**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C.  20549**





**FORM
      10-QSB**





(Mark
      One)


[
                X
                ]
            QUARTERLY
                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                1934For the quarterly period ended June 30, 2007[    ]
            TRANSITION
                REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACTFor
                the transition period from ________________ to
                _________________Commission
                file number  0-50742





**SIGN
                MEDIA SYSTEMS, INC**.
              __________________________________________________________________________
              (Exact
                name of small business issuer as specified in its
                charter)FLORIDA
              ________________________________________________
              (State
                or other jurisdiction of incorporation or organization)
            02-0555904
              ____________________________
              (IRS
                Employer Identification No.)2100
                19th
                Street, Sarasota FL  34234
              _____________________________________________________________________________
              (Address
                of principal executive offices)(941)
                330-0336
              _____________________________________________________________________________
              (Issuer's
                telephone number)_____________________________________________________________________________
              (Former
                name, former address and former fiscal year, if changed since last
                report)





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  [  ]





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange
      Act).  Yes  [  ]  No  [ X
      ]







**APPLICABLE
      ONLY TO CORPORATE ISSUERS**




State
      the
      number of shares outstanding of each of the issuer's classes of common equity,
      as of the latest practicable date:  11,493,267 Common Shares no par
      value as of June 30, 2007





Transitional
      Small Business Disclosure Format (Check one): Yes [ ] No [ X ]


1


**PART
      I — FINANCIAL INFORMATION**





**Item
      1.  Financial Statements.**




























**SIGN
      MEDIA SYSTEMS, INC.**


**CONDENSED
        CONSOLIDATED FINANCIAL STATEMENTS**
 **FOR
        THE SIX MONTHS ENDED JUNE 30, 2007 AND 2006**
 **(UNAUDITED)**


2


**SIGN
      MEDIA SYSTEMS, INC.**




**INDEX
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**(UNAUDITED)**











Condensed
      Consolidated Balance Sheet at June 30, 2007
      (Unaudited)                                                   
4





Condensed
      Consolidated Statements of Operations for the Six and Three


Months
      Ended June 30, 2007 and 2006
      (Unaudited)                                                                                   
5





Condensed
      Consolidated Statements of Cash Flows for the


Six
      Months Ended June 30, 2007 and 2006
      (Unaudited)                                                                             
6





Notes
      to
      the Condensed Consolidated Financial Statements


(Unaudited)                                                                                                                                                 
      7 - 11


3


**SIGN
      MEDIA SYSTEMS, INC.**




**CONDENSED
      CONSOLIDATED BALANCE SHEET (UNAUDITED)**


**JUNE 30,
      2007**






ASSETS




**2007**
            
            
            **2006****CASH
                FLOWS FROM OPERATING ACTIVITIES:**Net
                income (loss)
            
            $
            (1,756,537
            )
            
            $
            374,655**Adjustments
                to reconcile net income (loss)****to
                net cash (used in) provided by operating
                activities:**Depreciation
            
            
            20,332
            
            
            
            32,938Bad
                debt expense
            
            
            393,835
            
            
            
            -Issuance
                of common stock for consulting
            
            
            1,075,000
            
            
            
            -Issuance
                of common stock for compensation
            
            
            90,000
            
            
            
            -**Changes
                in assets and liabilities:**(Increase)
                in accounts receivable
            
            
            (875
            )
            
            
            (724,575
            )Decrease
                in inventory
            
            
            7,462
            
            
            
            7,540Increase
                (decrease) in accounts payable and accrued expenses
            
            
            (8,919
            )
            
            
            89,275**Total
                adjustments**
            
            
            1,576,835
            
            
            
            (594,822
            )**Net
                cash (used in) operating activities**
            
            
            (179,702
            )
            
            
            (220,167
            )**CASH
                FLOWS FROM INVESTING ACTIVITIES:**Acquisition
                of property and equipment
            
            
            (3,280
            )
            
            
            (1,984
            )(Increase)
                in interest receivable - related party
            
            
            (197,211
            )
            
            
            (17,594
            )**Net
                cash (used in) investing activities**
            
            
            (200,491
            )
            
            
            (19,578
            )**CASH
                FLOWS FROM FINANCING ACTIVITIES:**(Payments)
                on long-term debt
            
            
            (4,578
            )
            
            
            (11,023
            )(Payments)
                on debt-related party
            
            
            (96,773
            )
            
            
            (8,319
            )Proceeds
                from related parties
            
            
            179,549
            
            
            
            260,998**Net
                cash provided by financing activities**
            
            
            78,198
            
            
            
            241,656**NET
                INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS**
            
            
            (301,995
            )
            
            
            1,911**CASH
                AND CASH EQUIVALENTS - BEGINNING OF PERIOD**
            
            
            304,127
            
            
            
            2,252**CASH
                AND CASH EQUIVALENTS - END OF PERIOD**
            
            $
            2,132
            
            
            $
            4,163**SUPPLEMENTAL
                DISCLOSURE OF CASH FLOW INFORMATION:**Cash
                paid during the year for interest
            
            $
            381
            
            
            $
            583**SUPPLEMENTAL
                DISCLOSURE OF NON-CASH INFORMATION:**Issuance
                of common stock for consulting
            
            $
            1,075,000
            
            
            $
            -Issuance
                of common stock for compensation
            
            $
            90,000
            
            
            $
            -Bad
                debt expense
            
            $
            393,835
            
            
            $
            -




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






4


**SIGN
        MEDIA SYSTEMS, INC.**
  **CONDENSED
        CONSOLIDATED STATEMENT OF OPERATIONS**
 FOR
        THE SIX AND THREE MONTHS ENDED JUNE
        30,
        2007 AND 2006 (UNAUDITED)
    **SIX
                  MONTHS ENDED**
              
              
              **THREE
                  MONTHS ENDED****June
                  30,**
              
              
              **June
                  30,**
              
              
              **June
                  30,**
              
              
              **June
                  30,****2007**
              
              
              **2006**
              
              
              **2007**
              
              
              **2006****REVENUE**Truck
                  side advertising
              
              $
              -
              
              
              $
              -
              
              
              $
              -
              
              
              $
              -Graphics
                  and imaging
              
              
              7,482
              
              
              
              1,476
              
              
              
              7,306
              
              
              
              -Truck
                  side mounting systems
              
              
              17,231
              
              
              
              727,203
              
              
              
              1,148
              
              
              
              426,427**Total
                  revenue**
              
              
              24,713
              
              
              
              728,679
              
              
              
              8,454
              
              
              
              426,427**COST
                  OF GOODS SOLD**
              
              
              19,955
              
              
              
              15,820
              
              
              
              1,258
              
              
              
              6,469**GROSS
                  PROFIT**
              
              
              4,758
              
              
              
              712,859
              
              
              
              7,196
              
              
              
              419,958**OPERATING
                  EXPENSES**Professional
                  fees and administrative payroll
              
              
              1,270,788
              
              
              
              157,386
              
              
              
              42,495
              
              
              
              78,003General
                  and administrative expenses
              
              
              477,792
              
              
              
              63,522
              
              
              
              432,258
              
              
              
              22,971Depreciation
              
              
              20,332
              
              
              
              32,938
              
              
              
              10,166
              
              
              
              23,938**Total
                  operating expenses**
              
              
              1,768,912
              
              
              
              253,846
              
              
              
              484,919
              
              
              
              124,912**NET
                  INCOME (LOSS) BEFORE OTHER INCOME (EXPENSE)**
              
              
              (1,764,154
              )
              
              
              459,013
              
              
              
              (477,723
              )
              
