**United
      States**


**Securities
      and Exchange Commission**


Washington,
      D.C. 20549





**Form
      10-QSB**





(Mark
      One)




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





For
      the
      quarterly period ended **May
      31, 2008**





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




For
      the
      transition period from ___________ to ___________




Commission
      file number 333-143931





**GEEKS
      ON CALL HOLDINGS, INC.**


(Exact
      name of Small Business Issuer as Specified in Its Charter)





**Delaware**
            
            **20-8097265**(State
                or Other jurisdiction of
              Incorporation
                or Organization)
            
            (I.R.S.
                Employer
              Identification
                No.)





**814
      Kempsville Road Suite 106, Norfolk, VA 23502**


(Address
      of Principal Executive Offices)





**(757)
      466-3448**


Issuer’s
      telephone number





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





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


Yes o No x





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





**Common
                Stock, $.001 par value**
            
            **14,117,500**(Class)
            
            (Outstanding
                at July 14, 2008)





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









**GEEKS
      ON CALL HOLDINGS, INC** .





**TABLE
      OF CONTENTS**





Page**PART
                I.**
            **FINANCIAL
                INFORMATION**Item
                1.
            Financial
                Statements (Unaudited)
            
            3Condensed
                Consolidated Balance Sheets as of May 31, 2008 and August 31, 2007
                (audited)
            
            3Condensed
                Consolidated Statements of Operations for the Three and Nine Months
                Ended
                May 31, 2008 and 2007
            
            4Condensed
                Consolidated Statements of Stockholders’ Equity (Deficit) for the Year
                Ended August 31, 2007(unaudited) and Nine Months Ended May 31,
                2008
            
            5Condensed
                Consolidated Statements of Cash Flows for the Nine Months Ended May
                31,
                2008 and 2007
            
            7Notes
                to Unaudited Condensed Consolidated Financial Statements
            
            8Item
                2.
            Management’s
                Discussion and Analysis of Financial Condition and Results of
                Operations
            
            23Item
                3.
            Controls
                and Procedures
            
            34**PART
                II.**
            **OTHER
                INFORMATION**Item
                1.
            Legal
                Proceedings
            
            34Item
                2.
            Unregistered
                Sales of Equity Securities and Use of Proceeds
            
            34Item
                3
            Defaults
                upon Senior Securities
            
            34Item
                4.
            Submission
                of Matters to a Vote of Security Holders
            
            34Item
                5.
            Other
                Information
            
            34Item
                6.
            Exhibits
            
            35Signatures
            
            
            35




2




**PART
      I.**  **FINANCIAL
      INFORMATION**





**ITEM
      1.**  **FINANCIAL
      STATEMENTS**





**GEEKS
      ON CALL HOLDINGS, INC.**


**CONDENSED
      CONSOLIDATED BALANCE SHEETS**





May 31,
            
            August 31,2008
            
            2007(unaudited)
            
            (audited)ASSETSCurrent
                assets:Cash
                and cash equivalents
            
            $
            218,944
            
            $
            280,846Accounts
                receivable, net of allowance for doubtful accounts of $14,181 and
                $15,893,
                respectively
            
            
            293,211
            
            
            248,091Notes
                receivable, current portion
            
            
            105,071
            
            
            145,892Lease
                receivable, current portion
            
            
            18,881
            
            
            -Prepaid
                expenses and other current assets
            
            
            483,723
            
            
            255,402Total
                current assets
            
            
            1,119,830
            
            
            930,231Property
                and equipment, net of accumulated depreciation of $716,328 and $578,108,
                respectively
            
            
            775,467
            
            
            483,857Other
                assets:Deposits
            
            
            2,034
            
            
            1,784Notes
                receivable, long term portion
            
            
            191,797
            
            
            406,999Customer
                lists, net of accumulated amortization of $2,575
            
            
            151,925
            
            
            -Trademarks,
                net of accumulated amortization of $6,450 and $5,733,
                respectively
            
            
            7,883
            
            
            8,600Total
                other assets
            
            
            353,639
            
            
            417,383Total
                Assets
            
            $
            2,248,936
            
            $
            1,831,471LIABILITIES
                AND STOCKHOLDERS' EQUITY (DEFICIT)Current
                liabilities:Accounts
                payable and accrued liabilities
            
            $
            1,581,455
            
            $
            1,142,087Line
                of credit
            
            
            -
            
            
            200,000Note
                payable, current portion
            
            
            49,401
            
            
            -Obligation
                under capital lease, current portion
            
            
            80,836
            
            
            53,909Deferred
                franchise and initial advertising fees
            
            
            99,537
            
            
            271,450Total
                current liabilities
            
            
            1,811,229
            
            
            1,667,446Long-term
                liabilities:Obligation
                under capital lease, long term portion
            
            
            13,477
            
            
            53,909Note
                payable, long term portion
            
            
            100,830
            
            
            -Shares
                subject to mandatory redemption
            
            
            -
            
            
            685,000Deferred
                rent expense
            
            
            51,612
            
            
            50,914Total
                liabilities
            
            
            1,977,148
            
            
            2,457,269STOCKHOLDERS'
                EQUITY ( DEFICIT)Preferred
                stock, par value $0.001; authorized 10,000,000 shares, none issued
                and
                outstanding
            
            
            -
            
            
            -Preferred
                stock Class B, no par value; authorized 167,130 shares; issued and
                outstanding as of May 31, 2008 and August 31, 2007: -0- and 160,404
                shares, respectively
            
            
            -
            
            
            2,152,417Preferred
                stock Class C, no par value; authorized 128,870 shares; issued and
                outstanding as of May 31, 2008 and August 31, 2007: -0- and 119,784
                shares, respectively
            
            
            -
            
            
            741,291Common
                stock, par value of $0.001; authorized 100,000,000 and 5,000,000
                shares
                respectively; issued and outstanding as of May 31, 2008 and August
                31,
                2007: 13,950,000 and 4,707,229 shares, respectively
            
            
            13,950
            
            
            4,707Common
                shares to be issued
            
            
            187,500
            
            
            -Additional
                paid-in capital
            
            
            8,859,408
            
            
            1,846,446Accumulated
                deficit
            
            
            (8,789,070
            )
            
            (5,370,659
            )Total
                stockholders' equity (deficit)
            
            
            271,788
            
            
            (625,798
            )Total
                liabilities and stockholders' equity (deficit)
            
            $
            2,248,936
            
            $
            1,831,471





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




3




**GEEKS
      ON CALL HOLDINGS, INC.**


**CONDENSED
      CONSOLIDATED STATEMENTS OF OPERATIONS**


**(unaudited)**





Three months ended May 31,
            
            Nine months ended May 31,2008
            
            2007
            
            2008
            
            2007REVENUES:Franchise,
                area developer and initial advertising fees
            
            $
            201,289
            
            $
            437,051
            
            $
            605,154
            
            $
            928,763Royalties
                and advertising fees
            
            
            1,053,074
            
            
            1,471,649
            
            
            3,629,653
            
            
            4,438,243Other
            
            
            6,792
            
            
            13,285
            
            
            42,482
            
            
            43,388Total
                revenue
            
            
            1,261,155
            
            
            1,921,985
            
            
            4,277,289
            
            
            5,410,394OPERATING
                EXPENSES:Selling,
                general and administrative expenses
            
            
            2,196,183
            
            
            924,960
            
            
            4,862,578
            
            
            2,792,438Advertising
                expense
            
            
            758,229
            
            
            909,703
            
            
            2,630,550
            
            
            2,696,511Depreciation
                and amortization
            
            
            67,976
            
            
            41,841
            
            
            141,512
            
            
            128,311Total
                operating expenses
            
            
            3,022,388
            
            
            1,876,504
            
            
            7,634,640
            
            
            5,617,260Income
                (loss) from operations
            
            
            (1,761,233
            )
            
            45,481
            
            
            (3,357,351
            )
            
            (206,866
            )Other
                income (expense):Other
                income
            
            
            4,394
            
            
            -
            
            
            8,669
            
            
            -Dividends
                on mandatory redeemable preferred stock
            
            
            -
            
            
            -
            
            
            (6,340
            )
            
            -Interest
                income (expense), net
            
            
            5,548
            
            
            (12,817
            )
            
            5,603
            
            
            (34,364
            )Net
                income (loss) before provision for income taxes
            
            
            (1,751,291
            )
            
            32,664
            
            
            (3,349,419
            )
            
            (241,230
            )Income
                taxes (benefit)
            
            
            -
            
            
            -
            
            
            -
            
            
            -NET
                INCOME (LOSS)
            
            
            (1,751,291
            )
            
            32,664
            
            
            (3,349,419
            )
            
            (241,230
            )Preferred
                stock dividend
            
            
            -
            
            
            60,920
            
            
            68,992
            
            
            179,385NET
                LOSS AVAILABLE TO COMMON STOCKHOLDERS
            
            $
            (1,751,291
            )
            $
            (28,256
            )
            $
            (3,418,411
            )
            $
            (420,615
            )Loss
                per shares, basic and diluted
            
            $
            (0.13
            )
            $
            (0.01
            )
            $
            (0.39
            )
            $
            (0.09
            )Weighted
                average number of common shares outstanding, basic and
                diluted
            
            
            13,950,000
            
            
            4,703,158
            
            
            8,703,416
            
            
            4,703,158





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




4




**GEEKS
      ON CALL HOLDINGS, INC.**


**CONDENSED
      CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)**


**YEAR
      ENDED AUGUST 31, 2007 AND FOR THE NINE MONTHS ENDED MAY 31,
      2008**


**(unaudited)**




Common stock
            
            Preferred stock, Class A
            
            Preferred stock, Class BShares
            
            Amount
            
            Shares
            
            Amount
            
            Shares
            
            AmountAdjusted
                for recapitalization:Balance,
                September 1, 2006, adjusted for fractional shares issued in conjunction
                with merger on December 14, 2007
            
            
            4,703,158
            
            $
            4,703
            
            
            -
            
            $
            -
            
            
            160,404
            
            $
            1,979,661Issuance
                of common stock to employees
            
            
            4,071
            
            
            4
            
            
            -
            
            
            -
            
            
            -
            
            
            -Preferred
                stock dividend
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            172,756Net
                loss
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Balance,
                August 31, 2007
            
            
            4,707,229
            
            
            4,707
            
            
            -
            
            
            -
            
            
            160,404
            
            
            2,152,417Rounding
            
            
            10
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Preferred
                stock dividend
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            49,696Common
                stock issued in exchange for conversion of Series B preferred stock
                and
                accrued dividends on December 14, 2007
            
            
            2,097,756
            
            
            2,098
            
            
            -
            
            
            -
            
            
            (160,404
            )
            
            (2,202,113
            )Common
                stock issued in exchange for conversion of Series C preferred stock
                and
                accrued dividends on December 14, 2007
            
            
            655,475
            
            
            656
            
            
            -
            
            
            -
            
            
            -
            
            
            -Common
                stock issued in exchange for conversion of Series D redeemable preferred
                stock and accrued dividends on December 14, 2007
            
            
            552,225
            
            
            552
            
            
            -
            
            
            -
            
            
            -
            
            
            -Cancellation
                of previously issued common stock for services rendered
            
            
            (12,695
            )
            
            (13
            )
            
            -
            
            
            -
            
            
            -
            
            
            -Effect
                of merger with Geeks On Call Holdings, Inc (formerly Lightview, Inc.)
                on
                December 14, 2007
            
            
            2,150,000
            
            
            2,150
            
            
            -
            
            
            -
            
            
            -
            
            
            -Sale
                of common stock
            
            
            3,800,000
            
            
            3,800
            
            
            -
            
            
            -
            
            
            -
            
            
            -Fair
                value of vested options granted to employees
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Common
              stock to be
              issued in exchange for acquired assets
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Net
                loss
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Balance,
                May 31, 2008
            
            
            13,950,000
            
            $
            13,950
            
            
            -
            
            $
            -
            
            
            -
            
            $
            -





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


5




**GEEKS
      ON CALL HOLDINGS, INC.**


**CONDENSED
      CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
      CONTINUED**


**YEAR
      ENDED AUGUST 31, 2007 AND FOR THE NINE MONTHS ENDED MAY 31,
      2008**


**(unaudited)**





Preferred stock, Class C
            
            Common stock
            
            Additional
            
            AccumulatedShares
            
            Amount
            
            To be issued
            
            Paid in Capital
            
            Deficit
            
            TotalAdjusted
                for recapitalization:Balance,
                September 1, 2006, adjusted for fractional shares issued in conjunction
                with merger on December 14, 2007
            
            
            119,784
            
            $
            674,212
            
            $
            -
            
            $
            1,836,832
            
            $
            (3,983,170
            )
            $
            512,238Issuance
                of common stock to employees
            
            
            -
            
            
            -
            
            
            -
            
            
            9,614
            
            
            -
            
            
            9,618Preferred
                stock dividend
            
            
            -
            
            
            67,079
            
            
            -
            
            
            
            
            
            (239,835
            )
            
            -Net
                loss
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (1,147,654
            )
            
            (1,147,654
            )Balance,
                August 31, 2007
            
            
            119,784
            
            
            741,291
            
            
            -
            
            
            1,846,446
            
            
            (5,370,659
            )
            
            (625,798
            )Rounding
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Preferred
                stock dividend
            
            
            -
            
            
            19,296
            
            
            -
            
            
            -
            
            
            (68,992
            )
            
            -Common
                stock issued in exchange for conversion of Series B preferred stock
                and
                accrued dividends on December 14, 2007
            
            
            -
            
            
            -
            
            
            -
            
            
            2,200,015
            
            
            -
            
            
            -Common
                stock issued in exchange for conversion of Series C preferred stock
                and
                accrued dividends on December 14, 2007
            
            
            (119,784
            )
            
            (760,587
            )
            
            -
            
            
            759,931
            
            
            -
            
            
            -Common
                stock issued in exchange for conversion of Series D redeemable preferred
                stock and accrued dividends on December 14, 2007
            
            
            -
            
            
            -
            
            
            
            
            
            620,160
            
            
            -
            
            
            620,712Cancellation
                of previously issued common stock for services rendered
            
            
            -
            
            
            -
            
            
            
            
            
            (23,087
            )
            
            -
            
            
            (23,100
            )Effect
                of merger with Geeks On Call Holdings, Inc (formerly Lightview, Inc.)
                on
                December 14, 2007
            
