| Nevada                               |   | 88-0350448               |
|--------------------------------------|--------|--------------------------|
| (State      or other jurisdiction of |   | (I.R.S.      Employer    |
| incorporation      or organization)  |   | Identification      No.) |

| Large      accelerated filer | o | Accelerated      filer         | o      |
|------------------------------|---|--------------------------------|--------|
| Non-accelerated      filer   | o | Smaller      reporting company | þ |

----

|          |                                                                                             | Page   |
|---------------|--------------------------------------------------------------------------------------------------|--------|
| Item      1.  | Financial      Statements (Unaudited):                                                           |   |
|          |                                                                                             |   |
|          | Condensed      Consolidated Balance Sheet                                                        |   |
|          |  as      of June 30, 2008                                                                   | 3      |
|          |                                                                                             |   |
|          | Condensed      Consolidated Statements of Operations                                             |   |
|          |  for      the Three and Six Months Ended June 30, 2008 and 2007                             | 4      |
|          |                                                                                             |   |
|          | Condensed      Consolidated Statement of Stockholders’ Equity                              |   |
|          |  for      the Six Months Ended June 30, 2008                                                | 5      |
|          |                                                                                             |   |
|          | Condensed      Consolidated Statements of Cash Flows                                             |   |
|          |  for      the Six Months Ended June 30, 2008 and 2007                                       | 6      |
|          |                                                                                             |   |
|          | Notes      to Condensed Consolidated Financial Statements                                        | 8      |
|          |                                                                                             |   |
| Item      2.  | Management's      Discussion and Analysis of Financial Condition and Results of      Operations. | 14     |
|          |                                                                                             |   |
| Item      4T. | Controls      and Procedures.                                                                    | 18     |

| Item      1A | Risk      Factors                                                 | 19     |
|--------------|-------------------------------------------------------------------|--------|
|         |                                                              |   |
| Item      2. | Unregistered      Sales of Equity Securities and Use of Proceeds. | 22     |
|         |                                                              |   |
| Item      6. | Exhibits.                                                         | 23     |
|         |                                                              |   |
|         |                                                              |   |
| Signatures   |                                                              | 24     |
|         |                                                              |   |

----

| ITEM      1. | FINANCIAL      STATEMENTS. |
|--------------|----------------------------|

| AUXILIO,      INC. AND SUBSIDIARIES                                 |   |
|---------------------------------------------------------------------|--------|
| CONDENSED      CONSOLIDATED BALANCE SHEET                           |   |
| JUNE      30, 2008                                                  |   |
| (UNAUDITED)                                                         |   |
|                                                                |   |
| ASSETS                                                              |   |
| Current      assets:                                                |   |   |   |
| Cash      and cash equivalents                                      |   | $ | 689,106 |   |
| Accounts      receivable, net                                       |   |   | 4,444,550 |   |
| Prepaid      and other current assets                               |   |   | 46,474 |   |
| Supplies                                                            |   |   | 613,613 |   |
| Total      current assets                                           |   |   | 5,793,743 |   |
|                                                                |   |   |   |   |
| Property      and equipment, net                                    |   |   | 158,802 |   |
| Deposits                                                            |   |   | 28,790 |   |
| Loan      acquisition costs, net                                    |   |   | 126,882 |   |
| Intangible      assets, net                                         |   |   | 95,486 |   |
| Goodwill                                                            |   |   | 1,517,017 |   |
| Total      assets                                                   |   | $ | 7,720,720 |   |
|                                                                |   |   |   |   |
| LIABILITIES      AND STOCKHOLDERS' EQUITY                           |   |
|                                                                |   |   |   |   |
| Current      liabilities:                                           |   |   |   |   |
| Accounts      payable and accrued expenses                          |   | $ | 3,100,705 |   |
| Accrued      compensation and benefits                              |   |   | 586,086 |   |
| Deferred      revenue                                               |   |   | 417,938 |   |
| Current      portion of long-term debt                              |   |   | 600,000 |   |
| Current      portion of capital lease obligations                   |   |   | 14,335 |   |
| Revolving      loan payable                                         |   |   | 745,000 |   |
| Total      current liabilities                                      |   |   | 5,464,064 |   |
|                                                                |   |   |   |   |
| Note      payable, less current portion, net of discount of $66,860 |   |   | 965,140 |   |
|                                                                |   |   |   |   |
| Commitments      and contingencies                                  |   |   | - |   |
|                                                                |   |   |   |   |
| Stockholders'      equity:                                          |   |   |   |   |
| Common      stock, par value at $0.001, 33,333,333 shares           |   |   |   |   |
| authorized,      16,235,309 shares issued and outstanding           |   |   | 16,237 |   |
| Additional      paid-in capital                                     |   |   | 17,566,187 |   |
| Accumulated      deficit                                            |   |   | (16,290,908 | ) |
| Total      stockholders' equity                                     |   |   | 1,291,516 |   |
| Total      liabilities and stockholders’ equity               |   | $ | 7,720,720 |   |