              
              295,046**OTHER
                  INCOME (EXPENSE)**Impairment
                  of inventory
              
              
              (7,462
              )
              
              
              -
              
              
              
              -
              
              
              
              -Interest
                  income and other
              
              
              15,460
              
              
              
              18,000
              
              
              
              7,350
              
              
              
              7,296Interest
                  expense
              
              
              (381
              )
              
              
              (583
              )
              
              
              (309
              )
              
              
              (316
              )**Total
                  Other Income (Expense)**
              
              
              7,617
              
              
              
              17,417
              
              
              
              7,041
              
              
              
              6,980**NET
                  INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES**
              
              
              (1,756,537
              )
              
              
              476,430
              
              
              
              (470,682
              )
              
              
              302,026Provision
                  for income taxes
              
              
              -
              
              
              
              (101,775
              )
              
              
              -
              
              
              
              (96,175
              )**NET
                  INCOME (LOSS) APPLICABLE TO COMMON SHARES**
              
              $
              (1,756,537
              )
              
              $
              374,655
              
              
              $
              (470,682
              )
              
              $
              205,851**NET
                  INCOME (LOSS) PER BASIC AND DILUTED SHARES**
              
              $
              (0.16
              )
              
              $
              0.04
              
              
              $
              (0.04
              )
              
              $
              0.02**WEIGHTED
                  AVERAGE NUMBER OF COMMON****SHARES
                  OUTSTANDING**
              
              
              11,287,742
              
              
              
              8,460,000
              
              
              
              11,493,267
              
              
              
              8,460,000




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




5
 **SIGN
          MEDIA SYSTEMS, INC.**
  **CONDENSED
          CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)**
 FOR
          THE SIX MONTHS ENDED JUNE
          30,
          2007 AND 2006
   **2007**
                
                
                **2006****CASH
                    FLOWS FROM OPERATING ACTIVITIES:**Net
                    income (loss)
                
                $
                (1,756,537
                )
                
                $
                374,655**Adjustments
                    to reconcile net income (loss)****to
                    net cash (used in) provided by operating
                    activities:**Depreciation
                
                
                20,332
                
                
                
                32,938Bad
                    debt expense
                
                
                393,835
                
                
                
                -Issuance
                    of common stock for consulting
                
                
                1,075,000
                
                
                
                -Issuance
                    of common stock for compensation
                
                
                90,000
                
                
                
                -**Changes
                    in assets and liabilities:**(Increase)
                    in accounts receivable
                
                
                (875
                )
                
                
                (724,575
                )Decrease
                    in inventory
                
                
                7,462
                
                
                
                7,540Increase
                    (decrease) in accounts payable and accrued expenses
                
                
                (8,919
                )
                
                
                89,275**Total
                    adjustments**
                
                
                1,576,835
                
                
                
                (594,822
                )**Net
                    cash (used in) operating activities**
                
                
                (179,702
                )
                
                
                (220,167
                )**CASH
                    FLOWS FROM INVESTING ACTIVITIES:**Acquisition
                    of property and equipment
                
                
                (3,280
                )
                
                
                (1,984
                )(Increase)
                    in interest receivable - related party
                
                
                (197,211
                )
                
                
                (17,594
                )**Net
                    cash (used in) investing activities**
                
                
                (200,491
                )
                
                
                (19,578
                )**CASH
                    FLOWS FROM FINANCING ACTIVITIES:**(Payments)
                    on long-term debt
                
                
                (4,578
                )
                
                
                (11,023
                )(Payments)
                    on debt-related party
                
                
                (96,773
                )
                
                
                (8,319
                )Proceeds
                    from related parties
                
                
                179,549
                
                
                
                260,998**Net
                    cash provided by financing activities**
                
                
                78,198
                
                
                
                241,656**NET
                    INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS**
                
                
                (301,995
                )
                
                
                1,911**CASH
                    AND CASH EQUIVALENTS - BEGINNING OF PERIOD**
                
                
                304,127
                
                
                
                2,252**CASH
                    AND CASH EQUIVALENTS - END OF PERIOD**
                
                $
                2,132
                
                
                $
                4,163**SUPPLEMENTAL
                    DISCLOSURE OF CASH FLOW INFORMATION:**Cash
                    paid during the year for interest
                
                $
                381
                
                
                $
                583**SUPPLEMENTAL
                    DISCLOSURE OF NON-CASH INFORMATION:**Issuance
                    of common stock for consulting
                
                $
                1,075,000
                
                
                $
                -Issuance
                    of common stock for compensation
                
                $
                90,000
                
                
                $
                -Bad
                    debt expense
                
                $
                393,835
                
                
                $
                -
  The
          accompanying notes are an integral part of these condensed consolidated
          financial statements.
  6
 **SIGN
            MEDIA SYSTEMS, INC.**
  **NOTES TO
            CONDENSED CONSOLIDATED FINANCIAL STATEMENTS** **(UNAUDITED)**
 JUNE
            30, 2007 AND 2006
     **NOTE
              1-                 ORGANIZATION
              AND BASIS OF PRESENTATION**
  The
              condensed consolidated unaudited interim financial statements included
              herein
              have been prepared, without audit, pursuant to the rules and regulations
              of the
              Securities and Exchange Commission.  The condensed consolidated
              unaudited financial statements and notes are presented as permitted
              on Form
              10-QSB and do not contain information included in the Company’s annual condensed
              consolidated unaudited statements and notes.  Certain information and
              footnote disclosures normally included in the financial statements
              prepared in
              accordance with accounting principles generally accepted in the United
              States of
              America have been condensed or omitted pursuant to such rules and regulations,
              although the Company believes that the disclosures are adequate to
              make the
              information presented not misleading.  It is suggested that these
              condensed consolidated unaudited financial statements be read in conjunction
              with the December 31, 2006 audited consolidated financial statements
              and the
              accompanying notes thereto.  While management believes the procedures
              followed in preparing these condensed consolidated unaudited financial
              statements are reasonable, the accuracy of the amounts are in some
              respects
              dependent upon the facts that will exist, and procedures that will
              be
              accomplished by the Company later in the year.
 
 These
              condensed consolidated unaudited financial statements reflect all adjustments,
              including normal recurring adjustments which, in the opinion of management,
              are
              necessary to present fairly the consolidated operations and cash flows
              for the
              periods presented.
 
 The
              Company was incorporated on January 28, 2002 as a Florida corporation.
              Upon
              incorporation, an officer of the Company contributed $5,000 and received
              1,000
              shares of common stock of the Company. Effective January 1, 2003, the
              Company
              issued 7,959,000 shares of common stock in exchange of $55,702 of net
              assets of
              Go! Agency, LLC, a Florida limited liability company (“Go Agency”), a company
              formed on June 20, 2000, as E Signs Plus.com, LLC, a Florida limited
              liability
              company.  In this exchange, the Company assumed some debt of Go Agency
              and the exchange qualified as a tax-free exchange under IRC Section
              351.  The net assets received were valued at historical cost. The net
              assets of Go Agency that were exchanged for the shares of stock were
              as
              follows:
 Accounts
                          receivale
                      
                      $
                      30,668Fixed
                          assets, net of depreciation
                      
                      
                      112,214Other
                          assets
                      
                      
                      85,264Accounts
                          payable
                      
                      
                      (29,242
                      )Notes
                          payable
                      
                      
                      (27,338
                      )Other
                          payables
                      
                      
                      (115,864
                      )Total
                      
                      $
                      55,702
 Go
              Agency
              was formed to pursue third party truck side advertising.  The
              principal of Go Agency invested approximately $857,000 in Go Agency
              pursuing
              this business.  It became apparent that a more advanced truck side
              mounting system would be required and that third party truck side advertising
              alone would not sustain an ongoing profitable business.  Go Agency
              determined to develop a technologically advanced mounting system and
              focused on
              a different business plan.  Go Agency pre-exchange transaction was a
              company under common control of the major shareholder of
              SMS.  Post-exchange transactions have not differed. Go Agency still
              continues to operate and is still under common control.
 
