**UNITED
      STATES SECURITIES AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**FORM
      10-QSB**




**x**
            QUARTERLY
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934 FOR THE QUARTERLY PERIOD ENDED**December
                31, 2007**o
            TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934 FOR THE TRANSITION PERIOD FROM ______________ TO
                ______________







**SKRM
      Interactive, Inc.**


**(Formerly
      SKREEM Entertainment Corp.)**


(Exact
      name of small business issuer as specified in its charter)




**Delaware**
            
            **0-2236**
            
            **33-0565710**(State
                or other jurisdiction of
              incorporation)
            
            (Commission
                File No.)
            
            (IRS
                Employer Identification No.)





**14553
      South 790 West**


**Bluffdale,
      Utah 84065**


(Address
      of principal executive offices, including zip code)





Issuer’s
      telephone number, including area code: (866) 922-9533





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




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


Yes o No x





As
      of
      February 19 , 2008 the
      issuer had 77,320,292 shares
      of common stock outstanding.





Transitional
      Small Business Disclosure Format (check one): Yes o No x










TABLE
      OF
      CONTENTS





SKRM
      Interactive, Inc.


(formerly
      SKREEM Entertainment Corp.)





Part
                I. Financial InformationItem
                1.
            Consolidated
                Financial Statements
            2Unaudited
                Consolidated Balance Sheet - as of December 31, 2007
            2Unaudited
                Consolidated Statements of Operations for the nine months ended December
                31, 2007 and 2006 and for the period from inception, September 16,
                2002,
                to December 31, 2007
            3Unaudited
                Consolidated Statements of Operations for the three months ended
                December
                31, 2007 and 2006
            4Unaudited
                Consolidated Statements of Cash Flows for the nine months ended December
                31, 2007 and 2006 and for the period from inception, September 16,
                2002,
                to December 31, 2007
            5Notes
                to the Unaudited Consolidated Financial Statements
            6Item
                2.
            Management’s
                Discussion and Analysis or Plan of Operation
            9Item
                3.
            Controls
                and Procedures
            14Part
                II. Other InformationItem
                2.
            Unregistered
                Sales of Equity Securities and Use of Proceeds
            14Item
                6.
            Exhibits
            14







**Item
      1. FINANCIAL STATEMENTS**


SKRM
      Interactive, Inc.


(formerly
      SKREEM ENTERTAINMENT CORPORATION)


(A
      DEVELOPMENT STAGE COMPANY)


UNAUDITED
      CONSOLIDATED BALANCE SHEET


As
      of
      December 31, 2007




December
                31, 2007ASSETSCurrent
                assets:Cash
                and Cash equivalents
            
            $
            156Total
                assets
            
            $
            156LIABILITIES
                AND SHAREHOLDERS' DEFICITCurrent
                liabilities:Accounts
                payable and accrued liabilities
            
            $
            50,147Notes
                payable - shareholder
            
            
            649,200Total
                current liabilities
            
            
            699,347CTotal
                liabilities
            
            
            699,347Shareholders'
                deficit:PrPreferred
                shares - $0.001 par value; 1,000,000 authorized, no shares issued
                or
                outstanding
            
            
            -C
                Common shares - $0.001 par value; 199,000,000 authorized; 77,320,292
                shares issued and outstanding
            
            
            77,320Additional
                paid - in capital (Deficit)
            
            
            (714,080
            )Deficit
                accumulated during the development stage
            
            
            (62,431
            )Total
                shareholders' deficit
            
            
            (699,191
            )Total
                liabilities and shareholders' deficit
            
            $
            156








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





2


SKRM
      Interactive, Inc.


(formerly
      SKREEM ENTERTAINMENT CORPORATION)


(A
      DEVELOPMENT STAGE COMPANY)


UNAUDITED
      CONSOLIDATED STATEMENTS OF OPERATIONS For the Nine Months


Ended
      December 31, 2007 and 2006 and for the Period From Inception, September 16,
      2002,


to
      December 31, 2007




Nine
                Months Ended
            
            Inception
                toDecember
                31,
            
            December
                31,
            
            December
                31,2007
            
            2006
            
            2007ExpensesOperatingGeneral
                and administrative
            
            $
            58,845
            
            
            -
            
            $
            62,431Total
                expenses
            
            
            58,845
            
            
            -
            
            
            62,431Loss
                from operations
            
            
            (58,845
            )
            
            -
            
            
            (62,431
            )Net
                Loss
            
            $
            (58,845
            )
            $
            -
            
            $
            (62,431
            )Weighted
                Average Shares Outstanding - basic and diluted
            
            
            13,570,612
            
            
            765,000Basic
                and diluted loss per shareContinuing
                Operations
            
            $
            (0.00
            )
            $
            0.00Net
                Loss
            
            $
            (0.00
            )
            $
            0.00





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








3




SKRM
      Interactive, Inc.