            
            -
            
            
            -
            
            
            
            
            
            (2,150
            )
            
            -
            
            
            -Sale
                of common stock
            
            
            -
            
            
            -
            
            
            
            
            
            3,193,103
            
            
            -
            
            
            3,196,903Fair
                value of vested options granted to employees
            
            
            -
            
            
            -
            
            
            
            
            
            264,990
            
            
            -
            
            
            264,990Common
                stock to be issued in exchange for acquired assets
            
            
            -
            
            
            -
            
            
            187,500
            
            
            -
            
            
            -
            
            
            187,500Net
                loss
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (3,349,419
            )
            
            (3,349,419
            )Balance,
                May 31, 2008
            
            
            -
            
            $
            -
            
            $
            187,500
            
            $
            8,859,408
            
            $
            (8,789,070
            )
            $
            523,811





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


6




**GEEKS
      ON CALL HOLDINGS, INC.**


**CONDENSED
      CONSOLIDATED STATEMENTS OF CASH FLOWS**


**(unaudited)**





Nine months ended May 31,2008
            
            2007CASH
                FLOWS FROM OPERATING ACTIVITIES:Net
                loss
            
            $
            (3,349,419
            )
            $
            (241,230
            )Adjustments
                to reconcile net loss to net cash used in operating
                activities:Depreciation
                and amortization
            
            
            141,512
            
            
            128,311Bad
                debt expense
            
            
            328,974
            
            
            13,425Fair
                value of vested options granted to employees
            
            
            264,990
            
            
            -Changes
                in operating assets and liabilities:Accounts
                receivable
            
            
            (374,094
            )
            
            (291,808
            )Prepaid
                expenses and other current assets
            
            
            (228,321
            )
            
            (234,729
            )Deposits
                and other assets
            
            
            (250
            )
            
            -Accounts
                payable and accrued liabilities
            
            
            458,081
            
            
            82,743Deferred
                franchise fees
            
            
            (171,913
            )
            
            (7,371
            )Deferred
                rent expense
            
            
            698
            
            
            4,911Net
                cash used in operating activities
            
            
            (2,902,742
            )
            
            (545,748
            )CASH
                FLOWS FROM INVESTING ACTIVITIES:Proceeds
                from sale of investments
            
            
            -
            
            
            43,239Issuance
                (repayments) of loans to franchisees and others, net
            
            
            237,142
            
            
            (463,360
            )Purchase
                of property and equipment
            
            
            (242,331
            )
            
            (54,203
            )Net
                cash used in investing activities
            
            
            (5,189
            )
            
            (474,324
            )CASH
                FLOWS FROM FINANCING ACTIVITIES:Redemption
                of common stock
            
            
            (23,100
            )
            
            -Repayment
                of note obligation
            
            
            (110,000
            )
            
            -Repayment
                of credit line
            
            
            (200,000
            )Proceeds
                (repayments) of capital lease obligation
            
            
            (13,505
            )
            
            (45,812
            )Proceeds
                from issuance of shares subject to mandatory redemption
            
            
            -
            
            
            435,000Repayments
                of note payable
            
            
            (4,269
            )
            
            -Proceeds
                from sale of common stock
            
            
            3,196,903
            
            
            -Net
                cash provided by financing activities
            
            
            2,846,029
            
            
            389,188Net
                decrease in cash and cash equivalents
            
            
            (61,902
            )
            
            (630,884
            )Cash
                and cash equivalents, beginning of period
            
            
            280,846
            
            
            667,856Cash
                and cash equivalents, end of period
            
            $
            218,944
            
            $
            36,972Supplement
                disclosures of cash flow information
              Cash
                paid during the periods for:Interest
                paid
            
            $
            17,961
            
            $
            13,540Income
                taxes paid
            
            $
            -
            
            $
            -Supplement
              disclosures of noncash investing and financing activitiesFair
                value of vested options granted to employees
            
            $
            264,990
            
            $
            -Customer
                lists acquired through issuance of note payable
            
            $
            154,500
            
            $
            -Common
                stock to be issued in exchange for property and equipment
            
            $
            187,500
            
            $
            -





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




7


**GEEKS
      ON CALL HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING
      POLICIES**





General





The
      accompanying unaudited condensed consolidated financial statements have been
      prepared in accordance with the instructions to Form 10-QSB, and therefore,
      do
      not include all the information necessary for a fair presentation of financial
      position, results of operations and cash flows in conformity with generally
      accepted accounting principles.




In
      the
      opinion of management, all adjustments (consisting of normal recurring accruals)
      considered necessary for a fair presentation have been included. Operating
      results for the three and nine month periods ended May 31, 2008 are not
      necessarily indicative of the results that may be expected for the fiscal year
      ending August 31, 2008. The unaudited condensed consolidated financial
      statements should be read in conjunction with the August 31, 2007 financial
      statements and footnotes thereto included in the Company's amendment no. 2
      to the registration statement on Form S-1 filed with the SEC on July
      7, 2008.




Business
      and Basis of Presentation





Geeks
      On
      Call America, Inc. was incorporated under the laws of the State of Virginia
      on
      June 11, 2001 and subsequently reincorporated on December 14, 2007 under the
      laws of the State of Delaware. The Company provides quick-response, on-site
      computer solutions and telephone technical support (including services,
      on-going, support and training) primarily to small to medium business
      enterprises and residential computer users in the United States. On-site
      solutions are provided through a network of independent franchisees who are
      certified IT solutions providers conducting business under the trade names
      1 800
      905 GEEK and Geeks On Call®. While the Company has generated revenues from its
      franchise operations, the Company has incurred expenses, and sustained losses.
      Consequently, its operations are subject to all risks inherent in the
      establishment of a new business enterprise. As of May 31, 2008, the Company
      has
      accumulated losses of $8,789,070.





The
      condensed consolidated financial statements include the accounts of the Company,
      which is now named Geeks On Call Holdings, Inc., the registrant (formerly
      Lightview, Inc.) and Geeks On Call America, Inc., the wholly-owned subsidiary
      of
      Geeks On Call Holdings, Inc. (the “Company”). All significant intercompany
      balances and transactions have been eliminated in consolidation.





Merger
      and Corporate Restructure





On
      February 8, 2008, the Company consummated a reverse merger by entering into
      an
      Agreement of Merger and Plan of Reorganization (“Merger”) with the stockholders
      of Geeks On Call America, Inc. (the “Share Exchange”), pursuant to which the
      stockholders of Geeks On Call America, Inc. (“Geeks”) exchanged all of the
      issued and outstanding capital stock of Geeks for 8,000,000 shares of common
      stock of Geeks On Call Holdings, Inc., representing 79% of Geeks On Call
      Holdings, Inc.’s (the “Parent”) outstanding capital stock, after the return to
      treasury and retirement of 2,866,667 shares of common stock of the Parent held
      by certain stockholders of the Parent made concurrently with the share exchange.
      Upon consummation of the Merger, Geeks became a wholly-owned subsidiary of
      the
      Parent (the “Company”).





The
      acquisition is accounted for as a “reverse acquisition”, since the stockholders
      of Geeks owned a majority of the Parent’s common stock immediately following the
      transaction. The combination of the two companies is recorded as a
      recapitalization of Geeks pursuant to which Geeks is treated as the surviving
      and continuing entity although the Parent is the legal acquirer. Accordingly,
      the Company’s historical financial statements are those of Geeks. The Company
      did not recognize goodwill or any intangible assets in connection with this
      transaction.





All
      references to common stock, share and per share amounts have been retroactively
      restated to reflect the reverse acquisition as if the transaction had taken
      place as of the beginning of the earliest period presented.





8




**GEEKS
      ON CALL HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
      (continued)**





The
      total
      consideration paid was $-0- and the significant components of the transaction
      are as follows:




Geeks
      On
      Call Holdings, Inc. (Formerly named Lightview, Inc.)


Summary
      Statement of Financial Position


At
      February 8, 2008





Assets:
            
            $
            -0-Liabilities:Net
                liabilities assumed
            
            $
            -0-Total
                consideration:
            
            $
            -0-





Revenue
      Recognition





The
      Company accounts for revenue under the guidance provided by SFAS No. 45,
“Accounting for Franchise Fee Revenue (as amended)” and EITF 00-21, “Revenue
      Arrangements with Multiple Deliverables”.





Franchise
      fee revenue is recognized when (i) all material obligations of the Company
      to
      prepare the franchisee for operations have been substantially
      completed; and (ii) all material initial services to be provided by the
      Company have been performed, with an
      appropriate provision for estimated uncollectible amounts. Obligations to
      prepare the franchisee for operations are substantially completed upon the
      completion by the franchisee of the Company’s training program.





There
      are
      no other material conditions or commitments or obligations that exist related
      to
      the determination of substantial performance or substantial completion of the
      franchise agreement.





Area
      Development Sales





Area
      developer sales, wherein the Company sells the rights to develop a territory
      or
      market, are nonrefundable fees recognized as revenue upon signature of the
      Area
      Development Agreement and substantial completion of all of the Company’s
      obligations associated with the opening of the first franchise under the
      agreement have been met. Substantial completion includes, but is not limited
      to,
      conducting market and trade area analysis, a meeting with the Company’s
      Executive Team, and performing potential franchise background investigation,
      all
      of which are completed prior to our execution of the Area Development Agreement
      and receipt of the corresponding area development fee. As a result, the Company
      recognizes this fee in full upon receipt and with the opening of the first
      franchise under the Area Development Agreement.





No
      additional substantive services required after the first franchise is opened
      under the Area Development Agreement.





Advertising
      and Royalty Fees





Initial
      advertising fees are recognized when the territory is open and the related
      advertising has been performed. Ongoing royalties and advertising fees are
      recognized currently as the franchised territory generates sales and ongoing
      advertising is performed.





Repossessed
      Franchises





From
      time
      to time the Company may recover franchise rights through repossession if a
      franchisee decides not to open a franchise. If, for any reason, the Company
      refunds the consideration received, the original sale is canceled, and revenue
      previously recognized is accounted for as a reduction in revenue in the period
      the franchise is repossessed. If franchise rights are repossessed but no refund
      is made (a) the transaction is not regarded as a sale cancellation, (b) no
      adjustment is made to any previously recognized revenue, (c) any estimated
      uncollectible amounts resulting from unpaid receivables is provided for, and
      (d)
      any consideration retained for which revenue was not previously recognized
      is
      reported as revenue.





9




**GEEKS
      ON CALL HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
      (continued)**





Deferred
      Franchise Fees





The
      Company may receive all or part of the initial franchise or advertising fee
      prior to the execution of the franchise agreement of completion of the earnings
      process. These amounts are classified as deferred revenue until the fee
      qualifies to be recognized as revenue or is refunded.




Use
      of
      Estimates





The
      preparation of financial statements in conformity with generally accepted
      accounting principles 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 revenue and expenses during the reporting period. Actual
      results could differ from those estimates.





Cash
      and cash equivalents





For
      purposes of the Statements of Cash Flows, the Company considers all highly
      liquid debt instruments purchased with a maturity date of three months or less
      to be cash and cash equivalents. The Company had $218,944 in cash and cash
      equivalents at May 31, 2008.





Allowance
      for doubtful accounts





The
      Company periodically reviews its trade and notes receivables in determining
      its
      allowance for doubtful accounts. As of May 31, 2008 and August 31, 2007
      allowance for doubtful accounts balances for trade receivables were $14,181
      and
      15,893, respectively.





Inventories





Inventories,
      totaling $87,589 and $69,453 as of May 31, 2008 and August 31, 2007,
      respectively, are stated at the lower of cost (first in, first out) or net
      realizable value, and consist primarily of products for sale to franchisees,
      business forms, marketing and promotional supplies for sale to the Company’s
      franchisees. Inventories are included in prepaid expenses and other current
      assets in the accompanying balance sheets.





Concentration
      of Credit Risk





Financial
      instruments and related items, which potentially subject the Company to
      concentrations of credit risk, consist primarily of cash and cash equivalents,
      trade receivable and notes receivable. The Company keeps its cash and temporary
      cash investments with high credit quality institutions. At times, such
      investments may be in excess of the FDIC insurance limit.




Property
      and Equipment





Property
      and equipment are recorded at cost and depreciated over their estimated useful
      lives using the straight-line method as follows:





Office
                furniture and equipment
            
            10
                yearsComputer
                equipment
            
            5
                yearsVehicles
            
            5
                yearsSoftware
            
            3
                yearsLeasehold
                improvements
            
            lesser
                of lease terms or 7 years




Expenditures
      for repairs and maintenance which do not materially extend the useful lives
      of
      property and equipment are charged to operations. When property or equipment
      is
      sold or otherwise disposed of, the cost and related accumulated depreciation
      are
      removed from the respective accounts with the resulting gain or loss reflected
      in operations. Management periodically reviews the carrying value of its
      property and equipment for impairment. The property and equipment had not
      incurred any impairment loss at May 31, 2008.




10




**GEEKS
      ON CALL HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
      (continued)**





Customer
      lists





The
      Company acquired the rights to provide direct services to customers previously
      under a franchisee contract by issuing a note payable for the consideration
      of
      $154,500.





The
      Company amortized its intangible asset using the straight-line method over
      its
      estimated period of benefit.  The estimated useful life for the
      customer lists is three years. The Company periodically, but at least annually,
      evaluates the recoverability of intangible assets and takes into account events
      or circumstances that warrant revised estimates of useful lives or that indicate
      that impairment exists.





Advertising





The
      Company follows the policy of charging the costs of advertising to expense
      as
      incurred. The Company charged to operations $758,229 and $909,703 as advertising
      costs for the three-month periods ended May 31, 2008 and 2007, respectively
      and
      $2,630,550 and $2,696,511 for the nine-month periods ended May 31, 2008 and
      2007, respectively.





Impairment
      of Long-Lived Assets





The
      Company follows Statement of Financial Accounting Standards No. 144,
“ *Accounting
      for the Impairment or Disposal of Long-Lived Assets* ”
(“SFAS
      No. 144”). SFAS No. 144 requires that long-lived assets and certain identifiable
      intangibles held and used by the Company be reviewed for impairment whenever
      events or changes in circumstances indicate that the carrying amount of an
      asset
      may not be recoverable. Events relating to recoverability may include
      significant unfavorable changes in business conditions, recurring losses, or
      a
      forecasted inability to achieve break-even operating results over an extended
      period. The Company evaluates the recoverability of long-lived assets based
      upon
      forecasted discounted cash flows. Should impairment in value be indicated,
      the
      carrying value of the long-lived assets and certain identifiable intangibles
      will be adjusted, based on estimates of future discounted cash flows resulting
      from the use and ultimate disposition of the asset. SFAS No. 144 also requires
      assets to be disposed of be reported at the lower of the carrying amount or
      the
      fair value less disposal costs.





