**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      DC 20549**





**FORM
      10-QSB/A**


**Amendment
      No. 1**





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


For
      the
      quarterly period ended April 30, 2006





OR





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


For
      the
      transition period from _______ to _______








Commission
      file number: None





**PureDepth,
      Inc.**


(Exact
      Name of Registrant as Specified in Its Charter)





Delaware
              (State
                or other jurisdiction of
              incorporation
                or organization)
            20-4831825
              (I.R.S.
                Employer Identification No.)




255
      Shoreline Drive, Suite 610, Redwood City, California 94065


(Address
      of principal executive offices)





(650)
      632-0800


(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 Securities Exchange Act of 1934 during the preceding 12 months
      (or
      for such shorter period that the issuer 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 by Rule
      12b-2 of the Exchange Act). Yes [  ] No [X]





As
      of
      June 14, 2006 there were 58,644,445 shares of the issuer’s common stock, $.001
      par value, outstanding.





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










**Restatement
      Explanatory Note**:   The undersigned Issuer hereby amends
      its Quarterly Report on Form 10-QSB for the quarter April 30, 2006 in order
      to
      (a) restate its previously issued financial statements for the quarterly period
      ended April 30, 2006 to correct the Company’s computations of stock-based
      compensation under Statement of Financial Accounting Standards No. 123(R),
      (b)
      correct the computation of the depreciation expense, included in such Quarterly
      Report, (c) correct prior year 2005 and inception to date ended April 30, 2006
      operating expenses to reflect operating expense reclassifications, and (d)
      amend
      the Notes to the Financial Statement.





**Part
      I Financial Information**





Item
      1: Financial Statements


The
      financial statements in the quarterly report are restated as
      follows:





(a)
      the
      consolidated balance sheet is corrected in the form of (i) a reduction in the
      accumulated deficit and additional paid in capital by the same amount, $601,894,
      to correct the Company’s computations of stock-based compensation, resulting in
      no net impact on total stockholders’ equity, and (ii) increasing net property
      and equipment and reducing the accumulated deficit by the same amount
      $65,366,





(b)
      the
      consolidated statements of operations for the three months ended April 30,
      2006
      are restated for operating expense reductions in stock based compensation and
      depreciation expense in the form of (i) a reduction in sales and marketing
      in
      the amount of  $71,520, (ii) a reduction in general and administrative
      in the amount of $447,730, (iii) a reduction in research and development in
      the
      amount of  $82,644, and (iv) a reduction of depreciation expense in
      the amount of  $65,366, resulting in a reduction of the reported net
      loss  in the amount of  $667,260,





(c)
      the
      consolidated statements of operations for the three months ended April 30,
      2005
      have been reclassified for certain operating expenses (as previously reported
      on
      Form 8-K filed with the Commission on October 13, 2006) in the form of (i)
      an
      increase in sales and marketing in the amount of  $10,062, (ii) a
      reduction in general and administrative in the amount of $43,854, and (iii)
      an
      increase in research and development in the amount of  $33,792,
      resulting in no change to the total operating expenses and no change in the
      reported net loss for the period,





(d)
      the
      consolidated statements of operations for the inception to period ended April
      30, 2006 are restated for the current period corrections and prior year
      reclassifications (as previously reported on Form 8-K filed with the Commission
      on October 13, 2006) in the form of (i) an increase in sales and marketing
      in
      the amount of  $2,537,987 (ii) a reduction in professional fees in the
      amount of $32,775, (iii) a reduction in general and administrative in the amount
      of $5,206,028, (iv) an increase in research and development in the amount
      of  $2,056,027, (v) a reduction of depreciation expense in the amount
      of  $22,470, (vi) a reduction in grant receipts in the amount of
      $82,020, (vii) an increase in other income in the amount of $82,020, resulting
      in a reduction of the reported net loss  in the amount
      of  $672,226.





There
      is
      a “restated” notation in the attached financial statements, wherever there has
      been a restatement from the previously filed financial statements.





The
      Notes
      to the consolidated financial statements have been restated to reflect, and
      Note
      2 has been added to describe, the restatement changes in the restated
      consolidated balance sheet, restated consolidated statement of operations and
      restated consolidated statements of cash flows.  A pro forma
      presentation has been added to the consolidated statement of operations to
      show
      the summary effect of the above changes to the reported net loss.





In
      addition to the above restatements, immaterial corrections and changes to
      certain summations and presentations have been made or line items renamed for
      a
      more informative presentation.  These corrections and renaming changes
      did not have an impact on previously reported financial position, cash flow,
      or
      results of operations.





Item
      2: Management’s Discussion and Analysis of Financial Condition and Results of
      Operations





No
      Changes





Item
      3: Controls and Procedures




No
      Changes





2





**Part
      II Other Information**





No
      Changes





Except
      as
      described above, this Amendment does not include any other revisions to the
      original Quarterly Report and, accordingly, does not include any other updated
      information about changes in events, estimates or other developments subsequent
      to the filing date of the original Quarterly Report.