(formerly
      SKREEM ENTERTAINMENT CORPORATION)


(A
      DEVELOPMENT STAGE COMPANY)


UNAUDITED
      CONSOLIDATED STATEMENTS OF OPERATIONS For the Three Months Ended


December
      31, 2007 and December 31, 2006





Three
                Months EndedDecember
                31
            
            December
                312007
            
            2006ExpensesGeneral
                and administrative
            
            $
            58,845
            
            $
            -Total
                expenses
            
            
            58,845
            
            
            -Loss
                from operations
            
            
            (58,845
            )
            
            -Net
                Loss
            
            $
            (58,845
            )
            $
            -Weighted
                Average Shares Outstanding - basic and diluted
            
            
            39,277,646
            
            
            765,000Loss
                Per Share - basic and diluted
            
            $
            (0.00
            )
            $
            0.00




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








4




SKRM
      Interactive, Inc.


(formerly
      SKREEM ENTERTAINMENT CORPORATION)


(A
      DEVELOPMENT STAGE COMPANY)


UNAUDITED
      CONSOLIDATED STATEMENTS OF CASH FLOWS For the Nine Months


Ended
      December 31, 2007 and 2006 and for the Period From Inception, September 16,
      2002,


to
      December 31, 2007





Nine
                Months Ended
            
            Inception
                toDecember
                31,
            
            December
                31,
            
            December
                31,2007
            
            2006
            
            2007Cash
                Flows from Operating Activities:Net
                Loss
            
            $
            (58,845
            )
            $
            -
            
            $
            (62,431
            )Loss
                from continuing operations
            
            
            (58,845
            )
            
            -
            
            
            (62,431
            )Adjustments
                to reconcile net loss to net cash used in operating
                activities:Changes
                inAccounts
                payable and accrued liabilities
            
            
            50,147
            
            
            -
            
            
            50,147Net
                cash used in operating activities
            
            
            (8,698
            )
            
            -
            
            
            (12,284
            )Cash
                Flows from Investing Activities
            
            
            -
            
            
            -
            
            
            -Cash
                Flows from Financing ActivitiesProceeds
                from issuance of common stock
            
            
            -
            
            
            -
            
            
            3,586Net
                reverse merger adjustments
            
            
            8,854
            
            
            -
            
            
            8,854Net
                cash provided by financing activities
            
            
            8,854
            
            
            -
            
            
            12,440Net
                increase (decrease) in cash and cash equivalents
            
            
            156
            
            
            -
            
            
            156Cash
                and cash equivalentsBeginning
                of period - continuing operations
            
            
            -
            
            
            -
            
            
            -End
                of period - continuing operations
            
            $
            156
            
            $
            -
            
            $
            156




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




5




SKRM
      Interactive, Inc.


(formerly
      SKREEM ENTERTAINMENT CORPORATION)


(A
      DEVELOPMENT STAGE COMPANY)


NOTES
      TO
      UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS





Note
      1 -
      BASIS OF PRESENTATION





The
      accompanying unaudited consolidated condensed financial statements of SKRM
      Interactive, Inc. (formerly Skreem Entertainment Corporation)(“SKRM”, “Skreem”
or the “Company”), have been prepared in accordance with accounting principles
      generally accepted in the United States of America for interim financial
      information and with the instructions to Form 10QSB and Item 310(b) of
      Regulation S-B. They do not include all of the information and footnotes
      required by accounting principles generally accepted in the United States of
      America for complete financial statements. In the opinion of management, all
      adjustments, consisting only of normal recurring adjustments, considered
      necessary for a fair presentation, have been included in the accompanying
      unaudited consolidated financial statements. Operating results for the periods
      presented are not necessarily indicative of the results that may be expected
      for
      the full year.





