UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


Washington,
      D.C. 20549











**FORM
      10-QSB**





Quarterly
      Report Pursuant to Section 13 or 15(d)


of
      the
      Securities Exchange Act of 1934





For
      the
      Quarter Period Ended March
      31,
      2007





Commission
      File No. 000-29462





**American
      Basketball Association, Inc**


(Exact
      name of Registrant as specified in its Charter)





Utah
            87-0376691(State
                or jurisdiction of incorporation or organization)
            (IRS
                Employer Identification No.)





9421
                Holliday Road Indianapolis, IN
            46201(Address
                of Principal Executive Office)
            (Zip
                Code)





Registrant’s
      telephone number, including area code:   (317)
      844-7502





Former
      name, former address and former fiscal year, if changed since last
      report :




Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for a 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
o





The
      number of shares issued and outstanding of the Registrant’s Common Stock, no par
      value, as of May 14, 2007 was **** 26,597,017 .












**PART
      I - FINANCIAL INFORMATION**








**Item
                1:****Financial
                Statements (Unaudited)**Condensed
                Consolidated Balance Sheet
            F-1Condensed
                Consolidated Statements of Operations
            F-2Condensed
                Consolidated Statements of Operations Three Months
            F-3Notes
                to the Condensed Consolidated Financial Statements
            F4-F19










**AMERICAN
        BASKETBALL ASSOCAITION, INC. AND SUBSIDIARY**
 **CONDENSED
        CONSOLIDATED BALANCE SHEET**
 (UNAUDITED)
 
 March
                  31, 2007ASSETSCURRENT
                  ASSETSCash
              
              $
              500,279Prepaid
                  expenses and other current assets
              
              
              95,400Total
                  Current Assets
              
              
              595,679PROPERTY
                  AND EQUIPMENT,Net
              
              
              5,504TOTAL
                  ASSETS
              
              $
              601,183LIABILITIES
                  AND STOCKHOLDERS' DEFICIENCYCURRENT
                  LIABILITIESAccounts
                  payable and accrued expenses
              
              
              538,025TOTAL
                  CURRENT LIABILITIES
              
              
              538,025CLAIMS
                  AND CONTINGECIES
              
              
              1,045,331STOCKHOLDERS'
                  DEFICIENCYCommon
                  stock - no par value; 50,000,000 sharesauthorized;
                  26,597,017 shares issued and outstanding
              
              
              1,000Additional
                  paid in capital
              
              
              19,641,466Unearned
                  consulting fees
              
              
              (480,000
              )Accumulated
                  deficit
              
              
              (20,144,638
              )TOTAL
                  STOCKHOLDERS' DEFICIENCY
              
              
              (982,173
              )TOTAL
                  LIABILITIES ANDSTOCKHOLDERS'
                  DEFICIENCY
              
              $
              601,183




The
      Accompanying Notes Are An Integral Part Of These Condensed Consolidated
      Financial Statements ****




**F-1**




**AMERICAN
        BASKETBALL ASSOCIATION, INC.**
 **CONDENSED
        CONSOLIDATED STATEMENT OF OPERATIONS**
 (UNAUDITED)
 
 For
                  the Period EndedMarch
                  31,2007
              
              2006REVENUE
              
              $
              56,145
              
              $
              116,552COSTS
                  AND EXPENSESCost
                  of revenue
              
              
              4,800
              
              
              —Compensatory
                  element of stock transactions
              
              
              135,000
              
              
              —Depreciation
                  and amortization
              
              
              389
              
              
              389Selling
                  and administrative expenses
              
              
              635,973
              
              
              255,046TOTAL
                  COSTS AND EXPENSES
              
              
              776,162
              
              
              255,435OPERATING
                  LOSS
              
              
              (720,017
              )
              
              (138,883
              )OTHER
                  INCOMEOther
                  income
              
              
              64
              
              
              318TOTAL
                  OTHER INCOME
              
              
              64
              
              
              318NET
                  LOSS
              
              $
              (719,953
              )
              $
              (138,565
              )Basic
                  and Diluted Net Loss Per Share
              
              $
              (0.03
              )
              $
              (0.01
              )Weighted
                  Average Number of CommonShares
                  Outstanding - Basic and Diluted
              
              
              26,479,517
              
              
              14,862,703


The
      Accompanying Notes Are An Integral Part Of These Condensed Consolidated
      Financial Statements ****




**F-2**




**AMERICAN
                  BASKETBALL ASSOCIATION, INC.****CONDENSED
                  CONSOLIDATED STATEMENT OF CASH FLOWS**
                (UNAUDITED)
  For
                  the Period EndedMarch
                  312007
              
              2006CASH
                  FLOWS FROM OPERATING ACTIVITIESNet
                  loss
              
              $
              (719,953
              )
              $
              (138,565
              )Adjustments
                  to reconcile net loss to netcash
                  used in operating activities:Depreciation
                  and amortization
              
              
              389
              
              
              389Compensatory
                  element of stock transactions
              
              
              135,000
              
              
              —Changes
                  in operating assets and liabilities:Accrued
                  expenses and other current liabilities
              
              
              (113,724
              )
              
              113,149TOTAL
                  ADJUSTMENTS
              
              
              21,666
              
              
              113,538NET
                  CASH USED IN OPERATINGACTIVITIES
              
              
              (698,288
              )
              
              (25,027
              )NET
                  DECREASE IN CASH
              
              $
              (698,288
              )
              $
              (25,027
              )CASH
                  -Beginning
              
              
              1,198,567
              
              
              21,159CASH
                  -Ending
              
              $
              500,279
              
              $
              (3,868
              )




The
      Accompanying Notes Are An Integral Part Of These Condensed Consolidated
      Financial Statements ****





**F-3**




**AMERICAN
      BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**




**(formerly
      Souvall-Page Inc.)**




**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**





**Note
      1 - Nature of Operations and Summary of Significant Accounting
      Policies:**





**Organization
      and Nature of Operations**





American
      Basketball Association, Inc., is an Indiana corporation which was formed on
      April 21, 2004, for the purpose of providing basketball and sports entertainment
      for people of all ages. The league currently has over 47 teams located in the
      United States of America (USA), Canada, and Mexico that are set to begin play
      for the 2007-2008 basketball season.





Basketball
      operations under the American Basketball Association banner were revived in
      the
      year 2000 after approximately 25 years of inactivity following the original
      American Basketball Association league’s merger with the National Basketball
      Association. American Basketball Association league play was operated by
      different management and a distinct entity during the 2000-2001 and 2001-2002
      basketball seasons. League play was suspended during the 2002-2003 season.
      American Basketball Association league play resumed for the 2003-2004 season.
      The Company took over league operations for the 2004-2005, 2005-2006, 2006-2007
      seasons as well as the upcoming 2007-2008 season. Prior entities which operated
      the league have either been legally dissolved, administratively dissolved,
      or
      have ceased operations as of the inception date, and have no relationship to
      the
      Company.





Concurrent
      with the closing of the Share Purchase that is described below, Souvall-Page
      and
      Company, Inc., a Utah corporation (the “Registrant” or “Company”), ABA
      Acquisition Corp., Inc., an Indiana corporation and a subsidiary of Registrant
      (the “Sub”), and the ABA executed and delivered that certain Agreement and Plan
      of Merger (the “Merger Agreement”), whereby (i) 22,518,153 issued and
      outstanding shares of common stock of the ABA, constituting all of its issued
      and outstanding shares, were exchanged, on a 1:1 share ratio for shares of
      the
      Company (inclusive of shares issued upon conversion of the Bridge Loans, as
      defined below), (ii) each of the Purchaser Warrants (defined below), and (iii)
      each of the ABA’s other extant warrants giving the holders thereof the right to
      purchase in the aggregate 1,000,000 shares of common stock, were exchanged,
      respectively, for a warrant to acquire one share of the Company’s common stock
      (the shares and warrants being issued pursuant to the preceding clauses (i)
      -
      (iii) being, the “Exchanged Shares” and “Exchanged Warrants”, respectively and
      the exchange transaction being the “Share Exchange”). Each of the Placement
      Warrants were exchanged for a warrant to purchase units, each of which allows
      the holder to acquire two shares of the Company’s common stock and one warrant
      to acquire a share of the Company’s common stock (collectively the “Exchanged
      Placement Warrants”). Holders of the Exchanged Shares will be entitled to
      receive dividends, if any, that are paid on the Company’s common stock. The
      Exchanged Warrants and the Exchanged Placement Warrants are subject to
      adjustment or modification in the event of a stock split or other change to
      the
      Company’s capital structure so as to maintain the initial share ratio between or
      among the Exchanged Shares, the Exchanged Warrants, the Exchanged Placement
      Warrants and the Company’s common shares. The Company believes that the
      securities issued in connection with the merger were exempt from registration
      requirements pursuant to the provisions or standards of Regulation D promulgated
      under the Securities Act of 1933, as amended.










