SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

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

           For the quarterly period ended March 31, 2006

                                       OR

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

         For the transition period from ______________to ______________

                         Commission file number 0-32513


                                   ICOA, INC.
             (Exact name of Registrant as Specified in Its Charter)

                       Nevada                            87-0403239
           (State or Other Jurisdiction of     (IRS Employer Identification No.)
           Incorporation or Organization)

                  111 Airport Road, Warwick, Rhode Island 02889
             (Address of Principal Executive Offices with Zip Code)

        Registrant's Telephone Number, Including Area Code: 401-352-2300

 _________________________________________________________________________
 Former Name, Former Address and Former Fiscal Year, if Changed Since Last
 Report.


       Indicate by check mark whether the registrant (1) has 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 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 large accelerated
       filer, an accelerated filer, or a non-accelerated filer. See definition
       of "accelerated filer and large accelerated filer" in Rule 12b-2 of the
       Exchange Act. (Check one):

Large accelerated filer [ ]  Accelerated filer [ ]   Non-accelerated filer [X]

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

                                                           Yes   [ ]    No [X]


The number of shares of common stock outstanding as of May 15, 2006 was
381,808,967
There were no shares of preferred stock outstanding as of May 15, 2006

<PAGE>

PART I - FINANCIAL INFORMATION

Item 1.        Unaudited Consolidated Balance Sheet at March 31, 2006.........3

               Unaudited Consolidated Statements of Operations for the three
               months ended March 31, 2006 and 2005...........................4

               Unaudited Consolidated Statements of Cash Flows for the three
               months ended March 21, 2006 and 2005...........................5

               Notes to the Unaudited Consolidated Financial Statements.......6

Item 2.        Management's Discussion and Analysis of Financial Condition and
               Results of Operations.........................................12

Item 3.        Controls and Procedures.......................................19


PART II - OTHER INFORMATION

Item 1.        Legal Proceedings.............................................20

Item 2.        Changes in Securities.........................................20

Item 3.        Default on Senior Securities..................................20

Item 4.        Submission of Matters to a Vote of Security Holders...........20

Item 5.        Exhibits......................................................20


SIGNATURES

<PAGE>

                           ICOA, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                                 March 31, 2006
                                    Unaudited


                                     ASSETS

CURRENT ASSETS:
     Cash                                                       $        40,402
     Accounts receivable (net of allowance of $79,655)                  305,632
     Inventories                                                         94,001
     Prepaid expenses                                                    19,006
                                                                ----------------

        TOTAL CURRENT ASSETS                                            459,041

EQUIPMENT, net                                                        1,524,040

OTHER ASSETS:
     Long term receivables                                               55,566
     Other                                                               14,190
     Intangibles, net                                                 2,860,265
     Deferred finance costs                                             644,887
     Deposits                                                           103,173
                                                                ----------------

        TOTAL OTHER ASSETS                                            3,678,081
                                                                ----------------


                                                                $     5,661,162
                                                                ================


                      LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES:
     Cash overdraft                                             $        50,149
     Accounts payable and accrued expenses                            2,682,166
     Payroll tax liability                                              916,649
     Capital lease obligation                                           258,988
     Convertible debentures due in one year                             845,510
     Notes payable                                                      879,571
     Common stock to be issued                                          939,600
     Preferred stock to be issued                                       300,000
     Derivative instrument liability                                  2,117,045
                                                                ----------------

        TOTAL CURRENT LIABILITIES                                     8,989,678
                                                                ----------------


LONG TERM LIABILITIES:
     Capital lease obligation                                           640,652
     Convertible debentures                                             996,898
                                                                ----------------

        TOTAL LONG TERM LIABILITIES                                   1,637,550
                                                                ----------------


STOCKHOLDERS' DEFICIT:
     Preferred stock, $.0001 par value; authorized shares -
        50,000,000 shares; 0 issued and outstanding                           -
     Common stock, $.0001 par value; authorized shares -
        750,000,000 shares; 381,808,967 shares issued and
        outstanding                                                      38,182
     Additional paid-in capital                                      19,765,170
     Accumulated deficit                                            (24,769,418)
                                                                ----------------

        TOTAL STOCKHOLDERS' DEFICIT                                  (4,966,066)
                                                                ----------------

                                                                $     5,661,162
                                                                ================


                 See notes to consolidated financial statements

                                        3
<PAGE>

                          ICOA, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   Unaudited


                                              Three Months Ended March 31,
                                       -----------------------------------------
                                              2006                    2005
                                       --------------------    -----------------
REVENUES:
     Transaction service fees          $           533,241     $        147,975
     Equipment sales and installation              134,661              271,592
     Managed services                              146,089               70,348
                                       --------------------    -----------------
         TOTAL REVENUE                             813,991              489,915
                                       --------------------    -----------------

COST OF SERVICES:
     Telecommunication costs                       194,575               73,298
     Equipment and installation                     72,273              142,169
     Managed services                              176,300              110,842
     Depreciation and amortization                 344,784               62,542
                                       --------------------    -----------------
         TOTAL COST OF SERVICES                    787,932              388,851
                                       --------------------    -----------------

GROSS MARGIN                                        26,059              101,064

OPERATING EXPENSES:
     Selling, general and administrative           741,584            1,243,405
     Depreciation                                    2,123                2,202
                                       --------------------    -----------------
         TOTAL OPERATING EXPENSES                  743,707            1,245,607
                                       --------------------    -----------------

OPERATING LOSS                                    (717,648)          (1,144,542)

INTEREST EXPENSE                                  (237,444)            (751,539)
OTHER                                             (438,521)                   -
                                       --------------------    -----------------
NET LOSS                               $        (1,393,613)    $     (1,896,081)
                                       ====================    =================

BASIC AND DILUTED - LOSS PER SHARE     $            (0.004)    $         (0.011)
                                       ====================    =================

WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING
         Basic and Diluted                     369,728,208          173,627,052
                                       ====================    =================



                 See notes to consolidated financial statements

                                        4

<PAGE>

                           ICOA, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                    Unaudited
<TABLE>
<CAPTION>

                                                     For the Three Months Ended March 31,
                                                     ------------------------------------
                                                           2006                2005
                                                     ------------------   ---------------

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                  <C>                  <C>
    Net loss                                         $      (1,393,613)   $   (1,896,082)
                                                     ------------------   ---------------
    Adjustments to reconcile net loss to net cash
    used in operating activities:
           Depreciation                                          2,123             2,202
           Depreciation of equipment                           167,171            40,917
           Amortization of intangibles                         177,008            18,315
           Amortization of deferred financing cost             114,045            89,139
           Stock issued for compensation                       300,000           483,681
           Beneficial conversion and warrants issued
           for services                                              -           342,340
           Derivative instrument liability expensed            138,520                 -
    Changes in assets and liabilities:
        Accounts receivable                                     43,572          (188,828)
        Inventory                                               (3,595)           64,190
        Deposits                                               (41,168)          (10,000)
        Prepaid expenses                                       (11,064)           28,267
        Other assets                                                 -           (21,815)
        Payroll taxes                                          146,268                 -
        Accounts payable and accrued expenses                  194,961           555,545
                                                     ------------------   ---------------
    Net cash used in operating activities                     (165,772)         (492,129)
                                                     ------------------   ---------------