3


**PART
      I - FINANCIAL INFORMATION**





**Item
      1. Unaudited Condensed Consolidated Financial Statements**





**PUREDEPTH,
      INC. AND SUBSIDIARIES**


**(A
      Development Stage Company)**


**CONDENSED
      CONSOLIDATED BALANCE SHEET**





**April
                30,**
              **2006**
              **(Restated)****Unaudited****ASSETS**Current
                assets:Cash
                and cash equivalents
            
            $
            4,002,205Other
                current assets
            
            
            122,942Assets
                held for sale
            
            
            145,564**Total
                current assets**
            
            
            **4,270,711****Property
                & Equipment (net) (restated)**
            
            
            **319,929**Other
                Assets:Intellectual
                property (net)
            
            
            2,549,987Other
                assets held for sale
            
            
            21,002**Total
                other assets**
            
            
            **2,570,989****Total
                assets (restated)**
            
            **$**
            **7,161,629****LIABILITIES
                AND STOCKHOLDERS' EQUITY**Current
                liabilities:Current
                portion - notes payable
            
            $
            180,765Accounts
                payable
            
            
            496,704Accrued
                expenses
            
            
            62,862Liabilities
                held for sale
            
            
            156,597**Total
                current liabilities**
            
            
            **896,928**Note
                payable
            
            
            499,139**Total
                liabilities**
            
            
            **1,396,067**Commitments
              & Contingencies
            
            
            -Stockholders'
                equityPreferred
                stock series A, $0.01 par value, 1,000,000 shares authorized, 233,118.55
                shares issued and outstanding
            
            
            2,331Common
                stock, $0.001 par value 60,000,000 shares authorized, 6,255,400 shares
                issued & outstanding
            
            
            6,255Subscriptions
                received
            
            
            50,000Additional
                paid-in-capital (restated)
            
            
            24,945,092Accumulated
                deficit (restated)
            
            
            (18,527,215
            )Accumulated
                other comprehensive loss
            
            
            (710,901
            )**Total
                stockholders' equity (restated)**
            
            
            **5,765,562****Total
                liabilities and stockholders' equity (restated)**
            
            **$**
            **7,161,629**





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


4


**PUREDEPTH,
      INC. AND SUBSIDIARIES**


**(A
      Development Stage Company)**


**CONDENSED
      CONSOLIDATED STATEMENTS OF OPERATIONS**


**and
      COMPREHENSIVE INCOME / (LOSS)**


**(Unaudited)**


**Three
                months ended April 30,**
            
            
            **Inception
                to****2006**
              **(Restated)**
            
            
            **2005**
            
            
            **April
                30, 2006**
              **(Restated)**Net
                sales
            
            $
            -
            
            
            $
            -
            
            
            $
            -**Costs
                and expenses**Depreciation
                and amortization (restated)
            
            
            72,030
            
            
            
            120,247
            
            
            
            2,465,007Sales
                and marketing (restated)
            
            
            853,237
            
            
            
            192,313
            
            
            
            4,477,991Professional
                fees
            
            
            317,939
            
            
            
            102,075
            
            
            
            1,890,115Loss
                on fixed asset disposal
            
            
            -
            
            
            
            5,444
            
            
            
            111,194General
                and administrative (restated)
            
            
            1,509,221
            
            
            
            286,413
            
            
            
            7,407,315Research
                and development (restated)
            
            
            1,078,903
            
            
            
            466,942
            
            
            
            5,049,185**Total
                operating expenses (restated)**
            
            ****
            **3,831,330**
            
            
            ****
            **1,173,434**
            
            
            ****
            **21,400,807****Operating
                loss  (restated)**
            
            ****
            **(3,831,330**
            **)**
            
            ****
            **(1,173,434**
            **)**
            
            ****
            **(21,400,807**
            **)****Other
                income (expense)**Interest,
                net
            
            
            19,624
            
            
            
            (49,828
            )
            
            
            (932,788
            )Grant
                receipts
            
            
            1,850
            
            
            
            7,324
            
            
            
            600,605Foreign
                exchange gain
            
            
            24,760
            
            
            
            83,494
            
            
            
            423,618Other
                Income
            
            
            89,899
            
            
            
            90,796
            
            
            
            2,764,510**Total
                other income**
            
            ****
            **136,133**
            
            
            ****
            **131,786**
            
            
            ****
            **2,855,945****Loss
                before income tax (restated)**
            
            ****
            **(3,695,197**
            **)**
            
            ****
            **(1,041,648**
            **)**
            
            ****
            **(18,544,862**
            **)**Income
                tax provision
            
            
            -
            
            
            
            -
            
            
            
            -**Loss
                from continuing operations (restated)**
            
            ****
            **(3,695,197**
            **)**
            
            ****
            **(1,041,648**
            **)**
            
            ****
            **(18,544,862**
            **)**Income
                from discontinued operations, net of income tax
            
            
            17,647
            
            
            
            -
            
            
            
            17,647**Net loss
                (restated)**
            
            ****
            **(3,677,550**
            **)**
            
            ****
            **(1,041,648**
            **)**
            
            ****
            **(18,527,215**
            **)**Other
                comprehensive income (loss)Net
                loss per statement of operations (restated)
            
            
            (3,677,550
            )
            
            
            (1,041,648
            )
            
            
            (18,527,215
            )Foreign
                currency translation adjustments
            
            
            33,132
            
            
            
            (96,399
            )
            
            
            (710,901
            )**Comprehensive loss
                (restated)**
            
            $
            (3,644,418
            )
            
            $
            (1,138,047
            )
            