Stock
      Based Compensation





On
      December 16, 2004, the FASB issued SFAS No. 123(R) (revised 2004), “ *Share-Based
      Payment* ”
which
      is a revision of SFAS No. 123, “ *Accounting
      for Stock-Based Compensation* ”.
      SFAS
      No. 123(R) supersedes APB opinion No. 25, “ *Accounting
      for Stock Issued to Employees* ”,
      and
      amends SFAS No. 95, “ *Statement
      of Cash Flows* ”.
      Generally, the approach in SFAS No. 123(R) is similar to the approach described
      in SFAS No. 123. However, SFAS No. 123(R) requires all share-based payments
      to
      employees, including grants of employee stock options, to be recognized in
      the
      income statement based on their fair values. Pro-forma disclosure is no longer
      an alternative. The effective date for our application of SFAS No. 123(R) is
      September 1, 2006. Management has elected to apply SFAS No. 123(R) commencing
      on
      that date.




As
      more
      fully described in Note 11 below, the Company granted 2,275,000 and -0- stock
      options during the nine-month period ended May 31, 2008 and 2007, respectively
      to employees and directors of the Company under a non-qualified employee stock
      option plan.





As
      of May
      31, 2008, 2,275,000 employee stock options were outstanding with 300,000 shares
      vested and exercisable.





Segment
      reporting





The
      Company adopted Statement of Financial Accounting Standards No. 131, Disclosures
      about Segments of an Enterprise and Related Information ("SFAS 131"). SFAS
      establishes standards for reporting information regarding operating segments
      in
      annual financial statements and requires selected information for those segments
      to be presented in interim financial reports issued to stockholders. SFAS 131
      also establishes standards for related disclosures about products and services
      and geographic areas. Operating segments are identified as components of an
      enterprise about which separate discrete financial information is available
      for
      evaluation by the chief operating decision maker, or decision making group,
      in
      making decisions how to allocate resources and assess performance. The
      information disclosed herein, materially represents all of the financial
      information related to the Company's principal operating segment.




11





**GEEKS
      ON CALL HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
      (continued)**





Income
      taxes





The
      Company follows SFAS No. 109, “ *Accounting
      for Income Taxes* ”
(SFAS
      No. 109) for recording the provision for income taxes. Deferred tax assets
      and
      liabilities are computed based upon the difference between the financial
      statement and income tax basis of assets and liabilities using the enacted
      marginal tax rate applicable when the related asset or liability is expected
      to
      be realized or settled. Deferred income tax expenses or benefits are based
      on
      the changes in the asset or liability during each period. If available evidence
      suggests that it is more likely than not that some portion or all of the
      deferred tax assets will not be realized, a valuation allowance is required
      to
      reduce the deferred tax assets to the amount that is more likely than not to
      be
      realized. Future changes in such valuation allowance are included in the
      provision for deferred income taxes in the period of change. Deferred income
      taxes may arise from temporary differences resulting from income and expense
      items reported for financial accounting and tax purposes in different periods.
      Deferred taxes are classified as current or non-current, depending on the
      classification of assets and liabilities to which they relate. Deferred taxes
      arising from temporary differences that are not related to an asset or liability
      are classified as current or non-current depending on the periods in which
      the
      temporary differences are expected to reverse.





Loss
      per share





In
      accordance with SFAS No. 128, “ *Earnings
      per Share* ”,
      the
      basic loss per share is computed by dividing loss available to common
      shareholders by the weighted average number of common shares outstanding.
      Diluted loss per share is computed similar to basic loss per share except that
      the denominator is increased to include the number of additional common shares
      that would have been outstanding as if the potential common shares had been
      issued and if the additional common shares were dilutive. Common equivalent
      shares are excluded from the computation of the diluted loss per share as their
      effect would be anti-dilutive.





The
      following common stock equivalents were excluded from the calculation of the
      diluted loss per share for the three and nine month periods ended May 31, 2008
      and 2007 since the effect would have been anti-dilutive:




Three Months
              ended
              May 31,
              2008
            
            Three Months
              ended
              May 31, 2007
            
            Nine Months
              ended
              May 31,
              2008
            
            Nine Months
              ended
              May 31,
              2007Warrants
            
            
            1,875,000
            
            
            -
            
            
            1,875,000
            
            
            -Stock
                options for common stock
            
            
            300,000
            
            
            -
            
            
            300,000
            
            
            -Class
                B preferred stock, if converted
            
            
            -
            
            
            1,969,742
            
            
            -
            
            
            1,969,742Class
                C preferred stock, if converted
            
            
            -
            
            
            619,480
            
            
            -
            
            
            619,480Total
            
            
            2,175,000
            
            
            2,589,222
            
            
            2,175,000
            
            
            2,589,222





Recent
      accounting pronouncements





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”) *.* SFAS No.
      155 permits fair value remeasurement for any hybrid financial instrument that
      contains an embedded derivative that otherwise would require bifurcation,
      clarifies which interest-only strips and principal-only strips are not subject
      to the requirements of SFAS No. 133, establishes a requirement to evaluate
      interests in securitized financial assets to identify interests that are
      freestanding derivatives or that are hybrid financial instruments that contain
      an embedded derivative requiring bifurcation, clarifies that concentrations
      of
      credit risk in the form of subordination are not embedded derivatives, and
      amends SFAS No. 140 to eliminate the prohibition on a qualifying special purpose
      entity from holding a derivative financial instrument that pertains to a
      beneficial interest other than another derivative financial instrument. SFAS
      No.
      155 is effective for all financial instruments acquired or issued after the
      beginning of an entity’s first fiscal year that begins after September 15, 2006.
      The SFAS No. 155 did not have a material impact on the Company’s consolidated
      financial position, results of operations or cash flows.





In
      March
      2006, the FASB issued SFAS No. 156, “ *Accounting
      for Servicing of Financial Assets - an amendment to FASB Statement No.
      140* ”
(“SFAS
      No. 156”). SFAS No. 156 requires that an entity recognize a servicing asset or
      servicing liability each time it undertakes an obligation to service a financial
      asset by entering into a service contract under certain situations. The new
      standard is effective for fiscal years beginning after September 15, 2006.
      SFAS
      No.156 did not have a material impact on the Company's consolidated financial
      position, results of operations or cash flows.




12




**GEEKS
      ON CALL HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)**





Recent
      accounting pronouncements (continued)





In
      July
      2006, the FASB issued Interpretation No. 48, “ *Accounting*  *for
      uncertainty in Income Taxes”* (“FIN
      No. 48”). FIN No. 48 clarifies the accounting for Income Taxes by prescribing
      the minimum recognition threshold a tax position is required to meet before
      being recognized in the financial statements. It also provides guidance on
      derecognition, measurement, classification, interest and penalties, accounting
      in interim periods, disclosure and transition and clearly scopes income taxes
      out of SFAS No. 5, “ *Accounting
      for Contingencies”.* FIN No.
      48 is effective for fiscal years beginning after December 15, 2006. The Company
      did not have a material impact on the Company's consolidated financial position,
      results of operations or cash flows.





In
      September 2006, the FASB issued SFAS No. 157, “ *Fair
      Value Measurements* ”.  The
      objective of SFAS No. 157 is to increase consistency and comparability in fair
      value measurements and to expand disclosures about fair value
      measurements.  SFAS No. 157 defines fair value, establishes a
      framework for measuring fair value in generally accepted accounting principles,
      and expands disclosures about fair value measurements.  SFAS No. 157
      applies under other accounting pronouncements that require or permit fair value
      measurements and does not require any new fair value
      measurements.  The provisions of SFAS No. 157 are effective for fair
      value measurements made in fiscal years beginning after November 15,
      2007.   In February 2008, the FASB issued FASB Staff
      Position (“FSP”) 157-2 **,** *“Effective
      Date of FASB Statement No. 157”* (“FSP
      157-2 *),* which
      delayed the effective date of SFAS No. 157 for all non-financial assets and
      liabilities, except those that are recognized or disclosed at fair value in
      the
      financial statements on a recurring basis, until fiscal years beginning after
      November 15, 2008.   We have not yet determined the impact that
      the implementation of FSP 157-2 will have on our non-financial assets and
      liabilities which are not recognized on a recurring basis; however, we do not
      anticipate the adoption of this standard will have a material impact on our
      consolidated financial position, results of operations or cash
      flows.





In
      September 2006 the FASB issued its SFAS No. 158, “ *Employers’
      Accounting for Defined Benefit Pension and Other Postretirement Plans, an
      amendment of FASB Statements No. 87, 88, 106 and 132(R)* ”
(“SFAS
      No. 158”). SFAS No. 158 improves financial reporting by requiring an employer to
      recognize the overfunded or underfunded status of a defined benefit
      postretirement plan (other than a multiemployer plan) as an asset or liability
      in its statement of financial position and to recognize changes in that funded
      status in the year in which the changes occur through comprehensive income
      of a
      business entity or changes in unrestricted net assets of a not-for-profit
      organization. SFAS No. 158 also improves financial reporting by requiring an
      employer to measure the funded status of a plan as of the date of its year-end
      statement of financial position, with limited exceptions. The effective date
      for
      an employer with publicly traded equity securities is as of the end of the
      fiscal year ending after December 15, 2006. SFAS No. 158 did not have a material
      impact on its consolidated financial position, results of operations or cash
      flows.





In
      December 2006, the FASB issued FSP EITF 00-19-2, “ *Accounting
      for Registration Payment Arrangements* ”
(“
FSP
      00-19 -2”) which addresses accounting for registration payment arrangements. FSP
      00-19 -2 specifies that the contingent obligation to make future payments or
      otherwise transfer consideration under a registration payment arrangement,
      whether issued as a separate agreement or included as a provision of a financial
      instrument or other agreement, should be separately recognized and measured
      in
      accordance with SFAS No. 5, “Accounting for Contingencies”. FSP 00-19 -2 further
      clarifies that a financial instrument subject to a registration payment
      arrangement should be accounted for in accordance with other applicable
      generally accepted accounting principles without regard to the contingent
      obligation to transfer consideration pursuant to the registration payment
      arrangement. For registration payment arrangements and financial instruments
      subject to those arrangements that were entered into prior to the issuance
      of
      EITF 00-19-2, this guidance shall be effective for financial statements issued
      for fiscal years beginning after December 15, 2006 and interim periods within
      those fiscal years. The Company did not have a material impact on its
      consolidated financial position, results of operations or cash flows





In
      February 2007, the FASB issued SFAS No. 159, “ *The
      Fair Value Option for Financial Assets and Financial Liabilities - Including
      an
      Amendment of FASB Statement No. 115* ”
(“SFAS
      No. 159”).  SFAS No. 159 permits entities to choose to measure many
      financial instruments and certain other items at fair value.  Most of
      the provisions of SFAS No. 159 apply only to entities that elect the fair value
      option. However, the amendment to SFAS No. 115 “ *Accounting
      for Certain Investments in Debt and Equity Securities* ”
applies
      to all entities with available-for-sale and trading securities.  SFAS
      No. 159 is effective as of the beginning of an entity’s first fiscal year that
      begins after November 15, 2007.  Early adoption is permitted as of the
      beginning of a fiscal year that begins on or before November 15, 2007, provided
      the entity also elects to apply the provision of SFAS No. 157, “ *Fair
      Value Measurements* ”.  The
      adoption of SFAS No. 159 is not expected to have a material impact on our
      consolidated financial position, results of operations or cash
      flows.





13




**GEEKS
      ON CALL HOLDINGS, INC**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)**





Recent
      accounting pronouncements (continued)





In
      December 2007, the FASB issued SFAS No. 141(R), *"Business
      Combinations"* ("SFAS No. 141(R)"), which establishes principles and requirements for how
      an acquirer recognizes and measures in its financial statements the identifiable
      assets acquired, the liabilities assumed, and any noncontrolling interest in
      an
      acquiree, including the recognition and measurement of goodwill acquired in
      a
      business combination. SFAS No. 141R is effective as of the beginning of the
      first fiscal year beginning on or after December 15, 2008. Earlier adoption
      is prohibited and the Company is currently evaluating the effect, if any that
      the adoption will have on its consolidated financial position results of
      operations or cash flows.





In
      December 2007, the FASB issued SFAS No. 160, *"Noncontrolling
      Interest in Consolidated Financial Statements, an amendment of ARB
      No. 51”* (“SFAS
      No. 160”), which will change the accounting and reporting for minority
      interests, which will be recharacterized as noncontrolling interests and
      classified as a component of equity within the consolidated balance sheets.
      SFAS
      No. 160 is effective as of the beginning of the first fiscal year beginning
      on
      or after December 15, 2008. Earlier adoption is prohibited and the Company
      is currently evaluating the effect, if any that the adoption will have on its
      consolidated financial position results of operations or cash
      flows.





In
      June 2007, the Accounting Standards Executive Committee issued Statement of
      Position 07-1, “Clarification of the Scope of the Audit and Accounting Guide
      Investment Companies and Accounting by Parent Companies and Equity Method
      Investors for Investments in Investment Companies” (“SOP 07-1”). SOP 07-1
      provides guidance for determining whether an entity is within the scope of
      the
      AICPA Audit and Accounting Guide Investment Companies (the “Audit Guide”). SOP
      07-1 was originally determined to be effective for fiscal years beginning on
      or
      after December 15, 2007, however, on February 6, 2008, FASB issued a
      final Staff Position indefinitely deferring the effective date and prohibiting
      early adoption of SOP 07-1 while addressing implementation issues.





In
      June
      2007, the FASB ratified the consensus in EITF Issue No. 07-3, “Accounting
      for Nonrefundable Advance Payments for Goods or Services to be Used in Future
      Research and Development Activities” (EITF 07-3), which requires that
      nonrefundable advance payments for goods or services that will be used or
      rendered for future research and development (R&D) activities be deferred
      and amortized over the period that the goods are delivered or the related
      services are performed, subject to an assessment of recoverability.
      EITF 07-3 will be effective for fiscal years beginning after
      December 15, 2007. The Company does not expect that the adoption of
      EITF 07-3 will have a material impact on our consolidated financial
      position, results of operations or cash flows.





