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 September 30, 2005
                                       or
              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
         For the transition period from ____________ to ________________
                       Commission file number: 333-121543


                                OPTIONABLE, INC.

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

              Delaware                             52-2219407
 -----------------------------------         --------------------
(State or other jurisdiction of               (I.R.S. Employer
incorporation or organization)                Identification No.)

  555 Pleasantville Road, South Building, Suite 110 Briarcliff Manor, NY 10150
--------------------------------------------------------------------------------
               (Address of principal executive offices) (Zip Code)

                                 (914) 773-1100
                (Issuer's telephone number, including area code)

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

The total  number  of shares of the  issuer's  common  stock,  $.001 par  value,
outstanding  at October 31, 2005 was  51,406,431.

Transitional  Small  Business Disclosure Format: Yes |_| No |X|

<PAGE>

                SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

To the extent that the  information  presented in this Quarterly  Report on Form
10-QSB for the quarter ended September 30, 2005 discusses financial projections,
information or  expectations  about our products or markets,  or otherwise makes
statements  about future events,  such  statements are  forward-looking.  We are
making  these  forward-looking   statements  in  reliance  on  the  safe  harbor
provisions of the Private Securities  Litigation Reform Act of 1995. Although we
believe that the expectations reflected in these forward-looking  statements are
based on reasonable  assumptions,  there are a number of risks and uncertainties
that could cause actual results to differ  materially from such  forward-looking
statements.  These risks and uncertainties are described,  among other places in
this  Quarterly  Report,  in  "Management's  Discussion  and Analysis or Plan of
Operation."

In  addition,   we  disclaim  any  obligations  to  update  any  forward-looking
statements to reflect events or  circumstances  after the date of this Quarterly
Report.  When considering such  forward-looking  statements,  you should keep in
mind the risks  referenced  above and the other  cautionary  statements  in this
Quarterly Report.




























                                       2

<PAGE>

                                OPTIONABLE, INC.
                                  BALANCE SHEET
                               September 30, 2005
                                   (Unaudited)

                                     ASSETS

Current Assets:
Cash                                                          $       1,271,382
Accounts receivable, net of provision
 for doubtful accounts of $61,163                                       585,337
Due from related party                                                  344,276
Incentives receivable                                                   157,572
                                                              ------------------

     Total current assets                                             2,358,567

  Property and equipment, net of
   accumulated depreciation of $419,225                                  43,302
  Other receivable                                                      150,000
  Other assets                                                           79,820
                                                              ------------------

     Total assets                                             $       2,631,689
                                                              ==================

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities:
  Accounts payable and accrued expenses                       $          90,089
  Accrued compensation                                                  499,478
                                                              ------------------

    Total current liabilities                                           589,567

Due to chairman of the board, net of
 unamortized discount of $3,584,281                                   1,931,483
Due to executive officer, net of
 unamortized discount of $486,149                                       258,153
Due to chief executive officer, net
 of unamortized discount of $486,149                                    108,153
                                                              ------------------

     Total liabilities                                                2,887,356

Stockholders' Deficit:
  Preferred stock; $.0001 par value,
   5,000,000 shares authorized, none issued
   and outstanding at September 30, 2005                                      -
  Common stock; $.0001 par value, 100,000,000
    shares authorized, 51,406,431 issued and
    outstanding at September 30, 2005                                     5,141
  Additional paid-in capital                                          7,790,471
  Accumulated deficit                                                (8,051,279)
                                                              ------------------

     Total stockholders' deficit                                       (255,667)
                                                              ------------------


     Total liabilities and stockholders' deficit              $       2,631,689
                                                              ==================





                  See Notes to Unaudited Financial Statements.
                                       -3-

<PAGE>

                                OPTIONABLE, INC.
                            STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>

                                      For the Three-Month Periods Ended    For the Nine-Month Periods Ended
                                                  September 30                        September 30
                                      ----------------------------------  ------------------------------------
                                            2005              2004              2005                2004
                                      ----------------  ----------------  ----------------   -----------------
                                         (Unaudited)       (Unaudited)       (Unaudited)        (Unaudited)
<S>                                   <C>               <C>               <C>                <C>
Brokerage fees                        $       880,537   $       804,819   $     2,198,690    $      1,349,752
Brokerage fees-related party                  620,072           389,191         1,409,417             635,006
Incentives                                    199,863           299,278           529,151             374,717
                                      ----------------  ----------------  ----------------   -----------------
Net revenues                                1,700,472         1,493,288         4,137,258           2,359,475

Cost of revenues                              465,007           434,880         1,387,402           1,195,115
Cost of revenues-related party                163,628           153,107           644,338             299,698
                                      ----------------  ----------------  ----------------   -----------------
                                              628,635           587,987         2,031,740           1,494,813

Gross profit                                1,071,837           905,301         2,105,518             864,662

Operating expenses:
  Selling, general and administrative         185,328           148,030           514,385             562,378
  Research and development                    116,115            19,493           372,504              19,493
                                      ----------------  ----------------  ----------------   -----------------

     Total operating expenses                 301,443           167,523           886,889             581,871
                                      ----------------  ----------------  ----------------   -----------------

     Operating income                         770,394           737,778         1,218,629             282,791
                                      ----------------  ----------------  ----------------   -----------------

  Other income (expense):
  Gain on extinguishment of debt                    -           238,282                 -             238,282
  Interest expense to related parties         (76,176)          (67,401)         (221,834)           (206,617)
                                      ----------------  ----------------  ----------------   -----------------
                                              (76,176)          170,881          (221,834)             31,665
                                      ----------------  ----------------  ----------------   -----------------

Net income                            $       694,218   $       908,659   $       996,795    $        314,456
                                      ================  ================  ================   =================

Basic earnings per common share                $ 0.01            $ 0.02            $ 0.02              $ 0.01
                                      ================  ================  ================   =================

Diluted earnings per common share              $ 0.01            $ 0.02            $ 0.02              $ 0.01
                                      ================  ================  ================   =================

Basic weighted average common
shares outstanding                         51,406,431        45,096,430        51,406,431          45,096,430
                                      ================  ================  ================   =================

Diluted weighted average common
 shares outstanding                        51,461,963        45,096,430        51,449,427          45,096,430
                                      ================  ================  ================   =================
</TABLE>

                  See Notes to Unaudited Financial Statements.
                                       -4-

<PAGE>

                                OPTIONABLE, INC.
                            STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                            For the Nine-Month Periods Ended
                                                                      September 30
                                                           -----------------------------------
                                                                2005               2004
                                                           ----------------   ----------------
                                                              (Unaudited)        (Unaudited)