 Go
              Agency
              and the Company developed a new and unique truck side mounting system,
              which
              utilizes a proprietary cam lever technology, which allows an advertising
              image
              to be stretched tight as a drum.  Following the exchange, the Company
              had 7,960,000 shares of common stock issued and outstanding.  The
              Company has developed and filed an application for a patent on its
              mounting
              systems.  The cam lever technology is considered an intangible asset
              and has not been recorded as an asset on the Company’s consolidated balance
              sheet.  This asset was not recorded due to the fact that there was no
              historic recorded value on the books of Go Agency for this asset.
 
 On
              November 17, 2003, the Company entered into a merger agreement by and
              among
              American Power House, Inc., a Delaware corporation and its wholly owned
              subsidiary, Sign Media Systems Acquisition Company, Inc., a Florida
              corporation
              and Sign Media Systems, Inc.  Pursuant to the merger agreement, Sign
              Media Systems merged with Sign Media Systems Acquisition Company with
              Sign Media
              Systems being the surviving corporation.  The merger was completed on
              December 8, 2003, with the filing of Articles of Merger with the State
              of
              Florida at which time Sign Media Systems Acquisition ceased to exist
              and Sign
              Media Systems became the surviving corporation.  American Powerhouse
              was not actively engaged in any business at the time of the
              merger.  However, sometime prior to the merger, American
              Power House had acquired certain technology for the manufacture of
              a water
              machine in the form of a water cooler that manufactures water from
              ambient
              air.  Prior to the merger, American Power House granted a license to
              Sign Media Systems Acquisition to use that technology and to manufacture
              and
              sell the water machines.  The acquisition of this license was the
              business purpose of the merger.  As consideration for the merger, Sign
              Media Systems issued 300,000 shares of its common stock to American
              Power House,
              100,000 shares in the year ending December 31, 2003, and 200,000 shares
              in the
              year ending December 31, 2004.  The 300,000 shares of stock were
              valued at $1.50 per share based on recent private sales of Sign Media
              Systems
              common stock. At the time of the merger the Company was in negotiations
              with
              independent dealers in Central America who sold United States products
              in
              Central and South America and who had expressed a desire to market
              this product
              in that territory. Ultimately, the Company was unable to come to a
              satisfactory
              agreement with these dealers for the sale of this product. Accordingly,
              the
              Company is not currently engaged in the business of manufacturing and
              sale of
              this product. The Company will not become engaged in the business of
              manufacturing and selling this product until it can identify and come
              to a
              satisfactory agreement with an independent dealer or dealers in that
              territory
              for the sale of this product. The Company cannot currently predict
              when or if it
              will identify and come to a satisfactory agreement with an independent
              dealer or
              dealers in this territory for the sale of this product. Due to these
              problems
              with the Company’s plans for marketing and distribution of the water machine
              subsequent to the merger, the license has no carrying or book value
              for the
              years ended December 31, 2007 and 2006 in the Company’s consolidated financial
              statements for December 31, 2007 and 2006. There were no other material
              costs of
              the merger. There was and is no relationship between American Powerhouse
              and
              either Sign Media Systems or GO! AGENCY. The Company recorded this
              license as an
              intangible asset for $150,000 for the 100,000 shares of stock issued
              in 2003 and
              subsequently impaired
              the entire amount. The Company issued the remaining 200,000 shares
              in 2004, and
              recorded a liability for stock to be issued at $300,000. There is a
              $450,000
              charge against income reflected in the consolidated statements of income
              for the
              year ended December 31, 2003.
  **NOTE
              2-                SUMMARY
              OF SIGNIFICANT ACCOUNTING POLICIES**
 
 **Principles
              of Consolidation**
 
 The
              condensed consolidated unaudited financial statements include the accounts
              of
              the Company and its wholly owned subsidiary.  All significant
              intercompany accounts and transactions have been eliminated in
              consolidation.
 
 **Use
              of
              Estimates**
 
 The
              preparation of condensed consolidated unaudited financial statements
              in
              conformity with accounting principles generally accepted in the United
              States of
              America requires management to make estimates and assumptions that
              affect the
              reported amounts of assets and liabilities and disclosures of contingent
              assets
              and liabilities at the date of the financial statements and the reported
              amounts
              of revenues and expenses during the reporting period.  Actual results
              could differ from those estimates.
 
 7
  **NOTE
              2-                SUMMARY
              OF SIGNIFICANT ACCOUNTING POLICIES
              (CONTINUED)**


**Revenue
        and Cost Recognition**
 
 Currently,
        the Company has three primary sources of revenue:
 
 (1)
              The
                  sale and installation of their mounting
                  system;
 (2)
              The
                  printing of advertising images to be inserted on trucks utilizing
                  the
                  Company’s mounting systems; and
 (3)
              Third
                  party advertising.
 
 The
        Company’s revenue recognition policy for these sources of revenue is as follows.
        The Company relies on Staff Accounting Bulletin Topic 13, in determining
        when
        recognition of revenue occurs. There are four criteria that the Company must
        meet when determining when revenue is realized or realizable and earned.
        The
        Company has persuasive evidence of an arrangement existing; delivery has
        occurred or services rendered; the price is fixed or determinable; and
        collectibility is reasonably assured. The Company recognizes revenue from
        the
        sale of its mounting systems and images when it completes the work and either
        ships or installs the products. The Company recognizes revenue from third
        party
        advertising only when it has the contractual right to receive such revenue.
        The
        Company does retain a liability to maintain systems and images that are
        installed for purposes of third party advertising. However, any damage caused
        by
        the operator of the truck is the responsibility of the lessor of the space
        and
        is not the Company’s liability. To date the Company has experienced no cost for
        maintaining these leased systems. All deposits are non-refundable.
  In
        addition, the Company offers manufacturer’s warranties. These warranties are
        provided by the Company and not sold. Therefore, no income is derived from
        the
        warranty itself.
 
 Cost
        is
        recorded on the accrual basis as well, when the services are incurred rather
        than when payment is made.
 
 Costs
        of
        goods sold are separated by components consistent with the revenue categories.
        Mounting systems, printing and advertising costs include purchases made,
        and
        payroll costs attributable to those components. Payroll costs is included
        for
        sales, engineering and warehouse personnel in cost of goods sold. Cost of
        overhead is de minimus. The Company’s inventory consists of finished goods, and
        unassembled parts that comprise the framework for the mounting system placed
        on
        trucks for their advertising. All of these costs are included in costs of
        goods
        sold for the six months ended June 30, 2007 and 2006.
 
 **Warranties**
 
 The
        Company offers manufacturers warranties that covers all manufacturer defects.
        The Company accrues warranty costs based on historical experience and
        management’s estimates. The Company has not experienced any losses in the past
        two years with respect to the warranties, therefore has not accrued any
        liability for the six months ended June 30, 2007 and 2006. The following
        table
        represents the Company’s losses in the past two years with respect to
        warranties.
 