In
      December 2007, the FASB ratified the consensus in EITF Issue No. 07-1,
“Accounting for Collaborative Arrangements” (EITF 07-1). EITF 07-1
      defines collaborative arrangements and requires collaborators to present the
      result of activities for which they act as the principal on a gross basis and
      report any payments received from (made to) the other collaborators based on
      other applicable authoritative accounting literature, and in the absence of
      other applicable authoritative literature, on a reasonable, rational and
      consistent accounting policy is to be elected. EITF 07-1 also provides for
      disclosures regarding the nature and purpose of the arrangement, the entity’s
      rights and obligations, the accounting policy for the arrangement and the income
      statement classification and amounts arising from the agreement. EITF 07-1
      will be effective for fiscal years beginning after December 15, 2008, which
      will be the Company’s fiscal year 2009, and will be applied as a change in
      accounting principle retrospectively for all collaborative arrangements existing
      as of the effective date. The Company has not yet evaluated the potential impact
      of adopting EITF 07-1 on our consolidated financial position, results of
      operations or cash flows.





In
      March
      2008, the FASB” issued SFAS No. 161, “ *Disclosures
      about Derivative Instruments and Hedging Activities - an amendment to FASB
      Statement No. 133”* (“SFAS
      No. 161”) *.* SFAS
      No. 161 is intended to improve financial standards for derivative instruments
      and hedging activities by requiring enhanced disclosures to enable investors
      to
      better understand their effects on an entity's financial position, financial
      performance, and cash flows.  Entities are required to provide
      enhanced disclosures about: (a) how and why an entity uses derivative
      instruments; (b) how derivative instruments and related hedged items are
      accounted for under SFAS No. 133 and its related interpretations; and (c) how
      derivative instruments and related hedged items affect an entity’s financial
      position, financial performance, and cash flows.  It is effective for
      financial statements issued for fiscal years beginning after November 15, 2008,
      with early adoption encouraged.  We are currently evaluating the
      impact of SFAS No. 161, if any, will have on our consolidated financial
      position, results of operations or cash flows.





14





**GEEKS
      ON CALL HOLDINGS, INC**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)**





Recent
      accounting pronouncements (continued)





In
      April
      2008, the FASB issued FSP No. FAS 142-3, *“Determination
      of the Useful Life of Intangible Assets”.* This FSP
      amends the factors that should be considered in developing renewal or extension
      assumptions used to determine the useful life of a recognized intangible asset
      under SFAS No. 142, *“Goodwill
      and Other Intangible Assets”.* We
      are required to adopt FSP 142-3 on September 1, 2009, earlier adoption is
      prohibited.  The guidance in FSP 142-3 for determining the useful life
      of a recognized intangible asset shall be applied prospectively to intangible
      assets acquired after adoption, and the disclosure requirements shall be applied
      prospectively to all intangible assets recognized as of, and subsequent to,
      adoption.  We are currently evaluating the impact of FSP 142-3 on our
      consolidated financial position, results of operations or cash
      flows.








In
      May
      2008, the FASB issued SFAS No. 162, " *The
      Hierarchy of Generally Accepted Accounting Principles* "
      ("SFAS No. 162").  SFAS No. 162 identifies the sources of
      accounting principles and the framework for selecting the principles used in
      the
      preparation of financial statements of nongovernmental entities that are
      presented in conformity with generally accepted accounting principles (the
      GAAP hierarchy).  SFAS No. 162 will become effective 60 days
      following the SEC's approval of the Public Company Accounting Oversight Board
      amendments to AU Section 411, "The Meaning of Present Fairly in
      Conformity With Generally Accepted Accounting Principles."  We do not
      expect the adoption of SFAS No. 162 will have a material effect on our
      consolidated financial position, results of operations or cash
      flows.





In
      May
      2008, the FASB issued FSP Accounting Principles Board ("APB") 14-1 " *Accounting
      for Convertible Debt Instruments That May Be Settled in Cash upon Conversion
      (Including Partial Cash Settlement)* " ("FSP
      APB 14-1").  FSP APB 14-1 requires the issuer of certain
      convertible debt instruments that may be settled in cash (or other assets)
      on
      conversion to separately account for the liability (debt) and equity (conversion
      option) components of the instrument in a manner that reflects the issuer's
      non-convertible debt borrowing rate.  FSP APB 14-1 is effective
      for fiscal years beginning after December 15, 2008 on a retroactive
      basis.  We are currently evaluating the potential impact, if any, of
      the adoption of FSP APB 14-1 on our consolidated financial position,
      results of operations or cash flows.





Other
      recent accounting pronouncements issued by the FASB (including its Emerging
      Issues Task Force), the AICPA, and the SEC did not, or are not believed by
      management to, have a material impact on the Company’s present or future
      consolidated financial statements.





**NOTE
      2 - GOING CONCERN MATTERS**




The
      accompanying condensed consolidated financial statements have been prepared
      on a
      going concern basis, which contemplates the realization of assets and the
      satisfaction of liabilities in the normal course of business. As shown in the
      accompanying financial statements, the Company incurred a net loss of $3,349,419
      and $241,230 for the nine-month period ended May 31, 2008 and 2007,
      respectively. Additionally, the Company has negative cash flows from operation
      of $2,902,742 and an accumulated deficit of $8,789,070 as of May 31, 2008.
      These
      factors among others may indicate that the Company will be unable to continue
      as
      a going concern for a reasonable period of time.





The
      Company’s continued existence is dependent upon management’s ability to develop
      profitable operations and resolve its liquidity problems. 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 should the Company be unable
      to
      continue as a going concern.




The
      Company is actively pursuing additional equity financing through discussions
      with investment bankers and private investors. There can be no assurance that
      the Company will be successful in its effort to secure additional equity
      financing.




15





**GEEKS
      ON CALL HOLDINGS, INC**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**




**NOTE
      3 - NOTES RECEIVABLE**





Note
      receivables are recorded at cost, less allowance for doubtful accounts, if
      applicable. Repayment of the notes receivable is dependent on the performance
      of
      the underlying franchises that collateralize the notes receivable. An allowance,
      if applicable, is estimated based on a comparison of amounts due to the
      estimated fair value of the underlying franchise. There is no allowance as
      of
      May 31, 2008 and August 31, 2007.





At
      May
      31, 2008 and August 31, 2007, the notes receivable consists of bridge loans
      offered to franchises during the period which the franchise is establishing
      their permanent financing with a third party lender. The notes receivable bear
      an interest rate of 9% per annum and are recorded at face value. Interest is
      recognized over the life of the note receivable.





A
      summary
      of the notes receivable are as follows:




May 31,
              2008
            
            August 31,
              2007Notes receivable,
                9% per annum, secured by Franchise
            
            $
            296,868
            
            $
            552,891Less:
                Current portion
            
            
            (105,071
            )
            
            (145,892
            )Long
                term portion
            
            $
            191,797
            
            $
            406,999





**NOTE
      4 - PREPAID EXPENSES AND OTHER CURRENT ASSETS**





Prepaid
      expenses and other current assets consist primarily of advance payments for
      advertising with various forms of media and saleable promotional supplies or
      inventories as follows:





May 31,
              2008
            
            August 31,
              2007Prepaid expenses
            
            $
            396,134
            
            $
            185,949Promotional
                supplies and inventories
            
            
            87,589
            
            
            69,453$
            483,723
            
            $
            255,402





**NOTE
      5 - PROPERTY AND EQUIPMENT**





As
      of May
      31, 2008 and August 31, 2007, property and equipment was comprised of the
      following:





May 31,
              2008
            
            August 31,
              2007Office furniture
                and equipment
            
            $
            358,415
            
            $
            349,259Computer
                equipment
            
            
            408,056
            
            
            355,003Vehicles
            
            
            77,884
            
            
            60,885Software
            
            
            596,173
            
            
            245,551Leasehold
                improvements
            
            
            51,267
            
            
            51,2671,491,795
            
            
            1,061,965Less:
                accumulated depreciation
            
            
            (716,328
            )
            
            (578,108
            )$
            775,467
            
            $
            483,857





For
      the
      three-month periods ended May 31, 2008 and 2007, depreciation expense charged
      to
      operations was $65,163 and $41,603, respectively. For the nine-month periods
      ended May 31, 2008 and 2007, depreciation expense charged to operations was
      $138,220 and $127,594, respectively.




16





**GEEKS
      ON CALL HOLDINGS, INC**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      6 - TRADEMARKS**





Trademarks
      are recorded at cost and are amortized ratably over 15 years as summarized
      below:





May 31,
              2008
            
            August 31,
              2007Trademarks
            
            $
            14,333
            
            $
            14,333Less
                accumulated amortization
            
            
            (6,450
            )
            
            (5,733
            )$
            7,883
            
            $
            8,600





For
      the
      three-month period May 31, 2008 and 2007, the amortization expense charged
      to
      operations was $239 and $239, respectively. For the nine-month period May 31,
      2008 and 2007, the amortization expense charged to operations was $717 and
      $717,
      respectively.




**NOTE
      7 - CUSTOMER LISTS**





The
      Company has adopted SFAS No. 142, Goodwill and Other Intangible Assets, whereby
      the Company periodically tests its intangible assets for
      impairment.  On an annual basis, and when there is reason to suspect
      that their values have been diminished or impaired, these assets are tested
      for
      impairment,  and write-downs will be included in the results of
      operations.





Customer
      lists are recorded at cost and are amortized ratably over three years as
      summarized below:





May 31,
              2008
            
            August 31,
              2007Customer
                Lists
            
            $
            154,500
            
            $
            -Less
                accumulated amortization
            
            
            (2,575
            )
            
            -$
            151,925
            
            $
            -





For
      the
      three-month period May 31, 2008 and 2007, the amortization expense charged
      to
      operations was $2,575 and $-0-, respectively. For the nine-month period May
      31,
      2008 and 2007, the amortization expense charged to operations was $2,575 and
      $-0-, respectively





**NOTE
      8 - ACCOUNTS PAYABLE AND ACCRUED LIABILITIES**





As
      of May
      31, 2008 and August 31, 2007, accounts payable and accrued liabilities are
      comprised of the following:





May 31,
              2008
            
            August 31,
              2007Accounts
                payable
            
            $
            1,414,748
            
            $
            970,013Accrued
                salaries and expenses
            
            
            130,948
            
            
            169,197Payroll
                taxes payable
            
            
            35,759
            
            
            2,877$
            1,581,455
            
            $
            1,142,087





**NOTE
      9 - LINE OF CREDIT**





The
      Company has established a revolving bank line of credit with a financial
      institution. On October 13, 2006, the line of credit was increased from $200,000
      to $700,000. The line of credit accrues interest at prime plus 0.5% interest
      per
      annum and is collateralized by inventory, accounts receivable, equipment and
      other instruments of the Company. As of May 31, 2008, the line of credit was
      closed with no outstanding borrowings. See Note 15 below.




17





**GEEKS
      ON CALL HOLDINGS, INC**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      10 - NOTE PAYABLE**





As
      of May
      31, 2008 and August 31, 2007, note payable is comprised of the
      following:





May
                31,
              2008
            
            August 31,
              2007Note
                payable, 4.5% per annum with monthly payment of $4,596, due April
                2011;
                unsecured
            
            $
            150,231
            
            $
            -Less:
                current portion
            
            
            (49,401
            )
            
            -Long
                term portion
            
            $
            100,830
            
            $
            -





In
      April
      2008, the Company issued an unsecured note payable, due in 36 monthly payments,
      to acquire the right to provide direct services to customers previously serviced
      under a franchise agreement (see Note 7 above)





**NOTE
      11 - SHARES SUBJECT TO MANDATORY REDEMPTION**





Class
      D - Preferred Stock





During
      the year ended August 31, 2007, the Company sold an aggregate of 123,201 shares
      of its Class D Preferred Stock at an average price of $5.56 per share,
      mandatorily redeemable on the fifth anniversary from the date of issuance at
      market value of the Company multiplied by the put fraction as described in
      the
      Articles of Incorporation. The put fraction numerator is the number of shares
      of
      common stock the Class D Preferred stock is convertible into and the
      denominator is the sum of these shares plus the then outstanding common
      stock.





The
      holder of Class D Preferred stock will have the right to convert all, but not
      less than all, of the Class D Preferred stock at the option of the holder at
      any
      time into Common stock. The number of shares of Common stock is determined
      as
      follows: the sum of (A) the number of shares being converted plus (B) all earned
      but unpaid dividends with respect to converted shares, whether or not declared,
      to and including the time to conversion, divided by 5.56 plus (C) a fraction,
      numerator of which is 5.56 multiplied by the number of shares being converted,
      and the denominator of which is 3.85.





The
      Company has properly classified the Class D Preferred stock as liabilities
      at August 31, 2007 because these instruments embody obligations to repurchase
      the Company’s equity shares that require the Company to settle by transferring
      its assets at the holders’ option not the issuer’s option.





On
      December 14, 2007, the Company issued 534,828 shares of common stock in exchange
      for 103,417 shares of Class D Preferred Stock and issued 17,397 shares of common
      stock in settlement of unpaid dividends. Additionally, the Company issued a
      promissory note for $110,000 in exchange for the remaining 19,784 shares of
      Class D Preferred Stock. The promissory note was paid off as of May 31,
      2008





**NOTE
      12 - STOCKHOLDERS’ EQUITY**





Preferred
      stock





As
      of
      August 31, 2007, the Company was authorized four classes of preferred stock:
      Class A has 200,000 authorized shares; Class B has 167,130 authorized shares;
      Class C has 128,870 authorized shares and Class D has 179,860 authorized shares.
      All classes have no par value.





On
      December 14, 2007, the Company filed an “Amended and Restated Certificate of
      Incorporation” with the State of Delaware. With the amendment and restatement,
      the Company is authorized to issue two classes of stock to be designated,
      respectively, “Common Stock” and “Preferred Stock”. The total number of shares
      the Company is authorized to issue is five million seven hundred thousand
      (5,700,000) shares. Five million (5,000,000) shares shall be $0.001 par value
      Common Stock and seven hundred (700,000) shares shall be $0.001 par value
      Preferred stock. The Preferred Stock authorized by the Amended and Restated
      Certificate of Incorporation may be issued from time to time in one or more
      class.