----

| AUXILIO, INC. AND SUBSIDIARIES                       |   |
|------------------------------------------------------|--------|
| CONDENSED      CONSOLIDATED STATEMENTS OF OPERATIONS |   |
| (UNAUDITED)                                          |   |
|                                                 |   |
|                                                 |   | Three      Months |   |   | Six      Months |
|                                                 |   | Ended      June 30, |   |   | Ended      June 30, |
|                                                 |   | 2008 |   |   | 2007 |   |   | 2008 |   |   | 2007 |
| Revenues                                             |   | $ | 6,891,341 |   |   | $ | 5,022,112 |   |   | $ | 10,664,657 |   |   | $ | 10,885,023 |
| Cost      of revenues                                |   |   | 5,151,747 |   |   |   | 3,971,000 |   |   |   | 8,270,275 |   |   |   | 8,271,070 |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross      profit                                    |   |   | 1,739,594 |   |   |   | 1,051,112 |   |   |   | 2,394,382 |   |   |   | 2,613,953 |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating      expenses:                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Sales      and marketing                             |   |   | 378,313 |   |   |   | 313,909 |   |   |   | 700,461 |   |   |   | 588,384 |
| General      & administrative expenses           |   |   | 632,069 |   |   |   | 570,693 |   |   |   | 1,241,644 |   |   |   | 1,245,727 |
| Intangible      asset amortization                   |   |   | 47,743 |   |   |   | 59,541 |   |   |   | 95,487 |   |   |   | 119,082 |
| Total      operating expenses                        |   |   | 1,058,125 |   |   |   | 944,143 |   |   |   | 2,037,592 |   |   |   | 1,953,193 |
| Income      from operations                          |   |   | 681,469 |   |   |   | 106,969 |   |   |   | 356,790 |   |   |   | 660,760 |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other      income (expense):                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest      expense                                |   |   | (167,686 | ) |   |   | (201,714 | ) |   |   | (440,824 | ) |   |   | (406,596 |
| Interest      income                                 |   |   | 741 |   |   |   | 4,580 |   |   |   | 3,614 |   |   |   | 6,969 |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total      other income (expense)                    |   |   | (166,945 | ) |   |   | (197,134 | ) |   |   | (437,210 | ) |   |   | (399,627 |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income      (loss) before provision for income taxes |   |   | 514,524 |   |   |   | (90,165 | ) |   |   | (80,420 | ) |   |   | 261,133 |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income      tax expense                              |   |   | - |   |   |   | (5,600 | ) |   |   | (2,400 | ) |   |   | (11,200 |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      income (loss)                               |   |   | 514,524 |   |   | $ | (95,765 | ) |   | $ | (82,820 | ) |   | $ | 249,933 |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      income (loss) per share:                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                |   | $ | .03 |   |   | $ | (.01 | ) |   | $ | (.01 | ) |   | $ | .02 |
| Diluted                                              |   | $ | .02 |   |   | $ | (.03 | ) |   | $ | (.01 | ) |   | $ | (.00 |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Number      of weighted average shares:              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                |   |   | 16,235,309 |   |   |   | 16,131,875 |   |   |   | 16,235,309 |   |   |   | 16,127,367 |
| Diluted                                              |   |   | 21,845,983 |   |   |   | 17,631,173 |   |   |   | 17,344,428 |   |   |   | 18,541,538 |
|                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| AUXILIO,      INC. AND SUBSIDIARIES                                                                |
|----------------------------------------------------------------------------------------------------|
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY                                      |
| SIX      MONTHS ENDED JUNE 30, 2008                                                                |
| (UNAUDITED)                                                                                        |
|                                                                                               |
|                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Total |   |
|                                                                                               |   | Common      Stock |   |   | Paid-in |   |   | Accumulated |   |   | Stockholders' |   |
|                                                                                               |   | Shares |   |   | Amount |   |   | Capital |   |   | Deficit |   |   | Equity |   |
| Balance      at December 31, 2007                                                                  |   |   | 16,235,309 |   |   | $ | 16,237 |   |   | $ | 17,364,202 |   |   | $ | (16,208,088 | ) |   | $ | 1,172,351 |   |
| Stock      compensation expense for options and warrants granted to employees and      consultants |   |   | - |   |   |   | - |   |   |   | 201,985 |   |   |   | - |   |   |   | 201,985 |   |
| Net      loss                                                                                      |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (82,820 | ) |   |   | (82,820 | ) |
| Balance      at June 30, 2008                                                                      |   |   | 16,235,309 |   |   | $ | 16,237 |   |   | $ | 17,566,187 |   |   | $ | (16,290,908 | ) |   | $ | 1,291,516 |   |