 
 **Balance**
              
              **Charged**
              
              
              
              **Balance****at
                  Beginning**
              
              **to
                  Costs and**
              
              
              
              **at
                  End of****of
                  Period**
              
              **Expenses**
              
              **Deductions**
              
              **Period**Six
                  Months ended June 30, 2007
              
              $
              -
              
              
              $
              -
              
              
              $
              -
              
              
              
              $
              -Six
                  Months ended June 30, 2006
              
              $
              -
              
              
              $
              -
              
              
              $
              -
              
              
              
              $
              -
  **Provision
        for Bad Debt**
 
 Under
        SOP
        01-6 "Accounting for Certain Entities (including Entities with Trade
        Receivables) That Lend to or Finance the Activities of Others” the Company has
        intent and belief that all amounts in accounts receivable are
        collectible.  The Company extends unsecured credit to its customers in
        the ordinary course of business but mitigates the associated credit risk
        by
        performing credit checks and actively pursuing past due accounts over 90
        days.  The Company's former major customer at June 30, 2007, was
        uncharacteristically slow in paying their outstanding invoices during June
        30,
        2007 and a reserve of $393,835 was booked.
 
 Management's
        policy is to vigorously attempt to collect its receivables
        monthly.  The Company estimated the amount of the allowance necessary
        based on a review of the aged receivables from the major
        customer.  Management additionally instituted a policy for recording
        the recovery of the allowance if any in the period where it is
        recovered.
 
 Bad
        debt
        expense for the six months ended June 30, 2007 and 2006 was $393,835 and
        $-0-,
        respectively.
 
 **Cash
        and Cash Equivalents**
 
 The
        Company considers all highly liquid debt instruments and other short-term
        investments with an initial maturity of three months or less to be cash
        equivalents.
 
 The
        Company maintains cash and cash equivalent balances at several financial
        institutions that are insured by the Federal Deposit Insurance Corporation
        up to
        $100,000.
 
 **Accounts
        Receivable**
 
 Accounts
        receivable are presented at face value, net of the allowance for doubtful
        accounts. The allowance for doubtful accounts is established through provisions
        charged against income and is maintained at a level believed adequate by
        management to absorb estimated bad debts based on current economic
        conditions.
  **Property
        and Equipment**
 
 Property
        and equipment are stated at cost.  Depreciation is computed primarily
        using the straight-line method over the estimated useful life of the
        assets.
 
 Furniture
        and
        fixtures            5
        years
 Equipment                    
                  5 years
 Trucks                            
                 3 years
 
 **Advertising**
 
 Costs
        of
        advertising and marketing are expensed as incurred.  Advertising and
        marketing costs were $1,200 and $1,200 for the six months ended June 30,
        2007
        and 2006, respectively.
 
 8
 
  ****NOTE
          2-                SUMMARY
          OF SIGNIFICANT ACCOUNTING POLICIES****(CONTINUED)****
  **Fair
        Value of Financial Instruments**
 
 The
        carrying amount reported in the balance sheets for cash and cash equivalents,
        accounts receivable, accounts payable and accrued expenses approximate fair
        value because of the immediate or short-term maturity of these financial
        instruments.
  **Income
        Taxes**
 
 The
        provision for income taxes includes the tax effects of transactions reported
        in
        the financial statements. Deferred taxes would be recognized for differences
        between the basis for assets and liabilities for financial statement and
        income
        tax purposes. The major difference relates to the net operating loss carry
        forwards generated by sustaining deficits.
 
 **Stock-Based
        Compensation**
 
 Employee
        stock awards under the Company's compensation plans are accounted for in
        accordance with Accounting Principles Board Opinion No. 25 (“APB 25”),
“*Accounting for Stock Issued to Employees*”, and related
        interpretations. The Company provides the disclosure requirements of Statement
        of Financial Accounting Standards No. 123, “*Accounting for Stock-Based
        Compensation*” (“SFAS 123”), and related interpretations. Stock-based awards
        to non-employees are accounted for under the provisions of SFAS 123 and has
        adopted the enhanced disclosure provisions of SFAS No. 148 “Accounting for
        Stock-Based Compensation- Transition and Disclosure, an amendment of SFAS
        No.
        123”.
  The
        Company measures compensation expense for its employee stock-based compensation
        using the intrinsic-value method. Under the intrinsic-value method of accounting
        for stock-based compensation, when the exercise price of options granted
        to
        employees is less than the estimated fair value of the underlying stock on
        the
        date of grant, deferred compensation is recognized and is amortized to
        compensation expense over the applicable vesting period. In each of the periods
        presented, the vesting period was the period in which the options were granted.
        All options were expensed to compensation in the period granted rather than
        the
        exercise date.
 
 The
        Company measures compensation expense for its non-employee stock-based
        compensation under the Financial Accounting Standards Board (FASB) Emerging
        Issues Task Force (EITF) Issue No. 96-18, “*Accounting for Equity Instruments
        that are Issued to Other Than Employees for Acquiring, or in Conjunction
        with
        Selling, Goods or Services*”.
 
 The
        fair
        value of the option issued is used to measure the transaction, as this is
        more
        reliable than the fair value of the services received. The fair value is
        measured at the value of the Company’s common stock on the date that the
        commitment for performance by the counterparty has been reached or the
        counterparty’s performance is complete. The fair value of the equity instrument
        is charged directly to compensation expense and additional paid-in
        capital.
 
 **Loss
        per Share of Common Stock**
 
 Historical
        net (loss) per common share is computed using the weighted-average number
        of
        common shares outstanding.  Diluted earnings per share (EPS) include
        additional dilution from common stock equivalents, such as stock issuable
        pursuant to the exercise of stock options and warrants.  Common stock
        equivalents are not included in the computation of diluted earnings per share
        when the Company reports a loss because to do so would be antidilutive for
        the
        periods presented.
 
 The
        following is a reconciliation of the computation for basic and diluted
        EPS:
  June
                  30,2007
              
              
              2006Net income (loss)
              
              $
              (1,756,537
              )
              
              $
              374,655Weighted-average common shares outstandingBasic
              
              
              11,287,742
              
              
              
              8,460,000Weighted-average common stock equivalentsStock options
              
              
              -
              
              
              
              -Warrants
              
              
              -
              
              
              
              -Weighted-average common shares outstandingDiluted
              
              
              11,287,742
              
              
              
              8,460,000


**Share
      Based Payments**





In
      December 2004, the FASB issued Financial Accounting Standards No. 123 (revised
      2004)(FAS 123R), “Share Based Payment”, FASB 123R replaces FAS No. 123,
“Accounting for Stock Based Compensation”, and supercedes APB Opinion No. 25,
“Accounting for Stock Issued To Employees.” FAS 123R requires compensation
      expense, measured as the fair value at the grant date, released to share-based
      payment transactions to be recognized in the financial statements over the
      period that an employee provides service in exchange for the award. The company
      intends to adopt FAS 123R using the “modified prospective” transition method as
      defined in FAS 123R. Under the modified prospective method, companies are
      required to record compensation cost prospectively for the unvested portion,
      as
      of the date of adoption, of previously issued and outstanding awards over the
      remaining vesting period of such awards. FAS 123R is effective January 1, 2006.
      The company does not anticipate that the implementation of this standard will
      have material impact on financial position, results of operations or cash
      flows.




**Recent
      Accounting Pronouncements**





In
      May
      2005, the FASB issued SFAS No. 154, “Accounting Changes and Error
      Corrections.”  SFAS No. 154 replaces Accounting Principles Board (“APB”)
      Opinion No. 20, “Accounting Changes” and SFAS No. 3, “Reporting Accounting
      Changes in Interim Financial Statements.”  SFAS No. 154 requires
      retrospective application to prior periods’ financial statements of voluntary
      changes in accounting principle unless it is impracticable.  APB No.
      20 previously required that most voluntary changes in accounting principle
      be
      recognized by including the cumulative effect of changing to the new accounting
      principle in net income in the period of the change.  SFAS No. 154 is
      effective for accounting changes and corrections of errors made in fiscal years
      beginning after December 15, 2005.  The adoption of SFAS No. 154 did
      not have material impact on the Company’s financial position, results of
      operations, or cash flow.