Cash flows from operating activities:
<S>                                                        <C>                <C>
Net income                                                 $       996,795    $       314,456
Adjustments to reconcile net income to net
 cash provided by (used in) operating activities:
  Depreciation                                                      26,048             37,665
  Amortization of debt discount                                    221,834            133,216
  Forfeiture of officers' compensation                                   -            375,000
  Gain on extinguishment of debt                                         -           (238,282)
  Provision for doubtful accounts                                  (28,811)               212
  Fair value of warrants issued to consultant                        6,060                  -
Changes in operating assets and liabilities:
  Accounts receivable                                             (359,942)          (314,296)
  Due from related party                                           (50,701)          (275,198)
  Incentives receivable                                            (25,896)          (374,299)
  Other receivable                                                (150,000)                 -
  Other assets                                                     (66,864)            (1,032)
  Accounts payable and accrued expenses                            (40,598)          (600,829)
  Accrued compensation                                             151,761            327,000
  Accrued interest on notes payable to related parties                   -              3,627
                                                           ----------------   ----------------

Net cash provided by (used in) operating activities                679,686           (612,760)
                                                           ----------------   ----------------

Cash flows from investing activity:
  Purchases of property and equipment                              (23,085)              (597)
                                                           ----------------   ----------------

Net cash used in investing activity                                (23,085)              (597)
                                                           ----------------   ----------------

Cash flows from financing activities:

  Proceeds from line of credit payable to chairman
   of the board                                                          -             50,000
  Proceeds from issuance of shares of common stock                       -          1,000,000
  Principal repayments on due to chief executive officer          (186,354)          (500,000)
  Principal repayment on due to chairman of the board             (105,991)                 -
  Proceeds from issuance of notes payable to chairman
   of the board                                                          -            300,000
                                                           ----------------   ----------------

Net cash (used in) provided by financing activities               (292,345)           850,000
                                                           ----------------   ----------------

 Net increase in cash                                              364,256            236,643

Cash, beginning of period                                          907,126             63,041
                                                           ----------------   ----------------

Cash, end of period                                        $     1,271,382    $       299,684
                                                           ================   ================

Supplemental disclosures of cash flow information:
     Cash paid for taxes                                   $             -    $             -
                                                           ================   ================

     Cash paid for interest                                $             -    $        69,972
                                                           ================   ================


Supplemental disclosures for non-cash financing activity:

Increase in due to related party and corresponding
 increase in additional paid-in capital                    $             -    $       462,067
                                                           ================   ================

Increase in discount on due to chairman of the board
 and corresponding increase in additional paid-in capital  $             -    $     3,918,391
                                                           ================   ================

</TABLE>

                  See Notes to Unaudited Financial Statements.
                                       -5-

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004
                                   (Unaudited)

Note 1-Organization, Description of Business and Basis of Presentation

Optionable,  Inc. (the "Company") was formed in Delaware in February 2000 and is
a  trading  and  brokerage  services  provider  to  brokerage  firms,  financial
institutions,   energy  traders,  and  hedge  funds  nationwide.  The  Company's
operations are located in the New York metropolitan  area. The Company is in the
process of developing an automated electronic trading system.

The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information.
Accordingly,  they do not  include  all of the  information  and  the  footnotes
required by generally  accepted  accounting  principles  for complete  financial
statements.  In the  opinion  of  management,  all  adjustments,  consisting  of
recurring  accruals,  considered  for a fair  presentation  have been  included.
Operating  results for the three months and nine months ended September 30, 2005
are not  necessarily  indicative  of the results  that may be  expected  for the
fiscal year ending December 31, 2005.

Note 2- Summary of Significant Accounting Policies

Cash and Cash Equivalents

The Company considers all highly liquid investments with original  maturities of
three months or less to be cash equivalents.

Concentration of Credit Risks

The Company is subject to  concentrations of credit risk primarily from cash and
cash equivalents,  accounts receivable,  incentives receivable, due from related
party and other receivable.

The  Company's  cash  and  cash  equivalents  accounts  are  held  at  financial
institutions  and are  insured  by the  Federal  Deposit  Insurance  Corporation
("FDIC") up to $100,000.  During the  nine-months  ended September 30, 2005, the
Company has reached bank balances  exceeding the FDIC insurance limit. To reduce
its risk associated with the failure of such financial institutions, the Company
periodically evaluates the credit quality of the financial institutions in which
it holds deposits.

The Company's accounts  receivable are due from energy trading firms,  financial
institutions,   and  hedge  funds,  located  primarily  in  the  United  States.
Collateral is generally not required. Three of the Company's customers accounted
for 21%, 11%, and 10%, respectively, of its accounts receivable at September 30,
2005. No other customers  accounted for more than 10% of its accounts receivable
at September 30, 2005.

                                       6

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                          September 30, 2005 and 2004

Note 2- Summary of Significant Accounting Policies-Continued

The Company's  incentives  receivable  are due from two United States  exchanges
providing  the  Company  with  incentives  to  submit  customer  trades to their
respective platform. The incentives receivable are not collateralized.

The due from related party is due from an affiliate owned by the Company's Chief
Executive  Officer  and by an  Executive  Officer of the  Company,  who are both
stockholders of the Company. The due from related party is not collateralized.

The Company's  other  receivable is due from an employee of a related  party,  a
company owned by our Chief Executive Officer and by an Executive Officer.  It is
used as a $100,000  deposit  with a US  exchange  and a $50,000  deposit  with a
clearinghouse. It is secured by cash accounts.

Customer Concentration

One of the Company's  customers  accounted for  approximately 16% and 10% of its
revenues  during the  nine-month  periods  ended  September  30,  2005 and 2004,
respectively.   The  Company  minimizes  its  customer  concentration  risks  by
diversifying its existing customer base.

Product Concentration

All of  the  Company's  revenues  are  derived  from  fees  earned  from  energy
derivatives transaction fees and related incentives provided by exchanges.

Fair Value of Financial Instruments

The  carrying  value  of  cash  and  cash  equivalents,   accounts  receivables,
incentives  receivable,  due from  related  party,  other  receivable,  accounts
payable and accrued expenses,  and accrued  compensation  approximate their fair
value due to their short-term maturities. The carrying amount of due to Chairman
of the  board,  due to  Chief  Executive  Officer,  and  due  to  related  party
approximate their fair value based on the Company's incremental borrowing rate.