CASH FLOWS FROM INVESTING ACTIVITIES
    Other                                                            -           (75,000)
                                                     ------------------   ---------------
NET CASH USED IN INVESTING ACTIVITIES                                -           (75,000)
                                                     ------------------   ---------------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Payments of capital leases                                 (31,812)                -
    Payments of notes payable                                  (82,357)                -
    Proceeds of private placement                              130,000                 -
    Payments of convertible debentures                          (4,470)                -
    Proceeds from convertible debentures                       125,000           258,190
    Increase in deferred finance costs                         (27,500)          (16,250)
    Proceeds from notes payable                                 60,712           309,500
                                                                     -                 -
                                                     ------------------   ---------------
NET CASH PROVIDED BY FINANCING ACTIVITIES                      169,573           551,440
                                                     ------------------   ---------------
INCREASE (DECREASE) IN CASH                                      3,801           (15,689)

CASH - BEGINNING OF YEAR                                        36,601            23,626
                                                     ------------------   ---------------

CASH - END OF PERIOD                                 $          40,402    $        7,937
                                                     ==================   ===============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
    INFORMATION:
        State income taxes paid                      $               -    $            -
                                                     ==================   ===============
        Cash paid for interest                       $          13,044    $       14,157
                                                     ==================   ===============


NON-CASH INVESTING AND FINANCING ACTIVITIES:
        Conversion of debentures and interest into
        stock                                        $         209,775    $      275,000
                                                     ==================   ===============
        Conversion of notes and interest into stock  $               -    $    1,107,837
                                                     ==================   ===============
        Reclass of accounts payable to common stock
        to be issued                                 $         900,000    $            -
                                                     ==================   ===============
        Common stock issued in connection with
        settlements                                  $               -    $      507,000
                                                     ==================   ===============
        Unamortized beneficial conversion            $               -    $       50,158
                                                     ==================   ===============
</TABLE>


                 See notes to consolidated financial statements

                                        5
<PAGE>

                           ICOA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

Note 1 - Basis of Interim Financial Statement Presentation

         The accompanying unaudited consolidated financial statements have been
         prepared in accordance with generally accepted accounting principles
         for interim information. Accordingly, they do not include all of the
         information and footnotes required by generally accepted accounting
         principles for complete financial statements. The results of operations
         for the interim periods shown in this report are not necessarily
         indicative of expected results for any future interim period or for the
         entire fiscal year. ICOA, Inc. and Subsidiaries (the "Company"),
         believe that the quarterly information presented includes all
         adjustments (consisting only of normal, recurring adjustments)
         necessary for a fair presentation in accordance with generally accepted
         accounting principles. The accompanying consolidated financial
         statements should be read in conjunction with the Company's Form 10-KSB
         as filed with the Securities and Exchange Commission for the year ended
         December 31, 2005.

Note 2 - Going Concern

         The accompanying consolidated financial statements have been prepared
         assuming the Company will continue as a going concern, which presumes
         that the Company will be able to continue to meet its obligations and
         realize its assets in the normal course of business.

         As shown in the accompanying financial statements, the Company has a
         history of losses with an accumulated deficit of $24,769,418 and
         $23,375,805 at March 31, 2006 and December 31, 2005, respectively. The
         Company also has a working capital deficiency of $8,530,637 and
         $8,192,239 at March 31, 2006 and December 31, 2005, respectively. These
         conditions raise substantial doubt about the Company's ability to
         continue as a going concern. The Company's continuation as a going
         concern is dependent upon its ability to ultimately attain profitable
         operations, generate sufficient cash flow to meet its obligations, and
         obtain additional financing as may be required.


Note 3 - Convertible Debentures

         On November 2, 2005 the Company issued a Secured Convertible Debenture
         in the principal amount of $2,187,327.24, and on December 16, 2005 the
         Company issued a second Secured Convertible Debenture to Cornell in the
         principal amount of $200,000 for a total of $2,387,327.24. Both
         debentures were issued in connection with a Securities Purchase
         Agreement.

         These debentures are secured by all of the assets of the Company and
         its subsidiaries, accrue interest at a rate of 10% per annum, and are
         due on or before November 2, 2007. These debentures are convertible, at
         the option of the holder, into shares of common stock of the Company at
         the lower of $0.044 per share or 90% of the lowest volume weighted
         average price as quoted by Bloomberg LP for the ten (10) trading days
         immediately preceding the date of conversion. In connection with the
         transaction, the Company issued to Cornell a three year warrant to
         purchase 3,000,000 shares of common stock at a price of $0.04 per
         share.

         In February 2006, the Company issued a two year, secured convertible
         debenture to Cornell Capital Partners, LP in the aggregate amount of
         $125,000. The debenture carries similar conversion provisions as the
         November 2, 2005 and December 16, 2005 debentures. In addition, the
         Company issued 25,000,000 warrants to purchase common shares at a price
         of $0.01 per share, and 25,000,000 warrants to purchase common shares
         at a price of $0.03 per share. The warrants carry three year
         expirations. See below.

         On April 7, 2006 the Company signed a Term Sheet with Cornell Capital
         to buyout all existing Convertible Debentures and Amend the existing
         warrants. The term sheet requires the Company to pay Cornell Capital on
         or before June 1, 2006 $1,500,000 and the balance of the obligation is
         an unsecured $900,000 Convertible Debenture to be paid over nine months
         at a stated interest of 8%. The Convertible Debenture has a fixed
         conversion price of three cents ($0.03) per share. In consideration for
         the foregoing, upon closing, Cornell and the Company shall terminate
         the Security Agreement executed in connection with the Secured
         Convertible Debentures and Cornell shall release any and all security
         interest held in, or liens against, the assets of ICOA and its
         subsidiaries. All common stock Warrants shall be amended and restated
         to provide that the Company shall have the option to force Cornell to
         exercise the Warrants in the event the volume weighted average price of
         the Company's common stock is above the Warrant Exercise Price during
         any consecutive five trading day period, provided that the volume
         weighted average price of the Company's common stock remains above the
         Warrant Exercise Price during Cornell's exercise.

                                       6
<PAGE>

         In January 2006, the Company issued 3,572,851 shares of common stock
         upon conversion of $104,327.24 of the November 2006 secured convertible
         debenture to Cornell Capital. The shares were converted at a price of
         $0.0292 per share.

         In February 2006, the Company issued 1,760,563 shares of common stock
         upon conversion of $50,000 of the November 2006 secured convertible
         debenture to Cornell Capital. The shares were converted at a price of
         $0.0284 per share.

         In March 2006, the Company issued 2,183,000 shares of common stock upon
         conversion of $55,448.20 of the November 2006 secured convertible
         debenture to Cornell Capital. The shares were converted at a price of
         $0.0254 per share.


Note 4 - Notes Payable

         From January 2006 through March 2006, the Company issued short term
         bridge notes totaling $60,712 to Seaport Capital. The notes carried
         interest at a rate of between 10% and 15% per annum. During the same
         period, the Company repaid $77,712 to Seaport Capital consisting of the
         bridge notes secured between January and March, and a previous bridge
         note issued in December 2005.


Note 5 - Stockholders' Deficit

         On February 22, 2006, the Company sold 2,659,574 shares of restricted
         common stock for a total of $50,000. The shares were issued at an
         average price of $0.0188 per share.