**AMERICAN
      BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**




**(formerly
      Souvall-Page Inc.)**




**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**





**Note
      1 - Nature of Operations and Summary of Significant Accounting Policies
      (Continued):**




In
      connection with the merger, the Company paid $300,000 to David Merrell a former
      officer, director and principal beneficial owner of the Company’s common stock,
      and also issued to him 300,000 shares of common stock in consideration for
      which
      David Merrell agreed to indemnify the Company for and against liabilities of
      and
      claims against the Company existing as of and through the date of the merger.
      Effective December 21, 2006, Chiricahua Investments, LLC, a company controlled
      by David Merrell, returned 26,400,000 shares to the Company and those shares
      were canceled pursuant to the terms of the Merger Agreement. All other existing
      shareholders of Souvall-Page retained 2,723,864 shares of the Company’s common
      stock.





In
      connection with the merger, Joseph F. Newman and Richard P. Tinkham agreed
      to
      indemnify the ABA for and against certain liabilities of and claims against
      the
      ABA existing as of and through the date of the Merger. Mr. Newman and Mr.
      Tinkham have each agreed to deposit 500,000 shares of common stock into an
      escrow as further security for this indemnity agreement.





**Financial
      Statements**





The
      financial statements and notes are representations of the Company’s management,
      who is responsible for their integrity and objectivity. The accounting policies
      conform to accounting principles generally accepted in the United States of
      America and have been consistently applied in the preparation of the financial
      statements.





The
      accompanying financial statements have been prepared using generally accepted
      accounting principles applicable to a going concern which contemplates the
      realization of assets and liquidation of liabilities in the normal course of
      business. As reported in the financial statements, the Company has incurred
      losses of approximately $20,144,638 from inception of the Company through March
      31, 2007, and has negative cash flows from operations. The Company’s
      stockholders’ deficiency at March 31, 2007 was $982,173 and its current
      liabilities and claims and contingencies exceeded its current assets by
      $987,677. These factors combined, raise substantial doubt about the Company’s
      ability to continue as a going concern. Management’s plans to address and
      alleviate these concerns are as follows:





The
      Company’s management continues to develop a strategy of exploring all options
      available to it so that it can develop successful operations and have sufficient
      funds to be able to operate over the next twelve months. As a part of this
      plan,
      management is currently in negotiations with their target industries’ key
      players to develop additional business opportunities. In addition, management
      is
      exploring options in order to raise additional operating capital through debt
      and/or equity financing. No assurance can be given that funds will be available,
      or, if available, that it will be on terms deemed satisfactory to
      management.





The
      ability of the Company to continue as a going concern is dependent upon its
      ability to successfully accomplish the plans described in the preceding
      paragraph and eventually attain profitable operations. The accompanying
      financial statements do not include any adjustments relating to the
      recoverability and classification of asset carrying amounts or the amount and
      classification of liabilities that might result from the outcome of these
      uncertainties.










**AMERICAN
      BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**




**(formerly
      Souvall-Page Inc.)**




**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**




**Note
      1 - Nature of Operations and Summary of Significant Accounting Policies
      (Continued):**





**Use
      of Estimates and Assumptions**





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 assets and
      liabilities and disclosure of contingent assets and liabilities at the date
      of
      the financial statements and the reported amounts of revenues and expenses
      during the reporting period. Actual results could differ from those
      estimates.





**Cash
      and Cash Equivalents**





The
      Company considers all highly liquid instruments that are purchased within three
      months or less of an instruments maturity date to be cash
      equivalents.





**Accounts
      Receivable**





The
      Company carries its accounts receivable at invoiced amounts less an allowance
      for doubtful accounts. On a periodic basis, the Company evaluates its accounts
      receivable and establishes an allowance for doubtful accounts, based on history
      of past write-offs and collections and current credit conditions. The Company’s
      policy is not to accrue interest on past due trade receivables. Management
      has
      established an allowance for doubtful accounts of $119,500 as of March 31,
      2007
      which reduced the net accounts receivable balance to $95,400 as of March 31,
      2007. The Company carried $0 of accounts receivable at March 31, 2006 net of
      an
      allowance for doubtful accounts.





**Property
      and Equipment**





Property
      and equipment are recorded at cost and includes expenditures for new additions
      and those, which substantially increase the useful lives of existing assets.
      Depreciation is provided using the straight-line method over the estimated
      useful lives of the assets, which is generally five years. Expenditures for
      repairs or maintenance are charged to expense as incurred. The cost of property
      or equipment retired or otherwise disposed of and the related accumulated
      depreciation are removed from the accounts in the year of disposal with the
      resulting gain or loss reflected in earnings.










**AMERICAN
      BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**




**(formerly
      Souvall-Page Inc.)**




**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**




**Note
      1 - Nature of Operations and Summary of Significant Accounting Policies
      (Continued):**





**New
      Accounting Pronouncements**





In
      June
      2006, the Financial Accounting Standards Board (“FASB”) issued FASB
      Interpretation (“FIN”) No. 48, *“Accounting
      for Uncertainty in Income Taxes”* ,
      which
      clarifies the accounting for uncertainty in income taxes recognized in financial
      statements in accordance with Statement No. 109, *“Accounting
      for Income Taxes.”* This
      Interpretation prescribes a recognition threshold and measurement attribute
      for
      the financial statement recognition and measurement of a tax position taken
      or
      expected to be taken in a tax return. The Interpretation requires that the
      Company recognize in the financial statements the impact of a tax position
      if
      that position is more likely than not of being sustained on audit, based on
      the
      technical merits of the position. The Interpretation also provides guidance
      on
      derecognition, classification, interest and penalties, accounting in interim
      periods, disclosure and transition. FIN 48 is effective for fiscal years
      beginning after December 15, 2006. The Company is currently evaluating the
      impact this interpretation will have on its financial statements.





In
      March 2006, the FASB issued FASB Statement No. 156, “Accounting for
      Servicing of Financial Assets.” ** Statement
      156 amends FASB Statement No. 140, “Accounting for Transfers and Servicing
      of Financial Assets and Extinguishments of Liabilities,” and requires all
      separately recognized servicing assets and servicing liabilities to be initially
      measured at fair value, if practicable, and permits an entity to subsequently
      measure those servicing assets and servicing liabilities at fair value. This
      statement is effective for fiscal years beginning after September 15, 2006.
      The Company does not expect this statement to have a material impact on its
      financial position, results of operations or cash flows.





In
      February 2006, the FASB issued SFAS No. 155, “Accounting for Certain
      Hybrid Financial Instruments — An Amendment of FASB Statements No. 133
      and 140.” SFAS No. 155 provides entities with relief from having to
      separately determine the fair value of an embedded derivative that would
      otherwise be required to be bifurcated from its host contract in accordance
      with
      SFAS No. 133. SFAS No. 155 allows an entity to make an irrevocable
      election to measure such a hybrid financial instrument at fair value in its
      entirety, with changes in fair value recognized in earnings. SFAS No. 155
      is effective for all financial instruments acquired, issued or subject to a
      remeasurement event occurring after the beginning of an entity’s first fiscal
      year that begins after September 15, 2006. The Company is currently
      evaluating the impact this interpretation will have on its financial
      statements.