                                       7

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004

Note 2- Summary of Significant Accounting Policies-Continued

Software Development Costs

Costs incurred in the research and development of software products are expensed
as  incurred  until  technological  feasibility  has  been  established.   After
technological  feasibility is established,  any additional costs are capitalized
in accordance with Statement of Accounting  Financial Standards ("SFAS") No. 86,
Accounting  for the Costs of Computer  Software to Be Sold,  Leased or Otherwise
Marketed.  Costs of maintenance and customer  support will be charged to expense
when related  revenue is recognized or when those costs are incurred,  whichever
occurs  first.  The Company  believes  that the current  process for  developing
software  is  essentially  completed  concurrently  with  the  establishment  of
technological feasibility;  accordingly, no software development costs have been
capitalized at September 30, 2005.

Income Taxes

Income taxes are accounted for in accordance  with SFAS No. 109,  Accounting for
Income Taxes.  SFAS No. 109 requires the  recognition of deferred tax assets and
liabilities  to reflect  the future tax  consequences  of events  that have been
recognized in the Company's financial statements or tax returns.  Measurement of
the  deferred  items is based on  enacted  tax laws.  In the  event  the  future
consequences of differences  between financial  reporting bases and tax bases of
the Company's  assets and liabilities  result in a deferred tax asset,  SFAS No.
109  requires  an  evaluation  of the  probability  of being able to realize the
future benefits  indicated by such assets.  A valuation  allowance  related to a
deferred tax asset is recorded  when it is more likely than not that some or the
entire deferred tax asset will not be realized.

Use of Estimates

The preparation of financial statements in accordance with accounting principles
generally  accepted in the United States  requires  management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting periods. Significant estimates made by management include, but are not
limited to, the  realization  of  receivables.  Actual  results will differ from
these estimates.






                                       8

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004

Note 2- Summary of Significant Accounting Policies-Continued

Basic and Diluted Earnings per Share

Basic  earnings  per  share are  calculated  by  dividing  income  available  to
stockholders by the weighted-average  number of common shares outstanding during
each period.  Diluted earnings per share are computed using the weighted average
number of common and dilutive common share  equivalents  outstanding  during the
period.  Dilutive common share  equivalents  consist of shares issuable upon the
exercise of stock options and warrants  (calculated using the  modified-treasury
stock method).  The outstanding  options  amounted to 797,250 and 0 at September
30, 2005 and 2004,  respectively.  The outstanding  warrants amounted to 300,000
and  100,000 at  September  30,  2005 and 2004,  respectively.  The  outstanding
warrants at September 30, 2004 are excluded from the loss per share  computation
for the respective periods due to their antidilutive effect.

The  following  sets forth the  computation  of basic and diluted  earnings  per
share:

<TABLE>
<CAPTION>

                                                       For the three-month              For the nine-month
                                                           period ended                    period ended
                                                           September 30,                  September 30,
                                                        2005         2004               2005          2004
                                                   ============  ============      ============  ============
Numerator:
<S>                                                   <C>           <C>               <C>           <C>
Net income                                            $694,218      $908,659          $996,795      $314,456

Denominator:
Denominator for basic earnings per share-
Weighted average shares outstanding                 51,406,431    45,096,430        51,406,431    45,096,430
Effect of dilutive employee stock options               35,843             0            30,583             0
Effect of dilutive warrants                             15,422             0             8,772             0
                                                   ------------  ------------      ------------  ------------
Denominator for diluted earnings per share-
Weighted average shares outstanding                 51,457,696    45,096,430        51,445,787    45,096,430
                                                   ============  ============      ============  ============
Basic earnings per share                                 $0.01         $0.02             $0.02         $0.01
                                                   ============  ============      ============  ============
Diluted earnings per share                               $0.01         $0.02             $0.02         $0.01
                                                   ============  ============      ============  ============
Anti-dilutive weighted-average shares                        0       100,000                 0       100,000
                                                   ============  ============      ============  ============
</TABLE>

The share amounts included in the financial statements,  including the basic and
diluted  loss per share have been  retroactively  restated  to reflect the stock
splits discussed below.

                                       9

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004

Note 2- Summary of Significant Accounting Policies-Continued

Stock Splits

The Company's board of directors declared the following split of the Company's
common stock:


        June 10, 2004                            1.27 for 1

The basic and diluted earnings per share have been adjusted retroactively to
give effect to this stock spilt.

Revenue Recognition

Revenue is recognized when earned. The Company's revenue recognition policies
are in compliance with the Securities and Exchange Commission's Staff Accounting
Bulletin ("SAB") No. 104 "Revenue Recognition".

The Company generally invoices its customers monthly, for all transactions which
have been  executed  during such month.  Revenues are  recognized  on the day of
trade-trade   date  basis.   The  Company's   revenues  derive  from  a  certain
predetermined  fixed  fee of the  transactions  it  executes  on  behalf  of its
customers.  The fee is based on the volume of financial  instruments traded. The
Company  bases its fees on oral and written  contracts  and confirms the fees in
writing upon the execution of each transaction.

The Company also receives incentives from United States exchanges for the volume
of transactions  conducted by the Company using their  platform.  The incentives
are  based on a  percentage  of the  total  revenues  received  by the  exchange
attributable to the Company's volume of transactions submitted to the respective
exchanges.  The Company estimates monthly such incentives based on the volume of
daily  transactions  submitted  to the  respective  exchanges  using  the day of
trade-trade  date  basis,  and  the  exchanges'  published  revenues  by type of
transactions.  The Company, pursuant to SAB 104, realizes the incentive revenues
realized or realizable when the all of the following criteria are met:

     1) Persuasive  evidence of an arrangement exists. The Company has a written
separate  agreement with one of the  exchanges.  The other exchange has publicly
published  the terms of its  incentive  program in 2003,  which were modified in
2005 and are offered to all intermediaries in the select transactions;





                                       10

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004

Note 2- Summary of Significant Accounting Policies-Continued

     2) Delivery has occurred or services have been rendered. Under arrangements
with both  exchanges,  the incentives are earned on the day the Company  submits
transactions to the respective  exchanges  based on the revenues  generated from
such transactions and are no longer subject to minimum volume of transactions to
the respective exchanges. The Company accounts for all transactions submitted to
each  exchange on a daily basis.  Accordingly,  the Company is able to determine
when the incentives are earned based on the date it submits transactions to the
exchanges.  The Company has no other obligations to the exchanges to earn the
incentives;

     3)  "Seller's"  price to the buyer is fixed or  determinable.  Based on the
incentive program terms of each exchange, their published prices for the type of
transactions  the  Company  submits  to  them,  and the  Company's  transactions
records,  the Company is able to estimate the revenues  each  exchange  earns in
connection with the transactions it submits, and accordingly, the amount, if any
of the incentives the Company earns in connection with such transactions; and

     4) Collectibility is reasonably assured. Historically,  both exchanges have
paid the Company timely on incentives  earned. The Company has no knowledge that
they  do  not  intend  to pay  these  incentives,  if  earned,  in  the  future.
Furthermore,  the  Company  intends to  enforce  the  payment of any  incentives
receivable under the incentive programs.