As
      a
      result of the merger as of February 8, 2008 described in Note 1 above, the
      Company is authorized to issue 10,000,000 of $0.001 par value preferred stock
      and 100,000,000 shares of $0.001 par value common stock.





18




**GEEKS
      ON CALL HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**





**NOTE
      12 - STOCKHOLDERS’ EQUITY (continued)**





Class
      A - Preferred stock





Class
      A -
      Preferred stock did not carry voting rights and is redeemable upon demand at
      the
      original purchase price plus any accrued dividends. Each share is convertible
      by
      the holder into one share of common stock after a holding period of one year.
      As
      of May 6, 2004; all outstanding shares of Class A - Preferred stock were
      converted into common shares.





Class
      B - Preferred stock





Class
      B Preferred stock carried voting rights and is entitled to receive, when
      and as declared by the board of directors, cumulative annual dividends at an
      annual rate of $1.077 per share. The dividends accumulate and accrue on a day
      to
      day basis whether or not earned or declared. Unless all accumulative dividends
      of Class B Preferred stock for all past and current dividend periods have been
      paid or declared, no dividends other than a dividend solely in common stock
      will
      be paid or declared by the Company. The Company cannot sell, redeem or acquire
      shares of its common stock or Class A Preferred stock unless all cumulative
      dividends of Class B Preferred stock have been paid or declared.





Holders
      of the Class B Preferred stock can require the Company to repurchase the shares
      five years from the date of issuance at market value of the Company multiplied
      by the put fraction. The put fraction numerator is the number of shares of
      common stock the Class B Preferred stock is convertible into and the denominator
      is the sum of the total number of shares of common stock into which all
      securities of the Company convertible into common stock then outstanding could
      be converted (including all such shares included in the numerator of the put
      fraction).





Conversion





The
      holder of Class B Preferred stock will have the right to convert all, but not
      less than all, of the Class B Preferred stock at the option of the holder at
      any
      time into Common stock. The number of shares of Common Stock is determined
      as
      follows: the sum of the Conversion Ratio Share Number and the Return of Capital
      Share Number. For purposes of such calculation, the following terms shall have
      the following meanings:





“Conversion
      Ratio Share Number” means
      the product of (A) 1.00186 and (B) the sum of (y) the number of shares being
      converted multiplied by 3 and (z) the Dividend Accrual Share Number




“Dividend
      Accrual Share Number” means
      all earned but unpaid dividends with respect to converted shares, whether or
      not
      declared, to and including, the time of conversion, divided by
      10.77.





“Return
      of Capital Share Number” means
      the quotient of (A) 10.77 multiplied by the number of shares being converted,
      divided by (B) 3.85





In
      December 2005, the Company redeemed 2,669 shares of Class B Preferred stock
      at
      $21.54 per share.





In
      March
      2006, the Company redeemed 4,057 shares of Class B Preferred stock at $21.54
      per
      share.





In
      December 14, 2007, the Company issued 1,969,742 shares of common stock in
      exchange for the remaining 160,404 shares of Class B Preferred Stock and issued
      128,014 shares of common stock in settlement of accumulative and unpaid
      dividends.





Class
      C - Preferred stock





Class
      C Preferred stock carried voting rights and is entitled to receive, when
      and as declared by the board of directors, cumulative annual dividends at an
      annual rate of $0.56 per share. The dividends accumulate and accrue on a day
      to
      day basis whether or not earned or declared. Unless all accumulative dividends
      of Class C Preferred stock for all dividend periods have been paid or
      declared, no dividends other than a dividend solely in common stock will be
      paid
      or declared by the Company. The Company cannot sell, redeem or acquire shares
      of
      its common stock unless all cumulative dividends of Class C Preferred stock
      have
      been paid or declared.





19





**GEEKS
      ON CALL HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**




**NOTE
      12 - STOCKHOLDERS’ EQUITY (continued)**





Conversion





The
      any
      holder of Series C Preferred stock will have the right to convert all, but
      not
      less than all, of the Series C Preferred stock at the option of the holder
      at
      any time into Common stock. The number of shares of Common stock is determined
      as follows: the sum of (A) the number of shares being converted plus (B) all
      earned but unpaid dividends with respect to converted shares, divided by 5.56
      plus (C) a fraction, numerator of which is 5.56 multiplied by the number of
      shares being converted, and the denominator of which is 3.85.





Holders
      of the Class C Preferred stock can require the Company to repurchase the shares
      commencing five years from the date of issuance at market value of the Company
      multiplied by the put fraction. The put fraction numerator is the number of
      shares of common stock the Class C Preferred stock is convertible into and
      the
      denominator is the sum of the total number of shares of common stock into which
      all securities of the Company convertible into common stock then outstanding
      could be converted (including all such shares included in the numerator of
      the
      put fraction).





During
      the year ended August 31, 2006, the Company sold an aggregate of 119,784 shares
      of its Class C Preferred stock at an average price of $5.56 per share adjusted
      for stock dividends, splits or issuances of common stock below the initial
      conversion price.





In
      December 14, 2007, the Company issued 619,480 shares of common stock in exchange
      for 119,784 shares of Class C-Preferred stock (representing all) and issued
      35,995 shares of common stock in settlement of accumulative and unpaid
      dividends.





All
      issued and outstanding preferred stock had been converted to the Company’s
      common stock as of May 31, 2008.





Common
      stock





The
      Company is authorized to issue 100,000,000 shares of its common stock with
      a par
      value of $.001. As of May 31, 2008 and August 31, 2007, there were 13,950,000
      and 4,707,229 shares, respectively of common stock issued and
      outstanding.





In
      conjunction with the merger as described on February 8, 2008; the Company split
      its outstanding shares of common at a ratio of 1:2.115868. All references in
      the
      financial statements and notes to financial statements, numbers of shares and
      share amounts have been retroactively restated to reflect the
      split.





In
      year
      ended August 31, 2007, the Company issued an aggregate of 4,071 shares of common
      stock for services rendered valued at $9,618.





On December
      14, 2007, the Company issued a total of 2,097,756 shares of common stock in
      exchange for 160,404 shares of Class B Preferred stock and accrued and
      unpaid dividends.





On
      December 14, 2007, the Company issued a total of 655,475 shares of common stock
      is exchange for 119,784 shares of Class C Preferred stock and accrued and
      unpaid dividends.





On
      December 14, 2007, the Company issued a total of 552,225 shares of common stock
      in exchange for 103,417 shares of Class D Preferred stock and accrued and unpaid
      dividends.





**NOTE
      13 - WARRANTS AND OPTIONS**




Warrants





The
      following table summarizes the warrants outstanding and exercisable for the
      shares of the Company's common stock issued to non-employees of the Company.
      These warrants were granted in connection with the private placement of the
      Company’s common stock and possess all of the conditions for equity
      classification and therefore are classified as equity.




20





**GEEKS
      ON CALL HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**




**NOTE
      13 - WARRANTS AND OPTIONS (continued)**




Warrants
                Outstanding
            
            Warrants
                ExercisableExercise Price
            
            Number Outstanding
            
            Weighted Average
              Remaining
              Contractual Life
              (Years)
            
            Weighted Average
              Exercise Price
            
            Number
              Exercisable
            
            Weighted
              Average Exercise
              Price$
            1.50
            
            
            1,825,000
            
            
            4.69
            
            $
            1.50
            
            
            1,825,000
            
            $
            1.501,825,000
            
            
            
            
            
            
            
            
            1,825,000




Transactions
      involving warrants are summarized as follows:




Number of
              Shares
            
            Weighted
              Average Price
              Per ShareBalance,
                August 31, 2007
            
            
            -
            
            $
            -Granted
            
            
            1,825,000
            
            
            1.50Exercised
            
            
            -
            
            
            -Canceled
                / Forfeited / Expired
            
            
            -
            
            
            -Outstanding
                at May 31, 2008
            
            
            1,825,000
            
            $
            1.50




Stock
      Options





Effective
      September 1, 2006, the Company adopted the fair value recognition provisions
      of
      SFAS No. 123(R), “Share-Based Payment”, using the modified prospective method.
      Under this method, the provisions of SFAS No. 123(R) apply to all awards granted
      or modified after the date of adoption and all previously granted awards not
      yet
      vested as of the date of adoption. The initial adoption of this standard had
      no
      effect on the Company’s consolidated financial statements as the Company had not
      granted any awards prior to February 8, 2008.





On
      February 8, 2008, the Board of Directors approved the 2008 Equity Incentive
      Plan
      (the “Plan”) whereby the Plan is intended as an incentive, to retain in the
      employ of and as directors, officers, consultants, advisors and employees of
      the
      Company. It is further intended that certain options granted pursuant to the
      Plan as Incentive Options while certain other options as Nonqualified Options.
      Incentive Options and Nonqualified Options are hereinafter referred to
      collectively as “Options.” Option Price and Term shall be determined by the Plan
      Committee at the time of grant. The vesting periods of the Options are
      determined by the Plan Committee at the time of grant, however, in the absence
      of any Option vesting periods designated by the Plan Committee at the time
      of
      grant, Options shall vest and become exercisable at one-third of the total
      number of shares on each of the first, second and third anniversaries of the
      date of grant. The terms of the options are not to exceed ten years and as
      in
      the case of an Incentive Option granted to an Optionee who, at time such
      Inceptive Option is granted, owns more than 10% of the total combined voting
      power of all classes of stock of the Company, exercisable term is not to exceed
      five years.





Exercise
      price of the Incentive Options shall not be less than 100% of the Fair Market
      Value or the prevailing market price of the stock at the time of the grant
      date.
      Option is granted; provided, however, with respect to an Optionee with Inceptive
      Option who, at the time such Incentive Option is granted, owns more than 10%
      of
      the total combined voting power of all classes of stock of the Company, the
      exercise price should be at least 110% of the Fair Market Value per share of
      Stock on the grant date. Exercise price of the Nonqualified Options shall not
      be
      less than 100% of the Fair Market Value of such share of Stock on the grant
      date. The Company has reserved 3,000,000 shares of its common stock under the
      Incentive Options plan.





On
      February 8, 2008, the Company granted an aggregate of 2,275,000 options to
      purchase its common stock at $1.00 per share over the next six years vested
      as
      follows; option to purchase 300,000 shares of common stock vested immediately
      and the remaining 1,975,000 options are vesting 20% at each anniversary. The
      fair value, determined using the Black Scholes Option Pricing Model, of the
      vested portion of the options of $264,990 was recorded as stock compensation
      expense for the nine month period ended May 31, 2008. The following assumptions
      were utilized: Dividend yield: -0-%, volatility: 124.86%; risk free rate: 2.60%;
      expected life: 6 years.




21




**GEEKS
      ON CALL HOLDINGS, INC.**


**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION**


**MAY
      31, 2008**


**(unaudited)**




**NOTE
      13 - WARRANTS AND OPTIONS (continued)**




The
      following table summarizes the stock options outstanding and exercisable for
      the
      shares of the Company's common stock issued to employees and board of directors
      of the Company under the Nonqualified Options plan.




Options
                Outstanding
            
            Options
                ExercisableExercise Prices
            
            Number Outstanding
            
            Weighted Average
                Remaining Contractual
              Life (Years)
            
            Weighted Average
              Exercise Price
            
            Number Exercisable
            
            Weighted Average
              Exercise Price$
            1.00
            
            
            2,275,000
            
            
            5.69
            
            $
            1.00
            
            
            2,275,000
            
            $
            1.002,275,000
            
            
            
            
            
            
            
            
            2,275,000





Transactions
      involving stock options issued to employees are summarized as
      follows:




Number of
              Shares
            
            Weighted
              Average Price
              Per ShareBalance,
                August 31, 2007
            
            
            -
            
            $
            -Granted
            
            
            2,275,000
            
            
            1.00Exercised
            
            
            -
            
            
            -Canceled
                / Forfeited / Expired
            
            
            -
            
            
            -Outstanding
                at May 31, 2008
            
            
            2,275,000
            
            $
            1.00




**NOTE
      14 - RELATED PARTY TRANSACTIONS**





As
      of May
      31, 2008, the Company was due for travel and other advances from employees
      of
      $1,733. These advances have been included in the accompanying consolidated
      balance sheets under the caption, prepaid expenses and other current assets.
      Subsequent to May 31, 2008, all advances have been repaid.





In
      October 2007, the Company entered into an exclusive private label/marketing
      agreement (the “Agreement”) with Telkonet, Inc. (a major supplier of the
      Company) for products under the trade name Geek Link System. Pursuant to the
      Agreement, the Company is to resale these private labeled products to customers
      through the Company’s existing network of franchisees. In addition, the Company,
      Telkonet, Inc. and certain stockholders of the Company entered into an agreement
      whereby Telkonet, Inc. acquired 1,160,043.435 shares of the Company’s common
      stock from these existing stockholders, which in effect transferred 39.6%
      ownership in the Company to Telkonet, Inc. by these stockholders. With the
      effect of the December 14, 2007 preferred stock conversion, Telkonet Inc.’s
      ownership of the Company decreased to 30.68%.





**NOTE 15
      - SUBSEQUENT EVENTS**





In
      June
      2008, the Company issued an aggregate of 42,499 shares of its common stock
      in
      exchange for services rendered. Additionally, the Company issued 125,000 shares
      in connection with the purchase of quiXsupport Helpdesk Software.





In
      July
      2008, the Company established a $400,000 revolving bank line of credit with
      a
      financial institution.





22




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





**Overview**





The
      Company operates in Norfolk, Virginia through its wholly owned subsidiary,
      Geeks
      On Call America, Inc. (“Geeks”), a Delaware corporation.





The
      Company through its subsidiary is presently engaged in providing quick-response,
      on-site computer solutions and telephone technical support (including services,
      on-going, support and training) primarily to small to medium business
      enterprises and residential computer users in the United States. On-site
      solutions are provided through a network of independent franchisees who are
      all
      certified professional IT solutions providers conducting business under the
      trade names 1 800 905 GEEK and Geeks On Call®. During the second quarter the
      Company commenced the development of company owned territories, in geographical
      locations with no existing franchise resources, in order to expedite the growth
      of their national operations footprint.