In
      May
      2005, the FASB issued Statement SFAS No. 154 “Accounting Changes and Error
      Corrections” (SFAS 154) which supersedes APB Opinion No. 20, Accounting Changes”
and SFAS No. 3, “Reporting Accounting Changes in Interim Financial Statements”.
      SFAS 154 provides guidance on the accounting for and reporting of accounting
      changes and error corrections. It establishes, unless impractical, retrospective
      application as the required method for reporting a change in accounting
      principle in the absence of explicit transition requirements specific to the
      newly adopted accounting principle. The correction of an error in previously
      issued financial statements is not an accounting change. However, the reporting
      of an error correction involves adjustments to previously issued financial
      statements similar to those generally applicable to reporting an accounting
      change retroactively. Therefore, the reporting of a correction of an error
      by
      restating previously issued financial statements is also addressed by this
      Statement. SFAS 154 is effective for accounting changes and corrections of
      errors made in fiscal years beginning
      after December 15, 2005. The Company does not believe this standard has a
      material impact on its financial statements.







**AMERICAN
      BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**




**(formerly
      Souvall-Page Inc.)**




**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**





**Note
      1 - Nature of Operations and Summary of Significant Accounting Policies
      (Continued):**





In
      December 2004, the FASB issued Statement No. 123R (SFAS 123R), “Share-Based
      Payment”. This statement is a revision of SFAS 123, “Accounting for Stock-Based
      Compensation” (SFAS 123), and supersedes Accounting Principles Board Opinion No.
      25, “Accounting for Stock Issued to Employees” (APB 25). SFAS 123R focuses
      primarily on accounting for transactions in which an entity obtains employee
      services in share-based payment transactions. The Statement required entities
      to
      recognize compensation
      expense for awards of equity instruments to employees based on the grant-date
      fair value of those awards (with limited exceptions). SFAS 123R also requires
      the benefits of tax deductions in excess of recognized compensation expense
      to
      be reported as a financing cash flow, rather than as an operating cash flow
      as
      prescribed under the prior accounting rules. On December 31, 2006, the Company
      adopted the provisions of SFAS 123R using the modified prospective method,
      the
      results of which did not have a material impact on its financial position,
      results of operations or cash flows.





**Revenue
      Recognition**





Revenues
      are expected to be generated from a number of sources including national
      sponsorships, market reservation fees, broadcasting revenue and basketball
      and
      other merchandise sales. It is expected that sponsorship and broadcasting
      revenue will be recognized over the period of the agreements; market reservation
      fees will be recognized when receipt is assured; and merchandise sales less
      returns and allowances will generally be recognized when title and risk of
      product loss is transferred to the buyer. Such risk of product loss is expected
      to generally coincide with the time of shipment.





**Advertising**





The
      Company charges advertising costs to expense as incurred. Advertising expenses
      amounted to $0 for the period ended March 31, 2007, and $0 for the period ended
      March 31, 2006.










**AMERICAN
      BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**




**(formerly
      Souvall-Page Inc.)**




**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**





**Note
      1 - Nature of Operations and Summary of Significant Accounting Policies
      (Continued):**




**Income
      Taxes** ****




Deferred
      tax assets are recognized for taxable temporary differences, tax credit and
      net
      operating loss carryforwards. These assets are reduced by a valuation allowance,
      which is established when it is more likely than not that some portion or all
      of
      the deferred tax assets will not be realized. In 2006, based on this evaluation,
      the Company recorded a 100% valuation allowance on the consolidated balance
      sheet for its deferred tax assets.  In addition, management is required to
      estimate taxable income for future years by taxing jurisdictions and to consider
      this when making its judgment to determine whether or not to record a valuation
      allowance for part or all of a deferred tax asset. A one percent change in
      the
      Company’s overall statutory tax rate for 2006 would not have a material effect
      in the carrying value of the net deferred tax assets or
      liabilities.




The
      Company may have future operations in multiple taxing jurisdictions and would
      be
      subject to audit in these jurisdictions. Tax audits by their nature are often
      complex and can require several years to resolve. Accruals of tax contingencies
      require management to make estimates and judgments with respect to the ultimate
      outcome of tax audits. Actual results could vary from these
      estimates.





**Earnings
      per Share**





Basic
      earnings (loss) per share is computed by dividing income (loss) available to
      common stockholders by the weighted average number of common shares available.
      Diluted earnings (loss) per share is computed similar to basic earnings (loss)
      per share except that the denominator is increased to include the number of
      additional common shares that would have been outstanding if the potential
      common shares had been issued and if the additional common shares were dilutive.
      At March 31, 2007 and 2006, all common stock equivalents were
      anti-dilutive.








**AMERICAN
        BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**
  **(formerly
        Souvall-Page Inc.)**
  **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
  **Note
        2 - Property and Equipment:**
 
 Property
        and equipment consist of the following as of March 31, 2007 and
        2006:
  **2007**
                
                **2006**Computer
                    equipment
                
                $
                7,786
                
                $
                7,786Less
                    accumulated depreciation
                
                
                2,282
                
                
                724$
                5,504
                
                $
                7,062
 
 The
        company recorded depreciation expenses of $389 for the period ending March
        31,
        2007 and 2006.
 
 **Note
        3 - Accrued Compensation and Conversion to Common Stock:**
 
 The
        Company has recorded accrued compensation of $262,499 as of March 31, 2007
        and
        $125,000 as of March 31, 2006, respectively.
  **Note
        4 - Stockholders** **’** **Equity:**
 
 The
        following summarizes the Company ’ s
        shares
        of common stock as of March 31, 2007 and 2006:
  **2007**
                
                **2006**Authorized
                
                
                *
                
                
                50,000,000
                
                
                30,000,000Issued
                
                
                *
                
                
                26,597,017
                
                
                14,862,703Outstanding
                
                
                *
                
                
                26,597,017
                
                
                14,862,703
  The
        Company has one class of capital stock which is no par value common stock
        with
        equal voting rights *.*
 
 Issuance
        of Common Stock prior to recapitalization on December 22, 2006:
 
 In
        April
        2004, the Company issued 1,000 shares of its no par value common stock to
        its
        co-founders in exchange for services rendered. In May 2005, the Company issued
        each co-founder an additional 7,175,380 shares of common stock for services
        rendered. In August 2005, 510,943 shares were issued to unrelated investors
        for
        convertible debentures and accrued interest.
  
  **AMERICAN
        BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**
  **(formerly
        Souvall-Page Inc.)**
  **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
  **Note
        4 - Stockholders** **’** **Equity - continued**
 
 Issuance
        of Common Stock in conjunction with recapitalization on December 22,
        2006:
 
 As
        discussed in Note 1, the Company entered into a merger agreement on December
        21,
        2006. The merger agreement forced the Company into a recapitalization on
        or
        around this date. The Company issued shares of its common stock to sellers,
        investors and employees as disclosed in the Share Purchase Agreement (SPA)
        included in the merger agreement as disclosed below.
 
 The
        Company received a $400,000 bridge loan from investors included in the SPA
        to
        assist the Company with certain offering related costs in preparation of
        the
        merger agreement. The proceeds were received by the Company at various dates
        ranging from June 2006 through September 2006. On December 22, 2006, the
        Company
        converted the bridge loan, discount and accrued interest to 920,909 shares
        of
        common stock. The common stock was valued at the offering price included
        in the
        SPA of $0.60 per common share.
 
 On
        December 22, 2006, the Company issued 2,714,541 shares of common stock to
        consultants for services performed related to the SPA and key employees expected
        to be associated with the Company ’ s
        future
        league operations. The common stock was valued at the offering price included
        in
        the SPA of $0.60 per common share. The expense is included as a component
        of
        Compensatory Element of Stock Transactions in the Company ’ s
        Consolidated Statement of Operations for the year ended December 31, 2006.
 