|   | The accompanying notes are an      integral part of these condensed consolidated financial      statements.  |
|--------|-------------------------------------------------------------------------------------------------------------------|

----

| AUXILIO,      INC. AND SUBSIDIARIES                                                               |   |
|---------------------------------------------------------------------------------------------------|--------|
| CONDENSED      CONSOLIDATED STATEMENTS OF CASH FLOWS                                              |   |
| (UNAUDITED)                                                                                       |   |
|                                                                                              |   |   |   |
|                                                                                              |   | Six      Months Ended June 30, |   |
|                                                                                              |   | 2008 |   |   | 2007 |   |
| Cash      flows provided by operating activities:                                                 |   |   |   |   |   |   |
| Net      income (loss)                                                                            |   | $ | (82,820 | ) |   | $ | 249,933 |   |
| Adjustments      to reconcile net income (loss) to net cash                                       |   |   |   |   |   |   |   |   |
| provided      by operating activities:                                                            |   |   |   |   |   |   |   |   |
| Depreciation                                                                                      |   |   | 58,844 |   |   |   | 68,403 |   |
| Amortization      of intangible assets                                                            |   |   | 95,487 |   |   |   | 119,082 |   |
| Bad      debt recovery                                                                            |   |   | (28,510 | ) |   |   | - |   |
| Stock      compensation expense for warrants and options issued to employees and      consultants |   |   | 201,985 |   |   |   | 251,380 |   |
| Interest      expense related to amortization of warrants issued for    loans                     |   |   | 43,446 |   |   |   | 83,562 |   |
| Interest      expense related to amortization of loan acquisition costs                           |   |   | 82,450 |   |   |   | 143,730 |   |
| Interest      expense related to accretion of loan                                                |   |   | 197,083 |   |   |   | - |   |
| Changes      in operating assets and liabilities:                                                 |   |   |   |   |   |   |   |   |
| Accounts      receivable and other receivables                                                    |   |   | (2,010,512 | ) |   |   | (1,052,737 | ) |
| Supplies                                                                                          |   |   | 115,991 |   |   |   | 40,401 |   |
| Prepaid      and other current assets                                                             |   |   | 506 |   |   |   | 7,769 |   |
| Accounts      payable and accrued expenses                                                        |   |   | 1,534,445 |   |   |   | 515,015 |   |
| Accrued      compensation and benefits                                                            |   |   | 99,976 |   |   |   | 153,728 |   |
| Deferred      revenue                                                                             |   |   | 35,043 |   |   |   | 217,776 |   |
| Net      cash provided by operating activities                                                    |   |   | 343,414 |   |   |   | 798,042 |   |
| Cash      flows (used for) investing activities:                                                  |   |   |   |   |   |   |   |   |
| Purchases      of property and equipment                                                          |   |   | (8,710 | ) |   |   | (22,441 | ) |
| Net      cash (used for) investing activities                                                     |   |   | (8,710 | ) |   |   | (22,441 | ) |
| Cash      flows (used for) financing activities:                                                  |   |   |   |   |   |   |   |   |
| Payments      on capital leases                                                                   |   |   | (12,026 | ) |   |   | (9,949 | ) |
| Payments      on notes payable and long-term debt                                                 |   |   | (300,000 | ) |   |   | (300,000 | ) |
| Proceeds      from exercise of options                                                            |   |   | - |   |   |   | 5,875 |   |
| Net      cash (used for) financing activities                                                     |   |   | (312,026 | ) |   |   | (304,074 | ) |
| Net      increase in cash and cash equivalents                                                    |   |   | 22,678 |   |   |   | 471,527 |   |
| Cash      and cash equivalents, beginning of period                                               |   |   | 666,428 |   |   |   | 319,437 |   |
| Cash      and cash equivalents, end of period                                                     |   | $ | 689,106 |   |   | $ | 790,964 |   |