***Pioneer
      of On-Site IT Support.*** With our
      formation in June 2001, we believe that we have helped pioneer the on-site
      residential IT service concept to address a huge need. We were among the first
      companies to utilize national advertising and unique automotive detailing to
      promote our services. Recognizable by our branded midnight-blue
      Chrysler PT Cruisers, we have been recognized in 2007 and in prior years for
      our
      growth by *Franchise
      Times* and *Entrepreneur
      Magazine* . Our
      franchise owners and IT professionals also serve as experts for news stories,
      and have been featured in *USA
      Today, NBC Nightly News,* and
      hundreds of local newspapers and television.




***Franchise
      Growth.***  **** Since
      our operating subsidiary began franchising in 2001, each small business
      franchisee has worked as an entrepreneur by growing their businesses in the
      communities where they live and work. They build their businesses one satisfied
      customer at a time. As of May 31, 2008, we have granted more than 300
      independently-owned and-operated Geeks On Call franchises that support customers
      in 29 cities across the United States.




***Key
      variables of financial condition.***We use the following key
      indicators of financial condition and operating performance to analyze our
      financial results:




·
              Geographic
                  footprinto
              The
                  Company’s ability to service an increasing number of markets within the
                  United States.·
              Revenue
                  from services and sales performed by franchise units include a
                  number of
                  variables including:o
              Average
                  revenue per invoice; ando
              Total
                  number of weekly revenue generated appointments.·
              Revenue
                  from Company operated territories are measure by looking
                  at:o
              Average
                  revenue per invoice; ando
              Total
                  number of weekly revenue generated appointments.·
              Technology
                  Industry Changeso
              Industry
                  indicators include:§
              New
                  software versions;§
              New
                  virus attacks on personal computers;§
              Retail
                  economic reports listing the number of new computers sold;
                  and§
              Increases
                  or decreases in the number of new (small) business
                  startups.


***Small
      Business Expansion.*** Today,
      we have expanded our quick-response, IT services and solutions to advise
      and support small businesses. Through our network of Comptia A+ and Microsoft
      certified IT professionals, we provide small businesses with a competitive
      edge
      through technology support previously only available to large enterprise
      business. As business owners ourselves, our franchisees understand that IT
      is as
      mission-critical to a small business as it is to a large enterprise, thus
      leveling the playing field for entrepreneurs and small business throughout
      the
      country.




***Services.*** Our
      certified IT professionals provide a vast array of services including system
      security and online privacy solutions, hardware and software repairs and
      troubleshooting, wireless equipment and network installations, spyware and
      virus
      prevention and removal, data backups and transfers, and other value-added
      products and services from technology partners Telkonet, CA (formerly Computer
      Associates) and Gateway among others.




23




Our
      mission and vision is to be a leading provider of professional onsite enterprise
      technology solutions to the small to medium business and residential markets
      in
      the United States. We are focused on the development of opportunities to help
      our franchisees grow their business and drive revenue through additional channel
      opportunities. In order to successfully fulfill the mission and vision, our
      franchise partners must be well positioned within their geographic markets
      to
      leverage opportunities. In support of this effort we are committed to the
      development of enhanced national brand recognition, public relations,
      small-medium sized business market segmentation, compelling sales campaigns
      and
      support collateral materials.




We
      recently completed a national tour of our franchisees to introduce changes
      in
      our Preferred Partner Program including our relationship with CA to provide
      a variety of software products, the addition of business-class computers from
      Gateway, and the exclusive private labeling of a new powerline networking
      product — “GeekLink System” — by our partner Telkonet, Inc.
      (“Telkonet”).





The
      Company is considering ways to integrate the sale of the Geek Link technology
      into our network of franchisees across the country. Given recent changes in
      the
      technology we are evaluating Telkonet’s new system which will allow us to reach
      additional markets. We have the contractual right but not the obligation to
      purchase the Geek Link technology from Telkonet.  We are currently working
      with Telkonet to set a pricing structure that will make the system competitive
      in the marketplace.




It
      is our
      goal to seek out additional strategic partners with compelling products and
      services and attractive margin potential that provide our franchise partners
      with a competitive edge in the marketplace. One of our overarching business
      goals and primary objectives is to find new and innovative ways to help our
      franchise partners build their business and increase their
      profitability.




**Results
      of Operations**




Our
      revenues are derived primarily from royalties and advertising fees earned from
      operating franchises and fees earned from the sales of franchise
      territories. Fees from the sale of franchises are recognized in income in the
      period that substantially all services and conditions relating to the sale
      under
      our franchise agreement have been performed, typically the period in which
      the
      franchisee has completed and passed our training class.




**Three
      Months Ended May 31, 2008 compared to Three Months Ended May 31,
      2007**




**Revenue**




The
      following table summarizes our revenues for the three months ended May 31,
      2008
      and May 31, 2007:





**Three months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Total Revenue
            
            $
            1,261,155
            
            $
            1,921,985




For
      the
      three months ended May 31, 2008, revenue decreased by 34%, as compared to the
      same period in 2007. This decrease in revenue in the amount of $660,830 was
      primarily attributable to a reduction in 3 franchise owners and their 14
      respective franchises, their corresponding advertising and royalty revenues,
      and
      a reduction in the granting of new franchises. To maintain our overall level
      of
      quality, we have re-acquired marginally performing franchise operations and
      either re-franchised the territories or provides the support work from our
      corporate location internally transitioned to a company owned territory, and
      have added technical support staff to provide improved response
      times.




**Operating
      Loss**




The
      following table summarizes our operating loss for the three months ended
      May 31, 2008 and May 31, 2007:




**Three
                months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Operating income
                (loss)
            
            $
            (1,761,233
            )
            $
            45,481




Operating
      expenses, which consist of selling, general and administrative expenses,
      advertising and depreciation and amortization totaled $3,022,388 for the three
      months ended May 31, 2008, as compared to $1,876,504 for the three months ended
      May 31, 2007, representing an increase of approximately 61%. Our operating
      loss for the three months ended May 31, 2008 was $1,761,233 as compared to
      an operating income of $45,481 for the three months ended May 31, 2007,
      representing a decrease in operating income of approximately 3.772%. Our
      operating loss increased due to increased selling, general and administrative
      expenses as explained below.




24




**Selling,
      General and Administrative Expenses**




The
      following table summarizes our selling, general and administrative expenses
      for
      the three months ended May 31, 2008 and May 31, 2007:





**Three months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Selling, general and
                administrative expenses
            
            $
            2,196,183
            
            $
            924,960




For
      the
      three months ended May 31, 2008, selling, general and administrative expenses
      were $2,196,183 as compared to $924,960 for the three months ended May 31,
      2007,
      an increase of $1,271,223, or 137%. The increase in selling, general and
      administrative expenses of $1,271,223 are mainly attributable to these three
      areas and other direct and/or indirect overhead expenses.





Costs
      associated with meeting the requirements of being a public
      company





We
      have
      incurred significant costs relating to entering the public sector including
      professional fees relative to the preparation and completion of the reporting
      and filing requirements. During the quarter ended May 31, 2008, we incurred
      approximately $392,000 in connection with meeting the legal and accounting
      reporting obligations of becoming a public company. We did not incur similar
      costs during the quarter ended May 31, 2007.





Increased
      staffing





We
      incurred approximately $364,000 during the three months ended May 31, 2008
      in
      connection with support personnel costs as compared to $-0- during the previous
      year’s quarterly period. During the three months ended May 31, 2008 we employed
      approximately 14 support staff as compared to -0- during the previous year’s
      comparable period, or an addition of 14 employees. We have added the additional
      technical support staff to service customers of our company owned territories.
      Additionally, as discussed above, we intend to expand our corporate services
      both to larger customers and to our existing and future franchise operations.





Reacquired
      franchises





We
      incurred approximately $265,000 in costs relating to the reacquisition of under
      performing franchises during the three month period ended May 31, 2008 as
      compared to $-0- during the same period in prior year. Customer servicing are
      currently performed in house for these reacquired franchises.





**Advertising**




The
      following table summarizes our advertising expense for the three months ended
      May 31, 2008 and May 31, 2008:





**Three months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Advertising expense
            
            $
            758,229
            
            $
            909,703




Our
      advertising expenses for three months ended May 31, 2008, were $758,229 compared
      to $909,703 for the three months ended May 31, 2007. The decrease in advertising
      expense was directly related to a reduction in the number of active operating
      franchises.




**Depreciation
      and Amortization**




The
      following table summarizes our depreciation and amortization for the three
      months ended May 31, 2008 and May 31, 2007:




**Three months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Depreciation and amortization
            
            $
            67,976
            
            $
            41,841




25




Depreciation
      and amortization increased by $26,135 for the three months ended May 31, 2008
      compared to the three months ended May 31, 2007. The increase is attributed
      to
      the increase in depreciable assets.




**Nine
      Months Ended May 31, 2008 Compared to**  **the
      Nine Months Ended May 31, 2007**





**Revenues**




The
      following table summarizes our revenue for the nine months ended May 31, 2008
      and May 31, 2007:





**Nine months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Total Revenue
            
            $
            4,277,289
            
            $
            5,410,394




For
      the
      nine months ended May 31, 2008, revenue decreased by $1,133,105 as compared
      to
      the same period in 2007. This decrease in revenue in the amount of $1,133,105
      is
      primarily attributable to a reduction in 8 franchise owners and their 42
      respective franchises, their corresponding royalty and advertising revenues,
      and
      a reduction in the granting of new franchises.





As
      discussed in our three month operating results, we have re-acquired marginally
      performing franchise operations for the purpose of either re-franchising the
      territories or operating them with-in our company owned model. As such, we
      have
      added more technical support staff to provide improved response times.




**Operating
      Loss**




The
      following table summarizes our operating loss for the nine months ended May
      31,
      2008 and May 31, 2007:




**Nine months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Operating loss
            
            $
            3,357,351
            
            $
            206,866




Operating
      expenses, which consist of selling, general and administrative expenses,
      advertising and depreciation and amortization totaled $7,634,640 for the nine
      months ended May 31, 2008, as compared to $5,617,260 for the nine months ended
      May 31, 2007, representing an increase of approximately 36%. Our operating
      loss for the nine months ended May 31, 2008 was $3,357,351 as compared to
      an operating loss of $206,866 for the nine months ended May 31, 2007,
      representing an increase of approximately 1,523%. Our operating loss increased
      due to increased selling, general and administrative expenses as explained
      below.




**Selling,
      General & Administrative**




The
      following table summarizes our selling, general and administrative expenses
      for
      the nine months ended May 31, 2008 and May 31, 2007:





**Nine months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Selling, general
                and administrative expenses
            
            $
            4,862,578
            
            $
            2,792,428




For
      the
      nine months ended May 31, 2008, selling, general and administrative expenses
      were $4,862,578
      as compared to $2,792,428 for the nine months ended May 31, 2007, an increase
      of
      $2,070,150, or 74%. The increase in selling, general and administrative expenses
      of $2,070,150 are mainly attributable to these four areas and other direct
      and/or indirect overhead expenses




Costs
      associated with meeting the requirements of being a public
      company





We
      have
      incurred significant costs relating to entering the public sector including
      professional fees relative to the preparation and completion of the reporting
      and filing requirements. During the nine months ended May 31, 2008, we incurred
      approximately $855,000 in connection with meeting the legal and accounting
      reporting obligations of becoming a public company. We did not incur similar
      costs during the nine months ended May 31, 2007.




26




Increased
      staffing





We
      incurred approximately $394,000 during the nine months ended May 31, 2008 in
      connection with support personnel costs as compared to $-0- during the previous
      year’s nine month period. During the nine months ended May 31, 2008 we employed
      approximately 14 support staff as compared to -0- during the previous year’s
      comparable period, or an addition of 14 employees. We have added the additional
      support staff to service customers of our company owned territories.
      Additionally, as discussed above; we intend to expand our corporate services
      both to larger customers and to our existing and future franchise operations.





Stock
      based compensation





In
      our
      effort to retain and recruit qualified employees, we introduced a non qualified
      stock option plan during the last nine months. As such, we granted incentive
      stock options to officers and key employees as incentives. During the nine
      months ended May 31, 2008 we incurred a non cash cost of vested options in
      the
      amount of $264,900 which was not incurred during the previous comparable
      period.




Reacquired
      franchises





We
      incurred approximately $265,000 in costs relating to the reacquisition of under
      performing franchises during the nine month period ended May 31, 2008 as
      compared to $-0- during the same period prior year. Customer servicing are
      currently performed in house for these reacquired franchises.





**Advertising**




The
      following table summarizes our advertising expense for the nine months ended
      May
      31, 2008 and May 31, 2007:





**Nine months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Advertising expense
            
            $
            2,630,550
            
            $
            2,696,511




Advertising
      expenses decreased by $65,961 or 2% to $2,630,550 for the nine months ended
      May
      31, 2008, as compared to $2,696,511 for the nine months ended May 31, 2007.
      The
      decrease in advertising expense was directly related to a reduction in the
      number of active operating franchises.





**Depreciation
      and Amortization**




The
      following table summarizes our depreciation and amortization for the nine months
      ended May 31, 2008 and May 31,, 2007:





**Nine months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Depreciation
                and amortization
            
            $
            141,512
            
            $
            128,311




Depreciation
      and amortization expense totaled $141,512 during the nine months ended May
      31
      2008, as compared to $128,311 during the nine months ended May 31, 2007. The
      increase is a result from the additions in depreciable
      assets.




27




**Liquidity
      and Capital Resources**





**Net
      Cash Used in Operating Activities**




The
      following table summarizes our net cash used in operating activities for the
      nine months ended May 31, 2008 and May 31, 2007:




**Nine months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Net
                cash used in operating activities
            
            $
            2,902,742
            
            $
            545,748




Cash
      utilized in operating activities was $2,902,742 for the nine months ended May
      31, 2008, as compared to $545,748 for the nine months ended May 31, 2007. The
      increase was primarily due to the cost of the reverse merger and the hiring
      of
      additional staff and consultants.





During
      the nine months ended May 31, 2008, operating costs increased as a result
      of becoming public. We incurred significant costs including audit and legal
      fees as well as an increase in staffing levels. These costs reflect both an
      increase in our operating loss from $241,230 to $3,349,419, or an increase
      of
      $3,108,189 and the increased use of operating capital (cash flow) of
      $2,356,994.




