchase plans. SFAS 123(R) replaces FASB Statement No. 123, "Accounting
      for Stock-Based Compensation", and supersedes APB Opinion No. 25,
      "Accounting for Stock Issued to Employees". SFAS 123, as originally issued
      in 1995, established as preferable a fair-value-based method of accounting
      for share-based payment transactions with employees. However, that
      statement permitted entities the option of continuing to apply the
      guidance in Opinion 25, as long as the footnotes to financial statements
      disclosed what net income would have been had the preferable
      fair-value-based method been used. Public entities (other than those
      filing as small business issuers) will be required to apply SFAS 123(R) as
      of the first interim or annual reporting period that begins after June 15,
      2005. SFAS 123(R) is applicable for the Company effective the first
      interim period that starts after December 15, 2005. The Company has
      evaluated the impact of the adoption of SFAS 123(R), and believes that the
      impact may be significant to the company's future overall results of
      operations and financial position.

NOTE 2 SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

      During the nine months ended September 30, 2005, the Company received
      advances on a common stock purchase agreement. The gross amount of the
      advances was $200,000. Costs of $10,450 were deducted, resulting in net
      proceeds of $189,550. The costs have been deferred and will be applied
      against additional paid-in capital when the stock purchase is completed.

      In June 2005, the Company issued 100,000 shares of common stock, valued at
      $4,000, for services provided. Of the amount, $3,000 offset an outstanding
      payable, and the remaining $1,000 was charged to expense.

      During the nine months ended September 30, 2004, the Company reached a
      settlement to retire its remaining 12% convertible debentures aggregating
      $507,750 and related accrued interest of $92,057 in exchange for the
      issuance of 6,000,000 shares of common stock having a fair value of
      $162,000, and $200,000 in cash, payable in twelve monthly installments of
      $16,667, with a present value of $189,981, commencing May 1, 2004.
      Accordingly, the Company has recorded a gain of $247,826 related to the
      extinguishment (see Note 4).

      In February 2004, the Company granted options to purchase an aggregate of
      5,000,000 shares of common stock to two individuals in exchange for
      services to be rendered through August 1, 2005. The fair value of these
      options was $112,240. This amount has been amortized over the life of the
      services agreement (see Note 5).

      During April 2004, the Company issued 161,050 shares of common stock to an
      officer to settle a payable to him of $9,663. The shares were issued at a
      discount to market value and the Company has recorded a loss on
      extinguishment of debt of $4,026 (see Note 5).

NOTE 3 INTANGIBLE ASSETS

      During the nine months ended September 30, 2005 and 2004, the Company
      incurred costs of $11,000 and $26,750, respectively, for the development
      of new software applications. Amortization expense for the nine months
      ended September 30, 2005 and 2004 was $33,594 and $22,090, respectively.

      Amortization expense for the three months ended September 30, 2005 and
      2004 was $11,410 and $8,910, respectively. The amortization expense has
      been included in cost of sales.


                                       7
<PAGE>

                     TORBAY HOLDINGS, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            AS OF SEPTEMBER 30, 2005
                                   (UNAUDITED)

NOTE 4 12% CONVERTIBLE DEBENTURES

      On February 17, 2004, the Company and the debenture holders entered into a
      Redemption and Settlement Agreement and Mutual General Release (the
      "Settlement"). In accordance with the Settlement, all of the outstanding
      debentures and related warrants were redeemed by the Company. The Company
      issued 6,000,000 shares of common stock having a fair value of $162,000,
      to the debenture holders, and agreed to pay $200,000 in cash in twelve
      monthly installments of $16,667 commencing May 1, 2004. The Company has
      recorded a gain of $247,826 related to the extinguishment.

NOTE 5 STOCKHOLDERS' DEFICIENCY

      During the nine months ended September 30, 2005, the Company received
      advances on a common stock purchase agreement. The gross amount of the
      advances was $200,000. Costs of $10,450 were deducted, resulting in net
      proceeds of $189,550. The costs have been deferred and will be applied
      against additional paid-in capital when the stock purchase is completed.
      Closing of the transaction will occur upon the effectiveness of a
      registration statement registering the underlying shares. The purchase
      price of the shares to be issued will be the lesser of $0.04 or 50% of the
      average closing bid price on the 5 trading days either prior to closing or
      prior to the effectiveness of the registration statement. The purchaser
      will also be issued warrants exercisable into such number of shares equal
      to the aggregate investment amount divided by the purchase price. Half of
      these warrants will be exercisable at 110% of the purchase price and half
      will be exercisable at 150% of the purchase price. Upon the achievement of
      certain conditions, the Company may force the exercise of the warrants.
      The warrants will expire on December 31, 2008.

      During the nine months ended September 30, 2005, the Company issued
      2,090,000 shares of common stock as collateral for the loan described in
      Note 8. These collateral shares are not considered to be outstanding for
      loss per share calculations.

      In June 2005, the Company issued 100,000 shares of common stock, valued at
      $4,000, for services provided. Of the amount, $3,000 offset an outstanding
      payable, and the remaining $1,000 was charged to expense.

      In July 2005, the Company issued 200,000 shares of common stock for
      proceeds of $10,000.

      In September 2005, the Company issued 3,000,000 shares of common stock
      upon exercise of warrants, and received proceeds of $90,000.

      During February and March 2004, the Company issued 6,000,000 shares of
      common stock in connection with the retirement of its 12% convertible
      debentures payable described in Note 4.