9


******NOTE
        2-                SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES****(CONTINUED)******
 **Recent
          Accounting Pronouncements (continued)**


In
      February 2006, the FASB issued SFAS No. 155, “Accounting for Certain Hybrid
      Financial Instruments, an amendment of FASB Statements No. 133 and
      140.”  SFAS No. 155 resolves issues addressed in SFAS No. 133
      Implementation Issue No. D1, “Application of Statement 133 to Beneficial
      Interests in Securitized Financial Assets,” and permits fair value remeasurement
      for any hybrid financial instrument that contains an embedded derivative that
      otherwise would require bifurcation, clarifies which interest-only strips and
      principal-only strips are not subject to the requirements of SFAS No. 133,
      establishes a requirement to evaluate interests in securitized financial assets
      to identify interests that are freestanding derivatives or that are hybrid
      financial instruments that contain embedded derivative requiring
      bifurcation,  claries that concentrations of credit risk in the form
      of subordination are not embedded derivatives and amends SFAS No.
      140
      to eliminate the prohibition on a qualifying special-purpose entity from holding
      a derivative financial instrument that pertains to a beneficial interest other
      than another derivative financial instrument.  SFAS No. 155 is
      effective for all financial instruments acquired or issued after the beginning
      of the first fiscal year that begins after September 15, 2006.  The
      adoption of FAS 155 is not anticipated to have a material impact on the
      Company’s financial position, results of operations, or cash flows.




In
      March
      2006, the FASB issued SGAS No. 156, “Accounting for Servicing of Financial
      Assets, an amendment of FASB Statement No. 140.”  SFAS No. 156
      requires an entity to recognize a servicing asset or liability each time it
      undertakes on obligation to service a financial asset by entering into a
      servicing contract under a transfer of the servicer’s financial assets that
      meets the requirements for sale accounting, a transfer of the servicer’s
      financial assets to a qualified special purpose entity in a guaranteed mortgage
      securitization in which the transferor retains all of the
      resulting securities and classifies them as either available-for-sale or trading
      securities in accordance with SFAS No. 115, “Accounting for Certain Investments
      in Debt and Equity Securities” and an acquisition or assumption of obligation to
      service a financial asset that does not relate to financial assets of the
      servicer  or its consolidated affiliates.




Additionally,
          SFAS No. 156 requires all separately recognized servicing assets and servicing
          liabilities to be initially measured at fair value, permits an entity to
          choose
          either the use of an amortization or fair value method for subsequent
          measurements, permits at initial adoption a one-time reclassification of
          available-for-sale securities to trading securities by entities with recognized
          servicing rights and requires separate presentation of servicing assets
          and
          liabilities subsequently measured at fair value and additional disclosures
          for
          all separately recognized servicing assets and liabilities.  SFAS No.
          156 is effective for transactions entered into after the beginning of the
          first
          fiscal year that begins after September 15, 2006.  The adoption of FAS
          156 is not anticipated to have a material impact on the company’s financial
          position or results of operations.  In June 2006, the FASB issued
          Interpretation No. 48, “Accounting of Uncertainty in Income Taxes” (FIN48),
          which clarifies the accounting for uncertainty in income taxes recognized
          in an
          enterprise’s financial statements in accordance with SFAS No. 109,
“Accounting  for Income Taxes.”  FIN 48 establishes a
          recognition threshold and measurement attribute for the financial statement
          recognition and measurement of a tax position taken or expected to be taken
          in a
          tax return.  This interpretation also provides guidance on
          derecognition, classification, interest and penalties, accounting in interim
          periods, disclosure, and transition.  FIN 48 is effective for fiscal
          years beginning after December 15, 2006.  The Company is currently
          evaluating the impact in the adoption of this interpretation will have
          on its
          future financial statements.
 
 In
          September 2006, The Financial Accounting Standards Board (“FASB”) issued
          Statement of Financial Accounting Standards (“SFAS”) No. 157, “Fair Value
          Measurement” (SFAS No. 157”).  This standard provides guidance for
          using fair value to measure assets and liabilities.  SFAS No. 157
          applies whenever other standards require (or permit) assets or liabilities
          to be
          measured at fair value but does not expand the use of fair value in any
          new
          circumstances.  Prior to SFAS No. 157, the methods for measuring fair
          value were diverse and inconsistent, especially for items that are not
          actively
          traded.  The standard clarifies that for items that are not actively
          traded, such as certain kinds or derivatives, fair value should reflect
          the
          price in a transaction with a market participant, including an adjustment
          for risk, not just the company’s mark-to-model value.  SFAS No. 157
          also requires expanded disclosure of the effect on earnings for items measured
          using unobservable data.  SFAS No. 157 is effective for financial
          statements issued for fiscal years beginning after November 15, 2007, and
          interim periods within those fiscal years.  The Company is currently
          evaluating the impact of this statement on its financial statements and
          expects
          to adopt SFAS No. 157 on December 31, 2007.
 
 In
          September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined
          Benefit Pension and Other Postretirement Plans- -An Amendment of FASB Statements
          No 87,88,106 and 132R.”  This standard requires an employer to: (a)
          recognize in its statement of financial position an asset for a plan’s
          overfunded status or a liability for a plan’s underfunded status; (b) measure a
          plan’s assets and its obligations that determine its funded status as of the
          end
          of the employer’s fiscal year (with limited exceptions); and (c) recognize
          changes in the funded status of a defined benefit postretirement plan in
          the
          year in which the changes occur.  Those changes will be reported in
          comprehensive income.  The requirement to recognize the funded status
          of a benefit plan and the disclosure requirements are effective as of the
          end of
          the fiscal year ending after December 15, 2006.  The requirements to
          measure plan assets and benefit obligations as of the date of the employer’s
          fiscal year-end statement of financial position is effective for fiscal
          years
          ending after December 15, 2008,  The Company is evaluating the impact
          of this  statement on its financial statements and believes that such
          impact will not be material.
  **NOTE
          3-                ACCOUNTS
          RECEIVABLE**
 
 Accounts
          receivable consists of the
          following at June 30, 2007:
  **2007**Accounts
                    receivable
                
                $
                394,710Less
                    uncollectible receivables written-off
                
                
                (393,835
                )Total
                    accounts receivable, net
                
                $
                875
   NOTE
          4-                PROPERTY
          AND EQUIPMENT
  Property
          and equipment consists of the following at June 30, 2007:
 **2007**Equipment
                  
                  $
                  128,745Furniture
                      and Fixtures
                  
                  
                  112,022Transportation
                      Equipment
                  
                  
                  24,621265,388Less:
                      Accumulated Depreciation
                  
                  
                  186,968Net
                      Book Value
                  
                  $
                  78,420
  
 Depreciation
            expense for the six months ended June 30, 2007 was $20,332.
   10
   NOTE
            5-               
RELATED PARTY TRANSACTIONS
  On
            January 28, 2002, Sign Media Systems, Inc. was formed as a Florida Corporation
            but did not begin business operations until April 2002. Most of the revenue
            that
            Sign Media Systems, Inc. earned was contract work with Go! Agency, LLC.,
            a
            Florida limited liability company, a related party. Sign Media Systems,
            Inc.
            would contract Go! Agency, LLC. to handle and complete jobs.  There
            was no additional revenue or expense added from one entity to the
            other.
 