Stock-Based Compensation

The Company  accounts for stock options  issued to employees in accordance  with
the  provisions  of  Accounting   Principles   Board  ("APB")  Opinion  No.  25,
"Accounting  for Stock Issued to  Employees,"  and related  interpretations.  As
such,  compensation  cost is  measured on the date of grant as the excess of the
current market price of the underlying

                                       11

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004

Note 2- Summary of Significant Accounting Policies-Continued

stock over the exercise price. Such compensation  amounts, if any, are amortized
over the respective vesting periods of the option grant. The Company adopted the
disclosure provisions of SFAS No. 123, "Accounting for Stock-Based Compensation"
and  SFAS  148,  "Accounting  for  Stock-Based   Compensation   -Transition  and
Disclosure",  which  permits  entities  to provide  pro forma net income and pro
forma earnings per share  disclosures for employee stock option grants as if the
fair-valued  based method defined in SFAS No. 123 had been applied.  The Company
accounts  for stock  options  and stock  issued  to  non-employees  for goods or
services in accordance with the fair value method of SFAS 123.

Segment reporting

The Company  operates in one segment,  brokerage  services.  The Company's chief
operating  decision-maker  evaluates the  performance  of the Company based upon
revenues  and  expenses  by  functional  areas  as  disclosed  in the  Company's
statements of operations.

Recent Pronouncements

In December 2004, the FASB issued SFAS 123 (revised 2004) "Share-Based Payment".
This  Statement   requires  that  the  cost   resulting  from  all   share-based
transactions be recorded in the financial statements.  The Statement establishes
fair value as the measurement  objective in accounting for  share-based  payment
arrangements and requires all entities to apply a  fair-value-based  measurement
in accounting for share-based payment transactions with employees. The Statement
also  establishes  fair value as the measurement  objective for  transactions in
which an entity  acquires  goods or services from  non-employees  in share-based
payment   transactions.   The  Statement   replaces  SFAS  123  "Accounting  for
Stock-Based  Compensation"  and supersedes  APB Opinion No. 25  "Accounting  for
Stock Issued to  Employees".  The provisions of this Statement will be effective
for the Company beginning in the first quarter of 2006. The Company is currently
evaluating  the impact this new Standard  will have on its  financial  position,
results of operations or cash flows. Note 3-Due from Related Party

In April 2004,  the Company  agreed to pay certain  fixed and variable  fees and
support  services to a related party entity partly owned by its Chief  Executive
Officer and by an  Executive  Officer in exchange for a share of revenues of the
floor brokerage services of the related party.

The  Company's  share of revenues and expenses of the floor  brokerage  services
amounted to  approximately  $1.4  million and  $635,000,  during the  nine-month
period ended September 30, 2005 and 2004, respectively. The Company has received
$630,000 from the related party in connection with such floor brokerage services
during the same  period and the  related  party owed  approximately  $340,000 at
September 30, 2005.

                                       12

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004

Note 3-Due from Related Party-continued

The Company  recognizes  its share of revenues of the floor  brokerage  services
based on the  commissions  earned for such services  which are recognized on the
day of the trade-trade date basis.

Note 4-Other Receivable

The Company's other receivable consists of amounts due from a broker employed by
a related  party,  an  entity  owned by our Chief  Executive  Officer  and by an
Executive  Officer.  This other receivable  funded security deposits of $100,000
held at a US exchange  and $50,000 held at a  clearinghouse,  which are required
for the Company's floor operations.

Note 5-Due to Related Parties

The terms and amounts of due to related parties at September 30, 2005 are as
follows:

Due to Chairman of the Board, non-interest bearing,
unsecured, payable by March 12, 2014, if the Company obtains
additional equity or debt financing of at least $1,000,000
following the private placement which closed in September
2004 ("Capital Raise"), the Company will repay its Chairman
of the Board up to 39.33% of the Capital Raise, up to
$2,810,877, with the remaining balance and accrued interest
of 4.68% from the date of the Capital Raise due on March 22,
2014:                                                              $  5,515,764
Discount, using initial implied rate of 12%:                         (3,584,281)
                                                                   -------------
                                                                   $  1,931,483
                                                                   =============


Due to Executive Officer, non-interest bearing, unsecured,
payable by March 12, 2014, if the Company obtains additional
equity or debt financing of at least $1,000,000 following a
Capital Raise, the Company will repay its Executive Officer
up to 5.3% of the Capital Raise, up to $381,250, with the
remaining balance and accrued interest of 4.68% from the
date of the Capital Raise due on March 22, 2014:                   $    744,302
Discount, using initial implied rate of 12%:                           (486,149)
                                                                   -------------
                                                                   $    258,153
                                                                   =============

                                       13

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004


Note 5-Due to Related Parties-continued

Due to Chief Executive Officer, non-interest bearing,
unsecured, payable by March 12, 2014, if the Company obtains
additional equity or debt financing of at least $1,000,000
following a Capital Raise, the Company will repay its Chief
Executive Officer up to 5.3% of the Capital Raise, up to
$381,250, with the remaining balance and accrued interest of
4.68% from the date of the Capital Raise due on March 22,
2014:                                                              $    594,302
Discount, using initial implied rate of 12%:                           (486,149)
                                                                   -------------
                                                                   $    108,153
                                                                   =============

The  amortization  of the  discount  on the due to related  parties  amounted to
approximately   $222,000  and  $133,000  during  the  nine-month  periods  ended
September  30, 2005 and 2004,  respectively,  and has been  recorded as interest
expense to related parties in the accompanying statements of operations.

Interest  expense,  other than the amortization of discount,  in connection with
the various  amounts due to Chairman of the Board and note  payable to a related
party,  an  entity  in which  the  Company's  Chairman  of the Board is also the
managing director amounted to approximately $0 and $75,000 during the nine-month
periods ended September 30, 2005 and 2004, respectively.

During April 2005, the Company modified the terms of its due to related parties.
The modified  terms provide that, in the event of a Capital  Raise,  among other
things, the interest rate accrued after such event is reduced from 12% to 4.68%.
Additionally,  the modified  terms  provide that the Company may make  principal
repayments  towards  the due to  Chairman  of the  Board,  the due to its  Chief
Executive  Officer,  and the due to related party amounting to approximately 25%
of its cash  flows from  operating  cash flows  less  capital  expenditures.  In
connection  with the modified terms,  the Company made a principal  repayment of
$69,638 on the due to its  Chairman  of the Board,  which was offset  against an
accounts  receivable  of one of the  Company's  clients,  which is an  unrelated
party.  Additionally,  the Company made a principal repayment of $150,000 on the
due to Chief  Executive  Officer.  Furthermore,  during August 2005, the Company
made additional principal repayments of approximately  $73,000 on the due to its
related parties.