      In February 2004, the Company granted options to purchase an aggregate of
      5,000,000 shares of common stock to two individuals in exchange for
      services to be rendered through August 1, 2005. The options had an
      exercise price of $.008 per share and had a life of ninety days from grant
      date. The fair value of these options was $112,240 and this amount has
      been amortized over the life of the services agreement (seventeen months).
      The value was determined using the Black-Scholes option pricing model in
      accordance with SFAS 123 with the following assumptions: dividend yield of
      zero, expected volatility of 178%, risk-free interest rate of 3.5% and an
      expected life of three months. The options were exercised in February 2004
      and cash proceeds of $40,000 were received by the Company.


                                       8
<PAGE>

                     TORBAY HOLDINGS, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            AS OF SEPTEMBER 30, 2005
                                   (UNAUDITED)

      During March 2004, the Company sold 202,614 shares of common stock for
      cash proceeds of $17,000. The cash was received in March and the shares
      were issued in April. The shares were sold at a discount to market value,
      and a financing cost related to the discount of $4,013 has been
      recognized.

      During the three months ended March 31, 2004 the Company issued 3,000
      shares of common stock, valued at $300, for services rendered.

      During April and May 2004, the Company sold 2,005,168 shares of common
      stock for cash proceeds of $126,940. The shares were sold at a discount to
      market value, and a financing cost related to the discount of $44,245 has
      been recognized.

      During April 2004, the Company issued 161,050 shares of common stock to
      settle a payable to an officer in the amount of $9,663. The shares were
      issued at a discount to market value and the Company has recorded a loss
      on extinguishment of debt of $4,026.

      The Company deferred costs related to the issuance of options for services
      to be rendered through July 2005. During the nine months ended September
      30, 2005 and 2004, the Company has expensed $55,145 and $64,995,
      respectively, of these costs, with no remaining deferral at September 30,
      2005.

NOTE 6 GOING CONCERN

      The accompanying condensed consolidated financial statements have been
      prepared on a going concern basis, which contemplates the realization of
      assets and the settlement of liabilities and commitments in the normal
      course of business. As reflected in the accompanying condensed
      consolidated financial statements, the Company has a net loss of $281,684
      and a negative cash flow from operations of $307,167 for the nine months
      ended September 30, 2005 and a working capital deficiency of $348,053 and
      a stockholders' deficiency of $440,604 as of September 30, 2005. These
      factors raise substantial doubt about its ability to continue as a going
      concern. The ability of the Company to continue as a going concern is
      dependent on the Company's ability to raise additional funds to finance
      its operations. The condensed consolidated financial statements do not
      include any adjustments that might be necessary if the Company is unable
      to continue as a going concern.

      Management's plans to raise such funds include obtaining additional
      financing for which they are currently in negotiations with several
      financing institutions and increasing sales of the Quill computer mouse
      and related software products.

NOTE 7 ADVANCES PAYABLE - STOCKHOLDERS AND RELATED PARTIES

      During February 2005, an officer advanced $20,629 to the Company for
      working capital purposes. The advances are non-interest bearing and are
      repayable upon demand.

      During August 2005, the wife of an officer advanced $25,000 to the Company
      for working capital purposes. The advance will be repaid over twelve
      months, with monthly payments of $2,083 commencing September 2005.

NOTE 8 LOAN PAYABLE

      During the nine months ended September 30, 2005, the Company received
      loans totaling $32,900 from an individual for working capital purposes.
      The loans are non-interest bearing and are repayable upon demand. The
      Company has issued 2,090,000 shares of common stock as collateral for the
      loan.

NOTE 9 SUBSEQUENT EVENTS

      On October 18, 2005 the Company filed an amendment to its articles of
      incorporation increasing the number of authorized common shares to
      250,000,000.


                                       9
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

      Certain information contained in this Report are forward-looking
statements (within the meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1934, as amended).
Factors set forth that appear with the forward-looking statements, or in the
Company's other Securities and Exchange Commission filings, could affect the
Company's actual results and could cause the Company's actual results to differ
materially from those expressed in any forward-looking statements made by, or on
behalf of, the Company in this Report. In addition to statements that explicitly
describe such risks and uncertainties, readers are urged to consider statements
labeled with the terms "believes," "belief," "expects," "intends," "anticipates"
or "plans" to be uncertain and forward-looking. The forward-looking statements
contained herein are also subject generally to other risks and uncertainties
that are described from time to time in the Company's reports and registration
statements filed with the Securities and Exchange Commission. In addition, prior
financial performance and customer orders are not necessarily indicative of the
results that may be expected in the future and the Company believes that such
comparisons cannot be relied upon as indicators of future performance.
Additionally, the Company undertakes no obligation to publicly release the
results of any revisions to these forward-looking statements which may be made
to reflect events or circumstances occurring after the date hereof or to reflect
the occurrence of unanticipated events. The accompanying notes are an integral
part of the condensed consolidated financial statements.

OVERVIEW

      We are a holding company for late-stage developmental, or early-stage
commercial, companies with opportunities in niche markets. We currently own two
subsidiaries, Designer Appliances Ltd., an inactive United Kingdom ("UK")
company, and Designer Appliances, Inc., a Delaware corporation, and will
actively seek additional and appropriate acquisitions, subject to the comments
below. We have acquired valuable intellectual property rights including an
exclusive license on proprietary software and a UK patent for a computer mouse
that is thought to be beneficial to computer mice users with regards to the area
of treatment and prevention of repetitive strain injury. The UK patent is the
basis for further patent applications that may result in an expansion of the
scope and geography of our current patent position. We have achieved what we
believe are significant technical developments that will be patent protected,
though there is no guarantee that such developments will proceed to a patent.