         On March 24, 2006, the Company sold 13,333,333 shares of restricted
         common stock for a total of $80,000. The shares were issued at an
         average price of $0.006 per share.

         The difference between the issue price and the fair market price of the
         shares was expensed and classified as other expense in the statement of
         operations.

Note 6 - Capital Lease

         On May 4, 2005, the Company entered into a Master Lease Agreement with
         Agility Lease Fund I, LLC. Under the terms of the agreement, the
         Company can lease up to $1.0 million of equipment and project costs
         related to Wi-Fi network growth and deployments. In connection with the
         Master Lease Agreement, the Company is required to issue $200,000 of
         warrants at the market price on the day prior to closing, and an
         additional 10% warrant based on the market price on the day prior to
         each lease schedules execution.

         In May and June 2005, the Company utilized $529,234 of the lease line,
         and recorded $96,408 of prepaid interest. The three lease schedules are
         due in May and June 2008.

         In July and August 2005, the Company utilized $205,143 of the lease
         line, and recorded $52,621 of prepaid interest. The two lease schedules
         are due in July and August 2008.

         In connection with the lease agreement and the individual lease draws,
         the Company issued 4,245,133 three year warrants at prices between
         $0.056 and $0.06 per share. In connection with the July and August
         lease draws, the Company issued 204,955 three year warrants at a price
         of $0.051 per share, and 170,535 three year warrants at a price of
         $0.059 per share.

                                       7
<PAGE>

Note 7 - Litigation

         On October 8, 2004, SSJ Enterprises, LLC and Street Search, LLC filed
         suit in the United States District Court, District of Rhode Island
         against ICOA, Inc., George Strouthopoulos and Erwin Vahlsing alleging
         breach of contract, breach of oral contract and fraud regarding a
         Services Agreement, dated October 20, 2003 for consulting services
         under the agreement. The plaintiffs seek specific performance and
         damages of $20 million, plus interest, costs and reasonable attorney's
         fees.

         In November 2004, the Company filed its response to the allegations.

         In March 2006, the case reached trial, and the fraud charges against
         ICOA, Inc., George Strouthopoulos, and Erwin Vahlsing, Jr. were
         dismissed. The count alleging breach of contract was upheld, and the
         jury entered judgment against the Company in the amount of $900,000.
         Subsequently, the Company and the plaintiff's have reached a settlement
         under which the Company will issue 30,000,000 shares of common stock.
         The value of these shares at time of judgment was $900,000 which amount
         the Company had previously accrued on its books in the event it lost
         the case. Accordingly, the Company has reclassified this amount from
         accounts payable to stock to be issued.

         On January 25, 2002, a legal proceeding was commenced by us, against
         World Capital, Inc., a leasing company with which the Company had a
         contract to finance certain equipment purchases. On June 15, 2001, we
         signed a lease agreement with World Capital, Inc. and made payment of
         $178,641.49 representing the first and last two months lease payments.
         On July 25, 2001 World Capital, Inc. gave notice to us of its intention
         not to fund the equipment lease. We have filed suit in US District
         Court for the Eastern District of Pennsylvania seeking recovery of the
         payment, accrued interest, and damages caused by the failure to fund.

         In December 2002, the suit was amended to include criminal fraud
         charges against the principals of World Capital, Inc. Trial took place
         in late February, 2005 and we are awaiting verdict. While we believe we
         will prevail in these proceedings, there can be no guarantee regarding
         the outcome of this suit, or the collection of any judgment that might
         result. In light of these uncertainties, we have not recognized any
         value associated with this litigation.

         In April 2005, the company was advised that its case against World
         Capital, Inc. had been decided in its favor and judgment was entered
         against World Capital and its principals in the amount of $218,000. The
         defendants have appealed the ruling, and uncertainties exist regarding
         collectibility. In light of these uncertainties, we have not recognized
         any value associate with this litigation.




Note 8 - Acquisitions

         On May 26, 2005, the Company acquired the outstanding shares, in
         exchange for $2,000,000 of common stock and the assumption of a $50,000
         note, of Wise Technologies, Inc., a privately held corporation that
         provides Wi-Fi services in various airports, hotels, and universities.
         It is operated as a wholly-owned subsidiary.

         On July 8, 2005, the Company acquired the outstanding shares, in
         exchange for $962,999 of commons stock, of LinkSpot Networks, Inc., a
         privately held corporation that provides Wi-Fi services in various RV
         Parks and recreation facilities. It is operated as a wholly-owned
         subsidiary.

         On July 28, 2005, the Company acquired the operating assets of
         Cafe.com, in exchange for $30,000 of cash and $140,085 of commons
         stock. The assets consist of equipment and contracts to provide Wi-Fi
         services in various west coast based coffee shops.

         The above acquisitions have been accounted for as purchases and their
         results of operations are included in the financial statements of the
         Company from the date of acquisition.

                                       8
<PAGE>

         The following Unaudited pro forma consolidated results of operations
         have been prepared as if the acquisition of Wise, LinkSpot, and
         Cafe.com had occurred as of the following period:


<TABLE>
<CAPTION>

     -------------------------- -------------------------- -------------------------- ---------------------------
                                   As reported, Three                                         Pro Forma,
               2005                   Months Ended              Pre-Acquisition           Three Months Ended
                                     March 31, 2005               Operations                March 31, 2005
     -------------------------- -------------------------- -------------------------- ---------------------------
<S>                             <C>                        <C>                        <C>
     Revenues                   $                 489,915  $                 280,826  $                  770,741
     -------------------------- -------------------------- -------------------------- ---------------------------
     Loss before
     extraordinary items                       (1,896,081)                  (430,092)                 (2,326,173)
     -------------------------- -------------------------- -------------------------- ---------------------------
     Net Loss                                  (1,896,081)                  (430,092)                 (2,326,173)
     -------------------------- -------------------------- -------------------------- ---------------------------
     Loss per common share      $                  (0.011)                            $                   (0.010)
     -------------------------- -------------------------- -------------------------- ---------------------------
     Shares outstanding                       173,627,052                                            234,174,042
     -------------------------- -------------------------- -------------------------- ---------------------------
</TABLE>





Note 9 - Warrants

         In connection with the convertible debentures issued in February 2006
         to Cornell Capital, the Company issued three year warrants in the
         following amounts:

          o    Warrants to purchase up to 25,000,000 shares of common stock at a
               price of $0.01 per share

          o    Warrants to purchase up to 25,000,000 shares of common stock at a
               price of $0.03 per share


Note 10 - Derivative Liabilities

         In 2005, the Company determined that the conversion feature of the
         convertible debentures entered into with Cornell Capital represented an
         embedded derivative since the debentures are convertible into a
         variable number of shares upon conversion. Accordingly, the convertible
         debentures are not considered to be conventional debt under EITF 00-19
         and the embedded conversion feature must be bifurcated from the debt
         host and accounted for as a derivative liability.

         The Company believes that the aforementioned embedded derivatives and
         freestanding warrants meet the criteria of SFAS 133 and EITF 00-19, and
         should be accounted for as separate derivatives with a corresponding
         value recorded as liability.