                                       14

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004

Note 6- Other Related Party Transactions

The Company has recognized revenues of approximately $100,000 and $50,000 during
the nine-month  periods ended  September 30, 2005 and 2004,  respectively,  from
three related  parties,  entities in which its Chairman of the Board is also the
managing director. Such related parties owe the Company approximately $53,000 at
September 30, 2005.

The Company provides administrative services to a related party, an entity owned
by the Company's Chief Executive Officer and an Executive  Officer.  The Company
charged  approximately  $13,000 and $2,000 during the  nine-months  period ended
September 30, 2005 and 2004, respectively,  for such services. The related party
owes the Company  approximately $7,000 at September 30, 2005.  Furthermore,  the
Company has  purchased  goods of  approximately  $1,000 from this related  party
during the nine-month period ended September 30, 2005.

Note 7- Stockholders' Deficit

Stock Compensation Plan

During  November  2004,  the Company  adopted its 2004 Stock  Option Plan ("2004
Plan").  The 2004 Plan allows for the grant of both incentive  stock options and
nonstatutory stock options.  The 2004 Plan may be administered,  interpreted and
construed  by the Board of Directors or a  compensation  committee.  The maximum
number of shares of common stock which may be issued pursuant to options granted
under the 2004 Plan may not exceed  7,500,000  shares.  If any  options  granted
under the 2004 Plan expire or terminate  without having been exercised or ceased
to be exercisable, such options will be available again under the 2004 Plan. All
employees of the Company and its subsidiaries are eligible to receive  incentive
stock options and nonstatutory stock options. Non-employee directors and outside
consultants who provided  bona-fide services not in connection with the offer or
sale of  securities  in a capital  raising  transaction  are eligible to receive
nonstatutory  stock  options.  Incentive  stock options may not be granted below
their  fair  market  value at the  time of grant  or,  if to an  individual  who
beneficially  owns more than 10% of the total combined voting power of all stock
classes of the Company or a  subsidiary,  the option  price may not be less than
110% of the fair value of the common stock at the time of grant.  The expiration
date of an incentive stock option may not be longer than ten years from the date
of grant.  Option holders, or their  representatives,  may exercise their vested
options up to three months after their employment  termination or one year after
their  death or  permanent  and total  disability.  The 2004 Plan  provides  for
adjustments upon changes in capitalization.

The following pro forma information regarding stock-based  compensation has been
determined as if the Company had accounted for its employee  stock options under
the fair  value  method  pursuant  to SFAS 123.  For  purposes  of the  proforma
calculations,  the  fair  value  of each  option  granted  in 2005  and 2004 was
estimated at the date of grant using the Black-Scholes  model with the following
assumptions  used:  risk-free  interest  rate:  4.04% and  2.78%,  respectively;
dividend yield:  none;  volatility:  none;  expected lives: 3 years. The Company
granted 150,000 options during the nine-month period ended September 30, 2005.

                                       15

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004

Note 7- Stockholders' Deficit-continued

No stock-based  employee  compensation  cost is reflected in net income,  as all
options  granted  under the  Company's  plans had an exercise  price equal to or
above market  value of the  underlying  common  stock on the date of grant.  Had
compensation  cost  for  the  Company's  stock-based   compensation  plans  been
determined  based on the fair value at the grant  dates for grants  under  those
plans consistent with the method of SFAS No. 123, the Company's cash flows would
have  remained  unchanged;  however net income and earnings per share would have
been reduced to the pro forma amounts indicated below:

                                                               September 30,
                                                            2005          2004
                                                          ---------   ----------
Net income as reported:                                   $996,795    $ 314,456
Deduct: Total stock-base employee compensation expense
        determined under fair value based method for all
        awards, net of related tax effects                  (3,254)      (  -  )
                                                          ---------   ----------
Net income pro forma                                      $993,541    $ 314,456
                                                          =========   ==========
Earnings per share:
Basic                                                        $0.02        $0.01
                                                          =========   ==========
Diluted                                                      $0.02        $0.01
                                                          =========   ==========

Note 8- Commitments and Subsequent Events

During October 2005, the Company named a new Chief  Executive  Officer,  elected
him a  director,  and  entered  into  an  employment  agreement  with  him  (the
"Agreement").  The initial term of the  Agreement  is for 50 months,  subject to
renewal or earlier termination.

The Company's Chief Executive Officer's salary will be as follows:  $20,833 upon
entering into the Agreement, $46,875 from October 30, 2005 to December 31, 2005,
$275,000  from January 1 to December 31, 2006,  $300,000 from January 1, 2007 to
December 31, 2007,  $325,000 from January 1 to December 31, 2008,  $350,000 from
January 1, 2009 to December 31, 2009 ("Fixed Compensation" ) .

In addition,  beginning  with the first month of the quarter in which the amount
payable  to the Chief  Executive  Officer  is fully  paid,  the Chief  Executive
Officer will be paid (i) cash compensation  amounting to 5% of gross revenues of
the Company,  and (ii) stock compensation  amounting to 2% of the gross revenues
of the Company, as defined.  Gross Revenue is defined as the total gross revenue
related to any and all aspects of the brokerage  business,  including  incentive
received from exchanges,  based on generally accepted accounting principles. The
shares of  Company  common  stock  will be  granted at fair value at the date of
grant.

                                       16

<PAGE>

                                OPTIONABLE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           September 30, 2005 and 2004

Note 8- Commitments and Subsequent Events-continued

The Company will issue  options to its Chief  Executive  Officer equal to 20% of
the  number of shares of common  stock  issuable  under  warrants  which  become
exercisable pursuant to any Order Flow Agreements (Order Flow Agreements are the
agreements  for the  Company to issue  warrants to a firm based on the volume of
orders the firm placed with the  Company).  Those  options  will be fully vested
Non-Statutory  Stock Options granted under the Company's 2004 Plan at fair value
at the date of grant.  Also,  the  Company  will  issue to its  Chief  Executive
Officer  5,000  options each time a firm  registers  with and executes its first
10,000 lots on the  Company's  OPEX  platform.  The total number of such options
will be limited to  2,500,000.  Such options will be fully vested  Non-Statutory
Options granted under the Plan at fair value at the date of grant.