      We sell and market the AirO2bic Mouse computer mouse and software. The
Company's products are designed to justify a premium price in the upper and
certain niche sectors of our markets. There is no assurance that we, through our
active subsidiary, will be able to continue to manufacture or market these
items. The Company intends to market and sell only products that are designed to
attract a premium, niche or upscale market. Management believes that it has
identified several products, including the AirO2bic "Grip-less" Mouse and Nib
"Click-less" software, of an under exploited opportunity in the computer,
household and domestic appliances markets. Because of the Company's precarious
financial condition and limited capital resources, it is currently limiting its
operations to the production and sale of the AirO2bic Mouse and related
software.


                                       10
<PAGE>

RESULTS OF OPERATIONS FOR THE 3 MONTHS ENDED SEPTEMBER 30, 2005 AND 2004

Gross Profit

      For the 3 months ended September 30, 2005, the Company generated revenue
from sales of $127,543 compared to $37,887 for the 3 months ended September 30,
2004, an increase of $89,656, or 237%. Cost of sales were $26,092 for the 3
months ended September 30, 2005, compared to $18,961 for the 3 months ended
September 30, 2004, an increase of $7,131. Gross profit was $101,451 or 79.5% of
net revenues for the 3 months ended September 30, 2005 relative to $18,926 or
50% of net revenues for the 3 months ended September 30, 2004. The increase in
gross profit as a percentage of sales represents the impact of lower costs per
unit and increased sales relative to fixed costs of software amortization that
are included in costs of sales. All revenues were from sales of the Company's
AirO2bic Mouse (pronounced aerobic) product and related system configurations,
software and accessories.

      The increase in the Company's revenues and cost of sales in the 3 months
ended September 30, 2005 resulted from the shipment of backlog and ongoing
sales. A backlog situation for white left handed mice existed at September 30,
2005 which the Company anticipates will be satisfied in the fourth fiscal
quarter by a manufacturing order that has been placed.

Operating Expenses

      Operating expenses increased to $139,802 for the 3 months ended September
30, 2005 from $124,639 for the 3 months ended September 30, 2004, an increase of
$15,163 or 12.2%. The variance was comprised of increases in selling expenses
and general and administrative expenses partially offset by a decrease in
professional fees and compensation paid.

Other Income (Expenses)

      For the 3 months ended September 30, 2005 interest and financing costs
were $779 in income compared to an expense of $3,423 for the 3 months ended
September 30, 2004.


                                       11
<PAGE>

Net Loss

      The Company incurred a net loss $37,572 for the 3 months ended September
30, 2005 relative to a net loss of $109,136 for the 3 months ended September 30,
2004. The reduction in the net loss between the two periods was primarily due to
higher gross profit in the quarter ended September 30, 2005 which were only
partially offset by higher operating expenses.

RESULTS OF OPERATIONS FOR THE 9 MONTHS ENDED SEPTEMBER 30, 2005 AND 2004

Gross Profit

      For the 9 months ended September 30, 2005 the Company generated revenue of
$299,408 compared to $197,424 for the 9 months ended September 30, 2004. Cost of
sales was $74,523 for the 9 months ended September 30, 2005, compared to $64,693
for the 9 months ended September 30, 2004. Gross profit was $224,885 or 75.1% of
net revenues for the 9 months ended September 30, 2005 relative to $132,731 or
67.2% of net revenues for the 9 months ended September 30, 2004. The increase in
gross profit as a percentage of sales represents the impact of lower costs per
unit and increased sales relative to fixed costs of software amortization that
are included in costs of sales.

Operating Expenses

      For the 9 months ended September 30, 2005, operating expenses increased
$75,169 or 17.8% from $421,978 for the 9 months ended September 30, 2004 to
$497,147 for the 9 months ended September 30, 2005. This was primarily due to an
increase in professional fees of $35,081 and an increase in other general and
administrative expense of $39,930.

Other Income (expenses)

      The Company had total other expense of $9,422 for the 9 months ended
September 30, 2005 compared to income of $76,648 for the 9 months ended
September 30, 2004, which resulted from a gain on extinguishment of debt of
$243,800 and $15,000 for cancellation of stock issued for consulting fees which
was partially offset by interest and financing charges of $182,152.

Net Loss

      The Company incurred a net loss $281,684 for the 9 months ended June 30,
2005 relative to a net loss of $212,599 for the 9 months ended September 30,
2004, an increase in the loss of $69,085. The additional loss in the 9 months
ended September 30, 2005 is attributable to a net negative differential in other
Income/Expense of $86,070 partially offset by a lesser loss from operations in
2005.


                                       12
<PAGE>

LIQUIDITY AND CASH POSITION

Operating Activities

      For the 9 months ended September 30, 2005 and 2004, the Company used
$307,167 and $156,562, respectively, to fund operating activities. The increased
use of cash of $150,605 in the 9 months ended September 30, 2005 is due to
various factors, both positive and negative, in various categories, the greatest
impact on variance being net gains on the extinguishment of debt and deferred
equity based costs recognized during the 9 months ended September 30, 2004 and
an increase in accounts receivable and a decrease in accounts payable in the 9
months ended September 30, 2005.