         As a result of the Company's meeting the requirements of SFAS 133, all
         of the Company's previously issued and outstanding instruments,
         including fixed price convertible debentures, warrants and options as
         well as those issued in the future, would be classified as derivative
         liabilities as well.

         In February 2006, the Company issued an additional convertible
         debenture to Cornell Capital in the face amount of $200,000 and issued
         warrants to purchase 25,000,000 shares of common stock at a price of
         $0.01 per share, and an additional 25,000,000 shares of common stock at
         a price of $0.03 per share. In connection with this transaction the
         Company recorded $94,154 as a discount on convertible debentures;
         interest expense of $1,496,932; and a derivative liability of
         $1,591,086.

         The decrease in fair value between the date of inception of the various
         debt and equity instruments and March 31, 2006 amounted to $24,597 and
         has been recorded as interest expense.

                                       9
<PAGE>

         The aggregate fair value of the derivative liabilities at the date of
         issuance of the convertible debenture and at March 31, 2006 is as
         follows:
<TABLE>
<CAPTION>

                                                                At Inception             At March 31, 2006
                                                       ---------------------------  ----------------------------
<S>                                                    <C>                          <C>
        Discount on convertible debentures             $                1,421,102   $                 1,305,654
        Liability associated with prior convertible
        debentures and warrants                        $                  832,450                       811,391
                                                       ---------------------------  ----------------------------

         Total derivative liability                    $                2,253,552    $                2,117,045
                                                       ===========================  ============================
</TABLE>


Note 11 - Stock Options and Warrants

         Effective January 1, 2006, the Company began recording compensation
         expense associated with stock-based awards and other forms of equity
         compensation in accordance with FASB Statement No. 123-R, Share-Based
         Payment ("SFAS 123R") as interpreted by SEC Staff Accounting Bulletin
         No. 107. The Company adopted the modified prospective transition method
         provided under SFAS 123R, and consequently has not retroactively
         adjusted results from prior periods. The Company did not recognize any
         costs associated with stock-based awards in the first quarter of 2006
         as none were granted or unvested prior to January 1, 2006. Prior to
         January 1, 2006, the Company accounted for stock-based awards using the
         "disclosure only" alternative described in SFAS 123 and FASB Statement
         No. 148, Accounting for Stock-Based Compensation.

         The Company utilizes the Black-Scholes option-pricing model to
         calculate the fair value of each individual issuance of options. This
         method, and the underlying assumptions are further described in
         footnote 13 of our report on Form 10K dated December 31, 2005.



Note 12 - Subsequent Events

         In April 2006, the Company received $50,000 from the sale of a term
         note to an accredited investor. The note is due on June 1, 2006 and
         carries interest at a rate of 12% per annum. In addition, the investor
         received a two year warrant to purchase 555,555 shares of common stock
         at an exercise price of $0.045 per share. Pursuant to the penalty
         provision, the Investor will receive an additional 2,222,220 common
         stock warrants if the Company fails to pay the principal and accrued
         interest on the Maturity Date.

         In April 2006, the Company sold $150,000 in restricted common stock to
         accredited investors at prices ranging from $.0060 per share to $0.0112
         per share.

         In April 2006, the Company received $11,230 from the issuance of a
         demand note to an accredited investor. The note carries interest at a
         rate of 12% per annum.

         On April 3, 2006 the Company signed a Letter of Intent to acquire 100%
         of the stock of CTURN Corporation, a high-speed wireless broadband
         network service provider headquartered in Salem, Oregon. The proposed
         transaction is subject to the execution of a definitive agreement, and
         is contingent upon Company's ability to refinance a significant portion
         of debt with third-party creditors.

         On April 7, 2006 the Company signed a Term Sheet with Cornell Capital
         to buyout all existing Convertible Debentures and Amend the existing
         warrants. The term sheet requires the Company to pay Cornell Capital on
         or before June 1, 2006 $1,500,000 and the balance of the obligation is
         an unsecured $900,000 Convertible Debenture to be paid over nine months
         at a stated interest of 8%. The Convertible Debenture has a fixed
         conversion price of three cents ($0.03) per share. In consideration for
         the foregoing, upon closing, Cornell and the Company shall terminate
         the Security Agreement executed in connection with the Secured
         Convertible Debentures and Cornell shall release any and all security
         interest held in, or liens against, the assets of ICOA and its
         subsidiaries. All common stock Warrants shall be amended and restated
         to provide that the Company shall have the option to force Cornell to
         exercise the Warrants in the event the volume weighted average price of
         the Company's common stock is above the Warrant Exercise Price during
         any consecutive five trading day period, provided that the volume
         weighted average price of the Company's common stock remains above the
         Warrant Exercise Price during Cornell's exercise.

                                       10
<PAGE>

         On March 9, 2006 the Company executed a letter of understanding with
         SSJ Enterprises, LLC and Street Search, LLC pertaining to the
         obligations imposed on the Company as a result of the recent litigation
         against the Company by SSJ and Street Search. The parties agreed to
         settle the obligation with 30,000,000 shares of stock. The agreement
         was executed on April 12, 2006. The previously recorded accrual of
         $900,000 has been reclassified from accounts payable / accrued expenses
         to stock to be issued.





























                                       11
<PAGE>

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

         THE FOLLOWING ANALYSIS OF THE RESULTS OF OPERATIONS AND FINANCIAL
CONDITION OF THE COMPANY SHOULD BE READ IN CONJUNCTION WITH THE CONSOLIDATED
FINANCIAL STATEMENTS, INCLUDING THE NOTES THERETO OF THE COMPANY, CONTAINED
ELSEWHERE IN THE FORM 10-QSB.

Forward-looking statements in this report may prove to be materially inaccurate.
In addition to historical information, this report contains forward-looking
information that involves risks and uncertainties. The words "may", "will",
"expect", "anticipate", "continue", "estimate", "project", "intend" and similar
expressions are intended to identify forward-looking statements. Actual results
may differ materially from those included within the forward-looking statements
as a result of factors, including the risks described above and factors
described elsewhere in this report.

Strategy
Our goal is to be a leading and innovative national provider of broadband
solutions. As part of our overall strategy to compete in each relevant market
segment, we use our core competencies in the design, deployment and management
of broadband and broadband wireless networks in and to high-traffic public
locations in market segments including but not limited to airports, hospitality,
RV resorts and campgrounds, marinas, multiple dwelling units ("MDU's"),
restaurants and cafes, travel plazas and higher education.

ICOA's growth strategy is to build and acquire the expertise, infrastructure and
scale for the profitable delivery of wireless broadband services. This strategy
is based on the use of unlicensed spectrum to meet the increased demand for
wireless data services: more bandwidth for more services in more places.

Today, we sell, install, support and provide wired and wireless Ethernet and
Internet access services, primarily through Wi-Fi "hot spots" (public wireless
local area networks). As of March 31, 2006, ICOA owned or operated over 1,600
broadband access installations in high-traffic locations servicing millions of
annual patrons across 45 states. The Company currently generates revenue from:

          o    the design,  sale and  installation of Wi-Fi systems to airports,
               hotels,   universities,   travel  plazas,   convention   centers,
               quick-service  restaurants,  marinas, MDUs and other high-traffic
               locations,   usually   coupled  with  operating  and  maintenance
               contracts;

          o    providing  service  management   capabilities  to  Wi-Fi  service
               providers who need back office, network management, customer care
               and related services to support their on-going operations; and

          o    end users of Wi-Fi hot spots and  Internet  access  terminals  on
               "pay-for-use" transactions,  usually provided in public locations
               under long term  contracts  with  airports,  marinas,  hotels and
               other high traffic locations.