 On
        December 22, 2006, the Company issued 4,050,000 shares of common stock to
        investors for cash proceeds of $2,010,000, net of direct offering costs of
        $420,000. The common stock was valued at the offering price included in the
        SPA
        of $0.60 per common share.
 
 On
        December 22, 2006, the Company issued 2,723,864 shares of stock to the seller
        in
        conjunction with the merger agreement. The agreement required a 1:1 conversion
        of 2,723,864 shares of seller stock in exchange for the Company ’ s
        common
        stock.
 
 On
        December 22, 2006 the Company issued 300,000 shares to a seller ’ s
        former
        officer and director in consideration for items described in Note 1. The
        common
        stock was valued at the offering price included in the SPA of $0.60 per common
        share.
 
 
  **AMERICAN
        BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**
  **(formerly
        Souvall-Page Inc.)**
  **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
  **Note
        5 - Concentrations of Credit Risk:**
 
 Financial
        instruments, which potentially subject the Company to concentration of credit
        risk, consist primarily of cash and cash equivalents. The Company maintains
        its
        cash and cash equivalents with high credit quality institutions which, at
        times,
        may exceed federally insured limits. Accounts are guaranteed by the Federal
        Deposit Insurance Corporation (FDIC) up to $100,000. The Company has not
        experienced any losses in such accounts and does not believe it is exposed
        to
        any significant credit risk on cash and cash equivalents, which may, at times,
        exceed federally insured limits. The Company routinely assesses the financial
        strength of its stockholders and employees and, as a consequence, believes
        that
        its receivable credit risk exposure is limited.
 
 **Note
        6 - Licensing Agreement:**
 
 The
        commercial use of the trademarks “ ABA ” and “ American
        Basketball Association ” by the
        Company, alone or in combination with other words, phrases and design, is
        governed by a license agreement with NBA Properties, Inc. (NBA).  The scope
        of the license covers services and products as well as manufacturing,
        distributing and selling practices.  The license contains product quality
        language. Under trademark law, if a trademark owner issues a license without
        retaining the right to control product quality, it risks losing its ownership
        rights to the trademark.  Quality Approval provisions require the licensee
        to cause licensed Services and licensed
 
 Products
        to meet and conform to high standards of style, quality and appearance. 
Licensee ’ s
        use of
        the Licensed Marks are deemed approved.  Notwithstanding, NBA has
        discretion, using good faith, to revoke its approval of particular uses of
        the
        Licensed Mark that relate to gambling, adult content, or any other subject
        matter that would damage or reflect unfavorably upon the NBA, any of its
        member
        teams, or the Original ABA; violate provisions of the License; or misuse,
        mutilate, dilute or otherwise tarnish the Licensed Mark. The right to use
        of the
        marks under the license discontinues on expiration or termination of the
        agreement except for sell off of inventory.  The agreement can end if the
        league ceases operations, is no longer owned or operated by a licensee, or
        if
        product quality concerns are not corrected after notice.  Management
        believes the Company has complied with the requirements and conditions of
        the
        license, intends to meet its requirements and conditions and has received
        no
        notice otherwise.  All royalties due under the license have been
        satisfied.
 
 
  **AMERICAN
        BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**
  **(formerly
        Souvall-Page Inc.)**
  **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
  **Note
        7 - Other Significant Agreements:**
 
 The
        Company entered into a sponsorship agreement with a manufacturer of basketballs
        ( “ Manufacturer ” )
        whereby
        the Company would receive minimum royalties of $10,000 as well as other
        royalties based on sales of basketballs. In addition, Manufacturer is to
        provide
        a set number of basketballs to the teams and league. In exchange, the
        Manufacturer receives certain marketing and promotional opportunities as
        well as
        tickets to basketball games for teams included in the league.
 
 Management
        represents that other agreements exist and were executed for the year ended
        March 31, 2007 and 2006. However, management believes the financial effects
        from
        the agreements are immaterial to the financial statements as a whole.
 
 
  **AMERICAN
        BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**
  **(formerly
        Souvall-Page Inc.)**
  **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
  **Note
        8 - Commitments and Contingencies:**
 
 Various
        entities have been created by current and predecessor members of management
        since the year 2000. These entities include ABA, LLC, ABA Bounce, ABA Founders
        & Properties, LLC, ABA League, LLC, and ABA Operations, LLC. The
        Company ’ s
        independent legal counsel and management represent such entities either cease
        to
        exist, or are administratively dissolved at December 31, 2005. No material
        commitments or contingencies exist from these entities, not already accrued,
        that would effect the financial position, operations, and cash flows of the
        Company for the period ended March 31, 2007 and for the period ended March
        31,
        2006.
 
 The
        Company is involved with a variety of lawsuits for the periods ended March
        31,
        2007. Independent legal counsel has provided the Company with a summary of
        estimated claims and contingencies and believe certain cases will result
        in an
        unfavorable outcome. As a result the Company has included $1,045,331 of
        estimated accrued contingencies in its consolidated balance sheet at March
        31,
        2007
 
 On
        January 9, 2007, American Basketball Association, Inc. (the “ Company ” )
        entered
        into a Consulting agreement with Cioffi Business Management Services. The
        Consulting Agreement is for an initial term of twelve (12) months. The Company
        has agreed to compensate the consultant $102,000 as well as issue the Consultant
        550,000 shares of its common stock for the initial 12 month term. During
        the
        term of the Consulting Agreement, the principal shareholder of the consultant,
        Mr. Darren Cioffi, will act as the Company ’ s
        Chief
        Financial Officer.
 
 The
        Company has secured the marketing and other product consulting services of
        Meriwether Capital Group of which David Howitt, a director of the Company,
        is a
        controlling person. On January 3, 2007 The Meriwether Group Inc., entered
        into a
        consulting agreement with the ABA that is dated as of the agreement ’ s
        effective date of January 15, 2007. The agreement has a term of 24 months.
        Meriwether agreed to assist the ABA in developing and implementing a strategic
        sponsorship and licensing program for key merchandising categories that include
        uniforms, footwear, apparel, accessories, sport beverage, memorabilia and
        other
        agreed to categories. Meriwether also agreed to use its relationships with
        key
        brand managers and executives of internationally known sports, lifestyle,
        and
        food and beverage companies to assist the ABA in developing strategic licensing
        /supplier agreements and relationships. The ABA agreed to pay
        Meriwether:
  ·
                An
                    initial payment of $12,500,
 
  **AMERICAN
        BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**
  **(formerly
        Souvall-Page Inc.)**
  **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
  **Note
        8 - Commitments and Contingencies: continued**
  ·
              A
                  retainer of $2,500 per month,
 
 ·
              A
                  $10,000 bonus for each major licensing/sponsorship transaction
                  secured by
                  Meriwether and deemed earned after the ABA has derived at least
                  $50,000 or
                  more in revenue over its term,
 
 ·
              A
                  4% royalty from all revenue earned from any transaction that Meriwether
                  brings to the ABA,
 
 ·
              An
                  award of 225,000 shares of common stock as a performance incentive,
                  and
 
 ·
              All
                  reasonable and approved travel and out of pocket expenses incurred
                  by
                  Meriwether in providing its services to the
                  ABA.
  **Note
        9 - Legal proceedings:**
  In
        a case
        titled *Troy
        Fisher and 3 Ball Management, LLC. vs. American Basketball Association, RAG,
        LLC, Richardson Consulting Group, Ricardo Richardson, Reginald Jones, Robert
        Blackwell, and  Indiana Alley Cats* pending
        in the Marion County Superior Court, Indiana under Cause No. 
49D120511CT043427, the Plaintiffs seek to recover alleged damages from the
        Company after their team was suspended from the League for failure to follow
        the
        ABA Team Operations Manual. The
        Company intends to defend this litigation aggressively, expects that the
        courts
        will concur with the Company ’ s
        views
        that these actions and claims are without merit and currently
        believes that the outcome, other than costs of suit, will not be materially
        adverse to the ABA. Nevertheless, an adverse judgment on these actions could
        materially harm the business of the
        Company. No assurance can be given that the Company ’ s
        position will be upheld or will prove to be correct over the course of
        litigation.
 