Investing Activities

      For the 9 months ended September 30, 2005 and 2004, the Company used
$12,305 and $32,197, respectively, to fund investing activities. The decrease in
cash used in investing activities in the 9 months ended September 30, 2005 was
due to a decrease in intangible costs relating to software development and
lesser capital purchasing during the period.

Financing Activities

      For the 9 months ended September 30, 2005 and 2004, the Company realized
cash of $302,668 and $199,602, respectively, in connection with financing
activities. The increased proceeds of cash of $103,066 in the 9 months ended
September 30, 2005 was primarily due to $289,550 received for common stock sales
in 2005 as compared to $236,940 received in 2004 for common stock sales and
$45,629 received in 2005 for an advance from a related party.

      On September 13, 2005, the stockholders of the Company approved an
amendment to the Certificate of Incorporation of the Company to increase the
authorized shares of common stock of the Company from 100 million to 250
million. The amendment will enable the Company to issue additional equity
securities in connection with financings.

LIQUIDITY AND CAPITAL RESOURCES

Going Concern Qualification

      For the 9 months ended September 30, 2005, the Company has a net loss of
$281,684 and a negative cash flow from operations of $307,167, and as of
September 30, 2005 the Company had a working capital deficiency of $348,053 and
a stockholders' deficiency of $440,604. These factors raise substantial doubt
about the Company's ability to continue as a going concern. The ability of the
Company to continue as a going concern is dependent on the Company's ability to
raise additional funds (the availability and sufficiency of which to support
operations of the Company during the next 12 months is not assured) and achieve
continued growth in sales. The consolidated financial statements do not include
any adjustments that might be necessary if the Company is unable to continue as
a going concern. Management's plans include obtaining additional financing,
increasing sales of the AirO2bic computer mouse and seeking to expand sales of
related software products to be marketed under an Anti.Fatigue(TM) theme.


                                       13
<PAGE>

      The Company, including its subsidiaries, during its development stage
incurred start-up costs, including administrative costs and research and
development costs, while realizing limited operating revenue. The retirement at
the end of April 2005 of the debt resulting from the debenture settlement
agreement has further reduced the cash burden upon the Company.

      The Company has had, though small relative to its costs of operations and
maintaining its Securities Exchange Act of 1934 registration and OTC Bulletin
Board listing, generally increasing sales and revenue through September 30, 2005
obtained through direct marketing programs, via its website and indirectly
through an increasing number of distributor/resellers who themselves have their
own websites. Several strategic relationships are currently being explored,
including an informal relationship with an ergonomic keyboard manufacturer.

      The strategy has been for the Company to develop product and brand
recognition amongst the "professional ergonomic" industry ahead of investigating
"niche" assistive technology markets in the broader retail sector of the
computer peripheral business.

      The Company invested in a pilot-scale clinical study that is being
conducted on its behalf. The study is to investigate the use of a clinical
diagnostic test, called Nerve Conduction Velocity testing, to diagnose the
condition called Carpal Tunnel Syndrome, as a monthly marker of the impact of
the use of the AirO2bic mouse upon subjects with or without Carpal Tunnel
Syndrome ("CTS"). This study is to establish the usefulness of any data that may
be provided in tracking effects of the use of the AirO2bic mouse product. The
Company believes that the data this study has generated supports the premise
that the use of nerve conduction velocity testing may be used as a marker for
establishing symptomatic levels of Carpal Tunnel Syndrome and that after 3
months of use of the Company's AirO2bic mouse product, there had been a positive
impact upon nerve conduction velocity in all subjects studied.

      The Company continues its focus upon any opportunity to increase its sales
to the U.S. Government following clarification that Section 508 Law does require
computer mice to meet the prevailing standards. We have had ongoing discussions
with partners who have established access to this market. As a result, our
products have been listed under two GSA contracts with Unistar-Sparco and Kare
Products. Kare Products has just established itself upon the GSA advantage
product sites.

      In April 2005 we attended the Federal Offices Supplies Exposition in
Washington, D.C. Our Virtually Hands Free mousing system was featured in a
demonstration of certain of Hewlett Packard's products at their booth.


                                       14
<PAGE>

      Access to new markets necessarily requires partnership with organizations
that have a presence and reputation within those sectors. The Company has
developed an increasing reliance upon distributor/resellers. (This business is
now in excess of 50% of the Company's sales.) The Company believes that there is
great potential for reduction in costs of access to markets served by
distributors and resellers in terms of time, employment of personnel and
marketing. Reductions in gross margin may be necessary to achieve the pricing
incentives required by the retail computer market. Existing distribution
channels also showed seasonality in that a lower business activity was observed
during main holiday season periods; most noticeably during the winter holiday
period.

      At the end of 2002 the Company commenced production and shipment of its
mouse product and has maintained a clear focus upon developing that business and
has no plans to launch other products outside of the computer peripheral market
at this time. It continues to seek to strengthen its intellectual property
rights ("IPR") in the area of computer peripherals. To date the Company's IPR
portfolio includes vacuum cleaner, fans, heaters and other intellectual property
right bearing domestic appliances. The Company will remain focused on developing
sales of its Mouse and Software related products and developing other "parallel"
product technologies into products.

RECENT ACCOUNTING PRONOUNCEMENTS

      In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error
Corrections" ("SFAS 154") which replaces Accounting Principles Board Opinions
No. 20 "Accounting Changes" and SFAS No. 3, "Reporting Accounting Changes in
Interim Financial Statements-An Amendment of APB Opinion No. 28." SFAS 154
provides guidance on the accounting for and reporting of accounting changes and
error corrections. It establishes retrospective application, or the latest
practicable date, as the required method for reporting a change in accounting
principle and the reporting of a correction of an error. SFAS 154 is effective
for accounting changes and corrections of errors made in fiscal years beginning
after December 15, 2005 and is required to be adopted by the Company in the
first quarter of fiscal 2007. The Company is currently evaluating the effect
that the adoption of SFAS 154 will have on its consolidated results of
operations and financial condition.