 On
            January 3, 2003, the Company entered into a loan agreement with Olympus
            Leasing
            Company, a related party, and in connection therewith executed a promissory
            note
            with a future advance clause in favor of Olympus Leasing, whereby Olympus
            Leasing agreed to loan the Company up to a maximum of $1,000,000 for
            a period of
            three years, with interest accruing on the unpaid balance at 18% per
            annum,
            payable interest only monthly, with the entire unpaid balance due and
            payable in
            full on January 3, 2006. As of June 30, 2007 and 2006, there was $0 and
            $0 due
            to Olympus, respectively.
 
 On
            June
            28, 2005, the Company loaned $1,200,000 to Olympus Leasing Company, a
            related
            party. At June 28, 2005, Antonio F. Uccello, III, was, and is now the
            President,
            Chairman, a minority owner of the issued and outstanding shares of stock
            of
            Olympus Leasing and reports to its board of directors. Antonio F. Uccello,
            III,
            was and is one of the Company’s officers and directors and an indirect
            shareholder of Sign Media Systems, Inc. The loan is for a period of five
            years
            with interest accruing on the unpaid balance at 5.3% per annum payable
            annually,
            with the entire principle and unpaid interest due and payable in full
            on June
            28, 2010.
  There
                is
                no prepayment penalty. The purpose of the loan was to obtain a higher
                interest
                rate than is currently available at traditional banking institutions.
                Olympus
                Leasing’s primary business is making secured loans to chiropractic physicians
                throughout the United States for the purchase of chiropractic adjustment
                tables.
                The loans are generally for less than $3,000 each and are secured
                by a first
                lien on each chiropractic adjustment table. The chiropractic physician
                personally guarantees each loan. The rate of return on the Olympus
                Leasing loans
                is between 15% and 25% per annum. To date, Olympus Leasing has suffered
                no loss
                from any loan to a chiropractic physician for the purchase of a chiropractic
                adjustment table. There is an excellent market for the re-sale of
                tables, which
                may be the subject of a foreclosure. Olympus Leasing currently has
                in excess of
                $1,000,000 in outstanding finance receivables from chiropractic physicians
                secured by a first lien on each chiropractic adjustment
                table.
 Since
            the
            making of the loan by the Company to Olympus Leasing, Olympus Leasing
            has made
            payments to the Company of $956,272 pursuant to the note. The remaining
            balance
            that was due from related party on the balance sheet was $613,342 on
            June 30,
            2007.
  **NOTE
            6-               SHORT-TERM
            DEBT**
 
 Short-term
            debt consists of an installment note with GMAC Finance. Balance due on
            June 30,
            2007 was $7,410.
 
 **NOTE
            7-               PROVISION
            FOR INCOME TAXES**
 
 There
            was
            no provision for income taxes during the six months ended June 30, 2007.
            For the
            six months ended June 30, 2006 there was a $101,775 provision.
 
 In
            conformity with SFAS No. 109, deferred tax assets and liabilities are
            classified
            based on the financial reporting classification of the related assets
            and
            liabilities, which give rise to temporary book/tax differences. Deferred
            taxes
            were immaterial at June 30, 2007.
 
 NOTE
            8-               COMMITMENTS
            AND CONTINGENCIES
  The
            Company entered into a lease agreement on November 1, 2002 with Hawkeye
            Real
            Estate, LLC, a related entity, to lease warehouse and office
            space.  The rent is anticipated to be $30,000 per annum. The lease
            expires in November of 2007.
  Rent
                expense for the six months ended June 30, 2007 and 2006 was $15,000,
                and $8,025,
                respectively.
 NOTE
            9-               CONCENTRATION
            OF CREDIT RISK
  A
            material part of the Company’s business was dependent upon one key customer
            throughout its history. The company is no longer doing business with
            that
            customer which represented 99% of their revenues.
 
 **NOTE
            10-             STOCKHOLDERS’
EQUITY**
 
 As
            of
            June 30, 2007 and 2006, there were 100,000,000 shares of common stock
            authorized.
 
 As
            of
            June 30, 2007 and 2006, there were 11,493,267 and 8,460,000 shares of
            common
            stock issued and outstanding, respectively.
 
 The
            following is a list of the common stock transaction during the six months
            ended
            June 30, 2007:
 
 On
            January 10, 2007, the Company issued 150,000 shares of its common stock
            at a
            fair market value of $75,000, for services provided to the Company.
 
 On
            January 12, 2007, the Company issued 2,000,000 shares of its common stock
            at a
            fair market value of $1,000,000, for consulting services provided to
            the
            Company.
 
 On
            February 8, 2007, the Company issued 300,000 shares of its common stock
            at a
            fair market value of $90,000, as additional compensation for an employee’s past
            services to the Company.
 
 There
            were no options or warrants granted during the period beginning on January
            28,
            2002 (Inception) ending June 30, 2007.
  NOTE
            11-             SUBSEQUENT
            EVENT
  The
            company filed an 8-k on August 15, 2007 stating that the company sold
            securities
            in the amount of $235,294.
 
 11
 
 **Item
            2.  Management's Discussion and Analysis or Plan of
            Operation.**
 
 THE
            FOLLOWING DISCUSSION OF THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS
            OF THE
            COMPANY SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL STATEMENTS AND
            NOTES
            THERETO INCLUDED ELSEWHERE IN THIS REPORT.
 
 THIS
            DISCUSSION CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND
            UNCERTAINTIES, AND THE COMPANY'S ACTUAL RESULTS MAY DIFFER MATERIALLY
            FROM THOSE
            ANTICIPATED IN THESE FORWARD-LOOKING STATEMENTS AS A RESULT OF CERTAIN
            FACTORS,
            INCLUDING, BUT NOT LIMITED TO COMPETITION AND OVERALL MARKET AND ECONOMIC
            CONDITIONS.
 
 RESULTS
            OF CONTINUING OPERATIONS
 
 The
            following tables sets forth certain of our summary selected unaudited
            operating
            and financial data.  The following table should be read in conjunction
            with all other financial information and analysis presented herein.
 
 Six
            Months Ended
 June
            30
 
 2007
                  
                  
                  2006Total
                      Revenue
                  
                  $
                  24,713
                  
                  
                  $
                  728,679Cost
                      of Goods Sold
                  
                  
                  19,955
                  
                  
                  
                  15,820Gross
                      profit
                  
                  
                  4,758
                  
                  
                  
                  712,859Total
                      Operating Expenses
                  
                  
                  1,768,912
                  
                  
                  
                  253,846Net
                      Income (Loss) BeforeOther
                      Income (Expense)
                  
                  
                  (1,764,154
                  )
                  
                  
                  459,013Total
                      Other Income(Expense)
                  
                  
                  7,617
                  
                  
                  
                  17,417Net
                      Income (Loss)BeforeProvision
                      For IncomeTaxes
                  
                  
                  (1,756,537
                  )
                  
                  
                  476,430Provision
                      For IncomeTaxes
                  
                  
                  -
                  
                  
                  
                  (101,775
                  )Net
                      Income (Loss)Applicable
                      To CommonShares
                  
                  $
                  (1,756,537
                  )
                  
                  $
                  374,655Net
                      Income (Loss) PerBasic
                      And Diluted Shares
                  
                  $
                  (0.16
                  )
                  
                  $
                  0.04Weighted
                      AverageNumber
                      OF CommonShares
                      Outstanding
                  
                  
                  11,287,742
                  
                  
                  
                  8,460,000Gross
                      profit margin
                  
                  
                  19
                  %
                  
                  
                  98
                  %
 
 For
            the
            six months ended June 30, 2007, the Company had Total Revenue of $24,713,
            Cost
            of Goods Sold of $19,955, Gross Profit of $4,758, Total Operating Expenses
            $1,768,912, Net Income (Loss Before Other
            Income (Expense) of $(1,764,154), Total Other Income (Expense) $7,617,
            Net
            Income (Loss) Before Provision For Income Taxes of $(1,756,537), a Provision
            For
            Income Taxes of $0.00, Net Income (Loss) Applicable to Common Shares
            of
            $(1,756,537), and Net Income (Loss) Per Basic and Diluted Shares of $(0.16)
            based on 11,287,742 Weighted Average Number Of Common Shares
            Outstanding.
 