Upon the sale or merger or other business combination of the Company and another
company or companies,  the Company's Chief Executive Officer will be entitled to
a lump sum payment of 50% of the unpaid Fixed Compensation  should he desire not
to be employed with the new or successor entity.





















                                       17

<PAGE>

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

OVERVIEW

In recent  years,  the  energy  industry  changed  drastically.  Long a volatile
industry, high profile bankruptcies,  such as Enron, sparked a flight of capital
and a lack of  confidence  in the financial  position of energy  related  market
participants,  which  forced  energy  companies  to depart  the  energy  trading
markets.  We believe that the flow of investment out of energy  trading  markets
was mostly felt during  2003.  During 2004 and 2005,  we have  observed a higher
level of  participants  within the  investment  banking and hedge fund community
committing  capital to energy  trading,  which has increased the level of volume
within the energy trading  markets.  Such higher level of participants  has also
increased  our revenues,  net income,  and cash flow from  operating  activities
which has improved our financial condition. We also believe that we will need to
continue  to  increase  our  research  and   development   expenditures  in  the
foreseeable future which would be financed by our cash flows from operations.

We are in the process of completing the  development  of our electronic  trading
system,  OPEX. We had temporarily  discontinued such efforts in 2003 and resumed
them in late  2004.  We have  substantially  completed  the  development  of the
initial version of OPEX and we will commercially  launch it in the first half of
2006. We believe the costs  associated with  developing the  enhancements of the
first  operating  version of OPEX and the marketing  costs  associated  with the
initial launch will be at least $200,000 and $100,000,  respectively and will be
financed by our cash flows from operations.  We believe that we will continue to
generate cash flows from  operations  in the  foreseeable  future  sufficient to
permit us to absorb the costs to complete  the  enhancements  of OPEX as well as
the costs related to its initial launch.  Since inception,  substantially all of
our operations  were funded by Mark  Nordlicht,  our Chairman of the Board and a
stockholder.  Additionally,  during the fourth quarter of 2004, we  successfully
closed an equity  financing  generating  gross proceeds of  approximately  $1.25
million.

PLAN OF OPERATIONS

We believe that a majority of our revenues will continue to be generated through
voice-brokerage for the foreseeable  future. Once OPEX is commercially  launched
in 2006, we expect that revenues  generated through OPEX will constitute a small
but growing portion of our revenues.

     We expect that our cost of revenues  and cost of revenues  associated  with
Capital  Energy  Services  LLC, an entity owned by Edward  O'Connor,  our former
Chief Executive  Officer and an Executive  Officer,  and Kevin Cassidy,  our new
Chief  Executive  Officer,  will  increase  in the  foreseeable  future  for the
following  reasons:  1) as a result of increased  revenues and 2) as a result of
the new  50-month  employment  contract  we  entered  with Kevin  Cassidy  which
provides  fixed  and  variable  compensation  exceeding  those  we paid him as a
consultant.  For example,  Kevin  Cassidy's  fixed  compensation  will gradually
increase  from  $215,000  we paid  him as a  consultant  to  $350,000  by  2009.
Additionally,  Kevin's Cassidy's  employment  agreement  provides that beginning
with the first month of the quarter in which the amount payable to Kevin Cassidy
is fully paid, he will be paid additional cash  compensation  amounting to 5% of
our  gross  revenues  and a  stock  compensation  amounting  to 2% of our  gross
revenues.  Furthermore,  we will issue  options to Kevin Cassidy equal to 20% of
the  number of shares of common  stock  issuable  under  warrants  which  become
exercisable pursuant to any Order Flow Agreements (Order Flow Agreements are the
agreements under which we issue warrants to a firm based on the volume of orders
the firm placed with us). Finally,  we will issue to Kevin Cassidy 5,000 options
each time a firm  registers  with and executes its first 10,000 lots on our OPEX
platform. The total number of such options will be limited to 2,500,000.


This  discussion  and  analysis  of our  financial  condition  should be read in
connection with our financial  statements and accompanying  notes thereto in our
registration statement on Form SB-2 for the fiscal year ended December 31, 2004,
including  without  limitation  the  information  set forth  under  the  heading
"Critical Accounting Policies and Estimates".

                                       18

<PAGE>

                              Results of Operations


<TABLE>
<CAPTION>

                                        For the Nine-Month Periods Ended      Increase/        Increase/
                                                September 30,                (Decrease)       (Decrease)
                                       ---------------------------------      in $ 2005        in % 2005
                                           2005               2004            vs 2004           vs 2004
                                       --------------    ---------------    --------------    -----------
<S>                                    <C>               <C>                <C>                    <C>
Brokerage fees                         $   2,198,690     $    1,349,752     $     848,938          62.9%
Brokerage fees-related party               1,409,417            635,006           774,411         122.0%
Incentives                                   529,151            374,717           154,434          41.2%
                                       --------------    ---------------    --------------    -----------
Net revenues                               4,137,258          2,359,475         1,777,783          75.3%

Cost of revenues                           1,387,402          1,195,115           192,287          16.1%
Cost of revenues-related party               644,338            299,698           344,640         115.0%
                                       --------------    ---------------    --------------    -----------
                                           2,031,740          1,494,813           536,927          35.9%

Gross profit                               2,105,518            864,662         1,240,856         NM

Operating expenses:
  Selling, general and administrative        514,385            562,378           (47,993)         -8.5%
  Research and development                   372,504             19,493           353,011         NM
                                       --------------    ---------------    --------------    -----------
     Total operating expenses                886,889            581,871           305,018          52.4%

     Operating income                      1,218,629            282,791           935,838         NM

  Other income (expense):
  Gain on extinguishment of debt                   -            238,282          (238,282)        NM
  Interest expense-related parties          (221,834)          (206,617)           15,217           7.4%
                                       --------------    ---------------    --------------    -----------
                                            (221,834)            31,665           253,499         NM

Net income                             $     996,795     $      314,456     $     682,339         217.0%
                                       ==============    ===============    ==============    ===========
</TABLE>


NM:  Not meaningful


RESULTS OF OPERATIONS

Revenues

Revenues  consist of fees  earned  from  energy  derivatives  transactions.  The
increase in revenues of approximately  $1.8 million during the nine-months ended
September 30, 2005,  when  compared to the prior period,  is primarily due to an
increase  in the  volume of  transactions  handled  by us on behalf of  existing
customers.  Additionally,  the increase in revenues during the nine-months ended
September  30,  2005 is also due to an  increase  in  revenues  from  our  floor
brokerage  operations launched in April 2004, of which nine months were reported
during the nine-month period ended September 30, 2005 while only six months were
reported during the nine-month period ended September 30, 2004. Furthermore, the
increase in incentives  earned pursuant to agreements with two exchanges was due
to a higher volume of  transactions  handled by us on such  exchanges,  slightly
offset by a decrease of the  incentive  rate offered by the New York  Mercantile
Exchange ("NYMEX").