Note
      2 -
      REVERSE MERGER





On
      September 12, 2007, the Company, Jeffrey Martin (a principal shareholders of
      the
      Company), Sector 10 Services-USA, Inc. (“Sector 10 Services”), Sector 10
      Holdings, Inc. (“Sector 10 Holdings”) and the Pericles DeAvila Institute for
      Humanitarian Studies (the “DeAvila Institute”) entered into a Stock Exchange
      Agreement (the “Exchange Agreement”) setting forth the terms and conditions upon
      which the above named parties thereto proposed to consummate a stock exchange
      transaction pursuant to which Sector 10 Holdings and the DeAvila Institute
      would
      transfer to the Company approximately 75% of the issued and outstanding shares
      of common stock of Sector 10 Services in exchange for (i) the Company’s issuance
      and delivery to Sector 10 Holdings and the DeAvila Institute of 47,058,824
      and
      2,941,176 newly-issued shares of the Company’s common stock (the “Common
      Stock”), respectively, and (ii) Mr. Martin’s transfer and delivery to Sector 10
      Holdings and the DeAvila Institute of 14,117,674 and 882,353 outstanding shares
      of Common Stock, respectively (collectively, the “Sector 10 Transaction”). A
      summary of the terms of the Exchange Agreement and related details were
      originally disclosed in a Current Report on Form 8-K filed with the Securities
      and Exchange Commission on October 11, 2007 (the “October Form
      8-K).





As
      disclosed in the October Form 8-K, the consummation of the transactions
      contemplated by the Exchange Agreement was conditioned upon the Company’s
      amendment of its Certificate of Incorporation to authorize the issuance of
      sufficient shares of the Company’s common stock to consummate the transactions
      contemplated by the Exchange Agreement. On or about September 13, 2007 the
      Company obtained the written consent of the holders of sufficient shares of
      the
      issued and outstanding shares of the Company’s common stock to amend the
      Company’s Certificate of Incorporation for the purpose of increasing the
      authorized capital of the Company to 200,000,000 shares of capital stock,
      consisting of 190,000,000 shares of common stock and 10,000,000 shares of
      preferred stock. Based on the approval of the Company’s shareholders, on
      September 15, 2007, the Company filed a Certificate of Amendment to the
      Company’s Certificate of Incorporation for the purpose of affecting the increase
      in the number of authorized shares of the Company’s capital stock.





In
      November 2007, based upon the approval by the SKRM Interactive’s shareholders of
      the Certificate of Amendment, and the filing of the Certificate of Amendment
      with the Secretary of State of the State of Delaware, the Company completed
      the
      transactions contemplated by the Exchange Agreement, including the issuance
      and
      delivery to Sector 10 Holdings and the DeAvila Institute of 47,058,824 and
      2,941,176 newly-issued shares of the Company’s common stock, respectively. The
      Company believes the issuance of such shares to Sector 10 Holdings and the
      DeAvila Institute was exempt from registration under the Securities Act of
      1933,
      as amended (the “Securities Act”), pursuant to the provisions of Section 4(2)
      thereof.





The
      shareholders of Sector 10 Services owned 85%of SKRM Interactive immediately
      after the Sector 10 Transaction was completed in November 2007. The Sector
      10
      Transaction is treated as a reverse merger for accounting purposes, with Sector
      10 Services treated as the surviving entity. The Company’s financial statements
      have been adjusted to eliminate all prior SKRM Interactive information and
      include prior Sector 10 Services financial information.




6





A
      summary
      of significant adjustments to the balance sheet of the Company resulting from
      the Sector 10 Transaction is as follows:





SKRM
      Interactive Reconcile From 9/30/2007 Form 10-Q to 12/31/2007 Form 10-Q **[Q:
      Should this heading stay in the document?]**


DR
      (CR)


Assets
            Liabilities
            Common
                Stock
            Paid
                in Capital
            Retained
                Earnings
            Common
              Stock
                IssuedBalance
                at 9/30
            99,768
            (2,035,384)
            (26,548)
            (7,080,898)
            9,043,062
            26,548,292Shares
                issued in exchange
            
            
            (50,000)
            50,000
            
            50,000,000Merger
                Adjustments
            (99,612)
            1,336,037
            (772)
            7,744,978
            (8,980,631)
            772,000Balance
                at 12/31/2007
            156
            (699,347)
            (77,320)
            714,080
            62,431
            77,320,292





The
      reporting period for the new entity has been requested to continue with a March
      31 year end. The name of the company is in the process of being changed to
      Sector 10, Inc. Affirmation of these changes is expected to be received before
      the conclusion of the Company’s fiscal year ending March 31, 2008.





Note
      3 -
      EQUITY





*During
      the Quarter ended: December 31, 2007:*





In
      November 2007, the Company received approval to increase its authorized common
      stock to 200,000,000 shares. With this authorization, SKRM Interactive issued
      50,000,000 shares (47,058,824 shares to Sector 10 Holdings Inc and 2,941,176
      shares to the DeAvila Institute) and as part of the reverse merger between
      SKRM
      Interactive and Sector 10 Services, Inc.