**Net
      Cash Used in Investing Activities**




The
      following table summarizes our net cash used in investing activities for the
      nine months ended May 31, 2008 and May 31, 2007:





**Nine months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Net cash used
                in investing activities
            
            $
            5,189
            
            $
            474,324




Net
      cash
      used in investing activities totaled $5,189 for the nine months ended May 31,
      2008, as compared to $474,324 for the nine months ended May 31, 2007. A decrease
      in loans to franchisees and others, net of collections, of $700,000, net with
      increase in purchases of property and equipment of $188,000 and reduction in
      proceeds from investments of $43,000 was main causes for the net
      decline.




**Net
      Cash Provided by Financing Activities**




The
      following table summarizes our net cash provided by financing activities for
      the
      nine months ended May 31, 2008 and May 31, 2007:





**Nine months ended****May 31,**
              **2008**
            
            **May 31,**
              **2007**Net
                cash provided by financing activities
            
            $
            2,846,029
            
            $
            389,188




Net
      cash provided by financing activities totaled $2,846,029 for the nine
      months ended May 31, 2008, as compared to net cash provided by financing
      activities of $389,188 for the nine months ended May 31, 2007. The reason for
      the increase was primarily attributable to the proceeds from the sale of common
      stock in connection with the Private Placement.





Management
      has undertaken the following steps to address our requirements for increasing
      liquidity, generating cash flow and achieving profitable
      operations.





Future
      Capital Requirements:





We
      cannot
      make assurances that our business operations will develop and provide us with
      significant cash to continue operations.




28




Additional
      financing in the form of debt and/or equity are being sought to implement the
      increase in franchise growth and the Company owned territories, but we cannot
      guarantee that we will be able to obtain such financing. Financing transactions
      may include the issuance of equity or debt securities, obtaining credit
      facilities, or other financing mechanisms. However, the trading price of our
      common stock and the downturn in the U.S. stock and debt markets could make
      it
      more difficult to obtain financing through the issuance of equity or debt
      securities. Even if we are able to raise the funds required, it is possible
      that
      we could incur unexpected costs and expenses, fail to collect significant
      amounts owed to us, or experience unexpected cash requirements that would force
      us to seek alternative financing. Further, if we issue additional equity or
      debt
      securities, stockholders may experience dilution or the new equity securities
      may have rights, preferences or privileges senior to those of existing holders
      of out common stock. If additional financing is not available or is not
      available on acceptable terms, we will have to curtail our operations.





Financing:





The
      Company has raised through a private placement of its common stock, $3,196,000,
      net of costs.




In
      July 2008 we established a $400,000 revolving bank
      line of credit with a financial institution.




Franchise
      Growth:





We
      have
      developed plans to increase the number of franchises domestically and
      internationally by undertaking the following steps:




Entered
      into a relationship with several franchisee recruiting brokers to locate and
      recruit qualified financially stable franchise candidates.





Advertising
      in major franchise industry trade publications.





Attend
      and participate in International Franchise Association (IFA) industry
      conventions and events, including Company sponsorship, exhibition and platform
      speaking opportunities.





Leverage
      public relations opportunities arising from industry participation.





Projected
      capital requirements to implement the marketing of additional franchise is
      expected to range from $100,000 to $250,000 for industry and public relations
      as
      well as commissions payable to brokers upon the successful recruitment of a
      franchise candidate. These fees vary from broker to broker and are not paid
      unless revenue is recognized from the sale of a franchise.





The
      Company operates in Norfolk, Virginia through its wholly owned subsidiary,
      Geeks
      On Call America, Inc. (“Geeks”), a Delaware corporation.





The
      Company through its subsidiary is presently engaged in providing quick-response,
      on-site computer solutions and telephone technical support (including services,
      on-going, support and training) primarily to small to medium business
      enterprises and residential computer users in the United States. On-site
      solutions are provided through a network of independent franchisees who are
      all
      certified professional IT solutions providers conducting business under the
      trade names 1 800 905 GEEK and Geeks On Call®. During the second quarter the
      Company commenced the development of company owned territories, in geographical
      locations with no existing franchise resources, in order to expedite the growth
      of their national operations footprint.




**Critical
      Accounting Policies and Estimates**





**Revenue
      Recognition**




The
      Company accounts for revenue under the guidance provided by SFAS No. 45,
“Accounting for Franchise Fee Revenue (as amended)” and EITF 00-21, “Revenue
      Arrangements with Multiple Deliverables”.





Franchise
      fee revenue is recognized when (i) all material obligations of the Company
      to
      prepare the franchisee for operations have been substantially
      completed; and (ii) all material initial services to be provided by the
      Company have been performed, with an
      appropriate provision for estimated uncollectible amounts. Obligations to
      prepare the franchisee for operations are substantially completed upon the
      completion by the franchisee of the Company’s training program.





There
      are
      no other material conditions or commitments or obligations that exist related
      to
      the determination of substantial performance or substantial completion of the
      franchise agreement.




Area
        Development Sales
 
 Area
        developer sales, wherein the Company sells the rights to develop a territory
        or
        market, are nonrefundable fees recognized as revenue upon signature of the
        Area
        Development Agreement and substantial completion of all of the Company’s
        obligations associated with the opening of the first franchise under the
        agreement have been met. Substantial completion includes, but is not limited
        to,
        conducting market and trade area analysis, a meeting with the Company’s
        Executive Team, and performing potential franchise background investigation,
        all
        of which are completed prior to our execution of the Area Development Agreement
        and receipt of the corresponding area development fee. As a result, the Company
        recognizes this fee in full upon receipt and with the opening of the first
        franchise under the Area Development Agreement.
 
 No
        additional substantive services required after the first franchise is opened
        under the Area Development Agreement.
 
 Advertising
        and Royalty Fees
 
 Initial
        advertising fees are recognized when the territory is open and the related
        advertising has been performed. Ongoing royalties and advertising fees are
        recognized currently as the franchised territory generates sales and ongoing
        advertising is performed.
 
 Repossessed
        Franchises
 
 From
        time
        to time the Company may recover franchise rights through repossession if
        a
        franchisee decides not to open a franchise. If, for any reason, the Company
        refunds the consideration received, the original sale is canceled, and revenue
        previously recognized is accounted for as a reduction in revenue in the period
        the franchise is repossessed. If franchise rights are repossessed but no
        refund
        is made (a) the transaction is not regarded as a sale cancellation, (b) no
        adjustment is made to any previously recognized revenue, (c) any estimated
        uncollectible amounts resulting from unpaid receivables is provided for,
        and (d)
        any consideration retained for which revenue was not previously recognized
        is
        reported as revenue.
  Deferred
          Franchise Fees
 
 The
          Company may receive all or part of the initial franchise or advertising
          fee
          prior to the execution of the franchise agreement of completion of the
          earnings
          process. These amounts are classified as deferred revenue until the fee
          qualifies to be recognized as revenue or is refunded.




29




**Stock
      Based Compensation**





On
      December 16, 2004, the FASB issued SFAS No. 123(R) (revised 2004), " *Share-Based
      Payment* "
      which
      is a revision of SFAS No. 123, " *Accounting
      for Stock-Based Compensation* ".
      SFAS
      No. 123(R) supersedes APB opinion No. 25, " *Accounting
      for Stock Issued to Employees* ",
      and
      amends SFAS No. 95, " *Statement
      of Cash Flows* ".
      Generally, the approach in SFAS No. 123(R) is similar to the approach described
      in Statement 123. However, Statement 123(R) requires all share-based payments
      to
      employees, including grants of employee stock options, to be recognized in
      the
      income statement based on their fair values. Pro-forma disclosure is no longer
      an alternative. The effective date for our application of SFAS No. 123(R) is
      September 1, 2006. Management has elected to apply SFAS No. 123(R) commencing
      on
      that date.





**Use
      of Estimates**





The
      preparation of financial statements in conformity with generally accepted
      accounting principles 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 revenue and expenses during the reporting period. Actual
      results could differ from those estimates.




Recent
      accounting pronouncements





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”) *.* SFAS No.
      155 permits fair value remeasurement for any hybrid financial instrument that
      contains an embedded derivative that otherwise would require bifurcation,
      clarifies which interest-only strips and principal-only strips are not subject
      to the requirements of SFAS No. 133, establishes a requirement to evaluate
      interests in securitized financial assets to identify interests that are
      freestanding derivatives or that are hybrid financial instruments that contain
      an embedded derivative requiring bifurcation, clarifies that concentrations
      of
      credit risk in the form of subordination are not embedded derivatives, and
      amends SFAS No. 140 to eliminate the prohibition on a qualifying special purpose
      entity from holding a derivative financial instrument that pertains to a
      beneficial interest other than another derivative financial instrument. SFAS
      No.
      155 is effective for all financial instruments acquired or issued after the
      beginning of an entity’s first fiscal year that begins after September 15, 2006.
      The SFAS No. 155 did not have a material impact on the Company’s consolidated
      financial position, results of operations or cash flows.





In
      March
      2006, the FASB issued SFAS No. 156, “ *Accounting
      for Servicing of Financial Assets - an amendment to FASB Statement No.
      140* ”
(“SFAS
      No. 156”). SFAS No. 156 requires that an entity recognize a servicing asset or
      servicing liability each time it undertakes an obligation to service a financial
      asset by entering into a service contract under certain situations. The new
      standard is effective for fiscal years beginning after September 15, 2006.
      SFAS
      No.156 did not have a material impact on the Company's consolidated financial
      position, results of operations or cash flows.





In
      July
      2006, the FASB issued Interpretation No. 48, “ *Accounting
      for uncertainty in Income Taxes”* (“FIN
      No.
      48”). FIN No. 48 clarifies the accounting for Income Taxes by prescribing the
      minimum recognition threshold a tax position is required to meet before being
      recognized in the financial statements. It also provides guidance on
      derecognition, measurement, classification, interest and penalties, accounting
      in interim periods, disclosure and transition and clearly scopes income taxes
      out of SFAS No. 5, “ *Accounting
      for Contingencies”.* FIN No.
      48 is effective for fiscal years beginning after December 15, 2006. The Company
      did not have a material impact on the Company's consolidated financial position,
      results of operations or cash flows.




In
      September 2006, the FASB issued SFAS No. 157, “ *Fair
      Value Measurements* ”.  The
      objective of SFAS No. 157 is to increase consistency and comparability in fair
      value measurements and to expand disclosures about fair value
      measurements.  SFAS No. 157 defines fair value, establishes a
      framework for measuring fair value in generally accepted accounting principles,
      and expands disclosures about fair value measurements.  SFAS No. 157
      applies under other accounting pronouncements that require or permit fair value
      measurements and does not require any new fair value
      measurements.  The provisions of SFAS No. 157 are effective for fair
      value measurements made in fiscal years beginning after November 15,
      2007.   In February 2008, the FASB issued FASB Staff
      Position (“FSP”) 157-2 **,** *“Effective
      Date of FASB Statement No. 157”* (“FSP
      157-2 *),* which
      delayed the effective date of SFAS No. 157 for all non-financial assets and
      liabilities, except those that are recognized or disclosed at fair value in
      the
      financial statements on a recurring basis, until fiscal years beginning after
      November 15, 2008.   We have not yet determined the impact that
      the implementation of FSP 157-2 will have on our non-financial assets and
      liabilities which are not recognized on a recurring basis; however, we do not
      anticipate the adoption of this standard will have a material impact on our
      consolidated financial position, results of operations or cash
      flows.




30




In
      September 2006 the FASB issued its SFAS No. 158, “ *Employers’
      Accounting for Defined Benefit Pension and Other Postretirement Plans, an
      amendment of FASB Statements No. 87, 88, 106 and 132(R)* ”
(“SFAS
      No. 158”). SFAS No. 158 improves financial reporting by requiring an employer to
      recognize the overfunded or underfunded status of a defined benefit
      postretirement plan (other than a multiemployer plan) as an asset or liability
      in its statement of financial position and to recognize changes in that funded
      status in the year in which the changes occur through comprehensive income
      of a
      business entity or changes in unrestricted net assets of a not-for-profit
      organization. SFAS No. 158 also improves financial reporting by requiring an
      employer to measure the funded status of a plan as of the date of its year-end
      statement of financial position, with limited exceptions. The effective date
      for
      an employer with publicly traded equity securities is as of the end of the
      fiscal year ending after December 15, 2006. SFAS No. 158 did not have a material
      impact on its consolidated financial position, results of operations or cash
      flows.





In
      December 2006, the FASB issued FSP EITF 00-19-2, “ *Accounting
      for Registration Payment Arrangements* ”
(“FSP
      00-19-2”) which addresses accounting for registration payment arrangements. FSP
      00-19-2 specifies that the contingent obligation to make future payments or
      otherwise transfer consideration under a registration payment arrangement,
      whether issued as a separate agreement or included as a provision of a financial
      instrument or other agreement, should be separately recognized and measured
      in
      accordance with SFAS No. 5, “Accounting for Contingencies”. FSP 00-19-2 further
      clarifies that a financial instrument subject to a registration payment
      arrangement should be accounted for in accordance with other applicable
      generally accepted accounting principles without regard to the contingent
      obligation to transfer consideration pursuant to the registration payment
      arrangement. For registration payment arrangements and financial instruments
      subject to those arrangements that were entered into prior to the issuance
      of
      EITF 00-19-2, this guidance shall be effective for financial statements issued
      for fiscal years beginning after December 15, 2006 and interim periods within
      those fiscal years. The Company does not expect adoption of this standard will
      have a material impact on its consolidated financial position, results of
      operations or cash flows





In
      February 2007, the FASB issued SFAS No. 159,
“*The
      Fair Value Option for Financial Assets and Financial Liabilities - Including
      an
      Amendment of FASB Statement No. 115*”
(“SFAS
      No. 159”).  SFAS No. 159 permits entities to choose to measure many
      financial instruments and certain other items at fair value.  Most of
      the provisions of SFAS No. 159 apply only to entities that elect the fair value
      option. However, the amendment to SFAS No. 115 “*Accounting
      for Certain Investments in Debt and Equity Securities*”
applies
      to all entities with available-for-sale and trading securities.  SFAS
      No. 159 is effective as of the beginning of an entity’s first fiscal year that
      begins after November 15, 2007.  Early adoption is permitted as of the
      beginning of a fiscal year that begins on or before November 15, 2007, provided
      the entity also elects to apply the provision of SFAS No. 157, “*Fair
      Value Measurements*”.  The
      adoption of SFAS No. 159 is not expected to have a material impact on our
      consolidated financial position, results of operations or cash
      flows.