            $
            (19,238,116
            )**Pro
                forma Information for restatement:**Net
                loss as previously reported
            
            $
            (4,344,810
            )
            
            
            
            
            
            $
            (19,194,475
            )Adjustment
                in stock based compensation
            
            
            601,894
            
            
            
            
            
            
            
            601,894Adjustment
                in depreciation expense
            
            
            65,366
            
            
            
            
            
            
            
            65,366Net
                loss, (restated)
            
            $
            (3,677,550
            )
            
            
            
            
            
            $
            (18,527,215
            )








5


**PUREDEPTH,
      INC. AND SUBSIDIARIES**


**(A
      Development Stage Company)**


**CONDENSED
      CONSOLIDATED STATEMENTS OF OPERATIONS**


**and
      COMPREHENSIVE INCOME / (LOSS)**


**(Unaudited)**








**Three
                months ended April 30,**
            
            
            **Inception
                to****2006**
              **(Restated)**
            
            
            **2005**
            
            
            **April
                30, 2006**
              **(Restated)****Basic
                and diluted earnings (loss) per share:**Loss
                from continuing operations (restated)
            
            $
            (0.08
            )
            
            $
            (0.09
            )
            
            $
            (1.29
            )Net
                income (loss) (restated)
            
            $
            (0.08
            )
            
            $
            (0.09
            )
            
            $
            (1.29
            )Weighted
                average shares outstanding, basic and diluted
            
            
            46,194,409
            
            
            
            11,336,118
            
            
            
            14,382,618





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




6


**PUREDEPTH,
      INC. AND SUBSIDIARIES**


**(A
      Development Stage Company)**


**CONDENSED
      CONSOLIDATED STATEMENTS OF CASH FLOWS**


**(Unaudited)**


**Three
                months ended April 30,**
            
            
            **Inception
                to****2006**
              **(Restated)**
            
            
            **2005**
            
            
            **April
                30, 2006**
              **(Restated)****Cash
                flows from operating activities:**Net loss
            
            $
            (3,677,550
            )
            
            $
            (1,041,648
            )
            
            $
            (18,527,215
            )Adjustments
                to reconcile net loss to net cash provided byoperating
                activities:Depreciation
                and amortization
            
            
            72,030
            
            
            
            120,247
            
            
            
            2,465,007Stock-based
                compensation expense
            
            
            2,539,644
            
            
            
            271,586
            
            
            
            5,150,100Non-cash
                interest expense
            
            
            3,579
            
            
            
            68,978
            
            
            
            148,669Loss
                on disposal of fixed assets
            
            
            -
            
            
            
            5,444
            
            
            
            111,194Foreign
                exchange (gain)
            
            
            (24,760
            )
            
            
            (83,497
            )
            
            
            (423,618
            )Changes
                in operating assets and liabilities:(Increase)
                decrease in accounts receivable, trade
            
            
            46,436
            
            
            
            21,886
            
            
            
            (25,559
            )(Increase)
                decrease in prepayments
            
            
            (43,894
            )
            
            
            34,460
            
            
            
            (97,378
            )Increase
                (decrease) in payables to other creditors and accruals
            
            
            (36,066
            )
            
            
            200,752
            
            
            
            48,704Increase in
                accounts payable
            
            
            204,328
            
            
            
            113,209
            
            
            
            496,704Increase in
                accrued interest
            
            
            5,441
            
            
            
            24,693
            
            
            
            10,579**Net
                cash used in operating activities**
            
            ****
            **(910,812**
            **)**
            
            ****
            **(263,890**
            **)**
            
            ****
            **(10,642,813**
            **)****Cash
                flows from investing activities:**Payments
                for purchases of fixed assets
            
            
            (159,081
            )
            
            
            (107,824
            )
            
            
            (1,222,776
            )Expenditures
                - intellectual property
            
            
            (67,429
            )
            
            
            (81,692
            )
            
            
            (2,954,878
            )**Net
                cash used in investing activities**
            
            ****
            **(226,510**
            **)**
            
            ****
            **(189,516**
            **)**
            
            ****
            **(4,177,654**
            **)****Cash
                flows from financing activities:**Proceeds
                from issuance of Common Stock, net
            
            
            -
            
            
            
            -
            
            
            
            9,660,690Proceeds
                from issuance of Series A preferred stock
            
            
            4,227,472
            
            
            
            -
            
            
            
            4,577,472Proceeds
                from short term financing
            
            
            -
            
            
            
            -
            
            
            
            29,585Principal
                payments on short term financing
            
            
            (23,136
            )
            
            
            -
            
            
            
            (23,136
            )Issuance
                of related party note payable
            
            
            -
            
            
            
            745,212
            
            
            
            5,221,768Principal
                payments on short term financing
            
            
            -
            
            
            
            -
            
            
            
            (594,441
            )Stock
                subscriptions received
            
            
            50,000
            
            
            
            -
            
            
            
            50,000**Net
                cash provided by financing activities**
            
            ****
            **4,254,336**
            
            
            ****
            **745,212**
            
            
            ****
            **18,921,938**Effect
                of exchange rate changes on cash and cash equivalents
            
            
            27,193
            
            
            
            138,626
            
            
            
            (99,266
            )**Net
                increase in cash and cash equivalents**
            