Until recently, the Company's revenue has had a strong reliance on one time
equipment sales and installation projects. The revenue mix has changed with
recurring revenue increasing to 83.5% of total revenue for the three months
ended March 31, 2006 as compared to 44.6% for the same period in 2005. This is
an important aspect of our long term growth as the margin on recurring revenue
is significantly higher than on equipment and installation sales.

Today, ICOA is a provider of Wi-Fi networks and services. Our footprint for
retail services is targeted at high-traffic and high-value locations, with
wireless capability supplemented by a growing wired infrastructure and our kiosk
expertise. We also provide cost effective networks for the growing "amenity"
services segment. We provide high-quality and reliable support systems and
services for both our own operations and as a "back-office" for other service
providers. We are sensitive to the specific needs of the growing and changing
base of users who demand access to broadband on demand and anywhere, anytime,
with any device.

Our strategy over time is to focus on expanding end-to-end solutions which meet
the present and future needs of customers and the rapid proliferation of new
broadband wireless access devices such as hand-held consumer devices
communications devices, PDAs and mobile gaming platforms. We believe our
industry will be transformed over time from one driven solely by computing
platforms to one increasingly driven by a wide array of communications, gaming
and hand-held consumer device platforms. This device platform expansion is
increasing usage across our networks as it is also generating new end-user
demographic segment demand. In addition, as emerging technologies allow, and
subject to available capital, ICOA is looking to move beyond the delivery of
Wi-Fi access to the delivery of digital value-added services to deliver value to
our customers and users.

                                       12
<PAGE>

We anticipate increased revenue and demand to be generated in our near-term
horizon from services including VoIP, increased roaming, location-specific
applications, targeted advertising platforms, high-bandwidth content delivery
and management, and access to proprietary content. With respect to VoIP, a small
but steadily growing customer base has been utilizing VoIP technologies and
services over our Wi-Fi networks, and we expect this trend to improve as
additional services and VoIP-enabled devices are propagated into the
marketplace. This trend is in keeping with broader industry trends, such as the
recent Skype/Boingo VoIP over Wi-Fi trials which will include ICOA's assets in
the near future. With respect to ancillary revenue from roaming, ICOA's recently
achieved national scale provides the company with attractive locations of
strategic roaming value to other wireless service providers. Our networks were
designed as neutral-host specifically to prepare for roaming, a strategy which
maximizes revenue-potential from the existing asset base.

With respect to location-specific applications, including targeted advertising,
recent advancements in both hardware and software technologies provide
opportunities for layered services which were previously not possible, including
the value-add localization of advertising revenue. Our strategy is to fully
participate in this important transformation of the broadband wireless industry
through active partnerships with key industry solution providers on a go-forward
basis. The delivery and management of high bandwidth content is another recent
promising development. An example is IPTV and other entertainment industry
transitions to full digital platforms. Our strategy during the early-stages is
to engage in select trials with proven partners, ensure network capacity and
architectures meet the requirements of emerging content applications, and
prepare for demand as customer tastes and habits mature.

While today ICOA is focused on Wi-Fi, our models and approach is
technology-agnostic. We work with numerous technologies, as economies of scale,
market penetration and device propagation permit or demand. For example, we are
looking to early market tests of Wi-Max, a promising technology still in its
early stages of development. Wi-Max will most likely serve our medium-term
requirements as a fixed wireless backhaul replacement in certain locations,
bringing operational cost savings and expanded reach to locations otherwise
unreachable through terrestrial solutions. In the long-term, as the number of
Wi-Max capable devices increases to warrant select upgrades, the strategic value
of ICOA's footprint offers a platform from which to transition to mobile Wi-Max
solutions. With respect to newly emerging cellular 3G networks, it is our
strategy to work with device manufacturers and cellular providers for seamless
interoperability between the networks.

We have grown through acquisition and look to continue to do so. Our near to
medium term strategy is to continue to acquire promising Wi-Fi and broadband
services companies as capital resources allow 1) in market segments targeted for
growth and anticipated profitability or 2) with unique infrastructure
capabilities. We look for leading companies with management strength, and who
are strategically placed in market segments which may offer intrinsic value per
share. In the future, we may also consider equity investments in related and
complementary companies and assets which further our strategic objectives,
support our key business initiatives and enhance shareholder value.

All of our businesses operate in highly innovative environments characterized by
continuing and rapid introduction of new technologies, bundled services and
products which offer improved performance at lower prices. Nationally, our
competitors range in size from large established national companies with
multiple technology and service offerings, to smaller companies and new entrants
to the marketplace that compete in specialized market segments. The continued
and rapid convergence of computing, communications and consumer devices offers
us enhanced opportunities, but also increased competition. Competition tends to
increase pricing pressure or require us to modify our business models to remain
competitive, which may result in lower profits. Wherever we believe it is
advantageous, we may take various steps, including introducing new services and
other incentives in order to remain competitive and position the Company to
potentially increase market share.

During the first quarter of 2006, we continued our focus on a vertical driven
view of our business. This focus may bring about a future reorganization along
these lines to bring acquired assets in line with the verticals and our sales,
marketing, and support platforms. These new business verticals include ICOA
Airport Networks and ICOA Managed Services. We will continue for the near-term
with the market-forward LinkSpot, iDockUSA, Cafe.com and WiSE units operating
under the umbrella of ICOA, Inc.

                                       13
<PAGE>

ICOA Airport Networks
Under long-term contracts, our Airport Network Solutions subsidiary has
installed and operates Wi-Fi networks in 25 airports within the United States.
16 networks provide full facility coverage, while under the WiSE brand we offer
select coverage within the facilities of 9 airports. Our services are designed
to provide travelers with convenient, ease of access to broadband Internet
services, as well as private, wholesale, security-related and facility service
offerings. Our airport footprint has expanded by 258% since the same time last
year, from 7 to 25 facilities with a related 205% increase in annual passenger
coverage from 20 million to over 61 million. We believe the airport market
segment continues to offer high growth potential, both in expansion of the
number of facilities as well as the increased utilization and commensurate
monetization of existing assets. Our strategy is to continue to focus on
securing long-term contacts with tier two and tier three properties.

ICOA Managed Services
Our managed services business unit is focused on the sale, design, deployment
and management of amenity networks, as well as deployments and management of
hospitality, municipal and wholesale back office market segments. This includes
the offering of Tollbooth(TM), our turn-key back office solution, to
unaffiliated wireless service providers globally. Our back office solution suite
also includes network operating center and customer care center services to the
marketplace, as well as for our wholly-owned segment-focused units such as ICOA
Airport Networks, LinkSpot and iDockUSA. The managed services customer base has
increased 88% since January 2005. ICOA is the market innovator of large-scale
amenity Wi-Fi currently managing over 1,500 amenity locations nationally. In
numerous segments, such as restaurants, hospitality, cafes, we believe amenity
Wi-Fi services will experience increased acceptance.