      In December 2004, the FASB issued SFAS No.123 (revised 2004), "Share-Based
Payment". SFAS 123(R) will provide investors and other users of financial
statements with more complete and neutral financial information by requiring
that the compensation cost relating to share-based payment transactions be
recognized in financial statements. That cost will be measured based on the fair
value of the equity or liability instruments issued. SFAS 123(R) covers a wide
range of share-based compensation arrangements including share options,
restricted share plans, performance-based awards, share appreciation rights, and
employee share purchase plans. SFAS 123(R) replaces FASB Statement No. 123,
"Accounting for Stock-Based Compensation", and supersedes APB Opinion No. 25,
"Accounting for Stock Issued to Employees". SFAS 123, as originally issued in
1995, established as preferable a fair-value-based method of accounting for
share-based payment transactions with employees. However, that statement
permitted entities the option of continuing to apply the guidance in Opinion 25,
as long as the footnotes to financial statements disclosed what net income would
have been had the preferable fair-value-based method been used. Public entities
(other than those filing as small business issuers) will be required to apply
SFAS 123(R) as of the first interim or annual reporting period that begins after
June 15, 2005. SFAS 123(R) is applicable for the Company effective the first
interim period that starts after December 15, 2005. The Company has evaluated
the impact of the adoption of SFAS 123(R), and believes that the impact may be
significant to the company's future overall results of operations and financial
position.


                                       15
<PAGE>

SECTION 508 AMENDMENTS TO REHABILITATION ACT

      The General Services Administration (the "GSA") implemented a program that
sets standards for information technology so as to make such technology
accessible to those with special needs. The standards are applied under what is
called Section 508, which are described in full at www.section508.gov. Details
pertaining to our products can be found at www.aerobicmouse.com under the
heading GSA Section 508. These standards include a section relating to input
devices, such as computer mice and under item 1194.26, which relates to
subsection 1193.26- 2.0 a standard is prescribed for input devices. Companies
that consider their products to meet the standards can apply to have their
products listed within the "Buy Accessible" section of the section508.gov
website and also list a Voluntary Product Accessibility Template ("VPAT") by
which government purchasing officials can perform their own due diligence so as
to ensure the purchases they make are Section 508 compliant. The GSA Section 508
Group then provides access to the product and company information on the
website. The Company, having evaluated the standard and believing that its
products complied, submitted its applications for its hardware and software
products which were subsequently processed and listed on the Section 508
website.

      Section 508 compliance has been a requirement of system purchases,
typically large contracts over $2,500, since July, 2001 whereas
"Micropurchases"- purchases less than $2,500 and typically by credit card --
have been exempt from Section 508 compliance. This exemption expired on April 1,
2005, at which time making all purchases subject to Section 508 compliance.

      The Company was made aware by third parties that its products were no
longer listed in the Section 508 website. We had not been advised of their
removal and upon inquiry we were told that computer mice were not considered as
requiring Section 508 compliance and that our listing, by then some 18 months,
was erroneous.

      Following review by various bodies, at a meeting in December, 2004 the
Company's interpretation of Section 508 law, that computer mice were subject to
the standards, was confirmed and the Company's products were re-listed on the
Buy Accessible section of the www.section508.gov website. Therefore in regards
to computer mice and Section 508 there has been a positive determination by the
GSA of the requirement for Section 508 compliance at both the standards and
procurement levels. This is a first and our products are probably the first
design innovation that crosses the compliant non-compliant divide.


                                       16
<PAGE>

      It has therefore been positively confirmed by the GSA in de-listing and
re-listing our products that mice products are subject to 508 consideration,
both as standalone items and when included as a part of a system purchase.

      In September 2004 the Company exhibited its products at the Section 508
focused "IDEAS" conference in Washington DC and also officially launched its
Brakemoor(TM) Anti.Fatigue(TM) software product.

      At this time, to the Company's knowledge, there are no other products
listed on the website by other companies that may be considered to be
competitive to the Company's products, be they niche ergonomic computer mice or
mass-market supplier computer mice. The Company is therefore active in the
development of the potential such a listing has for opportunity to sell products
to the U.S. Government either directly or in partnership with other vendors who
sell to the government. It should be understood that this listing is not an
endorsement or recommendation by the U.S. Government, but an information source
for those must meet the compliance with Section 508 law.

COMPETITION

      It is the view of the Company's Board that all suppliers of computer mouse
products are potential competition. Within that principle it can be considered
that there exists direct competition, at this time considered to be companies
marketing other niche or small scale Ergonomic Products, and indirect
competition or mass-market retail competitors. The Company considers competition
to be any other company that can potentially divert sales dollars away from
those that could be spent on our products.

      At this time the Company believes that it holds a unique position in the
marketplace, as it is the only provider of mouse products that do not require
grip to be used and has an associated software product that removes the need to
be clicked. Likewise, no other competitive products, either direct or indirect
in market presence, have Section 508 compliance claims or have been reviewed and
commended for ease of use for persons with arthritis. While this position could
change, it would require competitors to expend significant product development
costs and risk potential infringement of the intellectual property rights of the
Company. These rights are undergoing extension with additional patents having
been filed on both design and utility basis in the U.S. with the intention to
extend these and other applications contemplated into PCT or world-wide patents
and two additional patents in other countries were filed during the first
quarter of 2005.