            ****
            **3,144,207**
            
            
            ****
            **430,432**
            
            
            ****
            **4,002,205**Cash
                and cash equivalents at beginning of period
            
            
            857,998
            
            
            
            114,817
            
            
            
            -**Cash
                and cash equivalents at end of period**
            
            **$**
            **4,002,205**
            
            
            **$**
            **545,249**
            
            
            **$**
            **4,002,205****Supplemental
                cash information:**Notes
                and accrued interest converted to stock
            
            $
            774,330
            
            
            $
            2,704,784
            
            
            $
            5,598,620Cash
                paid for interest
            
            $
            1,169
            
            
            $
            20
            
            
            $
            849,749Cash
                paid for income taxes
            
            
            -
            
            
            
            -
            
            
            
            -Purchase
                of intellectual property via issuance of note
                payable
            
            
            -
            
            
            
            -
            
            
            $
            1,257,929Warrants
                issued for stock issuance costs (restated)
            
            $
            1,840,779
            
            
            
            -
            
            
            $
            1,840,779





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


7


**PUREDEPTH,
      INC. AND SUBSIDIARIES**


**(A
      Development Stage Company)**


**NOTES
      TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
      STATEMENTS**





**Note
      1 - Basis of Presentation**





The
      accompanying unaudited financial statements of PureDepth, Inc. (“the Company")
      are presented in accordance with the requirements for Form 10-QSB and Article
      10
      of Regulation S-X and Regulation S-B. Accordingly, they do not include all
      of
      the disclosures required by generally accepted accounting principles in the
      United States of America. In the opinion of management, all adjustments (all
      of
      which were of a normal recurring nature) considered necessary to fairly present
      the financial position, results of operations, and cash flows of the Company
      on
      a consistent basis, have been made.





These
      results have been determined on the basis of generally accepted accounting
      principles and practices applied consistently with those used in the preparation
      of the Company's Annual Financial Statements for the ten months ended January
      31, 2006 and year ended March 31, 2005. Operating results for the three months
      ended April 30, 2006 are not necessarily indicative of the results that may
      be
      expected for the fiscal year ending January 31, 2007.





The
      accompanying condensed consolidated financial statements for the interim period
      should be read in conjunction with the Company’s audited consolidated financial
      statements and notes thereto for the year ended January 31, 2007 included in
      the
      Company’s Annual Report on Form 10-KSB filed with the Commission on May 31,
      2007.  Those statements contain a summary of significant accounting
      policies.





Certain
      amounts in the prior periods have been reclassified to conform to the current
      presentation.





**Note
      2 – Restatement**





*Restatements*




The
      Company’s management concluded after reviewing the computations related to stock
      based compensation and the activity related to fixed asset depreciation, that
      it
      needed to restate its previously filed Forms 10-QSB for the three months ended
      April 30, 2006 to correct the Company’s computations of stock based compensation
      and depreciation expense.




The
      consolidated balance sheets at April 30, 2006 have been amended by increasing
      net property and equipment by $65,366 for the depreciation correction, reducing
      accumulated deficit by $667,260 for the cumulative net loss adjustment and
      reducing additional paid in capital by $601,894 for the stock based compensation
      correction resulting in net increases in total assets and stockholders’ equity
      of $65,366.




The
      consolidated statements of operations for the period ended April 30, 2006 have
      been corrected by reducing total operating expenses in the total amount
      of  $667,260 for depreciation expense of $65,366, and stock based
      compensation expense of $601,894, resulting in a restated net loss of
      $3,677,550.




The
      restatement resulted in a decrease in the loss per share from $(0.09) to $(0.08)
      per share for the three months ended April 30, 2006 and $(1.34) to $(1.29)
      per
      share for the inception to April 30, 2006.







8




*Reclassifications*




The
      Company reviewed the classification of its operating expenses and other income
      items for the period ended April 30, 2005. As a result of the review, certain
      amounts have been reclassified to conform to the current
      presentation.  The reason for the reclassifications was the
      reallocation of certain departmental expenses. The results of the
      reclassifications did not impact previously reported financial position, cash
      flows, net operating loss, or the loss per share calculations.







**Three
                months ended April 30, 2005****As**
              **reported**
            
            
            **change**
            
            
            **As**
              **reclassified****Selected
                Operating Expenses**Depreciation
                and amortization
            
            $
            120,247
            
            
            $
            0
            
            
            $
            120,247Sales
                and marketing
            
            
            182,251
            
            
            
            (10,062
            )
            
            
            192,313Professional
                fees
            
            
            102,075
            
            
            
            0
            
            
            
            102,075Loss
                on fixed asset disposal
            
            
            5,444
            
            
            
            0
            
            
            
            5,444General
                and administrative
            
            
            330,267
            
            
            
            (43,854
            )
            
            
            286,413Research
                and development
            
            $
            433,150
            
            
            $
            33,792
            
            
            $
            466,942**Loss
                from Operations**
            
            
            (1,173,434
            )
            
            
            0
            
            
            
            (1,173,434
            )Net
                effect of Changes
            
            
            
            
            
            
            0







**Inception
                to April 30, 2006****As**
              **reported**
            
            
            **reclassified**
            
            
            **restatement**
            
            
            **As**
              **restated****Selected
                Operating Expenses**Depreciation
                and amortization
            
            $
            2,487,477
            
            
            $
            42,895
            
            
            $
            (65,366
            )
            