LinkSpot / RV Resort and Campground Segments
Acquired in the third quarter of 2005, our LinkSpot subsidiary provides Wi-Fi
service to recreational vehicle (RV) parks and campgrounds nationwide. LinkSpot
currently serves 75 RV resort and campground properties which cover 20,000
sites. The percentage of Americans moving into retirement is rising and is
forecast to continue to do so through this decade. Services include both
subscription-based and amenity offerings. Our strategy is to continue expanding
this segment through aggressive sales from our existing assets, strategic
partnerships with related outdoor recreation partners, and potential
acquisitions of accretive assets in this segment.

iDock/Marina Segment
Our iDockUSA division provides broadband wireless Internet and related services
in over 51 marinas reaching over 20,000 slips. In California, iDock has secured
a dominate market position, and is expanding to other geographic markets. Our
strategy is to continue to expand geographically, develop strategic partnerships
with related marina segment companies, offer ancillary services and content and
continue to explore accretive acquisitions.

WiSE Technologies
Our Wise Technologies subsidiary provides Wi-Fi services to 8 airports, and
various hospitality, higher education, MDU's, highway plazas and cafes. The WiSE
footprint is in the process of being reassigned to segment-focused business
units within the Company, such as ICOA Airport Networks and ICOA Managed
Services.

Cafe.com
Acquired in the third quarter of 2005, Cafe.com provides Wi-Fi services in
various quick service cafe locations predominantly on the West Coast. The
Cafe.com assets are being incorporated into ICOA's segment-focused business
units, including ICOA Managed Services.

Municipal
We also operate Wi-Fi municipal "hot zones" in Lexington, KY, and the harbor
district of Newport, RI. Our strategy is to provide all or distinct portions of
our turn-key offerings to this rapidly expanding segment through leveraging our
existing national infrastructure, full back-office suite of products and
services.

                                       14
<PAGE>

SIGNIFICANT ACCOUNTING POLICIES

         A summary of significant accounting policies is included in Note 3 to
the audited consolidated financial statements included in the Company's Annual
Report on Form10-KSB for the year ended December 31, 2005. Management believes
that the application of these policies on a consistent basis enables the Company
to provide useful and reliable financial information about the company's
operating results and financial condition.



Results of operations

Three months ended March 31, 2006 as compared to the three months ended March
31, 2005.


Revenue
Our revenue is derived from the ownership and operation of neutral-host
broadband wireless Wi-Fi Hot Spots and High Speed Internet terminals in high
traffic public locations, and Wi-Fi equipment sales, installation fees, and
network management and maintenance services.

For period ended March 31, 2006, quarterly revenue increased $324,076 or 66% to
$813,991 as compared to $489,915 for the quarter ended March 31, 2005.

The revenue growth for the three months ended March 31, 2006 is primarily due to
the increasing Transaction Service Fees and an increase in Managed Services Fees
period over period as well as year over year while new Equipment Sales decreased
as the Company did not pursue several large projects of the type it completed in
the first quarter of 2005. A portion of this increase is a result of the
acquisitions completed in 2005.

Revenue was generated from the following services:

                                           For the three months ended
                                          March 31,          March 31,
                                            2006               2005
                                      ------------------ ------------------
Transaction Service Fees              $         533,241  $         147,975
Wi-Fi Equipment Sales and Service               134,661            271,592
Managed Services                                146,089             70,348
                                      ------------------ ------------------
                               Total  $         813,991  $         489,915
                                      ================== ==================


Cost of Services consists primarily of:

                                           For the three months ended
                                      ------------------ ------------------
                                          March 31,          March 31,
                                            2006               2005
                                      ------------------ ------------------
Telecom/Co-Location/Hosting Costs     $         194,575  $          73,298
Wi-Fi Equipment and Installation                 72,273            142,169
Managed Services                                176,300            110,842
Depreciation Expense                            344,784             62,542
                                      ================== ==================
                               Total  $         787,932  $         388,851
                                      ================== ==================

For the quarter ended March 31, 2006, the Company recorded a gross margin of
$26,059, as compared to a gross margin of $101,064 for the quarter ended March
31, 2005 a decrease of $75,005 or 74%. This was primarily due to the increase in
depreciation and amortization of $282,242 coupled with added telecommunication
costs.

                                       15
<PAGE>

Cost of Services increased 103% or $399,081 for the three months ended March 31,
2006 versus the three months ended March 31, 2005. The increases were primarily
due to increased costs of providing help desk services as business has
increased, additional cost of telecommunications, and an increase in
depreciation expense. Depreciation and Amortization Expense increased 451% or
$282,242 for the three months ended March 31, 2006 compared to the three months
ended March 31, 2005. The increase was primarily due to the amortization of
intangible assets associated with the acquisitions of Wise Technologies,
LinkSpot Networks, Cafe.com, and depreciation associated with the capital
leases.

Selling, general and administrative expenses

General and administrative expenses consist primarily of:
Employee compensation and related expenses including payroll taxes and benefits
for executive, administrative and operations personnel, Professional fees
associated with deployment of Wi-Fi networks, legal and accounting fees
connected with registrations filed with the SEC, professional fees associated
with the development and creation of marketing materials in pursuit of
advertising contracts, travel and entertainment, and facility and office-related
costs such as rent, insurance, maintenance and telephone.

For the quarter ended March 31, 2006 these costs decreased $501,821 or 40% from
$1,243,405 for the quarter ended March 31, 2005 to $741,584 for the quarter
ended March 31, 2006.

The quarterly decreases outlined below are mainly a reflection of the Company's
efforts to control costs. The Company added several new personnel by converting
consultants who previously provided development services related to the business
model and the Company's entry into new market verticals to staff. This was
offset by an overall reduction in the use of consultants. Additionally, there
was a reduction in relocation and hiring expenses, and reduced legal expense
connected with financing, registration filings, acquisitions and the wind up of
litigation in the World Capital lawsuit and the SSJ litigation, accounting
expense related to acquisitions and reviews of SEC filings, finance fees
associated with the Convertible Debentures and the now cancelled Standby Equity
Distribution Agreement, employee stock bonuses, and additional travel and
entertainment expense connected with sales efforts to secure new installation
opportunities. Employment related expense in 2005 was higher than 2006 because
in 2005, the Company relocated several key members of its management team and
was required to provide temporary living expenses related to these moves.
Management expects general and administrative expenses in future periods to run
at similarly increased levels over the current year in support of the growth of
the business.


     Quarterly increases (decreases) in selling, general and administrative

                                                 For the three months ended
                                               March 31, 2006 as compared to
                                                       March 31, 2005
                                             -----------------------------------
            Payroll                          $                          75,531
            Consulting                                                (172,996)
            Legal                                                      (43,242)
            Accounting                                                   10,500
            Finance Fees                                               (32,333)
            IR / PR / Marketing                                        (12,395)
            Employment related expense                                (305,081)
            Travel & Entertainment                                     (52,477)
            Other                                                        30,672
                                             -----------------------------------
                   Increase Quarter and YTD  $                         (501,821)
                                             ===================================

Interest Expense

Interest expense consists of interest accrued on loans and convertible notes
payable, and the beneficial conversion feature on the convertible notes and
warrants.

Interest expense decreased by $514,095 to $237,444 for the three months ended
March 31, 2006 as compared to $751,539 for the three months ended March 31,
2005.