|   | The      accompanying notes are an integral part of these condensed consolidated      financial statements. |
|--------|-------------------------------------------------------------------------------------------------------------|

----

| AUXILIO,      INC. AND SUBSIDIARIES                                   |   |
|-----------------------------------------------------------------------|--------|
| CONDENSED      CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) |   |
| (UNAUDITED)                                                           |   |
|                                                                  |   |   |   |   |   |   |
|                                                                  |   | Six Months      Ended June 30, |   |
|                                                                  |   | 2008 |   |   | 2007 |   |
| Supplemental      disclosure of cash flow information:                |   |   |   |   |   |   |
|                                                                  |   |   |   |   |   |   |
| Interest      paid                                                    |   | $ | 119,486 |   |   | $ | 179,304 |   |
|                                                                  |   |   |   |   |   |   |   |   |
| Income      tax paid                                                  |   | $ | 11,500 |   |   | $ | 2,400 |   |
|                                                                  |   |   |   |   |   |   |   |   |

|   | The      accompanying notes are an integral part of these condensed consolidated      financial statements. |
|--------|-------------------------------------------------------------------------------------------------------------|

----

|   | NOTES      TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTS |
|--------|----------------------------------------------------------|

|   | SIX      MONTHS ENDED JUNE 30, 2008 AND 2007 |
|--------|----------------------------------------------|

|   | (UNAUDITED) |
|--------|-------------|

----

| Options                               |   |               Shares |      |   | Weighted      Average Exercise Price |   |   | Weighted      Average Remaining Term in Years |   |   | AggregateIntrinsic      Value |   |
|---------------------------------------|--------|--------------------------------------------------------------|-----------|--------|--------------------------------------|--------|--------|-----------------------------------------------|--------|--------|-------------------------------|--------|
| Outstanding      at December 31, 2007 |   |                                                         | 4,257,648 |   |                                 | $      | 1.12   |                                          |   |   |                          |   |   |   |
| Granted                               |   |                                                         | 111,500   |   |                                 |   | 1.17   |                                          |   |   |                          |   |   |   |
| Exercised                             |   |                                                         | -         |   |                                 |   | -      |                                          |   |   |                          |   |   |   |
| Cancelled                             |   |                                                         | (46,273   | )      |                                 |   | 1.73   |                                          |   |   |                          |   |   |   |
| Outstanding      at June 30, 2008     |   |                                                         | 4,322,875 |   |                                 | $      | 1.14   |                                          |   |   | 7.74                          |   |   | $ | 2,966,112 |   |
| Exercisable      at June 30, 2008     |   |                                                         | 2,117,814 |   |                                 | $      | 1.22   |                                          |   |   | 6.55                          |   |   | $ | 1,323,082 |   |