Cost of revenues

Cost of revenues  consists  primarily  of  compensation  of  personnel  directly
associated  with handling the energy  derivative  transactions  on behalf of our
customers as well as expenses  associated with our floor  brokerage  operations.
The increase in cost of revenues of approximately $540,000 during the nine-month
period  ended  September  30,  2005 when  compared  to the prior year  period is
primarily  attributable  to an  increase  in costs  associated  with having nine
months of operations of our floor  brokerage  operations  during the  nine-month
period ended  September 30, 2005 when  compared to six months of operations  for
the  nine-month  period  ended  September  30, 2004.  Additionally,  we incurred
increased  bonuses to our brokers resulting from the increase in revenues during
the nine-month period ended September 30, 2005.

                                       19

<PAGE>

Selling, general, and administrative expenses

Selling, general, and administrative expenses consists primarily of compensation
of personnel  supporting our operations as well as  professional  fees,  such as
legal fees,  incurred to handle certain matters which occur during the course of
operations.  The decrease in selling,  general,  and administrative  expenses of
approximately  $50,000  during the nine-month  period ended  September 30, 2005,
when compared to the prior period,  is primarily  attributable  to a decrease in
legal fees  incurred in connection  with a dispute  related to our contract with
the software  development  firm hired to develop our electronic  trading system.
This dispute was settled in early 2004.

Research and development

Research and development expenses consist primarily of compensation of personnel
and  consultants  associated  with the  development of our automated  electronic
trading  system.   The  increase  in  research  and   development   expenses  of
approximately  $350,000  during the nine-month  period ended  September 30, 2005
when  compared to the prior period,  is primarily  due to the  resumption of our
research  and  development  efforts  in  late  2004  while  we  had  temporarily
discontinued such efforts during 2003 and the early part of 2004.


Interest expense to related parties

Interest expense to related parties consists of interest charges associated with
amounts due to related parties. Interest expense to related parties has remained
consistent  during the nine-month  period ended September 30, 2005 when compared
to the prior year period.

Gain on extinguishments of debt

Gain on  extinguishments  of debt consists of gain resulting from the settlement
of professional fees due to our former legal counsel. The settlement, generating
gains of approximately $240,000,  occurred during the nine-month ended September
30, 2004.


LIQUIDITY AND CAPITAL RESOURCES

Historically,  we have funded our  operations  primarily  from proceeds of notes
payable to Mark Nordlicht, our Chairman and one of our principal stockholders.

During the  nine-month  period ended  September 30, 2005,  we generated  cash of
approximately $680,000 from operating activities, primarily resulting from:

     o    net income of  approximately  $1.0  million,  adjusted  for a non-cash
          interest expense of approximately $220,000;
     o    an  increase  in  accounts   receivable  of  approximately   $360,000,
          resulting from an increase in related revenues;
     o    an  increase  of  $150,000  in other  receivable,  resulting  from the
          Company's funding of security deposits held for the benefit of the New
          York  Mercantile  Exchange and a clearing  house,  to  facilitate  the
          trading of transactions we submit on behalf of our clients; and
     o    an  increase  in  accrued  compensation  of  approximately   $150,000,
          resulting from an increase in commissions related to higher revenues.

                                       20

<PAGE>

     We used our cash  generated  from  operating  activities to make  principal
     repayments of approximately  $170,000,  $20,000 and $110,000 on amounts due
     to Kevin Cassidy, our Chief Executive Officer,  Edward O'Connor, our former
     Chief Executive Officer, and to Mark Nordlicht,  our Chairman of the Board,
     respectively.

During  the  nine-month  period  ended  September  30,  2004,  we  used  cash of
approximately $610,000 in our operating activities, primarily resulting from:

     o    Our net income of approximately  $310,000,  adjusted by for a non-cash
          interest  expense  of  approximately   $130,000,   the  forfeiture  of
          officers'  compensation of $375,000,  and a gain on extinguishments of
          debt of approximately $240,000;
     o    an  increase  in  accounts   receivable  of  approximately   $310,000,
          resulting from an increase in related revenues;
     o    an  increase  in due from  related  party of  approximately  $280,000,
          resulting from an in related revenues;
     o    an increase in incentives  receivable,  resulting  from an increase in
          related revenues;
     o    a decrease in accounts payable and accrued expenses resulting from the
          settlement  of amounts  due to our  former  outside  counsel  and to a
          software developer; and
     o    an  increase  in  accrued  compensation  of  approximately   $330,000,
          resulting from an increase in commissions related to higher revenues.

     We funded our cash used in operating  activities by generating  proceeds of
     $1.0  million  from the  issuance  of  shares  or our  common  stock and by
     generating proceeds of $350,000 from the issuance of a line of credit and a
     note  payable  to Mark  Nordlicht.  We also  satisfied  a note  payable  of
     $500,000 to Mark Nordlicht.

     We believe that the  employment  arrangement  with our new Chief  Executive
     Officer,  Kevin  Cassidy,  may  decrease  our  cash  flows  from  operating
     activities  if our  revenues  decrease or if we are unable to increase  our
     revenues in an amount  sufficient to cover the additional cash compensation
     we will pay to Kevin  Cassidy.  Kevin  Cassidy's  fixed  compensation  will
     gradually increase from $215,000 we paid him as a consultant to $350,000 by
     2009. Additionally,  Kevin's Cassidy's compensation agreement provides that
     beginning  with the first month of the quarter in which the amount  payable
     to  Kevin  Cassidy  is  fully  paid,  he  will  be  paid   additional  cash
     compensation amounting to 5% of our gross revenues


CRITICAL ACCOUNTING POLICIES AND ESTIMATES

A summary  of  significant  accounting  policies  is  included  in Note 3 to the
audited  financial  statements  for the year ended December 31, 2004 included in
the prospectus contained in our registration  statement on Form SB-2. Management
believes that the application of these policies on a consistent basis enables us
to provide useful and reliable financial information about our operating results
and financial  condition.  Our financial  statements and accompanying  notes are
prepared in accordance with U.S. GAAP.  Preparing financial  statements requires
management to make estimates and assumptions that affect the reported amounts of
assets, liabilities,  revenue, and expenses. These estimates and assumptions are
affected by management's application of accounting policies. Critical accounting
policies for us include revenue recognition.