On
      November 30, 2007, the Company redeemed outstanding convertible notes in the
      original principal amount of $600,000, in exchange for the issuance of 1,200,000
      shares of the Company’s common stock. A shareholder provided the shares in the
      initial transaction. The financial statements present a liability to
      shareholders of 649,200 at December 31, 2007. This amount will be converted
      to
      equity when the 1,200,000 shares are issued to the shareholder. The shares
      are
      expected to be issued before the conclusion of the Company’s fiscal year ending
      March 31, 2008.





On
      November 30, 2006, the Company issued warrants to purchase 10,000,000 shares
      of
      the Company’s common stock at an exercise price of $1.75 per share to its
      convertible note holders. The warrants were amended as part of the November
      30,
      2007 repurchase agreement to remove any variable factors that could require
      adjustments to the outstanding warrants. As of December 31, 2007, the exercise
      price of the warrants was fixed at $ **[______]** and the
      warrants have been treated as equity for financial reporting
      purposes.





As
      a
      result of the Sector 10 Transaction, various adjustments were required to
      eliminate the prior SKRM Interactive activity and to include the information
      regarding Sector 10 Services. The merger adjustments and their impact on the
      Company’s balance sheet are identified in the schedule presented above in Note 2
      - Reverse Merger.





7





Note
      4 -
      GOING CONCERN





As
      of
      December 31, 2007, the Company’s revenue generating activities were not in
      place, and the Company has incurred losses since inception. These factors raise
      substantial doubt about the Company’s ability to continue as a going
      concern.





Management
      is currently negotiating contracts that are anticipated to generate revenues
      in
      the 4 th quarter
      of the Company’s fiscal year ending March 31, 2008. Management also intends to
      seek additional capital through equity and/or debt financing to assist the
      Company until profitable operations can be achieved. There can be no assurance
      that such funds will be available to the Company or available on terms
      acceptable to the Company. The financial statements do not include any
      adjustments that might result from the outcome of these uncertainties.





Note
      5 -
      INCOME TAXES





Income
      taxes are accounted for using the asset and liability method. Deferred tax
      assets and liabilities are recognized for the future tax consequences
      attributable to differences between the financial statement carrying amounts
      of
      existing assets and liabilities and their respective tax bases and net operating
      loss carryforwards. Valuation allowances are established when necessary to
      reduce net deferred tax assets to the amount expected to be realized.





For
      the
      three and nine-month periods ended December 31, 2007 and 2006, the Company
      made
      no provisions for income taxes. Accordingly, deferred tax assets have been
      entirely offset by valuation allowances. The difference between the amounts
      of
      income tax benefit that would result from applying domestic federal statutory
      income tax rates to the net loss and the net deferred tax assets is related
      to
      certain nondeductible expenses, state income taxes, and the change in the
      valuation allowance.





In
      June
      2006, FASB issued FIN48, *Accounting
      for Uncertainty in Income Taxes - an Interpretation of FASB Statement No.
      109.* It is
      effective for fiscal years beginning after December 15, 2006. The Company has
      determined that the application of FIN 48 is immaterial to the financial
      statements for the current period. As the Company expects the business to change
      significantly in the future, an evaluation regarding the impact of FIN 48 will
      be reviewed on a quarterly basis.




8


**Item**  **2** . **Management’s
      Discussion And Analysis Or Plan Of Operation**




This
      report contains forward-looking statements within the meaning of Section 29a
      of
      the Securities Act of 1933, as amended, and Section 21e of the Securities
      Exchange Act of 1934, as amended. These forward-looking statements are subject
      to numerous risks and uncertainties that could cause actual results to differ
      materially from historical or anticipated results. You should not place undue
      reliance on such forward-looking statements, and, when considering such
      forward-looking statements, you should keep in mind the risk factors noted
      in
      this report, including the section of this report entitled “Risks Related to Our
      Business and Operations.” You should also keep in mind that all forward-looking
      statements are based on management’s existing beliefs about present and future
      events outside of management’s control and on assumptions that may prove to be
      incorrect. The following discussion and analysis should be read in conjunction
      with our financial statements and notes thereto, which are included elsewhere
      in
      this report.