            $
            2,465,007Sales
                and marketing
            
            
            1,940,004
            
            
            
            2,609,507
            
            
            
            (71,520
            )
            
            
            4,477,991Professional
                fees
            
            
            1,922,891
            
            
            
            (32,775
            )
            
            
            0
            
            
            
            1,890,115Loss
                on fixed asset disposals
            
            
            111,194
            
            
            
            0
            
            
            
            0
            
            
            
            111,194General
                and administrative
            
            
            12,613,343
            
            
            
            (4,758,298
            )
            
            
            (447,730
            )
            
            
            7,407,315Research
                and development
            
            $
            2,993,158
            
            
            $
            2,138,671
            
            
            $
            (82,644
            )
            
            $
            5,049,185**Loss
                from Operations**
            
            
            (22,068,067
            )
            
            
            0
            
            
            
            (667,260
            )
            
            
            (21,400,807
            )Grant
                receipts
            
            
            682,625
            
            
            
            (82,020
            )
            
            
            0
            
            
            
            600,605Other
                income
            
            
            2,682,490
            
            
            
            82,020
            
            
            
            0
            
            
            
            2,764,510Net
                effect of Changes
            
            
            
            
            
            
            0
            
            
            
            (667,260
            )








9





**Note
      3 -Description of Business**





*The
      Company - Description of Business*




PureDepth,
      Inc., along with our wholly owned subsidiaries, PureDepth Limited (PDL) and
      PureDepth Incorporated Limited (PDIL), and our predecessor parent entity, Deep
      Video Imaging Limited (DVIL), (collectively, the Company) develops,
      manufactures, markets and supports multi-layer display technology (MLDTM). The
      Company’s technology has gaming, military, automotive and handheld video display
      applications.





The
      Company is deemed a development stage company as defined by Statement of
      Financial Accounting Standards (SFAS) No. 7 *Accounting and Reporting by
      Development Stage Enterprises* due to its continuing research and
      development activities related to making its multi-layer display technology
      (MLDTM) economically viable for its targeted applications.





**Note
      4 - Merger**





On
      March
      31, 2006 and pursuant to an Agreement and Plan of Merger and Reorganization
      dated March 16, 2006, PureDepth, Inc., a California corporation (PDI-CA) entered
      into a merger with PureDepth Technologies, Inc., a Delaware corporation and
      wholly owned subsidiary of Diamond One, Inc., a Colorado corporation quoted
      on
      the OTC Bulletin Board. As a result of the merger, PureDepth Technologies,
      Inc.
      succeeded to the business of PDI-CA, and survived as a wholly owned operating
      subsidiary of Diamond One, Inc. The merger was effected by the filing of a
      certificate of merger with the Delaware Secretary of State on March 31,
      2006.




At
      the effective time of the merger,
      the legal existence of the PDI-CA ceased and all of the 23,311,855 shares of
      the
      PDI-CA’s common stock that were outstanding immediately prior to the merger were
      cancelled. Simultaneously, PDI-CA’s former stockholders received an aggregate of
      233,118.55 shares of Diamond One, Inc’s Series A Preferred Stock, representing
      approximately 89% of the registrant’s outstanding voting power after the merger.
      In addition, all securities convertible into and exercisable for shares of
      the
      PDI-CA’s common stock (e.g. options and warrants) that were outstanding
      immediately prior to the merger were cancelled, and their holders received
      similar securities for the purchase of Diamond One, Inc. common
      stock.





Prior
      to
      the merger and pursuant to authority granted to it by the registrant’s articles
      of incorporation, as amended, Diamond One, Inc’s board of directors approved and
      adopted a Certificate of Designation relating to a new class of preferred stock
      denominated Series A Preferred Stock.**On May 10, 2006 all
      outstanding shares of Series A Preferred Stock automatically converted into
      shares of common stock on a 229.021-for-1 basis upon the effectiveness of an
      additional amendment to Diamond One, Inc’s articles of incorporation which
      increased the number of shares of authorized common stock.  In total,
      former holders of PDI-CA securities now hold approximately 93% of the
      outstanding common stock of Diamond One, Inc. on a fully diluted
      basis.





The
      merger represented a change in control of Diamond One, Inc. as greater than
      50%
      of the issued and outstanding voting stock of the registrant on a post-merger
      basis is now held by the former holders of PDI common stock. In addition, and
      simultaneously with the effectiveness of the merger, the board of directors
      of
      Diamond One, Inc. was reconstituted by the appointment of Messrs. David Hancock,
      Fred Angelopoulos and Mark Kalow to its Board of Directors, and the resignation
      of Messrs. Troy Fullmer and Robert Chramosta.  Messrs. Fullmer and
      Chramosta also resigned their positions as officers. In their place, Fred
      Angelopoulos was appointed as its Chief Executive Officer and President, and
      Kristin Bowman was appointed as Chief Operating Officer, Secretary and acting
      Chief Financial Officer.   All prior operations of Diamond One,
      Inc. were divested to the former directors of that company.





On
      May 8,
      2006 the name of PureDepth Technologies, Inc., the surviving reincorporation
      merger entity, was changed to PureDepth, Inc. On May 30, 2006, PureDepth, Inc.
      (f/k/a Diamond One, Inc.) consummated a short-form merger with a wholly owned
      Delaware subsidiary, pursuant to which it reincorporated in the State of
      Deleware. After the reincorporation, the Company’s name remains “PureDepth,
      Inc.”.