                                       16
<PAGE>

The decrease is primarily attributable to a reduction in beneficial conversion
feature recorded on convertible debentures issued in the first quarter.

Other Expense

The company recorded expense of $438,521 in the three months ended March 31,
2006 as the "mark to market" adjustment of the derivative liability and
compensation expense related to stock issuances.

Net Loss

For the three months ended March 31, 2006, the Company had a loss of $1,393,613
as compared to a loss of $1,896,081 for the three months ended March 31, 2005 a
decrease of $502,468 or 27%.

The significant difference for the quarter as compared to the same period last
year is mainly due to the reduction in selling, general and administrative costs
incurred in the first three months offset by an increase in depreciation and
amortization expense.


Income Taxes

No provision for federal and state income taxes has been recorded as the Company
incurred net operating losses since January 1, 1998 (Inception). The net
operating losses will be available to offset any future taxable income. Given
the Company's limited operating history, losses incurred to date and the
difficulty in accurately forecasting future results, management does not believe
that the realization of the potential future benefits of these carry forwards
meets the criteria for recognition of a deferred tax asset required by generally
accepted accounting principles. Accordingly, a full 100% valuation allowance has
been provided.

Liquidity and Capital Resources

Cash and cash equivalents were $40,402 at March 31, 2006. Net cash used in
operating activities of $165,772 was derived from the net loss from operations
offset by depreciation of equipment, amortization of intangibles and deferred
financing costs, a decrease in accounts receivable, an increase in inventory, an
increase in prepaid expenses and deposits, and an increase in accounts payable,
payroll taxes, and accrued expenses.

At March 31, 2006, the Company had a working capital deficit of $8,530,637. The
Company made no capital expenditures during the three months ended March 31,
2006.

In February 2006, the Company issued a two year, secured convertible debenture
to Cornell Capital Partners, LP in the aggregate amount of $125,000. The
debenture carries similar conversion provisions as the November 2, 2005 and
December 16, 2005 debentures. In addition, the Company issued 25,000,000
warrants to purchase common shares at a price of $0.01 per share, and 25,000,000
warrants to purchase common shares at a price of $0.03 per share. The warrants
carry three year expirations.

From January 2006 through March 2006, the Company issued short term bridge notes
totaling $60,712 to Seaport Capital. The notes carried interest at a rate of
between 10% and 15% per annum. During the same period, the Company repaid
$77,712 to Seaport Capital consisting of the bridge notes secured between
January and March, and a previous bridge note issued in December 2005.

On February 22, 2006, the Company sold 2,659,574 shares of restricted common
stock to an accredited investor for a total of $50,000. The shares were issued
at an average price of $0.0188 per share.

On March 24, 2006, the Company sold 13,333,333 shares of restricted common stock
to accredited investors for a total of $80,000. The shares were issued at an
average price of $0.006 per share.

In January 2006, the Company issued 3,572,851 shares of common stock upon
conversion of $104,327.24 of the November 2006 secured convertible debenture to
Cornell Capital. The shares were converted at a price of $0.0292 per share.

                                       17
<PAGE>

In February 2006, the Company issued 1,760,563 shares of common stock upon
conversion of $50,000 of the November 2006 secured convertible debenture to
Cornell Capital. The shares were converted at a price of $0.0284 per share.

In March 2006, the Company issued 2,183,000 shares of common stock upon
conversion of $55,448.20 of the November 2006 secured convertible debenture to
Cornell Capital. The shares were converted at a price of $0.0254 per share.


The Company has satisfied its cash requirements to date primarily through
private placements of common stock, warrants, debentures convertible into shares
of common stock, promissory notes, and the issuance of common stock in lieu of
payment for services. Also, officers have at times loaned the Company funds to
provide working capital.

The Company needs to raise a minimum of $5,700,000 through public or private
debt, sale of equity, to continue expanding our broadband on demand managed
services and service operation center, and to develop and implement additional
contracts at airports, hotels and retail locations in order to continue
expanding our Wi-Fi networks in strategic high traffic locations. Such financing
may not be available when needed. Even if such financing is available, it may be
on terms that are materially adverse to your interests with respect to dilution
of book value, dividend preferences, liquidation preferences, or other terms. If
we are unable to obtain financing on reasonable terms, we could be forced to
delay, scale back or eliminate certain product and service development programs.
In addition, such inability to obtain financing on reasonable terms could have a
material adverse effect on our business, operating results, or financial
condition.

The report of our independent auditors on our financial statements for the years
ended December 31, 2005 and 2004 contains an explanatory paragraph, which
indicates that we have incurred losses and have a working capital deficiency.
This report raises substantial doubt about our ability to continue as a going
concern. This report is not viewed favorably by analysts or investors and may
make it more difficult for us to raise additional debt or equity financing
needed to run our business.


Subsequent Events

In April 2006, the Company received $50,000 from the sale of a term note to an
accredited investor. The note is due on June 1, 2006 and carries interest at a
rate of 12% per annum. In addition, the investor received a two year warrant to
purchase 555,555 shares of common stock at an exercise price of $0.045 per
share. Pursuant to the penalty provision, the Investor will receive an
additional 2,222,220 common stock warrants if the Company fails to pay the
principal and accrued interest on the Maturity Date.

In April 2006, the Company sold $150,000 in restricted common stock to
accredited investors at prices ranging from $.0096 per share to $0.0112 per
share.

In April 2006, the Company received $11,230 from the sales of a demand note to
an accredited investor. The note carries interest at a rate of 12% per annum.

On April 3, 2006 the Company signed a Letter of Intent to acquire 100% of the
stock of CTURN Corporation, a high-speed wireless broadband network service
provider headquartered in Salem, Oregon. The proposed transaction is subject to
the execution of a definitive agreement, and is contingent upon Company's
ability to refinance a significant portion of debt with third-party creditors.

On April 7, 2006 the Company signed a Term Sheet with Cornell Capital to buyout
all existing Convertible Debentures and Amend the existing warrants. The term
sheet requires the Company to pay Cornell Capital on or before June 1, 2006
$1,500,000 and the balance of the obligation is an unsecured $900,000
Convertible Debenture to be paid over nine months at a stated interest of 8%.
The Convertible Debenture has a fixed conversion price of three cents ($0.03)
per share. In consideration for the foregoing, upon closing, Cornell and the
Company shall terminate the Security Agreement executed in connection with the
Secured Convertible Debentures and Cornell shall release any and all security
interest held in, or liens against, the assets of ICOA and its subsidiaries. All
common stock Warrants shall be amended and restated to provide that the Company
shall have the option to force Cornell to exercise the Warrants in the event the
volume weighted average price of the Company's common stock is above the Warrant
Exercise Price during any consecutive five trading day period, provided that the
volume weighted average price of the Company's common stock remains above the
Warrant Exercise Price during Cornell's exercise.

                                       18
<PAGE>

On March 9, 2006 the Company executed a letter of understanding with SSJ
Enterprises, LLC and Street Search, LLC pertaining to the obligations imposed on
the Company as a result of the recent litigation against the Company by SSJ and
Street Search. The parties agreed to settle the obligation with 30,000,000
shares of stock. The agreement was executed on April 12, 2006.