**Overview**




On
      September 12, 2007, the Company, Jeffrey Martin (a principal shareholders of
      the
      Company), Sector 10 Services-USA, Inc. (“Sector 10 Services”), Sector 10
      Holdings, Inc. (“Sector 10 Holdings”) and the Pericles DeAvila Institute for
      Humanitarian Studies (the “DeAvila Institute”) entered into a Stock Exchange
      Agreement (the “Exchange Agreement”) setting forth the terms and conditions upon
      which the above named parties thereto proposed to consummate a stock exchange
      transaction pursuant to which Sector 10 Holdings and the DeAvila Institute
      would
      transfer to the Company approximately 75% of the issued and outstanding shares
      of common stock of Sector 10 Services in exchange for (i) the Company’s issuance
      and delivery to Sector 10 Holdings and the DeAvila Institute of 47,058,824
      and
      2,941,176 newly-issued shares of the Company’s common stock (the “Common
      Stock”), respectively, and (ii) Mr. Martin’s transfer and delivery to Sector 10
      Holdings and the DeAvila Institute of 14,117,674 and 882,353 outstanding shares
      of Common Stock, respectively (collectively, the “Sector 10 Transaction”). A
      summary of the terms of the Exchange Agreement and related details were
      originally disclosed in a Current Report on Form 8-K filed with the Securities
      and Exchange Commission on October 11, 2007 (the “October Form
      8-K).





In
      November 2007, based upon the approval by the SKRM Interactive’s shareholders of
      the Certificate of Amendment, and the filing of the Certificate of Amendment
      with the Secretary of State of the State of Delaware, the Company completed
      the
      transactions contemplated by the Exchange Agreement, including the issuance
      and
      delivery to Sector 10 Holdings and the DeAvila Institute of 47,058,824 and
      2,941,176 newly-issued shares of the Company’s common stock, respectively. The
      Company believes the issuance of such shares to Sector 10 Holdings and the
      DeAvila Institute was exempt from registration under the Securities Act of
      1933,
      as amended (the “Securities Act”), pursuant to the provisions of Section 4(2)
      thereof.





Prior
      to
      the execution of the Exchange Agreement, the Company entered into agreements
      with Sterling LLC (“Sterling”) and HLB & Associates, LLC (“HLB”), pursuant
      to which Sterling agreed to provide to the Company and its affiliates certain
      research, market review, strategic analysis, review and planning services and
      HLB agreed to provide to the Company certain planning, development, advertising
      and promotional services. As a result of the Company’s consummation of the
      transactions contemplated by the Exchange Agreement, and the corresponding
      change in the nature of the Company’s business operations, the Company’s Board
      of Directors (the “Board”) determined that the Company’s continued performance
      of the Sterling and HLB agreements was not in the best interests of the Company
      and its shareholders. Accordingly, on December 17, 2007 the Board terminated
      the
      Sterling and HLB agreements described above. The Company did not incur any
      early
      termination penalties as a result of the termination of either agreement.





Sector
      10
      Services has been developing relationships and presently has contracts under
      review that could generate significant revenues for the Company. The initial
      contracts are expected to be completed before the conclusion of the year ending
      March 31, 2008. If the Company is successful in negotiating and executing
      purchase contracts, and if the Company is able to expand its operations to
      fulfill product orders which could be issued under those contracts, neither
      possibility of which the Company can presently assure, the Company’s management
      believes the Company’s revenues and related cash flows of the Company would have
      a material impact on the Company financial statements.





9


**Going
      Concern Qualification**





The
      notes
      to the Company’s consolidated financial statements disclose that the limited
      cash flow of the Company has been absorbed in operating activities and the
      Company has incurred net losses since inception, and the Company has a working
      capital deficiency. In the event that funding from internal sources or from
      public or private financing is insufficient to fund the Company’s business, the
      Company will have to substantially cut back its level of spending, which could
      substantially curtail the Company’s operations. These factors raise substantial
      doubt about the Company’s ability to continue as a going concern. The Company’s
      going concern uncertainty may affect its ability to raise additional capital,
      and may also affect its ability to raise additional capital, and may also affect
      its relationships with suppliers and customers. Investors should carefully
      examine the Company’s financial statements.




**Results
      of Operations**





Nine
      Months Ended December 31, 2007 as Compared to the Nine Months Ended December
      31,
      2006





*Revenues
      -*





The
      Company had no revenues for the nine months ended December 31, 2007. **[Q:
      What about 2006?]** The
      Company is currently negotiating various contracts which the Company’s
      management currently believes will generate revenues beginning in the fiscal
      quarter ending March 31, 2008.