                                       17
<PAGE>

      The employment of an IPR strategy is considered, but not guaranteed, to
act as a barrier to entry by other providers of computer mice. It is also
considered that the market environment, in regards to the general lack of
recognition by mouse manufacturers of health issues due to mouse product usage,
precludes entries by established organizations who are outside of the directly
competitive ergonomic sector. Their entry would likely raise more risk from the
possible litigious consequence of launching a "health conscious product as, by
inference, other and previous products could be viewed as "not health
conscious". For example, Logitech, the largest mouse and keyboard manufacturer
in the world is promoting a new keyboard product as having a "better design"
that "enhances total comfort experience."

      Logitech stated "The information contained in this document is provided AS
IS without warranty of any kind. Some experts believe that the use of any
keyboard may cause serious injury to your hands, wrists, arms, neck or back. For
important ergonomic information about setting up your computer workspace, please
read our Comfort Guidelines, which can be found at www.logitech.com/comfort."

      We have recently been told (as yet uncorroborated) that major
manufacturers product disclaimers and ergonomic guides are now being offered in
evidence of as proof of correlation between computer usage and fatigue injury.

      While these views and opinions cannot be relied upon as to develop or
maintain an advantage for the Company's in the future, it is considered that the
opportunity for the Company to achieve a market share of 5% of the total new and
replacement U.S. computer mouse market is possible from those impaired or having
some form of disability under this market scenario. It is also the Company's
intent to work with any other who may wish to license our technology.

      Since achieving a Section 508 listing, MATvp membership with Microsoft and
an Arthritis Foundation commendation, the Company has redefined its mission to
be a leading supplier of Universally Designed Assistive and Accessible
Technology computer input device products, an area that is not catered to by
mass-market suppliers. The Company believes that this sector is now on the
fringe of opportunity for supply into a bigger market accessible by retail
distribution. Research conducted on behalf of Microsoft and found at
www.microsoft.com/enable/research under "Key Findings" on the first page states.

      "57% of computer users are likely or very likely to benefit from the use
of accessible technology."

      44% of computer users use some form of accessible technology.

      Users seek solutions to make their computers easier to use, not for
solutions based on their health or disability.


                                       18
<PAGE>

      Making accessibility options easier to discover and use will result in
computers that are easier, more convenient, and more comfortable for computer
users.

      To provide an example of the market kinetic in computer input devices: A
target of a 5% share of what is currently considered the annual new and
replacement U.S. computer mouse market would translate into approximately 2
million mice sales per year, which on a worldwide basis could relate to 10
million pieces per year. This does not contemplate earlier retirement of
computer mice and therefore possible upside due to an awareness of the issues
and our products as a result of the Company's marketing activities.

      At this time there are no other competitors who state they are providers
of a Grip-less or Click-less computer mouse products or have a Section 508
listing or Arthritis Foundation commendation.

      Revenues generated by sales of the AirO2bic mouse and related products,
where possible, will be used to further develop mouse product sales until a cash
flow positive, and profit positive position, can be established at sustainable
levels, thus allowing the Company to access bank financing, and thereby reducing
the extent to which the Company must rely on other sources of external
financing. In the absence of sales, the estimated amount of working capital that
the Company will need, to expand the commercialization and distribution over the
next year of mouse and related products at minimum planned operational levels,
is approximately $500,000. Such amount would be up to $2 million to achieve
accelerated market penetration. There are no anticipated acquisitions of
additional subsidiaries during the next 12-month period.

      It is recognized that revenues do not provide for a sustainable business
at current levels. It is the belief of management that by suitable and adequate
investment a sustainable business can be achieved, and that revenue potential
could be significant upon an expansion of our limited and current marketing
effort.

PRODUCTS

o Introduced in 2002: Quill "grip-less" mouse, which allows the user to mouse
without the need to grip, which is indicated as a contributory factor in those
who develop Functional Impairments such as repetitive strain injury or carpal
tunnel syndrome.

o Introduced in 2003: Nib "click-less" software, which performs a high
percentage of computer mouse button clicks for its users and, subject to its
effective utilization, can aid those with functional impairment due to injury
and is also classified as assistive technology.

o Introduced in 2003: Nib Trial version: This is a 30-day active version of Nib
software which is freely downloaded from the Company's www.aerobicmouse.com
website.


                                       19
<PAGE>

o Introduced in 2004: The Quill Well Mouse mat: Completes the "system approach"
and helps to promote a permanent visual image of the Company's products in the
user's environment.

o Introduced in 2003: The Virtually Hands Free (VHF) mousing system: A bundle of
the Quill Mouse and Nib Software that allows the user to elect not to use most
of his muscles forward of his elbow, but still mouse and interact with his
computer in a conventionally recognized manner.

o Introduced in 2003: Carpal Management Systems I & II: A bundle of the VHF
system and one (System I) or two (System II) FlexTend orthotic gloves that
facilitate the use of a recognized and medically validated therapy exercise
glove with a mousing system that gives relief from the type of activity that
some consider to cause clawing of the hand due to mousing. This is being
marketed jointly with Balance Systems Inc.