Item 3. - Controls and Procedures

(A)  Evaluation of Disclosure Controls and Procedures
As of the end of the period covered by this report, the Company carried out an
evaluation, under the supervision and with the participation of the Company's
Principal Executive Officer and Principal Financial Officer of the effectiveness
of the design and operation of the Company's disclosure controls and procedures.
The Company's disclosure controls and procedures are designed to provide a
reasonable level of assurance of achieving the Company's disclosure control
objectives. The Company's Principal Executive Officer and Principal Financial
Officer have concluded that the Company's disclosure controls and procedures
are, in fact, effective at this reasonable assurance level. In addition, the
Company reviewed its internal controls, and there have been no significant
changes in its internal controls or in other factors that could significantly
affect those controls subsequent to the date of their last valuation or from the
end of the reporting period to the date of this Form 10-QSB.

(B)  Changes in Internal Controls over Financial Reporting
In connection with the evaluation of the Company's internal controls during the
quarter ended March 31, 2005, the Company's Principal Executive Officer and
Principal Financial Officer have determined that there are no change to the
Company's internal controls over financial reporting that have materially
affected, or is reasonably likely to materially effect, the Company's internal
controls over financial reporting.

                                       19
<PAGE>

                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

None.

Item 2.  Changes in Securities

During the three months ended March 31, 2006, the Company issued the following
unregistered securities:

In February 2006, the Company issued a two year, secured convertible debenture
to Cornell Capital Partners, LP in the aggregate amount of $125,000. The
debenture carries similar conversion provisions as the November 2, 2005 and
December 16, 2005 debentures. In addition, the Company issued 25,000,000
warrants to purchase common shares at a price of $0.01 per share, and 25,000,000
warrants to purchase common shares at a price of $0.03 per share. The warrants
carry three year expirations.

From January 2006 through March 2006, the Company issued short term bridge notes
totaling $60,712 to Seaport Capital. The notes carried interest at a rate of
between 10% and 15% per annum. During the same period, the Company repaid
$77,712 to Seaport Capital consisting of the bridge notes secured between
January and March, and a previous bridge note issued in December 2005.

On February 22, 2006, the Company sold 2,659,574 shares of restricted common
stock to an accredited investor for a total of $50,000. The shares were issued
at an average price of $0.0188 per share.

On March 24, 2006, the Company sold 13,333,333 shares of restricted common stock
to accredited investors for a total of $80,000. The shares were issued at an
average price of $0.006 per share.

In January 2006, the Company issued 3,572,851 shares of common stock upon
conversion of $104,327.24 of the November 2006 secured convertible debenture to
Cornell Capital. The shares were converted at a price of $0.0292 per share.

In February 2006, the Company issued 1,760,563 shares of common stock upon
conversion of $50,000 of the November 2006 secured convertible debenture to
Cornell Capital. The shares were converted at a price of $0.0284 per share.

In March 2006, the Company issued 2,183,000 shares of common stock upon
conversion of $55,448.20 of the November 2006 secured convertible debenture to
Cornell Capital. The shares were converted at a price of $0.0254 per share.


Item 3.  Default on Senior Securities

During June 2004, the Company raised an aggregate of $726,880 (net of expenses)
from Cornell Capital under a Promissory Note. The Note carries interest at the
rate of 5% per annum beginning 90 days from its date, and was to be paid in full
by November 8, 2004. The Company has received an extension of the due date from
Cornell Capital to July 30, 2005. The Company has requested an additional
extension from Cornell Capital Partners. This event of default has been cured by
the issuance of new Convertible Debentures.

Item 4.  Submission of Matters to a Vote of Security Holders

None.

Item 5.  Exhibits

         a) Exhibits
<TABLE>
<CAPTION>

Exhibit No.           Description                                              Location
--------------        -------------------------------------------------------  -----------------------------------------------
<S>                                                                                                                 <C>
3.1                   Articles of Incorporation                                Incorporated by reference to Exhibit 3.1 in
                                                                               the Registration Statement on Form 10-K filed
                                                                               with the Securities and Exchange Commission on
                                                                               November 30, 2000

3.2                   Articles of Amendment dated March 14, 1985               Incorporated by reference to Exhibit 3.2 in
                                                                               the Registration Statement on Form SB-2 filed
                                                                               with the Securities and Exchange Commission on
                                                                               November 30, 2000

                                       20
<PAGE>

Exhibit No.           Description                                              Location
--------------        -------------------------------------------------------  -----------------------------------------------
3.3                   Articles of Amendment dated August 25, 2000              Incorporated by reference to Exhibit 3.3 in
                                                                               the Registration Statement on Form SB-2 filed
                                                                               with the Securities and Exchange Commission on
                                                                               November 30, 2000

3.4                   Articles of Amendment dated February 10, 2005            Incorporated by reference to Exhibit 2.1 on
                                                                               Form 10-K filed with the Securities and
                                                                               Exchange Commission on March 25, 2005

3.5                   Bylaws                                                   Incorporated by reference to Exhibit 3.4 in
                                                                               the Registration Statement on Form SB-2 filed
                                                                               with the Securities and Exchange Commission on
                                                                               November 30, 2000

10.2                  Master Lease Agreement #5509 with Agility Lease fund     Incorporated by reference to Exhibit 99.1 to
                      I, LLC.                                                  ICOA's Current Report on Form 8-K filed with
                                                                               the Securities and Exchange Commission on
                                                                               April 22, 2005

10.3                  Form of Warrant to be issued to Agility Solutions        Incorporated by reference to Exhibit 99.2 to
                                                                               ICOA's Current Report on Form 8-K filed with
                                                                               the Securities and Exchange Commission on
                                                                               April 22, 2005

10.4                  Employment Agreement with Stephen N. Cummings            Incorporated by reference to Exhibit 99.1 to
                                                                               ICOA's Current Report on Form 8-K filed with
                                                                               the Securities and Exchange Commission on
                                                                               October 28, 2005

21.1                  Subsidiaries of ICOA                                     Incorporated by reference to Exhibit 21.1 in
                                                                               the Registration Statement on Form SB-2 filed
                                                                               with the Securities and Exchange Commission on
                                                                               November 30, 2000

31.1                  Certification pursuant to Section 302 of the             Provided herewith
                      Sarbanes-Oxley Act of 2002

31.2                  Certification pursuant to Section 302 of the             Provided herewith
                      Sarbanes-Oxley Act of 2002

32.1                  Certification pursuant to Section 906 of the             Provided herewith
                      Sarbanes-Oxley Act of 2002

32.2                  Certification pursuant to Section 906 of the             Provided herewith
                      Sarbanes-Oxley Act of 2002
</TABLE>

                                       21
<PAGE>

                                   SIGNATURES

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

       Date:  May 16, 2006
                                                     ICOA, INC.


                                                    /s/ Richard Schiffmann
                                                    ---------------------------
                                                    Richard Schiffmann
                                                    Chief Executive Officer


                                                    /s/ Stephen N. Cummings
                                                    ---------------------------
                                                    Stephen N. Cummings.
                                                    Sr. Vice President and
                                                    Chief Financial Officer


                                                    /s/ Erwin Vahlsing, Jr.
                                                    ---------------------------
                                                    Erwin Vahlsing, Jr.
                                                    Vice President Finance
                                                    Principal Accounting Officer