| Warrants                              |   | Shares |      |   | Weighted      Average Exercise Price |   |   | Weighted      Average Remaining Term in Years |   |   | AggregateIntrinsic      Value |   |
|---------------------------------------|--------|--------|-----------|--------|--------------------------------------|--------|--------|-----------------------------------------------|--------|--------|-------------------------------|--------|
| Outstanding      at December 31, 2007 |   |   | 3,063,021 |   |                                 | $      | 1.14   |                                          |   |   |                          |   |   |   |
| Granted                               |   |   | -         |   |                                 |   | -      |                                          |   |   |                          |   |   |   |
| Exercised                             |   |   | -         |   |                                 |   | -      |                                          |   |   |                          |   |   |   |
| Cancelled                             |   |   | -         |   |                                 |   | -      |                                          |   |   |                          |   |   |   |
| Outstanding      at June 30, 2008     |   |   | 3,063,021 |   |                                 | $      | 1.14   |                                          |   |   | 3.37                          |   |   | $ | 2,306,539 |   |
| Exercisable      at June 30, 2008     |   |   | 2,685,521 |   |                                 | $      | 1.20   |                                          |   |   | 3.37                          |   |   | $ | 1,906,389 |   |

|                                                          |   | Three      Months   |   |   | Six      Months     |   |
|---------------------------------------------------------------|--------|---------------------|--------|--------|---------------------|--------|
|                                                          |   | Ended      June 30, |   |   | Ended      June 30, |   |
|                                                          |   | 2008                |   |   | 2007                |   |   | 2008 |   |   | 2007 |   |
| Cost      of revenues                                         |   | $                   | 26,875 |   |                | $      | 26,154 |   |   | $ | 64,111 |   |   | $ | 53,792 |   |
| Sales      and marketing                                      |   |                | 19,405 |   |                |   | 28,677 |   |   |   | 41,437 |   |   |   | 58,872 |   |
| General      and administrative expense                       |   |                | 46,888 |   |                |   | 53,866 |   |   |   | 96,437 |   |   |   | 138,716 |   |
|    Total      stock based compensation expense |   | $                   | 93,168 |   |                | $      | 108,697 |   |   | $ | 201,985 |   |   | $ | 251,380 |   |

----

|                                                             |   | Three Months      Ended June 30, |       |   | Six      Months Ended June 30, |   |
|------------------------------------------------------------------|--------|---------------------------------------|------------|--------|--------------------------------|--------|
|                                                             |   | 2008                                  |       |   | 2007                           |   |   | 2008 |   |   | 2007 |   |
| Numerator:                                                       |   |                                  |       |   |                           |   |   |   |   |   |   |   |
| Net      income (loss)                                           |   | $                                     | 514,524    |   |                           | $      | (95,765 | ) |   | $ | (82,820 | ) |   | $ | 249,933 |   |
| Effects      of dilutive securities:                             |   |                                  |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Convertible      notes payable                                   |   |                                  | (137,234   | )      |                           |   | (381,971 | ) |   |   | (120,693 | ) |   |   | (315,234 | ) |
| Income      (loss) after effects of conversion of note payable   |   | $                                     | 377,290    |   |                           | $      | (477,736 | ) |   | $ | (203,513 | ) |   | $ | (65,301 | ) |
|                                                             |   |                                  |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Denominator:                                                     |   |                                  |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Denominator      for basic calculation weighted average shares   |   |                                  | 16,235,309 |   |                           |   | 16,131,875 |   |   |   | 16,235,309 |   |   |   | 16,127,367 |   |
|                                                             |   |                                  |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Dilutive      common stock equivalents:                          |   |                                  |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Secured      convertible notes                                   |   |                                  | 2,648,511  |   |                           |   | 1,499,298 |   |   |   | 1,109,119 |   |   |   | 1,499,298 |   |
| Options      and warrants                                        |   |                                  | 2,962,163  |   |                           |   | - |   |   |   | - |   |   |   | 914,873 |   |
|                                                             |   |                                  |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Denominator      for diluted calculation weighted average shares |   |                                  | 21,845,983 |   |                           |   | 17,631,173 |   |   |   | 17,344,428 |   |   |   | 18,541,538 |   |
|                                                             |   |                                  |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Net      income (loss) per share:                                |   |                                  |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Basic      net income (loss) per share                           |   | $                                     | .03        |   |                           | $      | (.01 | ) |   | $ | (.01 | ) |   | $ | .02 |   |
|                                                             |   |                                  |       |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Diluted      net income (loss) per share                         |   | $                                     | .02        |   |                           | $      | (.03 | ) |   | $ | (.01 | ) |   | $ | (.00 | ) |

| Trade      receivable                |   | $      | 4,444,550 |   |
|--------------------------------------|--------|--------|-----------|--------|
| Allowance      for doubtful accounts |   |   | -         |   |
| Total      accounts receivable       |   | $      | 4,444,550 |   |