o Introduced in 2004: Nib (for PC's) "click-less" software, with Gesture
technology, which enhances the previous version by allowing the selection of
different click types by the movement of the mouse cursor. To Gesture a Right
click the mouse cursor is moved to the right and back, to Gesture a double
click, to the left and back or to highlight or drag, downwards and back.

o Introduced in 2003: Nib (for PC's) Trial version with Gesture Technology: This
is a 30-day active version of Nib software which is freely downloaded from the
Company's www.quillmouse.com website.

o Introduced in 2004: McNib (for Macintosh computer) "click-less" software, with
the Gesture technology described above.

o Introduced in 2004: McNib (for Macintosh) Trial version with Gesture
Technology: This is a 30-day active version of McNib software which is freely
downloaded from the Company's www.quillmouse.com website.

o Introduced in 2004: The McVirtually Hands Free ("McVHF") mousing system: A
bundle of the Quill Mouse and McNib Software with Gesture technology that allows
the user to elect not to use most of his muscles forward of his elbow, but still
mouse and interact with his computer in a conventionally recognized manner.

o In March of 2004, following an independent review by a designer, health care
professionals and persons with arthritis, the Arthritis Foundation in the US
have given an Ease of Use commendation to the Virtually Hands Free Mousing
system and under a licensing agreement the Company is permitted to use the
Arthritis Foundation's Ease of Use logo as a graphic indication of the
commendation. This commendation makes the VHF System the first to be recognized
as being Assistive to persons with a clinical disability.


                                       20
<PAGE>

o Introduced in 2004 "The Clickless Web": This is a development on the Company's
Clickless software. The Clickless software, an application that performs mouse
button clicks for the user, is a computer resident program that requires
installation upon the user's computer following purchase. One element of the
computer resident software is the ability to click links and other functions,
which enables interaction with the Internet, so as to be able to surf it and
store files etc., from it. This new development, as a product called among other
names, "The Clickless Web", takes the "web surfing and interacting" component of
the computer resident software, and, using a webpage application tool called
"Active X", allows these features to be accessed temporarily when a website,
empowered with the feature, is enabled. This type of application known as "tools
on demand" is considered a future direction and application of the Internet in
which there is less requirement for software to be loaded onto a computer, or
hand held device. Such applications as needed, are accessed on demand, and can
be potentially prepaid as a service, or rented for the duration of their use.
This feature could increase the portability of applications and also decrease
memory requirements and hard disk management of Internet connected devices. The
Clickless Web is the Company's first product in this potential growth area.
Prior to its launch and in keeping with its strategy, the Company filed a
world-wide patent application on this technology.

At this time there exist two demonstration sites for this technology:
www.theclicklessweb.com and www.theassistiveweb.com both of which link to an
identical page.

o In November 2004 the E-Quill-AirO2bic product was introduced that provided
customers with a color choice option that in management's opinion matches
current system sales trends of Black or White.

The Assistive Web site will be focused upon generating income from large
corporations such as banks, search engines, web retailers, assistive technology
websites and other high traffic websites. Pricing on this product has yet to be
established and no income from either of these websites can be anticipated as
yet.

Marketing is a dynamic that must take advantage of opportunities when they are
recognized. Consequently the SooToSee and SooToSpeak developments described
below are on hold and will be continued later and incorporated as modules into a
new range of Anti.Fatigue(TM) Software (discussed below).

o Introduced in the third quarter of 2005. Brakemoor(TM) Anti.Fatigue(TM)
Software: We have identified what we believe is a broad market opportunity of
which the SooToSee and SooToSpeak product concepts, subject to market review and
development, will be a part. We believe that many of the issues of prevention of
fatigue related injuries such as Carpal Tunnel Syndrome and Repetitive Strain
Injuries can be minimized, if not eliminated, by adequate work fatigue
management, which includes hardware products such as the AirO2bic Mouse.
Brakemoor(TM) was launched in two program forms, Brakemoor per se, a fully
functional (no advertising) program and BrakemoorShare(TM) a more limited
function program that includes sponsored advertisement during the break session.
Physiological fatigue occurs as a result of metabolic activity that exhausts
substrates and generates toxic byproducts. Brakemoor allows the user to
determine their own fatigue point by awareness and then has a patent pending
process of Re-Aeration, Relaxation and Recovery. Brakemoor uniquely at this time
applies these 3 stages compared to competitive products that typically have an
exercise step only as the break interlude. A Swedish Advisory Group called
Procrid (Prevention of muscle disorders in Operation of Computer Input Devices)
concluded that:


                                       21
<PAGE>

"Breaks from computer work must be frequent and allow for mental relaxation.
Operators must be educated how to achieve full mental and muscular relaxation."

Sponsorship initiatives are underway to enhance the potential for distribution
of the BrakemoorShare(TM) product, which the Company hopes will in turn assist
in the promotion of the Company's Anti.Fatigue(TM) strategy and thereby provide
additional marketing exposure for all the Company's products, both hardware and
software.

Media versions (video and audio) of Brakemoor(TM) are planned for release in the
quarter ending December 31, 2005 to extend the coverage of that product to
personal and portable media players. The Company intends to seek patent
protection for the Brakemoor(TM) process of Re-Aeration, Relaxation and
Recovery.

BABY BOOMER MARKET

      Another market sector that is sought to be addressed is the so called Baby
Boomers, those individuals born between 1946 and 1964, who are numerically large
in number, when considered as a single market and are now experiencing the
gradual deterioration of limbs and sensors as is commensurate with their age. A
survey commissioned by the Microsoft Corp.(www.microsoft.com/enable/research)
suggests that approximately 30 million individuals in the U.S. could benefit
from dexterity enhancing technology such as ours.