*Operating
      Expenses -*





The
      Company had no operating expenses for the nine months ended December 31, 2007
      or
      December 31, 2006. **[Q:
      How can there be no operating expenses for either nine-month period, but on
      the
      next page there is a discussion of cash used in operations for the nine months
      ended 12/31/07?]**





*General
      and Administrative Expenses -*





General
      and administrative expenses were $58,845 for the nine months ended December
      31,
      2007. These expenses are made up in large part by accounting, consulting and
      professional fees of $52,438 and other expenses of $6,407.





General
      and administrative expenses were $0 for the nine months ended December 31,
      2006. **[What
      about December 2007?]**





**[Q:
      Where is the three-month discussion?] [Need to add three-month discussion prior
      to filing]**





**Liquidity
      and Capital Resources**





As
      of
      December 31, 2007, SKRM had cash of $156. We believe this is not sufficient
      to
      meet our working capital requirements for the coming year.





The
      Company is currently negotiating various contracts which the Company’s
      management currently believes will generate cash flow in the fiscal quarter
      ending March 31, 2008. We may consider also generating funding from the sale
      of
      shares of our common stock to in private transactions. There is no guarantee
      that we will be successful in arranging financing on acceptable terms. If we
      are
      not able to raise additional debt or equity, our ability to continue our
      business operations is doubtful.





We
      do not
      currently have any arrangements for financing and we may not be able to find
      such financing if required. Obtaining additional financing would be subject
      to a
      number of factors, including investor sentiment. Market factors may make the
      timing, amount, terms or conditions of additional financing unavailable to
      us.





Our
      continuation as a going concern is dependent upon continued financial support
      from our shareholders or other parties.




10




*Total
      Assets -*





The
      Company had $156 in total assets as of December 31, 2007 comprised of cash.




*Total
      Liabilities -*





The
      Company had $699,347 in total liabilities as of December 31, 2007. The Company’s
      total liabilities as of December 31, 2007 were comprised of (a) $50, 197 of
      accounts payable and accrued liabilities and (b) $649,200 in notes payable
      to a
      shareholder. We are currently in negotiation with one of our shareholder with
      respect to the satisfaction of the $649,200 in notes payable. If we are
      successful in those negotiations, we hope to satisfy the full amount of that
      debt through the issuance of shares of our common stock.





*Operating
      Activities -*





Cash
      used
      in operations for the nine months ended December 31, 2007 was $8,698. Operating
      activities were affected by the change in accounts payable and accrued
      liabilities of $50,197.





Cash
      used
      in operations for the nine months ended December 31, 2006 was $0.





*Investing
      Activities -*





There
      was
      no cash from investing activities for the nine months ended December 31, 2007
      or
      December 31, 2006.





*Financing
      Activities -*





Cash
      used
      in financing activities for the nine months ended December 31, 2007 was $8,854
      comprised from net adjustments attributed to the Sector 10 Transaction between
      the Company and Sector 10 Services.





Cash
      used
      in financing for the nine months ended December 31, 2006 was $0.





**Risks
      Related to our Business and Operations**




*Investing
      in the Company’s common stock involves a high degree of risk. You should
      carefully consider the risks described below, and all of the other information
      set forth in this report before deciding to invest in shares of the Company’s
      common stock. In addition to historical information, the information in this
      report contains forward-looking statements about the Company’s future business
      and performance. The Company’s actual operating results and financial
      performance may be different from what the Company’s management expects as of
      the date of this report. The risks described in this report represent the risks
      that management has identified and determined to be material to the Company.
      Additional risks and uncertainties not currently known to the Company’s
      management, or that the Company’s management currently deems to be immaterial,
      may also materially harm the Company’s business operations and financial
      condition.*





**[Peric:
      There are a number of significant risks which are not discussed in this section
      and should be added. For example, you should add risk factors regarding the
      “going concern qualification,” the lack of revenues, the absence of executed
      contracts and the uncertainty of the Company’s ability to manufacture products
      if contracts are executed, among other risks.]**





***The
      Company has not paid dividends and does not anticipate paying dividends in
      the
      future.***





The
      Company has not paid any cash dividends on its common stock to date and does
      not
      anticipate any cash dividends being paid to holders of its common stock in
      the
      foreseeable future. While the Company’s dividend policy will be based on the
      operating results and capital needs of the business, it is anticipated that
      any
      earnings will be retained to finance the Company’s future expansion. As the
      Company has no plans to issue cash dividends in the future, its common stock
      could be less desirable to other investors and as a result, the value of our
      common stock may decline, or fail to reach the valuations of other similarly
      situated companies who have **[missing
      text?]**




11




***The
      directors, executive officers and principal stockholders of the Company have
      effective control of the Company, preventing non-affiliate stockholders from
      significantly influencing the Company’s direction and
      future.***