 *American
        Arbitration Association case: 52 180 E 00612 06 Jaren W. Jackson v. The American
        Basketball Association, LLC, the Philadelphia Fusion, Wayne Butler and Jeffrey
        Wilson.* In
        November 2006 Jaren Jackson commenced arbitration against the Company for
        unpaid
        wages of
        about
        $15,000 owed by
        the Philadelphia Fusion, one of the teams of the ABA that played during
        the 2004 ABA season . 
        The arbitration is to be held in Indianapolis, Indiana but no date has been
        set.
 
 
  **AMERICAN
        BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**
  **(formerly
        Souvall-Page Inc.)**
  **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
  **Note
        9 - Legal proceedings - continued**
 
 *Steven
        Jaloza and Salvatore Fradella v. Joseph Newman, Richard P. Tinkham, Jr.,
        and the
        American Basketball Association, Inc* .,
        pending in the Marion County Circuit Court under Cause
        No.:49C010611PL0046089.  In this action, filed in November
        2006, plaintiffs assert that Joseph Newman and Richard Tinkham breached
        fiduciary duties owed to them under the Operating Agreement of a separate
        entity, ABA Founders and Properties, LLC. The Company is not a party to the
        Operating Agreement. Plaintiffs
        seek to add the Company as a defendant as an alter ego of Newman and
        Tinkham.  Hearing
        on the Company ’ s
        Motion
        to Dismiss is set for February 5, 2007.  This motion by the Company is
        based on an action pending in the Marion County Superior Court, under Cause
        No.
        49D010608PL033078, filed by the same plaintiffs, that also asserts breach
        of
        fiduciary duties owed by Joseph Newman to them under the Operating Agreement
        of
        ABA Founders and Properties, LLC.  In that action the Company, after
        hearing, was found not subject to the remedies sought in that
        action. The
        Company intends to defend this litigation aggressively, expects that the
        courts
        will concur with the Company ’ s
        views
        that these actions and claims are without merit and currently believes that
        the
        outcome, other than costs of suit, will not be materially adverse to the
        ABA.
        Nevertheless, an adverse judgment on these actions could materially harm
        the
        business of the Company. No assurance can be given that the Company ’ s
        position will be upheld or will prove to be correct over the course of
        litigation.
  *Steven
        Jaloza and Salvatore Fradella vs. ABA Founders & Properties, LLC, ABA Sports
        and Entertainment, Inc., a/k/a ABA Enterprises, Inc., ABA International,
        Inc.,
        ABA League, LLC, ABA Operations, LLC, ABA Properties, LLC, ABA Rental, Inc.
        and
        ABA Services, Inc* .
        In the
        Marion Superior Court, Room No 5, Indiana. Cause No. 49D010608PL033078. Steven
        Jaloza ( “ Jaloza ” )
        and
        Salvatore Fradella ( “ Fradella ” )
        seek
        damages from ABA Founders & Properties, LLC, ABA Sports and Entertainment,
        Inc., a/k/a ABA Enterprises, Inc., ABA International, Inc., ABA League, LLC,
        ABA
        Operations, LLC, ABA Properties, LLC, ABA Rental, Inc., and ABA Services,
        Inc.
        for alleged breach of fiduciary duties allegedly arising under the Operating
        agreement of ABA Founders & Properties, LLC. The suit was filed in August,
        2006. A hearing for prejudgment attachment and to appoint a receiver over
        ABA
        Indiana was held on October 30, 2006. Prejudgment attachment was not granted
        and
        a receiver was not appointed. Neither ABA Utah nor ABA Indiana is a party
        to the
        action. The Plaintiffs have not pursued the action in this court since the
        date
        of the receivership hearing. This matter is covered by the Indemnification
        Agreement. The ABA intends to contest the case vigorously. The potential
        for an
        unfavorable outcome is not significant. The plaintiffs did not appeal the
        denial
        of the request for prejudgment attachment or the decision not to appoint
        a
        receiver. Jaloza and Fradella disassociated from ABA Founders & Properties,
        LLC in June, 2001. The Operating Agreement of ABA Founders & Properties, LLC
        allowed Newman and Tinkham to engage in or possess interests in other business
        ventures of every kind and description for their own account.
 
 
  **AMERICAN
        BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**
  **(formerly
        Souvall-Page Inc.)**
  **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
  **Note
        9 - Legal proceedings - continued**
 
 *Credentials
        Plus, LLC v. Calderson* ,
        230 F.
        Supp.2d (N.D. Ind 2002) holds that fiduciary duties of members of an Indiana
        LLC
        are governed by I.C. 23-18-4-2(b) and can be eliminated by provisions in
        the
        Operating Agreement. The action should be disposed by summary judgment but
        has
        been held open in view of the matter pending in the Marion County Circuit
        Court
        under Cause No.:49C010611PL0046089.
 
 *Ricardo
        Richardson and Richardson Consulting vs. American Basketball Association,
        a/k/a
        ABA Founders & Properties, a/k/a ABA Sports & Entertainment, Inc., Joe
        Newman, in his official capacity and Richard P. Tinkham, Jr., in his official
        capacity* .
        In the
        Marion Superior Court, Indiana. Cause No. 49D11-0608-PL-33933. Richardson
        asserts that as a minority shareholder in ABA Sports & Entertainment, Inc.
        he has a right to prevent use of its unspecified proprietary rights which
        he
        alleges it sold to Brax Capital Group. Neither ABA Utah nor ABA Indiana is
        a
        party to this action. The lawsuit was filed in August, 2006. ABA Sports &
Entertainment, Inc, Newman and Tinkham filed answers. The Court granted the
        defendant ’ s
        motion
        to require that Richardson take the matter to the board of directors of ABA
        Sports & Entertainment, Inc as required in a derivative shareholder action.
        Richardson has not done this. This matter is covered by the Indemnification
        Agreement. The ABA intends to contest the case vigorously.
  *Jeff
        Noordgaard, Michael Hart, Daimon Bethea, Coleco Buie, Deron Hayes, Michael
        Robinson and Tremaine Wingfield vs. Joe Newman, ABA Operations, LLC and ABA
        League, LLC* .
        In the
        Marion Superior Court, Indiana. Cause No. 49D11-0207-CC-001122. Ryan Hoover,
        Jeff Nordgaard, Michael Hart, Daimon Bethea, Coleco Buie, Deron Hayes, Michael
        Robinson and Tremaine Wingfield (the “ Players ” )
        seek
        damages under the legal theory of breach of contract and under the statutory
        theory of the Wage Payment Statute for alleged non-payment of wages. Progress
        of
        Claim - The lawsuit was filed in 2003. Summary Judgment was entered against
        ABA
        Operations, LLC ( “ Operations ” )
        and ABA
        League, LLC ( “ League ” )
        on
        January 5, 2007 in the amount of $762,331.43. An appeal of this decision
        was
        filed with the Indiana Court of Appeals on March 8, 2007. This matter is
        covered
        by the Indemnification Agreement. Prior to December 19, 2006, funds of ABA
        Indiana were held in a bank account titled in the name of ABA League, LLC
        as
        trustee. Since December 19, 2006, all funds of ABA Utah and ABA Indiana have
        been held in bank accounts titled in the name of ABA Indiana. The Players
        have
        vigorously attempted to collect this judgment from ABA Utah and ABA Indiana.
        The
        ABA intends to contest the case vigorously. Undersigned counsel has hired
        Indianapolis attorney, Paul Ludwig, to represent the interests of ABA Utah
        and
        ABA Indiana in this matter. ABA Utah or ABA Indiana has been named as a
        Garnishee Defendant. Neither ABA Utah nor ABA Indiana has funds or contract
        owed
        to ABA League, LLC. The bank account that Players seek to garnish has $32,000
        in
        it. A garnishment hearing on this bank account is set for June 5, 2007. In
        the meantime,
        a hearing to set an appeal bond to stay enforcement of the judgment pending
        appeal is set for May 5, 2007. Collateral is required to post a supercedas
        bond
        with the trial court pending appeal. Severko Hrywnak ( “ Hrywnak ” )
        has
        promised to provide the collateral. The strategy is to have a portion or
        the
        entire judgment amount overturned on appeal. The tactic is to settle this
        matter
        using non ABA Indiana or ABA Utah assets. ABA Management believes that the
        judgment will be overturned on appeal. The Company intends to defend this
        litigation aggressively, expects that the courts will concur with the
        Company ’ s
        views
        that these actions and claims are without merit and currently believes that
        the
        outcome, other than costs of suit, will not be materially adverse to the
        ABA.
        Nevertheless, an adverse judgment on these actions could materially harm
        the
        business of the Company. No assurance can be given that the Company ’ s
        position will be upheld or will prove to be correct over the course of
        litigation .
  