 For
            the
            six months ended June 30, 2006, the Company had Total Revenue of $728,689,
            Cost
            of Goods Sold of $15,820, Gross profit of $712,859, Total Operating Expenses
            of
            $253,846, Net Income (Loss) Before Other Income (Expense) of $459,013,
            Total
            Other Income (Expense) of $17,417, Net Income (Loss) Before Provision
            For Income
            Taxes of $476,430, a Provision For Income Taxes of $(101,775), Net Income
            (Loss)
            Applicable To Common Shares of $374,655 and Net Income (Loss) Per Basic
            and
            Diluted Shares of $0.04 based on 8,460,000 Weighted Average Number Of
            Common
            Shares Outstanding.
  Three
            Months Ended
 June
            30
 
 2007
                  
                  
                  2006Revenue
                  
                  $
                  8,454
                  
                  
                  $
                  426,427Cost
                      of Goods Sold
                  
                  
                  1,258
                  
                  
                  
                  6,469Gross
                      profit
                  
                  
                  7,196
                  
                  
                  
                  419,958Total
                      Operating Expenses
                  
                  
                  484,919
                  
                  
                  
                  124,912Net
                      Income (Loss) BeforeOther
                      Income (Expense)
                  
                  
                  (477,723
                  )
                  
                  
                  295,046Total
                      Other Income(Expense)
                  
                  
                  7,041
                  
                  
                  
                  6,980Net
                      Income (Loss)BeforeProvision
                      For IncomeTaxes
                  
                  
                  (470,682
                  )
                  
                  
                  302,026Provision
                      For IncomeTaxes
                  
                  
                  -
                  
                  
                  
                  (96,175
                  )Net
                      Income (Loss)Applicable
                      To CommonShares
                  
                  $
                  (470,682
                  )
                  
                  $
                  205,851Net
                      Income (Loss) PerBasic
                      And Diluted Shares
                  
                  $
                  (0.04
                  )
                  
                  $
                  0.02Weighted
                      AverageNumber
                      OF CommonShares
                      Outstanding
                  
                  
                  11,493,267
                  
                  
                  
                  8,460,000Gross
                      profit margin
                  
                  
                  85
                  %
                  
                  
                  98
                  %
 
 For
            the
            three months ended June 30, 2007, the Company had Total Revenue of $8,454,
            Cost
            of Goods Sold of $1,258, Gross profit of $7,196, Total Operating Expenses
            of
            $484,919, Net Income (Loss) Before Other Income (Expense) of $(477,723),
            Total
            Other Income (Expense) of $7,041, Net Income (Loss) Before Provision
            For Income
            Taxes of $(470,682), a Provision For Income Taxes of $-, Net Income (Loss)
            Applicable To Common Shares of $(470,682) and Net Income (Loss) Per Basic
            and
            Diluted Shares of $(0.04) based on 11,493,267 Weighted Average Number
            Of Common
            Shares Outstanding.
 
 For
            the
            three months ended June 30, 2006, the Company had Total Revenue of $426,427,
            Cost of Goods Sold of $6,469, Gross profit of $419,958, Total Operating
            Expenses
            of $124,912, Net Income (Loss) Before Other Income (Expense) of $295,046,
            Total
            Other Income (Expense) of $6,980, Net Income (Loss) Before Provision
            For Income
            Taxes of $302,026, a Provision For Income Taxes of $(96,175), Net Income
            (Loss)
            Applicable To Common Shares of $205,851 and Net Income (Loss) Per Basic
            and
            Diluted Shares of $0.02 based on 8,460,000 Weighted Average Number Of
            Common
            Shares Outstanding.
 
 12
  MANAGEMENT’S
            DISCUSSION
 
 The
            Company’s revenue decreased by $703,966 from six month period to six month
            period.  The Company attributes the decreases in Revenue, Gross
            Profit, Net Income Before Other Income, Net Income Before Provision For
            Income
            tax, Net Income Applicable to Common Shares, and Net Income Per Basic
            And
            Diluted Shares to the loss of one key customer that had previously accounted
            to
            more than ninety percent (90%) of the Company’s sales.
 
 The
            Company attributes the increase in Total Operating Expenses to (a) the
            issuance
            of 150,000 shares of its unregistered restricted common stock valued
            at $75,000
            for unpaid consulting services performed over  a period of three
            years, (b) the issuance of 300,000 shares of its unregistered restricted
            common
            stock valued at $90,000  to an officer of the Company for unpaid
            services for a period of five years, and (c) the issuance of 2,000,000
            shares of
            its registered common stock valued at $1,000,000 for consulting services
            over a
            period of four years for a total of $1,650,000.
 
 The
            Company will require significant additional capital to implement both
            its short
            term and long-term business strategies.  However, there can be no
            assurance that such additional capital will be available or, if available,
            that
            the terms will be favorable to the Company.  The absence of
            significant additional capital whether raised through a public or private
            offering or through other means, including either private debt or equity
            financings, will have a material adverse effect on the Company’s operations and
            prospects.
 
 The
            Company’s operations have consumed and will continue to consume substantial
            amounts of capital, which, up until now, have been largely financed internally
            through cash flows, from loans from related parties, and private
            investors.  The Company expects capital and operating expenditures to
            increase.  Although the Company believes that it will be able to
            attract additional capital through private investors and as a result
            thereof its
            cash reserves and cash flows from operations will be adequate to fund
            its
            operations through the end of calendar year 2007, there can be no assurance
            that
            such sources will, in fact, be adequate or that additional funds will
            not be
            required either during or after such period.  No assurance can be
            given that any additional financing will be available or that, if available,
            it
            will be available on terms favorable to the Company.  If adequate
            funds are not available to satisfy either short or long-term capital
            requirements, the Company may be required to limit its operations significantly
            or discontinue its operations.  The Company’s capital requirements are
            dependent upon many factors including, but not limited to, the rate at
            which it
            develops and introduces its products and services, the market acceptance
            and
            competitive position of such products and services, the level of promotion
            and
            advertising required to market such products and services and attain
            a
            competitive position in the marketplace, and the response of competitors
            to its
            products and services.
 
 Because
            of the loss of a key customer and a corresponding decline in revenue,
            the
            Company’s Board of Directors have authorized the Company’s officers to pursue
            raising additional capital of up to $5,000,000 by the means of a private
            placement of its common stock pursuant to Regulation 230.506 of Regulation
            D
            promulgated by the Securities and Exchange Commission pursuant to the
            Securities
            Act of 1933.  The proceeds from the private placement will be utilized
            to expand the Company’s current business. and to seek the  acquisition
            of non-related businesses
            internationally,  including.  There is no assurance that the
            private placement will attract sufficient additional capital for these
            purposes.
 