----

----

| 8. | EMPLOYMENT      AGREEMENTS |
|----|----------------------------|

----

----

----

|   | · | revenue      recognition |
|--------|--------|--------------------------|

|   | · | accounts      receivable valuation and relatedreserves |
|--------|--------|--------------------------------------------------------|

|   | · | impairment      of intangible assets |
|--------|--------|--------------------------------------|

|   | · | deferred      revenue |
|--------|--------|-----------------------|

----

----

----

----

|   | · | the      emergence of competitors in our target market, and the quality and      development of their  products and services;  and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the      market’s acceptance of our products and  services. |
|--------|--------|-------------------------------------------------------------------|

|   | · | successfully      complete the development of our products and  services; |
|--------|--------|---------------------------------------------------------------------------|

|   | · | modify      our products and services as necessary to meet the demands of our      market; |
|--------|--------|--------------------------------------------------------------------------------------------|

|   | · | attract      and retain highly skilled employees;and |
|--------|--------|------------------------------------------------------|

|   | · | respond      to competitive influences. |
|--------|--------|-----------------------------------------|

|   | · | greater      name recognition and larger marketing budgets and    resources; |
|--------|--------|------------------------------------------------------------------------------|

|   | · | established      marketing relationships and access to larger customer    bases; |
|--------|--------|----------------------------------------------------------------------------------|

|   | · | substantially      greater financial, technical and other resources;  and |
|--------|--------|---------------------------------------------------------------------------|

|   | · | larger      technical and support staffs. |
|--------|--------|-------------------------------------------|

----

|   | · | develop      or enhance our service offerings; |
|--------|--------|------------------------------------------------|

|   | · | take      advantage of future opportunities;or |
|--------|--------|------------------------------------------------|

|   | · | respond      to customers and competition. |
|--------|--------|--------------------------------------------|

----

|   | · | net      tangible assets of at least $2,000,000, if the issuer has been in      continuous operation for at least three years, or net tangible assets of      at least $5,000,000, if the issuer has been in continuous operation for      less than three years; or |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | average      annual revenue of at least $6,000,000 for the last three      years. |
|--------|--------|-----------------------------------------------------------------------------------|

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| No.  | Item                                                                                                                                                                              |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 31.1 | Certification      of the Chief Executive Officer pursuant to Rule 13a-14(a) and Rule      15d-14(a) of the Securities Exchange Act of 1934, as    amended.                       |
| 31.2 | Certification  of      the Chief Financial Officer  pursuant to Rule 13a-14(a) and Rule      15d-14(a) of the Securities Exchange Act of 1934, as    amended. |
| 32.1 | Certification      of the CEO and CFO pursuant to Rule 13a-14(b) and Rule 15d-14(b) of the      Securities Exchange Act of 1934 and 18 U.S.C. Section 1350    *.                  |

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| Date:  August      14, 2008 | By:    |                     /s/          Etienne      Weidemann |
|---------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                  |   | Etienne      Weidemann                                                                                                                                                                                        |
|                                  |   | Chief      Executive Officer                                                                                                                                                                                  |
|                                  |   | (Principal      Executive Officer)                                                                                                                                                                            |

| Date:  August      14, 2008 |                         /s/            Paul      T. Anthony |                                |
|---------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------|
|                                  |                                                                                                                                                                                                              | Paul      T. Anthony                |
|                                  |                                                                                                                                                                                                              | Chief      Financial Officer        |
|                                  |                                                                                                                                                                                                              | (Principal      Accounting Officer) |