The
      directors, officers, and principal stockholders and their affiliates control
      in
      excess of 80% **** of the
      Company’s outstanding shares of common stock and are expected to continue to
      control a majority of our outstanding common stock following any financing
      transactions projected for the foreseeable future. These directors, officers
      and
      affiliates effectively control all matters requiring approval by the Company’s
      stockholders, including any determination with respect to the acquisition or
      disposition of assets, future issuances of securities, declarations of dividends
      and the election of directors. This concentration of ownership may also delay,
      defer, or prevent a change in control and otherwise prevent stockholders other
      than management’s affiliates from influencing the Company’s direction and
      future.





***The
      market for the Company’s stock is thin and subject to manipulation.***





The
      volume of trading in the Company’s common stock is limited and can be dominated
      by a few individuals. The limited volume, if any, can make the price of the
      Company’s common stock subject to manipulation by one or more stockholders and
      will significantly limit the number of shares that one can purchase or sell
      in a
      short period of time. An investor may find it difficult to dispose of shares
      of
      the Company’s common stock or obtain a fair price for the Company’s common stock
      in the market.





***The
      market price for the Company’s common stock is volatile and may change
      dramatically at any time.***





The
      market price of the Company’s common stock is highly volatile. The price for the
      Company’s common stock may change dramatically as the result of announcements of
      the Company’s operating or financial results, the rate of the Company’s
      expansion, significant litigation or other factors or events that would be
      expected to affect the Company’s business or financial condition, results of
      operations and other factors specific to the Company’s business and future
      prospects. In addition, the market price for the Company’s common stock may be
      affected by various factors not directly related to the Company’s business,
      including the following:





·
            intentional
                manipulation of the Company’s stock price by existing or future
                stockholders;·
            short
                selling of the Company’s common stock or related derivative
                securities;





·
            a
                single acquisition or disposition, or several related acquisitions
                or
                dispositions, of a large number of the Company’s shares of the Company’s
                common stock;·
            the
                interest, or lack of interest, of the market in the Company’s business
                sector, without regard to the Company’s financial condition or results of
                operations;





·
            the
                adoption of governmental regulations and similar developments in
                the
                United States or abroad that may affect the Company’s ability to offer the
                Company’s products and services or affect the Company’s cost structure;·
            developments
                in the businesses of companies that purchase the Company’s products;
                and





·
            economic
                and other external market factors, such as a general decline in market
                prices due to poor economic indicators or investor
                distrust.





***Our
      business may be affected by increased compensation and benefits
      costs.***





**[Missing
      Text?]**




12





***The
      Company is unlikely to pay dividends on its common stock in the foreseeable
      future.***




The
      Company has never declared or paid dividends on its stock. The Company currently
      intends to retain all available funds and any future earnings for use in the
      operation and expansion of its business. The Company does not anticipate paying
      any cash dividends in the foreseeable future, and it is unlikely that investors
      will derive any current income from ownership of the Company’s common stock.
      This means that the potential for economic gain from ownership of the Company’s
      common stock depends on appreciation of the stock price and will only be
      realized by a sale of the stock at a price higher than the purchase price.





***The
      Company’s common stock is a “low-priced stock” and subject to regulation that
      limits or restricts the potential market for the
      stock.***





Shares
      of
      the Company’s common stock may be deemed to be “low-priced” or “penny stock,”
resulting in increased risks to investors and certain requirements being imposed
      on some brokers who execute transactions in the common stock. In general, a
      low-priced stock is an equity security that:





·
            Is
                priced under five dollars;·
            Is
                not traded on a national stock exchange, the Nasdaq Global Market
                or the
                Nasdaq Capital Market;


·
            Is
                issued by a company that has less than $5 million in net tangible
                assets
                (if it has been in business less than three years) or has less than
                $2
                million in net tangible assets (if it has been in business for at
                least
                three years); and·
            Is
                issued by a company that has average revenues of less than $6 million
                for
                the past three years.





The
      Company believes that our common stock is presently a “penny stock.” At any time
      the common stock qualifies as a penny stock, the following requirements, among
      others, will generally apply:





·
            Certain
                broker-dealers who recommend penny stock to persons other than established
                customers and accredited investors must make a special written suitability
                determination for the purchaser and receive the purchaser’s written
                agreement to a transaction prior to sale.·
            Prior
                to executing any transaction involving a penny stock, certain
                broker-dealers must deliver to certain purchasers a disclosure schedule
                explaining the risks involved in owning penny stock, the broker-dealer’s
                duties to the customer, a toll-free telephone number for inquiries
                about
                the broker-dealer’s disciplinary history and the customer’s rights and
                remedies in case of fraud or abuse in the
                sale.