 **PART
            II — OTHER INFORMATION**
 
 **Item
            1.  Legal Proceedings.**
 
 There
            are
            no pending or threatened legal proceedings against the Company or any
            of its
            subsidiaries.
  **Item
            2.  Recent Sales of Unregistered Securities.**
 
 The
            following information is furnished with regard to all securities sold
            by us
            within the past three years that were not registered under the Securities
            Act.  The issuances described hereunder were made in reliance upon the
            exemptions from registration set forth in Section 4(2) of the Securities
            Act
            relating to sales by an issuer not involving any public offering.  All
            securities sold by us within the past three years were shares of common
            stock,
            no par value.  No underwriter was used in any of these transactions
            and there were no underwriting discounts or commissions paid. (1)
 
 Date
                  Name
                  Number
                      of Shares
                  Consideration
                      in DollarsJanuary
                      24, 2007
                  Marcus
                      Faller
                  150,000
                  Services
                    75,000February
                      8, 2007
                  Evelyn
                      P. Silva
                  300,000
                  Services
                    90,000Total
                  
                  
                  $165,00
 
 The
            Company claims an exemption from registration for common stock issued
            to the
            above purchasers Pursuant to Section 4(2) of the Securities Act of
            1933.  All of the above purchasers, were provided
            the  Company’s  non-financial statement and financial
            statement information described in Section 502(b)(2) of Regulation D
            promulgated
            by the Securities and Exchange Commission.  Prior to each sale, each
            of these purchasers was afforded the opportunity to ask questions and
            receive
            answers concerning the terms and conditions of the offering and to obtain
            additional information we possessed or could acquire without unreasonable
            effort
            or expense to verify the accuracy of the information provided
            them.  The Company took reasonable care to insure that the shares of
            stock sold to these purchasers could not be resold without registration
            under
            the Securities Act of 1933 (the “Act”) or an exemption there from and that these
            purchasers were not underwriters under that Act and in connection there
            with:  (a) made reasonable inquiry to insure that these purchasers
            were acquiring the shares of stock for themselves and not for any other
            persons;
            (b) provided written disclosure to each purchaser that the shares of
            stock had
            not been registered under the Act and therefore could not be resold unless
            registered under the Act or unless an exemption from registration is
            available;
            and (c) placed a restrictive legend on the shares of stock stating that
            they had
            not been registered under the act and setting forth restrictions on their
            transferability and sale.  Finally, the Company made reasonable
            inquiry to insure that each of these purchasers had such knowledge and
            experience in financial and business matters that each purchaser was
            capable of
            evaluating the merits and risks of investment in the shares of stock
            and of
            making an informed investment decision with respect thereto or had consulted
            with advisors who possess such knowledge and experience.
 
 In
            the
            year ended December 31, 2006, we issued 583,267 shares of unregistered
            common
            stock to satisfy liabilities for stock to be issued in prior years for
            a total
            of $224,900.  Reference is made to the Company’s First Amended Form
            10-K for the period ended December 31, 2005 dated April 17, 2006 and
            filed with
            the Securities and Exchange Commission on April 17, 2006,which is incorporated
            herein by
            reference.
 
 In
            addition to the above, reference is made to the Company’s Form 8-K, Section 3 -
            Securities and Trading Markets dated August 15 2007 and filed with the
            Securities and Exchange Commission on August 15, 2007, which is incorporated
            herein by reference.
 
 13
  **Item
            3.  Defaults Upon Senior Securities.**
 
 NONE
 
 **Item
            4.  Submission of Matters to a Vote of Security
            Holders.**
 
 NONE
 
 **Item
            5.  Other Information.**
 
 On
            June
            28, 2005, the Company loaned, $1,200,000 to Olympus Leasing Company,
            a related
            party.  At June 28, 2005, Antonio F. Uccello, III, was, and is now the
            President, Chairman and a minority owner of the issued and outstanding
            shares of
            stock of Olympus Leasing and reports to its board of
            directors.  Antonio F. Uccello, III, was and is one of the Company’s
            officers and directors and an indirect shareholder of Sign Media Systems,
            Inc.  The loan is for a period of five years with interest accruing on
            the unpaid balance at 5.3% per annum payable annually, with the entire
            principal
            and unpaid interest due and payable in full on June 28, 2010.  There
            is no prepayment penalty.  The purpose of the loan was to obtain a
            higher interest rate than is currently available at traditional banking
            institutions.  Olympus Leasing’s primary business is making secured
            loans to chiropractic physicians throughout the United States for the
            purchase
            of chiropractic adjustment tables.  The loans are generally for less
            than $3,000 each and are secured by a first lien on each chiropractic
            adjustment
            table.  Each loan is personally guaranteed by the chiropractic
            physician.  The rate of return on the Olympus Leasing loans is between
            15% and 25% per annum.  To date, Olympus Leasing has suffered no loss
            from any loan to a chiropractic physician for the purchase of a chiropractic
            adjustment table.    On January 3, 2007, the Company
            pursuant to the future advance clause in this note loaned Olympus Leasing
            an
            additional $300,000.  Since the making of the loan, including future
            advances thereon, by the Company to Olympus Leasing, Olympus Leasing
            has made
            payments to the Company of $956,272 pursuant to the note attached hereto
            as
            Exhibit 10.6.  The remaining balance that was due from related party
            on the balance sheet was $613,342 on June 30, 2007.  Because of the
            foregoing facts, the Company believes that the probability of a default
            on the
            loan by it to Olympus Leasing is unlikely.  The current principal
            balance due to the Company from Olympus Leasing is $594,746.  There is
            an excellent market for the re-sale of chiropractic adjustment tables
            which may
            be the subject of a foreclosure.  Olympus Leasing currently has in
            excess of $1,000,000 in outstanding finance receivables from chiropractic
            physicians secured by a first lien on each chiropractic adjustment
            table.
 
 **Item
            6.  Exhibits and Reports on Form 8-K.**
 
 **INDEX
            TO EXHIBITS.**
 
 **EXHIBIT**
 **NUMBER                              DESCRIPTION
            OF EXHIBIT**
 ------------------------------------------------------------------------------------------------
 10.6                                       
            Promissory Note described in Part I, Item 2, Management's Discussion
            and
            Analysis and Plan of Operation above which is inforporated herein
            by
 reference from the Company's Second Amended Form 10-QSB, Quarterly Report
            under
            Section 13 or 15(d) of the Exchange Act
            for
            the period ended
 June
            30, 2005 and filed with the Securities and Exchange Commission on November
            22,
            2005.
  31.1                                      
            Certification of Chief Executive Officer pursuant to 18 U.S.C. Section
            1350, as
            adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
            2002.
  31.2                                       Certification
            of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
            pursuant to Section 302 of the Sarbanes-Oxley Act of
            2002.
  32.1                                      
            Certification of Chief Executive Officer pursuant to 18 U.S.C. Section
            1350, as
            adopted pursuant to Section 906of the Sarbanes-Oxley Act of
            2002.
  32.2                                      
            Certification of Chief Financial Officer pursuant to 18 U.S.C. Section
            1350, as
            adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
            2002.
 
 The
              Company filed one Form 8K for the quarter ended June 30, 2007 dated
              June 18,
              2007 and filed with the Securities and Exchange Commission on June
              18, 2007
              relating to the amicable resignation of a director for personal reasons
              copy of
              which is incorporated herein by reference.
 
 The
              Company filed no Forms 8K for the quarter ended March 31, 2007.
  **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.
 
 SIGN
                        MEDIA SYSTEMS, INC.
                      (Registrant)Date
                        August 20, 2007
                    /s/Antonio
                        F. Uccello, III
                      Antonio
                        F. Uccello, III
                      Chief
                        Executive Officer
                      Chairman
                        of the
                        Board