In
      December 2007, the FASB issued SFAS No. 141(R), *"Business
      Combinations"* ("SFAS No. 141(R)"), which establishes principles and requirements for how
      an acquirer recognizes and measures in its financial statements the identifiable
      assets acquired, the liabilities assumed, and any noncontrolling interest in
      an
      acquiree, including the recognition and measurement of goodwill acquired in
      a
      business combination. SFAS No. 141R is effective as of the beginning of the
      first fiscal year beginning on or after December 15, 2008. Earlier adoption
      is prohibited and the Company is currently evaluating the effect, if any, that
      the adoption will have on its consolidated financial position, results of
      operations or cash flows.




In
      December 2007, the FASB issued SFAS No. 160, *"Noncontrolling
      Interest in Consolidated Financial Statements, an amendment of ARB
      No. 51"* ("SFAS
      No. 160"), which will change the accounting and reporting for minority
      interests, which will be recharacterized as noncontrolling interests and
      classified as a component of equity within the consolidated balance sheets.
      SFAS
      No. 160 is effective as of the beginning of the first fiscal year beginning
      on
      or after December 15, 2008. Earlier adoption is prohibited and the Company
      is currently evaluating the effect, if any, that the adoption will have on
      its
      consolidated financial position, results of operations or cash flows.





In
      June 2007, the Accounting Standards Executive Committee issued Statement of
      Position 07-1, “Clarification of the Scope of the Audit and Accounting Guide
      Investment Companies and Accounting by Parent Companies and Equity Method
      Investors for Investments in Investment Companies” (“SOP 07-1”). SOP 07-1
      provides guidance for determining whether an entity is within the scope of
      the
      AICPA Audit and Accounting Guide Investment Companies (the “Audit Guide”). SOP
      07-1 was originally determined to be effective for fiscal years beginning on
      or
      after December 15, 2007, however, on February 6, 2008, FASB issued a
      final Staff Position indefinitely deferring the effective date and prohibiting
      early adoption of SOP 07-1 while addressing implementation issues.





In
      June
      2007, the FASB ratified the consensus in EITF Issue No. 07-3, “Accounting
      for Nonrefundable Advance Payments for Goods or Services to be Used in Future
      Research and Development Activities” (EITF 07-3), which requires that
      nonrefundable advance payments for goods or services that will be used or
      rendered for future research and development (R&D) activities be deferred
      and amortized over the period that the goods are delivered or the related
      services are performed, subject to an assessment of recoverability.
      EITF 07-3 will be effective for fiscal years beginning after
      December 15, 2007. The Company does not expect that the adoption of
      EITF 07-3 will have a material impact on our consolidated financial
      position, results of operations or cash flows.




31




In
      December 2007, the FASB ratified the consensus in EITF Issue No. 07-1,
“Accounting for Collaborative Arrangements” (EITF 07-1). EITF 07-1
      defines collaborative arrangements and requires collaborators to present the
      result of activities for which they act as the principal on a gross basis and
      report any payments received from (made to) the other collaborators based on
      other applicable authoritative accounting literature, and in the absence of
      other applicable authoritative literature, on a reasonable, rational and
      consistent accounting policy is to be elected. EITF 07-1 also provides for
      disclosures regarding the nature and purpose of the arrangement, the entity’s
      rights and obligations, the accounting policy for the arrangement and the income
      statement classification and amounts arising from the agreement. EITF 07-1
      will be effective for fiscal years beginning after December 15, 2008, which
      will be the Company’s fiscal year 2009, and will be applied as a change in
      accounting principle retrospectively for all collaborative arrangements existing
      as of the effective date. The Company has not yet evaluated the potential impact
      of adopting EITF 07-1 on our consolidated financial position, results of
      operations or cash flows.





In
      March
      2008, the FASB” issued SFAS No. 161, “ *Disclosures
      about Derivative Instruments and Hedging Activities – an amendment to FASB
      Statement No. 133”* (“SFAS
      No. 161”) *.* SFAS
      No. 161 is intended to improve financial standards for derivative instruments
      and hedging activities by requiring enhanced disclosures to enable investors
      to
      better understand their effects on an entity's financial position, financial
      performance, and cash flows.  Entities are required to provide
      enhanced disclosures about: (a) how and why an entity uses derivative
      instruments; (b) how derivative instruments and related hedged items are
      accounted for under SFAS No. 133 and its related interpretations; and (c) how
      derivative instruments and related hedged items affect an entity’s financial
      position, financial performance, and cash flows.  It is effective for
      financial statements issued for fiscal years beginning after November 15, 2008,
      with early adoption encouraged.  We are currently evaluating the
      impact of SFAS No. 161, if any, will have on our consolidated financial
      position, results of operations or cash flows.





In
      April
      2008, the FASB issued FSP No. FAS 142-3, *“Determination
      of the Useful Life of Intangible Assets”.* This FSP
      amends the factors that should be considered in developing renewal or extension
      assumptions used to determine the useful life of a recognized intangible asset
      under SFAS No. 142, *“Goodwill
      and Other Intangible Assets”.* We
      are required to adopt FSP 142-3 on September 1, 2009, earlier adoption is
      prohibited.  The guidance in FSP 142-3 for determining the useful life
      of a recognized intangible asset shall be applied prospectively to intangible
      assets acquired after adoption, and the disclosure requirements shall be applied
      prospectively to all intangible assets recognized as of, and subsequent to,
      adoption.  We are currently evaluating the impact of FSP 142-3 on our
      consolidated financial position, results of operations or cash
      flows.





In
      May
      2008, the FASB issued SFAS No. 162, " *The
      Hierarchy of Generally Accepted Accounting Principles* "
      ("SFAS No. 162").  SFAS No. 162 identifies the sources of
      accounting principles and the framework for selecting the principles used in
      the
      preparation of financial statements of nongovernmental entities that are
      presented in conformity with generally accepted accounting principles (the
      GAAP hierarchy).  SFAS No. 162 will become effective 60 days
      following the SEC's approval of the Public Company Accounting Oversight Board
      amendments to AU Section 411, "The Meaning of Present Fairly in
      Conformity With Generally Accepted Accounting Principles."  We do not
      expect the adoption of SFAS No. 162 will have a material effect on our
      consolidated financial position, results of operations or cash
      flows.





In
      May
      2008, the FASB issued FSP Accounting Principles Board ("APB") 14-1 " *Accounting
      for Convertible Debt Instruments That May Be Settled in Cash upon Conversion
      (Including Partial Cash Settlement)* " ("FSP
      APB 14-1").  FSP APB 14-1 requires the issuer of certain
      convertible debt instruments that may be settled in cash (or other assets)
      on
      conversion to separately account for the liability (debt) and equity (conversion
      option) components of the instrument in a manner that reflects the issuer's
      non-convertible debt borrowing rate.  FSP APB 14-1 is effective
      for fiscal years beginning after December 15, 2008 on a retroactive
      basis.  We are currently evaluating the potential impact, if any, of
      the adoption of FSP APB 14-1 on our consolidated financial position,
      results of operations or cash flows.





Other
      recent accounting pronouncements issued by the FASB (including its Emerging
      Issues Task Force), the AICPA, and the SEC did not, or are not believed by
      management to, have a material impact on the Company’s present or future
      consolidated financial statements.




**Going
      Concern Matters**





The
      accompanying condensed consolidated financial statements have been prepared
      on a
      going concern basis, which contemplates the realization of assets and the
      satisfaction of liabilities in the normal course of business. As shown in the
      accompanying financial statements, the Company incurred a net loss of $3,349,419
      and $241,230 for the nine-month period ended May 31, 2008 and 2007,
      respectively. Additionally, the Company has negative cash flows from operation
      of $2,902,742 and an accumulated deficit of $8,789,070 as of May 31, 2008.
      These
      factors among others may indicate that the Company will be unable to continue
      as
      a going concern for a reasonable period of time.




32




A
      large
      portion of the year to date losses are attributable to one time costs associated
      with the process of raising capital and becoming a public company along with
      the
      retirement of debt. These losses are not recurring.





Management
      has developed a strategic plan to address our requirements for generating cash
      flow and achieving profitable operations.





We
      aim to
      move towards profitability by accelerating the growth of our existing franchise
      network, while simultaneously opening company operated territories, the first
      of
      which are located in 4 major US markets including Phoenix, AZ, Sacramento,
      CA,
      Northwestern, VA and Kansas City, MO.





We
      are
      also launching an endorsed vendor program strengthening brand awareness and
      delivering value added IT solutions to the franchise community. These new
      business to business relationships will grow recurring revenue and increase
      our
      royalty base.





We
      cannot
      however make assurances that our business operations will develop and provide
      us
      with significant cash to continue operations.





**OFF-BALANCE
      SHEET ARRANGEMENTS**





Since
      our
      inception, we have not engaged in any off-balance sheet arrangements, including
      the use of structured finance, special purpose entities or variable interest
      entities.





**TRENDS,
      RISKS AND UNCERTAINTIES**





We
      have
      sought to identify what we believe to be the most significant risks to our
      business, but we cannot predict whether, or to what extent, any of such risks
      may be realized nor can we guarantee that we have identified all possible risks
      that might arise. Investors should carefully consider all of such risk factors
      set forth in the Current Report of Form 8-K filed by us with the Securities
      and
      Exchange Commission (“SEC”) on February 13, 2008 and amendment no. 2 to the
      registration statement on Form S-1 filed with the SEC on July 7, 2008 before
      making an investment decision with respect to our Common Stock.





**CAUTIONARY
      FACTORS THAT MAY AFFECT FUTURE RESULTS**





We
      have
      sought to identify what we believe are significant risks to our business, but
      we
      cannot predict whether, or to what extent, any of such risks may be realized
      nor
      can we guarantee that we have identified all possible risks that might
      arise.




Forward-Looking
      Statements





We
      may
      from time to time make written or oral statements that are "forward-looking,"
      including statements contained in this Form 10QSB and other filings with the
      Securities and Exchange Commission, reports to our stockholders and news
      releases. All statements that express expectations, estimates, forecasts or
      projections are forward-looking statements within the meaning of the Act. In
      addition, other written or oral statements which constitute forward-looking
      statements may be made by us or on our behalf. Words such as "expects,"
      "anticipates," "intends," "plans," "believes," "seeks," "estimates," "projects,"
      "forecasts," "may," "should," variations of such words and similar expressions
      are intended to identify such forward-looking statements. These statements
      are
      not guarantees of future performance and involve risks, uncertainties and
      assumptions which are difficult to predict. Therefore, actual outcomes and
      results may differ materially from what is expressed or forecasted in or
      suggested by such forward-looking statements. We undertake no obligation to
      update publicly any forward-looking statements, whether as a result of new
      information, future events or otherwise. Important factors on which such
      statements are based are assumptions concerning uncertainties, including but
      not
      limited to uncertainties associated with the following:





(a)
      volatility or decline of our stock price;




(b)
      potential fluctuation in quarterly results;





(c)
      our
      failure to earn revenues or profits;





(d)
      inadequate capital and barriers to raising the additional capital or to
      obtaining the financing needed to implement its business plans;





(e)
      inadequate capital to continue business;





(f)
      changes in demand for our products and services;




33




(g)
      rapid
      and significant changes in markets;





(h)
      litigation with or legal claims and allegations by outside parties;
      and





(i)
      insufficient revenues to cover operating costs.





You
      should read the discussion and analysis in conjunction with our financial
      statements and notes thereto, included herewith. This discussion should not
      be
      construed to imply that the results discussed herein will necessarily continue
      into the future, or that any conclusion reached herein will necessarily be
      indicative of actual operating results in the future. Such discussion represents
      only the best present assessment of management.




**ITEM
      3.**  **CONTROLS
      AND PROCEDURES**





We
      carried out an evaluation, under the supervision and with the participation
      of
      our management, including our chief executive officer and principal financial
      officer, of the effectiveness of the design and operation of our disclosure
      controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under
      the
      Securities Exchange Act of 1934, as amended (the “Exchange Act”). Disclosure
      controls and procedures include, without limitation, controls and procedures
      designed to ensure that information required to be disclosed by an issuer in
      the
      reports that it files or submits under the Exchange Act is accumulated and
      communicated to the issuer’s management, including its principal executive and
      principal financial officers, or persons performing similar functions, as
      appropriate to allow timely decisions regarding required disclosure. Based
      upon
      our evaluation, our chief executive officer and principal financial officer
      concluded that our disclosure controls and procedures are effective, as of
      the
      end of the period covered by this Report (May 31, 2008), in ensuring that
      material information that we are required to disclose in reports that we file
      or
      submit under the Exchange Act is recorded, processed, summarized and reported
      within the time periods specified in the Securities and Exchange Commission
      rules and forms.




There
      were no changes in our internal controls over financial reporting during the
      nine month period ended May 31, 2008 that have materially affected, or are
      reasonably likely to materially affect, our internal control over financial
      reporting.




**PART
      II. OTHER INFORMATION**





**ITEM
      1. LEGAL PROCEEDINGS**





From
      time
      to time we may be involved in claims arising in the ordinary course of business.
      To our knowledge there are no pending or threatened, legal proceedings,
      government actions, administrative actions, investigations or claims against
      the
      Company.




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





Except
      as
      previously included in our Current Reports on Form 8-K filed with the Securities
      and Exchange Commission, we have not sold any equity securities during the
      period covered by this Report that were not registered under the Securities
      Act
      of 1933, as amended.




**ITEM
      3.****DEFAULTS
      UPON SENIOR SECURITIES**





None.




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





None




**ITEM
      5.****OTHER
      INFORMATION**





None.




34




**ITEM
      6.**  **EXHIBITS**




Exhibit Number
            
            Description of ExhibitExhibit
                31.1*
            
            Section
                302 Certification of Principal Executive OfficerExhibit
                31.2*
            
            Section
                302 Certification of Principal Financial OfficerExhibit
                32.1*
            
            Section
                906 Certification of Principal Executive Officer and Principal Financial
                Officer








*
      Filed
      herewith.





**SIGNATURES**





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




GEEKS
                ON CALL HOLDINGS, INC.Date:
                July 15, 2008
            By:
            /s/
                Richard ColeRichard
                Cole
              Chief
                Executive Officer


35