For
      a
      full description of the merger transaction refer to Form 8-K filed with the
      Securities and Exchange Commission on April 6, 2006.





10





The
      merger was accounted for as a reverse acquisition in accordance with SFAS No.
      141 *Business Combinations in which*PDI was identified as the acquiring
      entity and Diamond One, Inc was identified as the acquired
      entity.  Any remaining identifiable assets and liabilities of Diamond
      One, Inc. were assigned fair values at the acquisition date. No goodwill was
      recognized.  The assets of the Company were incorporated into the
      group financial statements at their pre-merger carrying values at the date
      of
      the business combination.  Comparative financial information for
      periods prior to the merger is presented for the former PDI entity.





The
      following is pro-forma results of operations as if the transaction had occurred
      at the beginning of each period presented:





Three
                months ended April 30,2006
            
            
            2005Net
                Sales
            
            $
            -
            
            
            $
            -Operating
                loss
            
            
            (3,831,330
            )
            
            
            (1,173,434
            )Other
                income (expense)
            
            
            136,133
            
            
            
            131,786Income
                from discontinued operations
            
            
            17,647
            
            
            
            2,598Pro-forma
                net loss
            
            
            (3,677,550
            )
            
            
            (1,039,050
            )Pro-forma
                net loss per share *
            
            $
            (0.07
            )
            
            $
            (0.06
            )Pro-forma
                Weighted average shares outstanding
            
            
            50,340,947
            
            
            
            17,591,518





*
      Pro-forma net loss per share is computed as if all preferred shares are
      converted as of the beginning of the period.





**Note
      5 – Discontinued Operations**





*Divestiture
      of Former Business*





Prior
      to
      the merger, Diamond One, Inc. had assigned all of its assets and liabilities,
      specifically including the coin and exchange business owned and operated by
      Diamond One, Inc., to Numismatic Capital Group. As part of the merger agreement
      on May 9, 2006, the former officers of Diamond One, Inc. exercised an option
      to
      acquire Numismatic Capital Group at the net book value.  The Company
      recorded income from operations of the discontinued coin and exchange operation
      of $17,647 for the three months ended April 30, 2006.





**Note
      6 - Stockholder’s Equity**





On
      February 23, 2006, in connection with a private placement offering, the Company
      issued common stock and warrants to its majority shareholder, K1W1, in exchange
      for the forgiveness of debt totaling $774,330.  In this transaction
      the Company issued 772,286 shares of common stock, 386,143 three-year A-warrants
      to purchase 386,143 shares of common stock at an exercise price of $2.75 per
      share and 386,143 one-year B-warrants to purchase 386,143 shares of common
      stock
      at an exercise price of $2.00 per share.





On
      March
      1, 2006, in a private placement offering, the Company issued common stock and
      warrants for cash of totaling $4,264,480 net of issuance costs of
      $3,021,299.  Also included in the transaction is the issuance of
      350,000 shares of subscribed capital received in January 2006.  In
      this offering the Company issued 5,795,000 shares of common
      stock,  three-year A-warrants to purchase 2,897,500 shares of common
      stock at an exercise price of $2.75 per share and one-year B-warrants to
      purchase 2,897,500 shares of common stock at an exercise price of $2.00 per
      share. In connection to the private placement and included in the issuance
      costs
      the Company also issued three-year C-warrants (adjusted to reflect the March
      31,
      2006 merger transaction) to purchase 1,082,811 shares of common stock at an
      exercise price of $0.44 per share in the amount of $1,840,779 for services
      related to the private placement.





On
      March
      31, 2006 the Company issued 31,800 shares of common stock pursuant to the
      exercise of common stock options for a former employee at an exercise price
      of
      $0.65 per share for cash totaling $20,670.





On
      March
      31, 2006, the effective date of the merger, the Company converted 23,311,855
      shares of the Company’s common stock that were outstanding immediately prior to
      the merger to an aggregate of 233,118.55 shares of Series A Preferred Stock
      at a
      one-for-hundred   ratio.





11


On
      March,
      31, 2006 the Company issued 6,255,400 shares of common stock in exchange for
      the
      6,255,400 shares of the common stock of Diamond One, Inc. surrendered at the
      time of the merger.





**Note
      7 - Stock Option Plan**





Prior
      to
      the merger, and effective March 31, 2006, the Board of Directors of PureDepth,
      Inc. approved and authorized an amendment and restatement of its Second Amended
      and Restated Executive Share Option Plan No. 3 (the “Prior Plan”) into the 2006
      Stock Incentive Plan (the “Plan”) and entered into agreements with each of the
      existing option holders whereby such option holders agreed that the Plan would
      thereafter govern their respective options. The amendment had no effect upon the
      number of options or the strike prices.





As
      a
      result of the merger, all unvested stock options issued under the Plan vested
      upon the effective date of the merger, March 31, 2006.





Options
      issued under the Company’s Prior Plan, except those issued to David Hancock and
      Keith Phillips, carried certain anti-dilution rights with respect of company
      securities issued prior to the merger transaction. Upon closing of the private
      placement offering of PureDepth, Inc. on March 1, 2006, further options were
      deemed to be issued to various holders under the Plan holding anti-dilution
      rights with subsequent vesting of those options occurring under the accelerated
      vesting provisions on the reverse acquisition date, being March 31, 2006. These
      anti-dilution rights terminated at the effective time of the merger, and were
      not carried forward under the Plan.