 **AMERICAN
          BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**
  **(formerly
          Souvall-Page Inc.)**
  **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
  Note
        9 - Legal proceedings -
        continued
  *James
        P. Dod vs. Perry R. Hall, a/k/a Pierre Hall, d/b/a Next Level Sports Franchise
        Development, LLC, d/b/a The Cleveland Rockers, d/b/a The Lake Erie Rockers,
        Ralph W. Underhill, American Basketball Association, Inc., and American
        Basketball Association, LLC.* In the
        Cleveland Municipal Court, Cuyahoga County, Ohio. Cause No. 06CVF0032421.
        James
        P. Dod ( “ Dod ” )
        seeks
        $13,000 in damages under the theory of negligent misrepresentation from ABA
        Indiana and American Basketball Association, LLC as a result of information
        about *The
        Cleveland Rockers* appearing on the ABA website. The lawsuit was filed December 8, 2006. ABA
        Indiana filed its answer and cross claim on February 15, 2007. The case is
        set
        for a pre-trial hearing on June 11, 2007. This matter is covered by the
        Indemnification Agreement. The ABA intends to contest the case. The potential
        for an unfavorable outcome of $13,000 is not significant. The elements of
        the
        tort of negligent misrepresentation are: one who, in the course of his business,
        profession or employment, or in any other transaction in which he has a
        pecuniary interest, supplies false information for the guidance of others
        in
        their business transactions, is subject to liability for pecuniary loss caused
        to them by their justifiable reliance upon the information, if he fails to
        exercise reasonable care or competence in obtaining or communicating the
        information. The ABA is not in the business of supplying information for
        the
        guidance of others.  Such businesses typically include attorneys,
        surveyors, abstractors of title and banks dealing with no-depositors ’ checks.  The ABA was not hired or paid by Dod to supply information. 
The ABA does not hold a duty to supply Dod with information nor did it
        communicate any affirmative false statement to Dod. If not settled the matter
        should be disposed at hearing.
 
 
  **AMERICAN
        BASKETBALL ASSOCIATION, INC AND SUBSIDIARY**
  **(formerly
        Souvall-Page Inc.)**
  **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
  **Note
        9 - Legal proceedings - continued**
  *Severko
        Hrywnak v. Joseph Newman* .
        Filed
        in the Circuit Court of Cook County, Illinois. Cause No. 2007L001101 and
        removed
        to the United States District Court for the Northern District of Illinois
        and
        assigned Cause No. 1:07-cv-00771. Severko Hrywnak ( “ Hrywnak ” )
        seeks
        damages under the legal theories of breach of contract, promissory estoppel
        and
        fraud. Hrywnak alleges that Newman promised to repay losses Hrywnak incurred
        in
        hosting the 2006 ABA all star game by tendering 400,000 shares of ABA Utah
        stock. Neither ABA Utah nor ABA Indiana is a party to this lawsuit. The lawsuit
        was filed on January 30, 2007. An answer was filed. The matter was settled
        however, Hrywnak has not performed a promise of the settlement agreement
        to
        provide collateral for the supercedas appeal bond in the Indiana Legends
        player
        case. Initially, Hrywnaks asseted claims against ABA Utah and not Newman.
        The
        claims against Newman derive from his capacity as CEO of ABA Utah. This matter
        is covered by the Indemnification Agreement. The ABA intends to vigorously
        contest the case until Hrywnak performs his promise to provide collateral
        for
        the supercedas bond. Potential for Unfavorable Outcome and amount/range of
        potential loss - The claims should be dismissed based on the current settlement
        negotiations. In any event, no monetary damages can be awarded against either
        ABA Utah or ABA Indiana.
  *Thaddeus
        A. Wier, Jr. v. American Basketball Association, Inc* .
        In the
        Superior Court of Erie County, New York. Index No. 2007-001971. On December
        5,
        2006, Thaddeus A Weir, Jr. ( “ Weir ” )
        agreed
        to fund the ABA Indiana with $200,000 and raise $4,000,000 (the Alternate
        Financing Plan ” )
        in the
        event ABA Indiana could not come to terms with Purchasers under a pending
        Stock
        Purchase Agreement ( ‘ the “ SPA ” ).
        On
        December 5, 2006, as part of the Alternate Financing Plan, ABA Indiana and
        Big
        Apple Consulting USA, Inc. ( “ Big
        Apple ” )
        entered
        a contingent agreement (the “ Big
        Apple
        Agreement ” )
        pursuant to which, Big Apple was to provide investor management services
        to ABA
        Indiana in the event it did not come to terms with Purchasers under the SPA.
        On
        December 13, 2006, as part of the Alternate Financing Plan, Weir and ABA
        Indiana
        entered into a contingent advisory agreement (the “ Weir
        Agreement ” )
        in the
        event ABA Indiana did not come to terms with Purchasers under the SPA. Weir
        failed to wire the $200,000 to ABA Indiana. ABA Indiana notified Weir of
        the
        termination of the Big Apple Agreement and the Weir Agreement. ABA Indiana
        entered into the SPA on December 19, 2006. On January 9, 2007, Weir asserted
        that ABA Utah was obligated to perform the Big Apple Agreement and the Weir
        Agreement. On January 29, 2007, ABA Indiana and ABA Utah advised Weir that
        the
        Alternate Financing Plan was separate and distinct from the SPA and that
        the
        Weir Agreement and the Big Apple Agreement had been terminated in December,
        2006
        due to lack of performance. Without service of summons, Weir filed the action
        in
        the Superior Court of Erie County, New York on February 20. Without service
        of
        summons no response is due. The matter was settled on February 20, 2007.
        However, promises under the settlement agreement have not been
        performed. The ABA intends to come to satisfactory terms with Wier. Potential
        for Unfavorable Outcome and amount/range of potential loss - The potential
        amount of loss is significant. However, the likelihood of an unfavorable
        outcome
        is not significant. The Company intends to defend this litigation aggressively,
        expects that the courts will concur with the Company ’ s
        views
        that these actions and claims are without merit and currently believes that
        the
        outcome, other than costs of suit, will not be materially adverse to the
        ABA.
        Nevertheless, an adverse judgment on these actions could materially harm
        the
        business of the Company. No assurance can be given that the Company ’ s
        position will be upheld or will prove to be correct over the course of
        litigation.
 
 
  **ITEM
        2: MANAGEMENT****’****S
        DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
        OVERVIEW**
 
 MANAGEMENT ’ S
        DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
        OPERATIONS
  BUSINESS
        PLAN OVERVIEW
 
 Our
        primary business is (i) operating the American Basketball Association (the “ League ” ),
        a
        professional basketball league composed of 47 independently-owned teams located
        in the United States, Mexico and Canada, (ii) marketing League-related
        merchandise and other products and services offered by the Company and the
        League and (iii) developing or expanding media outlets and ancillary
        entertainment businesses that complement the League ’ s
        operations.
 