·
            In
                connection with the execution of any transaction involving a penny
                stock,
                certain broker-dealers must deliver to certain purchasers the following:




O
            bid
                and offer price quotes and volume information;O
            the
                broker-dealer’s compensation for the trade;O
            the
                compensation received by certain salespersons for the
                trade;


O
            monthly
                accounts statements; andO
            a
                written statement of the customer’s financial situation and investment
                goals.





***Compliance
      with existing and new regulations of corporate governance and public disclosure
      may result in additional expenses.***





Compliance
      with changing laws, regulations, and standards relating to corporate governance
      and public disclosure, including the Sarbanes-Oxley Act of 2002 and other SEC
      regulations, requires large amounts of management attention and external
      resources. This may result in increased general and administrative expenses
      and
      a diversion of management time and attention from revenue-generating activities
      to compliance activities.





13




**Item
      3.**  **Controls
      and Procedures**





(a)  Based
      on
      the evaluation of our “disclosure
      controls and procedures” (as defined in the Securities Exchange Act of 1934
      Rules 13a-15(e) or 15d-15(e)) required by paragraph (b) of Rules 13a-15 or
      15d-15, the Company’s principal executive officer and principal financial
      officer concluded that as of December 31, 2007, the Company’s disclosure
      controls and procedures were effective in ensuring that information required
      to
      be disclosed by the Company in its reports that it files or submits under the
      Securities Exchange Act of 1934 (as amended) is recorded, processed, summarized
      and reported within the time periods specified in the rules and forms of the
      SEC.




(b)  There
      have been no changes in our internal control over financial reporting identified
      in connection with the evaluation required by paragraph (d) of Exchange Act
      Rules 13a-15 or 15d-15 that occurred during our last fiscal quarter that have
      materially affected, or are reasonably likely to materially affect, our internal
      control over financial reporting.





**[Peric:
      Confirm that there statements are accurate]**





**PART
      II - OTHER INFORMATION**





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








On
      September 12, 2007, the Company, Jeffrey Martin, Sector 10 Services, Sector
      10
      Holdings, and the DeAvila Institute the Section 10 Transaction Exchange
      Agreement. The offer and sale of shares of common stock in the Sector 10
      Transaction were effected in reliance upon the exemptions for sales of
      securities not involving a public offering, as set forth in Section 4(2) of
      the
      Securities Act and/or Regulation D promulgated thereunder, based upon the
      following: (a) there was no public offering or general solicitation with respect
      to the Sector 10 Transaction offering; (b) each of Sector 10 Holdings and the
      DeAvila Institute investor was provided with certain disclosure materials and
      all other information requested with respect to the Company; (c) each of Sector
      10 Holdings and the DeAvila Institute acknowledged that all securities being
      purchased were “restricted securities” for purposes of the Securities Act, and
      agreed to transfer such securities only in a transaction registered under the
      Securities Act or exempt from registration under the Securities Act; and (d)
      a
      legend was placed on the certificates representing each such security stating
      that it was restricted and could only be transferred if subsequently registered
      under the Securities Act or transferred in a transaction exempt from
      registration under the Securities Act.




**Item
      6. Exhibits**





See
      the
      Exhibit Index attached hereto following the signature page.





14





**SIGNATURES**





Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned thereunto
      duly authorized.





SKRM
                Interactive, Inc.February
                19, 2007
            
            By:
                /s/ Pericles DeAvilaDate
            
            Pericles
                DeAvila, President (Principal Executive Officer)February
                19, 2007
            
            By:
                /s/ Pericles DeAvilaDate
            
            Pericles
                DeAvila
              Chief
                Financial Officer








15






**EXHIBIT
                INDEX****Exhibit
                No.**
            
            **Exhibit**
            
            **Incorporated
                by Reference/ Filed Herewith****[Discuss
                other exhibits]**31.1
            
            Rule
                13a-14(a)/15d-14(a) Certification of Chief Executive
                Officer
            
            Filed
                herewith31.2
            
            Rule
                13a-14(a)/15d-14(a) Certification of Chief Financial
                Officer
            
            Filed
                herewith32.1
            
            Section
                1350 Certification of Chief Executive Officer
            
            Filed
                herewith32.2
            
            Section
                1350 Certification of Chief Financial Officer
            
            Filed
                herewith







16