A
      summary
      of option activity under the Plan as of April 30, 2006 is presented
      below:




**Options**
            
            **Shares**
            
            
            **Weighted-**
              **Average**
              **Exercise**
              **Price**Outstanding
                at beginning of  period
            
            
            4,181,296
            
            
            $
            0.65Granted
                (including post merger conversion) **(1)**
            
            
            8,735,153
            
            
            $
            0.28Exercised
            
            
            (72,829
            )
            
            $
            0.28Forfeited
                or expired
            
            
            (393,050
            )
            
            $
            0.28Outstanding
                at April 30, 2006
            
            
            12,450,570
            
            
            $
            0.28Exercisable
                at April 30, 2006
            
            
            12,450,570
            
            
            $
            0.28




(1)
            Granted
                options include the conversion shares in the exchange ratio of 2.29021
                for
                1 for all options granted prior to the effective date of the
                merger.




The
      weighted-average grant-date fair value of options granted during the quarter
      ended April 30, 2006 was $0.28, per share. No new options were granted in
      the corresponding quarter of the previous year.




As
      of
      March 31, 2006, all previously unvested options became immediately exercisable
      as a result of the merger with Puredepth Technologies Inc. and all remaining
      deferred option cost was charged to expense.





The
      following table summarizes significant ranges of outstanding and exercisable
      options as of April 30, 2006:





**Outstanding**
            
            
            **Exercisable****Range
                of Exercise Price**
            
            
            **Number**
              **Outstanding**
            
            
            **Weighted**
              **Average**
              **Remaining**
              **Contractual**
              **Life
                (In Years)**
            
            
            **Weighted**
              **Average**
              **Exercise**
              **Price
                per**
              **Share**
            
            
            **Aggregate**
              **Intrinsic**
              **Value
                ($000)**
            
            
            **Number**
              **Exercisable**
            
            
            **Weighted**
              **Average**
              **Exercise**
              **Price
                per**
              **Share**
            
            
            **Aggregate**
              **Intrinsic**
              **Value
                ($000)**$0.28
                - $0.44
            
            
            
            12,450,570
            
            
            
            6.4
            
            
            
            $0.28
            
            
            
            $23,282
            
            
            
            12,450,570
            
            
            
            $0.28
            
            
            
            $23,282





12


The
      aggregate intrinsic value in the preceding table represents the total pretax
      intrinsic value based on the Company’s closing stock price of $2.15 as of April
      28, 2006.  As of April 30, 2006 all outstanding options are
      in-the-money.





*Stock
      Compensation*




We
      currently use the Black-Scholes option pricing model to determine the fair
      value
      of stock options. The determination of the fair value of stock-based payment
      awards on the date of grant using an option-pricing model is affected by our
      stock price as well as assumptions regarding a number of complex and subjective
      variables. These variables include our expected stock price volatility over
      the
      term of the awards, actual and projected employee stock option exercise
      behaviors, risk-free interest rate and expected dividends.




We
      estimate the volatility of our common stock by using our limited historical
      data
      and similar entities.  We base the risk-free interest rate that we use
      in the option valuation model on U.S. Treasury issues with remaining terms
      similar to the expected term on the options. We do not anticipate paying any
      cash dividends in the foreseeable future and therefore use an expected dividend
      yield of zero in the option valuation model. We are required to estimate
      forfeitures at the time of grant and revise those estimates in subsequent
      periods if actual forfeitures differ from those estimates. All stock-based
      payment awards are amortized on a straight-line basis over the requisite service
      periods of the awards, which are generally the vesting periods. To determine
      the
      expected term of out employee awards granted we utilized the simplified approach
      as defined by SEC Staff Accounting Bulletin No. 107, Share-Based Payment
      (SAB107).





**Note
      8 - Income Taxes**





For
      the
      quarter ended April 30, 2006, the Company incurred net operating losses of
      $3,677,550 and, accordingly, no provision for income taxes has been recorded.
      In
      addition, no benefit for income taxes has been recorded due to the uncertainty
      of the realization of any tax assets.





At
      January 31, 2006, PureDepth, Inc. (California) had both a federal and state
      net
      operating loss carry-forward of $1,016,582. Further, there were foreign net
      operating loss carry-forwards of $3,102,917 in respect of PureDepth, Inc’s.
      foreign subsidiaries.





In
      addition, at January 31, 2006, Diamond One, Inc. reported approximately $43,000
      of federal and state net operating losses, but has not assessed the current
      status of net operating loss carry-forwards following
      reorganization.





Net
      operating loss carry-forwards, if not utilized, will begin to expire within
      twenty years for federal purposes and within ten years for California purposes.
      The foreign net operating tax loss carry-forward can be carried forward
      indefinitely unless a change in ultimate control of the loss companies
      results.





For
      financial reporting purposes, the Company has incurred a loss in each period
      since its inception. Based on the available objective evidence, including the
      Company's history of losses, management believes it is currently more likely
      than not that the net deferred tax assets will not be fully realizable.
      Accordingly, the Company provided a full valuation allowance against its net
      deferred tax assets.