                                       21

<PAGE>

REVENUE RECOGNITION

Revenue is  recognized  when  earned.  Our revenue  recognition  policies are in
compliance  with the  Securities  and  Exchange  Commission's  Staff  Accounting
Bulletin ("SAB") No. 104 "Revenue  Recognition".  The application of SAB No. 104
requires  us to apply our  judgment,  including  whether our  customers  receive
services over a period of time.

We generally invoice our customers monthly, for all transactions which have been
executed  during such month.  Revenues are  recognized on the day of trade-trade
date basis.  Our revenues derive from a certain  predetermined  fixed fee of the
transactions  we  execute  on behalf of our  customers.  The fee is based on the
volume of  financial  instruments  traded.  We base our fees on oral and written
contracts   and  confirm  the  fees  in  writing  upon  the  execution  of  each
transaction.

We also receive incentives from NYMEX" and the Intercontinental Exchange ("ICE")
for the  volume  of  transactions  conducted  by us using  their  platform.  The
incentives  are based on a  percentage  of the total  revenues  received  by the
exchange attributable to our volume of transactions  submitted to the respective
exchanges.  We also apply our  judgment  when making  estimates  monthly of such
incentives  based on the volumes of  transactions  submitted  to the  respective
exchanges and the exchanges' published revenues by type of transaction.

We, pursuant to SAB 104, realize the incentive  revenues  realized or realizable
when all of the following criteria are met:

1) Persuasive  evidence of an  arrangement  exists.  We have a written  separate
agreement with one of the exchanges.  The other exchange has publicly  published
the initial terms of its incentive program in 2003 which it modified in 2005 and
is offered to all intermediaries in the select transactions;

2) Delivery has occurred or services have been rendered. Under arrangements with
both exchanges,  the incentives are earned on the day we submit  transactions to
the respective  exchanges based on the revenues generated from such transactions
and are no longer  subject to minimum volume of  transactions  to the respective
exchanges. We account for all transactions submitted to each exchange on a daily
basis.  Accordingly,  we are able to determine  when the  incentives  are earned
based on the date it submits  transactions  to the  exchanges.  We have no other
obligations to the exchanges to earn the incentives;

3)  "Seller's"  price  to the  buyer  is  fixed  or  determinable.  Based on the
incentive program terms of each exchange, their published prices for the type of
transactions  we submit to them, and our  transactions  records,  we are able to
determine an estimate for the revenues  each exchange  earns in connection  with
the  transactions  it  submits,  and  accordingly,  the  amount,  if  any of the
incentives we earn in connection with such transactions; and;

4) Collectibility is reasonably assured.  Both exchanges have paid us during the
third quarter of 2005 for  incentives  earned in the prior  quarter.  We have no
knowledge  that they do not intend to pay these  incentives,  if earned,  in the
future.  Furthermore,  we  intend  to  enforce  the  payment  of any  incentives
receivable under the incentive programs.

                                       22

<PAGE>

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

During August 2005,  the Company  issued  100,000  options under its 2004 Option
Plan to one of its  employees.  The options are  exercisable at a price of $0.30
per share and vest at a rate of 25% on August  2,  2006 and  25,000  every  year
thereafter,  provided that certain  performance  milestones are met. The options
are cancelled upon the earliest of one year after the  employee's  death or upon
termination of employment for cause.  The issuance was exempt from  registration
pursuant to the  exemption  from  registration  provided by Section  4(2) of the
Securities Act of 1933, as amended.

ITEM 3. CONTROLS AND PROCEDURES

Our Chief  Executive  Officer and our Chief Financial  Officer (the  "Certifying
Officers") are responsible for establishing and maintaining  disclosure controls
and procedures for our Company.  Such officers have concluded  (based upon their
evaluations of these controls and procedures as of the end of the period covered
by this report) that our  disclosure  controls and  procedures  are effective to
ensure  that  information  required  to be  disclosed  by us in this  report  is
recorded, processed, summarized, and reported in a timely manner.

The  Certifying  Officers  have also  indicated  that there were no  significant
changes in our internal controls over financial  reporting or other factors that
could  significantly  affect  such  controls  subsequent  to the  date of  their
evaluation, and there were no significant deficiencies and material weaknesses.

Our  management,  including the  Certifying  Officers,  does not expect that our
disclosure  controls or our  internal  controls  will  prevent all error and all
fraud. A control system, no matter how well conceived and operated,  can provide
only  reasonable,  not absolute,  assurance  that the  objectives of the control
system are met. In  addition,  the design of a control  system must  reflect the
fact that there are resource  constraints,  and the benefits of controls must be
considered relative to their costs.  Because of the inherent  limitations in all
control systems,  no evaluation of controls can provide absolute  assurance that
all control  issues and instances of fraud,  if any,  within a company have been
detected.  These  inherent  limitations  include the realities that judgments in
decision-making  can be faulty,  and that breakdowns can occur because of simple
error or mistake.  Additionally,  controls can be circumvented by the individual
acts of some  persons,  by  collusion  of two or more  people  or by  management
override of the control.  The design of any systems of controls is also based in
part upon certain  assumptions about the likelihood of future events,  and there
can be no assurance  that any design will succeed in achieving  its stated goals
under all potential future conditions.  Because of these inherent limitations in
a cost-effective  control system,  misstatements due to error or fraud may occur
and not be detected.






                                       23

<PAGE>

                           PART II - OTHER INFORMATION


ITEM 6. EXHIBITS
(a)      Exhibits

Exhibit 31.1   Certification of the Chief Executive Officer pursuant to Section
               302 of the Sarbanes-Oxley Act of 2002

Exhibit 31. 2  Certification of the Chief Financial Officer pursuant to Section
               302 of the Sarbanes-Oxley Act of 2002

Exhibit 32.1   Certification of the Chief Executive Officer pursuant to U.S.C.
               Section 1350, as adopted pursuant to Section 906 of the
               Sarbanes-Oxley Act of 2002

Exhibit 32.1   Certification of the Chief Financial Officer pursuant to U.S.C.
               Section 1350, as adopted pursuant to Section 906 of the
               Sarbanes-Oxley Act of 2002

Exhibit 99.    Certain Risk Factors Which May Impact Our Business, Results of
               Operations and Financial Condition















                                       24

<PAGE>

                                   SIGNATURES

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

                                OPTIONABLE, INC.


      Date                                      By: /s/   Kevin Cassidy
    -------------                                   -----------------------
     November 7, 2005                                    Kevin Cassidy
                                                    Chief Executive Officer




                                                By: /s/ Marc-Andre Boisseau
                                                    -----------------------
                                                        Marc-Andre Boisseau
                                                    Chief Financial Officer