 **Background**
 
 The
        original American Basketball Association league (the “ Original
        ABA ” )
        existed
        for nine full seasons, starting in 1967. It was known as the “ lively ” league
        that created the three-point shot, and it was the “ frontier ” league
        that brought modern professional basketball to many “ hoops-crazy ” cities.
        During that time, the Original ABA competed with the more established, rival
        NBA
        for players, fans, and media attention until 1976 when ABA teams were absorbed
        into the NBA and the original ABA ceased to exist. At that time, four of
        the
        strongest Original ABA teams joined the NBA, while the remaining Original
        ABA
        teams vanished along with the Original ABA itself.
 
 The
        League commenced play under the current banner and management in 2004 as
        the
        American Basketball Association. The League is a new professional basketball
        league and is not a continuation of the Original ABA whose teams were absorbed
        into the NBA in 1976. Since 2004, the League has grown to more than 30 teams
        competing in last year ’ s
        League
        championship, and 47 teams competing during 2006. The League continues to
        gain
        acceptance as a fan-pleasing entertainment experience that emphasizes basketball
        skills and fast-paced games at affordable prices. The League continues the
        Original ABA tradition of innovation in its efforts to bring diverse,
        fan-friendly, exciting basketball to its fans. Management believes that the “ ABA ” name
        remains synonymous with innovative and spirited basketball, the 3-point play, “ Dr.
        J. ” (former
        star player Julius Erving) and slam dunk contests, all of which have contributed
        significantly to the growth and development of professional basketball as
        it has
        become known throughout the world.
 
 ***The
        Company*** ***’*** ***s
        Role*** .
        Management views one of its principal operating challenges ahead to be how
        to
        maximize the League ’ s
        brand
        recognition in combination with new initiatives and today ’ s
        new
        revenue possibilities. Management believes that, in addition to basketball,
        the
        League ’ s
        fans
        also share an interest in music and emerging pop culture and that they provide
        reference points for what are new and hot trends in the pop-culture. In essence,
        these fans, by their habits and spending patterns, are the initiators or
        predictors of pop trends. The Company intends to capitalize on the demographic
        composition of that fan base and branch into music and entertainment, as
        described below. In the process, management believes that fans will not only
        competitively attractive value for the $10-12 ticket price and that the League
        will be transformed into a formidable sports and family entertainment
        experience. This approach to League expansion will in management ’ s
        view
        provide the League with the potential to grow until the total market reach
        may
        be as high as 100 cities and towns in the United States, Mexico, and Canada.
        While League cities will be both large and small (including, for example,
        New
        York, Los Angeles, Dallas, Chicago and Detroit, as well as Bellingham,
        Washington, Rockville, Maryland, Burlington, Vermont and Waco, Texas) all
        are
        expected to have basketball and music fans in significant and growing
        numbers.
 
 
  **CRITICAL
        ACCOUNTING POLICIES AND ESTIMATES**
  The
        preparation of our condensed consolidated financial statements requires us
        to
        make estimates and judgments that affect the reported amounts of assets,
        liabilities, revenues and expenses and the related disclosures. A summary
        of
        those accounting policies can be found in the footnotes to the consolidated
        financial statements included elsewhere in this report. Certain of our
        accounting policies are considered critical as they are both important to
        the
        portrayal of our financial condition and results of operations and require
        judgments on the part of management about matters that are uncertain. We
        have
        identified the following accounting policies that are important to the
        presentation of our financial condition and results of operations.
  **REVENUE
        RECOGNITION**
 
 Revenues
        are expected to be generated from a number of sources including national
        sponsorships, market reservation fees, broadcasting revenue and basketball
        and
        other merchandise sales. It is expected that sponsorship and broadcasting
        revenue will be recognized over the period of the agreements; market reservation
        fees will be recognized when receipt is assured; and merchandise sales less
        returns and allowances will generally be recognized when title and risk of
        product loss is transferred to the buyer. Such risk of product loss is expected
        to generally coincide with the time of shipment.
 
 RESULTS
        OF OPERATIONS
 
 The
        following discussion relates to the historical financial statements of American
        basketball Association and should be read in conjunction with the consolidated
        financial statements and related notes.
 
 COMPARISON
        OF PERIOD ENDING MARCH 31, 2007 AND 2006
 
 Net
        revenues decreased from $116,522 for the period ended March 31, 2006 to $56,145
        for the period ending March 31, 2007. Such revenues represent revenues from
        market reservation fees. As a result, the decrease in revenues was a result
        of a
        decrease in market reservation fees.
 
 Cost
        of
        revenues as a percentage of net revenues increased from 0.0% of net revenues
        for
        the period ending March 31, 2006 to 8.5% of net revenues for the period ending
        March 31, 2007. The decrease is in direct relation to the decrease in market
        reservation fees as a component of net revenues.
 
 Compensatory
        element of stock transactions decreased from $0 for the period ending March
        31,
        2006 to $135,000, for the same period ending March 31, 2007. The increase
        was a
        result of signing new consulting agreements.
 
 Selling,
        general and administrative expenses increased from $255,046 for the period
        ending March 31, 2006, to $635,973 for the period ending March 31, 2007.
        The
        increase is due the addition of personnel as well as increased accounting,
        legal
        and other professional services related to the various legal and accounting
        issues since the reverse merger.
 
 LIQUIDITY
        AND CAPITAL RESOURCES
 
 At
        March
        31, 2007, our cash totaled $500,279.
 
 Net
        cash
        used in operating activities was $698,288 for the period ending March 31,
        2007
        compared to cash used in operating activities was $25,027 for the period
        ending
        March 31, 2006. The increase in cash used relates to the hiring of additional
        administrative staff required to implement the Company ’ s
        business plan as well as additional accounting, legal and professionals needed
        since the reverse merger.
 
 Net
        cash
        used in investing activities was $0 for the period ending March 31, 2007
        compared to net cash used in investing activities of $0 for the period ending
        March 31, 2006.
  
  Net
        cash
        provided from financing activities was $0 for the period ending M arch
        31,
        2007 as compared to net cash provided from financing activities of $0 for
        the
        period ending March 31, 2006.
 
 In
        view
        of our accumulated deficit and recurring losses there is substantial doubt
        about
        our ability to continue as a going concern. In this regard management is
        adopting a plan for the development of our merchandising, sponsorship, media
        and
        market reservation product lines as well as seeking additional capital through
        the private sale of our debt or equity securities. There is no assurance
        that we
        will complete any financing or that we will achieve profitable operations.
        The
        financial statements do not include any adjustments that might result from
        the
        outcome of this uncertainty.
 
 We
        expect
        to fund development expenditures and incur losses until we are able to generate
        sufficient income and cash flows to meet such expenditures and other
        requirements. We do not currently have adequate cash reserves to continue
        to
        cover such anticipated expenditures and cash requirements. These factors,
        among
        others, raise substantial doubt about our ability to continue as a going
        concern.
  The
        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 accounting principles generally accepted in the United States.
        The preparation of these financial statements requires us to make estimates
        and
        judgments that affect the reported amounts of assets, liabilities, revenues
        and
        expenses, and related disclosure of contingent assets and liabilities. On
        an
        on-going basis, we evaluate our estimates, including those related to income
        tax
        and marketing related agreements with our affiliates. We base our estimates
        on
        historical experience and on various other 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 or conditions.
  **FORWARD-LOOKING
        STATEMENTS: MARKET DATA**
  The
        discussion in this Quarterly Report on Form 10-QSB contains forward-looking
        statements that involve risks and uncertainties. The statements contained
        in
        this Report that are not purely historical 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, including
        statements regarding our expectations, beliefs, intentions or strategies
        regarding the future. All forward-looking statements included in this document
        are based on information available to us on the date hereof, and we assume
        no
        obligation to update any such forward-looking statements. Our actual results
        could differ materially from those described in our forward-looking statements.
        Factors that could cause or contribute to such differences include, but are
        not
        limited to, our unproven business model and a limited operating history in
        a new
        and rapidly evolving industry; our ability to implement our business plan;
        and
        our ability to manage our growth, retain and grow our customer base and expand
        our service offerings.
  We
        make
        forward-looking statements in the “ Management ’ s
        Discussion and Analysis of Financial Condition and, Results of
        Operations ” above.
        These forward-looking statements include, but are not limited to, statements
        about our plans, objectives, expectations, intentions and assumptions and
        other
        statements that are not historical facts. We generally intend the, words “ expect ” , “ anticipate ” , “ intend ” , “ plan ” , “ believe ” , “ seek ” , “ estimate ” and
        similar expressions to identify forward-looking statements.
  This
        Quarterly Report on Form 10-QSB contains certain estimates and plans related
        to
        us and the industry in which we operate, which assumes certain events, trends
        and activities will occur and the projected information based on those
        assumptions. We do not know that all of our assumptions are accurate. In
        particular, we do not know what level of growth will exist in our industry,
        if
        any, and particularly in the foreign markets in which we operate, have devoted
        resources and in which we shall seek to expand. If our assumptions are wrong
        about any events, trends and activities, then our estimates for future growth
        for our business may also be wrong. There can be no assurances that any of
        our
        estimates as to our business growth will be achieved.
  