**Note
      9 - Related Party Transactions**





During
      the quarter ended April 30, 2006 the Company entered into the following related
      party transactions:





·
            On
                February 23, 2006 the Company’s majority shareholder, K1W1, converted
                loans in the aggregate amount of $774,330 as part of the Company’s private
                placement offering into 386,143 units consisting of 772,286 shares
                of
                common stock, warrants to purchase an aggregate of 386,143 additional
                shares of common stock at an exercise price of $2.75 per share (A
                Warrant)
                (merger adjusted - $1.20 per share), and warrants to purchase an
                aggregate
                of 386,143 additional shares of common stock in the Company at an
                exercise
                price of $2.00 per share (B Warrant) (merger adjusted - $0.87 per
                share).
                The outstanding interest in relation to the loan was forgiven by
                the
                shareholder effective at this date.




13


·
            On
                March 31, 2006 the Company issued options to purchase 232,932 shares
                of
                common stock at an exercise price of $0.44 to Mark Kalow pursuant
                to his
                agreement to serve as a director.





**Note
      10 - Subsequent Events**





*Merger*





On
      May 5,
      2006, Diamond One, Inc., (the parent of the Company after completion of the
      merger) held a special meeting of the stockholders to consider and act upon
      the
      following corporate actions:





(a)
            
            a
                proposal to adopt amended and restated articles of incorporation
                for
                Diamond One, Inc.; and





(b)
            
            a
                proposal to reincorporate Diamond One, Inc. in the State of Delaware
                by
                merging Diamond One, Inc. with and into PureDepth Technologies, Inc.,
                the
                wholly owned subsidiary of Diamond One, Inc. with PureDepth Technologies,
                Inc. surviving the merger.





On
      May 8,
      2006 the name of PureDepth Technologies, Inc., (Delaware) was changed to
      PureDepth, Inc. On May 9, 2006, Diamond One, Inc. filed its Amended and Restated
      Articles of Incorporation with the Secretary of State of Colorado, changing
      its
      name to “PureDepth, Inc.”





The
      short-form merger and reincorporation was consummated on May 30, 2006, with
      PureDepth, Inc. (formerly known as PureDepth Technologies, Inc.) surviving
      the
      merger. The charter documents of PureDepth, Inc. (formerly known as PureDepth
      Technologies, Inc.) became the effective charter documents of the Company.
      These
      proposals were both approved at the meeting by approximately 72% of the
      stockholders entitled to vote on the proposals.





*Conversion
      of Preferred Stock*





On
      May 9,
      2006 the Company converted all 233,118.55 shares of the Series A Preferred
      Stock
      issued in the acquisition of Diamond One into an aggregate of 53,389,045 shares
      of common stock at a 229.01-for-one ratio.  The conversion was
      effected pursuant to the terms of the Certificate of Designation for the
      registrant’s Series A Preferred Stock, which provided that all outstanding
      preferred shares of that series would automatically convert upon an increase
      in
      the number of shares of common stock authorized for issuance under the
      registrant’s articles of incorporation.  Pursuant to the merger,
      warrants were automatically converted and their respective post merger exercise
      prices became $1.20 for A-warrants and $0.87 for B-warrants.





On
      May 9,
      2006 pursuant to the exercise of an Option Agreement held by the Company, dated
      March 16, 2006, the Company transferred all of the outstanding membership
      interests in its wholly owned subsidiary, Numismatic Capital Group, LLC to
      Messrs. Charmosta and Fullmer, the former officers of Diamond One, Inc., in
      exchange for 1,000,000 shares of our common stock held by them.  The
      transaction was accounted for at the net book value of the assets transferred
      with no gain or loss recognized. The Company subsequently cancelled these
      shares.





The
      conversion was effected pursuant to the terms of the Certificate of Designation
      for the registrant’s Series A Preferred Stock, which provided that all
      outstanding preferred shares of that series would automatically convert, on
      a
      229.021 for 1 basis, upon an increase in the number of shares of common stock
      authorized for issuance under the registrant’s articles of
      incorporation.




*Divestiture
      of Former Business*





Prior
      to
      the merger, Diamond One had assigned all of its assets and liabilities,
      specifically including the coin and exchange business owned operated by Diamond
      One, to Numismatic Capital Group. The exercise of the Option Agreement
      effectively divested the Company of the entire coin and exchange
      business.




14


**SIGNATURES**





In
      accordance with the requirements of the Exchange Act of 1934, the registrant
      caused this report to be signed on its behalf by the undersigned, thereunto
      duly
      authorized.




PUREDEPTH,
                INC.Date: September
                12, 2007
            By:
            /s/ Thomas
                L. MarcusThomas
                L. Marcus
              *Interim
                Chief Executive Officer*





By:
            /s/ Jonathan
                J. McCamanJonathan
                J. McCaman
                *Chief
                  Financial Officer and*
                *Chief
                  Accounting
                  Officer*










**Index
      to Exhibits Filed with this Report**





Exhibit
                No.
            Description




31.1
            Certification
                of Chief Executive Officer31.2
            Certification
                of Chief Financial Officer


32.1
            Certifications
                of Chief Executive Officer and Chief Financial Officer pursuant to
                Section
                906 of the Sarbanes-Oxley Act of
                2002.








15