      While there is unlikely to be an early and measurable impact upon our
business, as a result of these studies and in anticipation that further study
might confirm these early findings, we believe popular opinion may be influenced
sufficiently that may lead to a changing market environment that could create a
greater computer user health consciousness that ultimately may be beneficial to
us.

MICROSOFT ASSISTIVE TECHNOLOGY VENDOR PROGRAM (MATVP)

      Designer Appliances Inc. was recently enrolled into the MATvp program. The
primary purpose of this program is to decrease the time from development to
market for assistive technology products. Quarterly meetings are held with
Microsoft. During the quarter ended September 30, 2005 we received the Beta 1
version Microsoft's new operating system, project Longhorn, now called Vista.
Initial testing of the operating system on our products showed full hardware
compatibility and the need for only minor adaptations of our products to achieve
functionality with the system.


                                       22
<PAGE>

HEWLETT-PACKARD ASSISTIVE TECHNOLOGY LISTING

      The Hewlett-Packard Company ("HP") lists all of the Company's products in
their Small and Medium Business catalogue under the section of Assistive
Technology.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

      Discussion and analysis of our financial condition and results of
operations are based upon our consolidated financial statements, which have been
prepared in accordance with generally accepted accounting principles in the
United States. The preparation of these consolidated financial statements
requires us to make estimates and judgments that affect the amounts reported in
the consolidated financial statements and the accompanying notes. Item 6.
Management's Discussion and Analysis or Plan of Operation contained in the
Company's Annual Report on Form 10-KSB for the year ended December 31, 2004
describes these critical accounting policies.

      On an on-going basis, we re-evaluate our estimates, including those
related to intangible assets, the allowance for doubtful accounts, equity based
compensation and litigation. We base our estimates on experience and on various
assumptions that are believed to be reasonable under the circumstances, the
results of which form the basis for making judgments about the carrying values
of assets and liabilities that are not readily apparent from other sources.
Actual results may differ from these estimates under different assumptions.

ITEM 3. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

      Disclosure controls and procedures are designed to ensure that information
required to be disclosed in the reports filed or submitted under the Exchange
Act is recorded, processed, summarized and reported, within the time period
specified in the SEC's rules and forms. Disclosure controls and procedures
include, without limitation, controls and procedures designed to ensure that
information required to be disclosed in the reports filed under the Exchange Act
is accumulated and communicated to management, including our President and Chief
Financial Officer, as appropriate, to allow timely decisions regarding required
disclosure. Our Chief Executive Officer and Chief Financial Officer, in
consultation with our other members of management and advisors as appropriate,
carried out an evaluation of the effectiveness of our disclosure controls and
procedures as of the end of the period covered by this quarterly report pursuant
to Rule 15d-15(b) promulgated under the Exchange Act. Based upon that
evaluation, our Chief Executive Officer and our Chief Financial Officer
concluded that our disclosure controls and procedures were effective in alerting
him in a timely manner to information relating to the Company required to be
disclosed in this report.


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<PAGE>

Changes in Internal Control over Financial Reporting

      The term internal control over financial reporting is defined as a process
designed by, or under the supervision of, our President and Principal Financial
Officer, and effected by our board of directors, management and other personnel,
to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles.

      In connection with their review of our financial statements as of March
31, 2005 and for the three months then ended our independent auditors identified
that our accounts receivable were overstated at December 31, 2004. We
subsequently reevaluated our accounts receivable and recorded an adjustment. The
auditors advised us that this adjustment reflected a significant deficiency in
our accounting systems. During the three months ended June 30, 2005 we
implemented an automatic sales order processing system which we believe has
cured the deficiency noted by our auditors.

      There were no other changes in our internal control over financial
reporting identified in connection with our evaluation of these controls as of
the end of the period covered by this report that could have significantly
affected those controls subsequent to the date of the evaluation referred to in
the previous paragraph, including any correction action with regard to
significant deficiencies and material weakness.

                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

      As of the date of this Form 10-QSB, we are not a party to any litigation,
and management has no knowledge of any threatened or pending litigation against
us.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

      During the quarter ended September 30, 2005 we did not sell any equity
securities in transactions that were not registered under the Securities Act of
1933, as amended (the "Securities Act"), except that on July 18, 2005 the
Company issued to one person an aggregate of 200,000 shares of common stock for
a purchase price of $10,000. The issuance was made in a private placement
transaction under an exemption from the registration requirements of the
Securities Act afforded by Section 4(2) of the Securities Act.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.


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<PAGE>

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

      The Company held a special meeting of stockholders on September 13, 2005.
At the meeting the stockholders of the Company voted to amend the Certificate of
Incorporation of the Company to increase the authorized number of shares of
common stock from 100 million to 250 million. The result of the vote was:

For                        Against                   Abstain

65,912,231                 2,699,737                 136,000

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

31.1 Certification of the Chief Executive Officer and Principal Financial
Officer of Torbay Holdings, Inc. pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.

32.1 Certification of the Chief Executive Officer and Principal Financial
Officer of Torbay Holdings, Inc. pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.


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<PAGE>

                                   SIGNATURES

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

                                                           TORBAY HOLDINGS, INC.

                                                        By: William Thomas Large
                                    --------------------------------------------
                                                      Name: William Thomas Large
                                    Title: President and Chief Executive Officer
                  (Principal Executive Officer and Principal Accounting Officer)

Date: November 14, 2005


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