  **RECENT
        ACCOUNTING PRONOUNCEMENTS**
  In
        December 2004, the FASB issued SFAS No. 153, “ Exchange
        of Non-monetary Assets. ” SFAS No.
        153 amends APB Opinion No. 29, “ Accounting
        for Non-monetary Transactions, ” to
        eliminate the exception for non-monetary exchanges of similar productive
        assets.
        The Company will be required to apply this statement to non-monetary exchanges
        after December 31, 2005. The adoption of this standard is not expected to
        have a
        material effect on the Company ’ s
        financial position or results of operations.
 
 In
        May
        2005, the FASB issued SFAS No. 154, “ Accounting
        Changes and Error Corrections-A Replacement of APB Opinion No. 20 and FASB
        Statement No. 3. ” SFAS No.
        154 changes the requirements for the accounting for and reporting of a change
        in
        accounting principle. The Company will be required to apply this statement
        for
        accounting changes and corrections of errors made in fiscal years beginning
        after December 15, 2005. The adoption of this standard is not expected to
        have a
        material effect on the Company ’ s
        financial position or results of operations.
 
 In
        February 2006, the FASB issued SFAS No. 155, “ Accounting
        for Certain Hybrid Financial Instruments -- an amendment of FASB Statements
        No.
        133 and 140. ” SFAS 155
        amends SFAS No. 133, “ Accounting
        for Derivative Instruments and Hedging Activities ” and SFAS
        No. 140, “ Accounting
        for Transfers and Servicing of Financial Assets and Extinguishments of
        Liabilities ” and
        related interpretations. SFAS 155 permits fair value re-measurement for any
        hybrid financial instrument that contains an embedded derivative that otherwise
        would require bifurcation and clarifies which interest-only strips and
        principal-only strips are not subject to recognition as liabilities. SFAS
        155
        eliminates the prohibition on a qualifying special-purpose entity from holding
        a
        derivative financial instrument that pertains to a beneficial interest other
        than another derivative financial instrument. SFAS 155 is effective for the
        Company for all financial instruments acquired or issued beginning January
        1,
        2007. The adoption of this standard is not expected to have a material effect
        on
        the Company ’ s
        financial position or results of operations.
 
 In
        March
        2006, the FASB issued SFAS No. 156, “ Accounting
        for Servicing of Financial Assets - an amendment of FASB Statement No.
        140. ” SFAS 156
        requires an entity to recognize a servicing asset or servicing liability
        each
        time it undertakes an obligation to service a financial asset. It also requires
        all separately recognized servicing assets and servicing liabilities to be
        initially measured at fair value, if practicable. SFAS 156 permits an entity
        to
        use either the amortization method or the fair value measurement method for
        each
        class of separately recognized servicing assets and servicing liabilities.
        SFAS
        156 is effective for the Company as of January 1, 2007. The adoption of this
        standard is not expected to have a material effect on the Company ’ s
        financial position or results of operations.
  **Item
        3:**  **Controls
        and Procedures**
 
 We
        maintain a set of disclosure controls and procedures designed to ensure that
        information required to be disclosed by us in the reports filed under the
        Securities Exchange Act, is recorded, processed, summarized and reported
        within
        the time periods specified by the SEC ’ s
        rules
        and forms. Disclosure controls are also designed with the objective of ensuring
        that this information is accumulated and communicated to our management,
        including our chief executive officer and chief financial officer, as
        appropriate to allow timely decisions regarding required
        disclosure.
 
 Based
        upon their evaluation as of the end of the period covered by this report,
        our
        chief executive officer and chief financial officer concluded that, our
        disclosure controls and procedures are effective to ensure that information
        required to be included in our periodic SEC filings is recorded, processed,
        summarized, and reported within the time periods specified in the SEC rules
        and
        forms.
 
 Limitations
        of Disclosure Controls and Procedures
 
 Our
        management, including our chief executive officer and chief financial officer
        does not expect that our disclosure controls or internal control over financial
        reporting will prevent all errors or all instances of fraud. A control system,
        no matter how well designed and operated, can provide only reasonable, not
        absolute, assurance that the control system ’ s
        objectives will be met. Further, the design of a control system must reflect
        the
        fact that there are resource constraints, and the benefits of controls must
        be
        considered relative to their costs. Because of the inherent limitations in
        all
        control systems, no evaluation of controls can provide absolute assurance
        that
        all control issues and instances of fraud, if any, within our Company have
        been
        detected. These inherent limitations include the realities that judgments
        in
        decision-making can be faulty, and that breakdowns can occur because of simple
        error or mistake. Controls can also be circumvented by the individual acts
        of
        some persons, by collusion of two or more people, or by management override
        of
        the controls. The design of any system of controls is based in part upon
        certain
        assumptions about the likelihood of future events, and any design may not
        succeed in achieving its stated goals under all potential future conditions.
        Over time, controls may become inadequate because of changes in conditions
        or
        deterioration in the degree of compliance with policies or procedures. Because
        of the inherent limitation of a cost-effective control system, misstatements
        due
        to error or fraud may occur and not be detected.
  
  **PART
        II - OTHER INFORMATION**
 
 **Item
        1.:**  **Legal
        Proceedings**
  None.
  **Item
        2.:**  **Changes
        in Securities**
 
 (a)  None
 
 (b)  None
 
 (c)  None
 
 (d)  Not
        Applicable.
 
 **Item
        3.:**  **Defaults
        upon Senior Securities**
 
 None.
 
 **Item
        4.:**  **Submission
        of Matters to a Vote of Security Holders**
 
 None
 
 **Item
        5.:**  **Other
        Information**
 
 None
 
 **Item
        6.:**  **Exhibits**
 
 (a)  The
        following exhibits are filed as part of this report:
  31.1
              
              Certification
                  of Chief Executive Officer of Periodic Reportpursuant to Rule 13a-14a and Rule 15d-14(a).31.2
              
              Certification
                  of Chief Financial Officer of Periodic Report pursuant to Rule
                  13a-14a and
                  Rule 15d-14(a).32.1
              
              Certification
                  of Chief Executive Officer of pursuant to 18 U.S.C. - Section
                  1350.32.2
              
              Certification
                  of Chief Financial Officer of pursuant to 18 U.S.C. - Section
                  1350.
  
  **SIGNATURES**
 
 Pursuant
        to the requirements of the Securities Exchange Act of 1934, the Registrant
        has
        caused this report to be signed on its behalf by the undersigned thereunto
        duly
        authorized.
  Dated:
                  May 21, 2007
              AMERICAN
                  BASKETBALL ASSOCIATION, INC.By:
              /s/
                Joseph F. NewmanJoseph
                  F. Newman, Chief Executive Officer
 By:
              /s/
                Darren CioffiDarren
                  Cioffi, Chief Financial Officer