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1

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

Form 10-QSB

(Mark One)

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the quarterly period ended April 30, 2007

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
ACT For the transition period from __________ to __________

Commission file number 333-139209

SEARCH BY
HEADLINES.COM.CORP(Exact name of small business issuer as
specified in its charter)

|Nevada                                                               | N/A                              
|-------------------------------------------------------------------- | ---------------------------------
|(State or other jurisdiction of incorporation or
      organization) | (IRS Employer Identification No.)

5520 14B Avenue, Delta, BC V4M 2G6(Address of
principal executive offices)

(778)386-3528(Issuer's telephone number)

Not Applicable(Former name, former address and
former fiscal year, if changed since last report)

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

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date: 9,010,000 common
shares issued and outstanding as of June 1, 2007

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

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

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2

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

These financial statements have been prepared by Search By
Headlines.Com. Corp. without audit, pursuant to the rules and regulations of the
SEC. Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been omitted in accordance with such SEC rules and regulations. In the
opinion of management, the accompanying statements contain all adjustments
necessary to present fairly the financial position of the Company as of April
30, 2007, and its results of operations and its cash flows for the three month
period ended April 30, 2007 and for the period from inception (May 17, 2005) to
April 30, 2007. The results for these interim periods are not necessarily
indicative of the results for the entire year. The accompanying financial
statements should be read in conjunction with the financial statements and the
notes thereto filed as a part of the Companys Form SB-2/A filed on December 22,
2006.

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3

|SEARCH BY HEADLINES.COM CORP.
|-----------------------------
|                             
|(A Development Stage Company)
|                             
|INTERIM FINANCIAL STATEMENTS 
|                             
|April 30, 2007               
|                             
|(Stated in US Dollars)       
|                             
|(Unaudited)                  

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|4                               
|--------------------------------
|                                
|                                
|SEARCH BY HEADLINES.COM CORP.   
|(A Development Stage Company)   
|INTERIM BALANCE SHEET           
|April 30, 2007 and July 31, 2006
|(Stated in US Dollars)          
|(Unaudited)                     

|                                                            |   | April 30, |   |   | July 31, |  
|----------------------------------------------------------- | - | --------- | - | - | -------- | -
|ASSETS                                                      |   | 2007      |   |   | 2006     |  
|                                                            |   |           |   |   |          |  
|Current                                                     |   |           |   |   |          |  
|Cash and cash equivalents                                   | $ | 35,040    |   | $ | 60,923   |  
|Interest receivable                                         |   | -         |   |   | 610      |  
|                                                            |   |           |   |   |          |  
|Total current assets                                        |   | 35,040    |   |   | 61,533   |  
|                                                            |   |           |   |   |          |  
|Website  Notes 3 and 4                                     |   | 4,059     |   |   | 1,970    |  
|                                                            |   |           |   |   |          |  
|                                                            | $ | 39,099    |   | $ | 63,503   |  
|                                                            |   |           |   |   |          |  
|LIABILITIES                                                 |   |           |   |   |          |  
|                                                            |   |           |   |   |          |  
|Current                                                     |   |           |   |   |          |  
|Accounts payable                                            | $ | 16,220    |   | $ | 9,316    |  
|                                                            |   |           |   |   |          |  
|STOCKHOLDERS EQUITY                                        |   |           |   |   |          |  
|                                                            |   |           |   |   |          |  
|Capital stock  Note 4                                      |   |           |   |   |          |  
|Authorized                                                  |   |           |   |   |          |  
|100,000,000 common shares,
      par value $0.001 per share |   |           |   |   |          |  
|Issued and outstanding                                      |   |           |   |   |          |  
|9,010,000 common shares                                     |   | 9,010     |   |   | 9,010    |  
|Additional paid-in capital                                  |   | 54,090    |   |   | 54,090   |  
|Comprehensive income                                        |   | 6,039     |   |   | 6,487    |  
|Deficit accumulated during the development
      stage      |   | (46,260   | ) |   | (15,400  | )
|                                                            |   |           |   |   |          |  
|Total stockholders equity                                  |   | 22,879    |   |   | 54,187   |  
|                                                            |   |           |   |   |          |  
|                                                            | $ | 39,099    |   | $ | 63,503   |  

SEE ACCOMPANYING NOTES

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|5                                                                      
|-----------------------------------------------------------------------
|                                                                       
|                                                                       
|SEARCH BY HEADLINES.COM CORP.                                          
|(A Development Stage Company)                                          
|INTERIM STATEMENT OF OPERATIONS                                        
|for the three and nine months ended April 30, 2007 and
      2006 and  
|for the period May 17, 2005 (Date of Inception) to April
      30, 2007
|(Stated in US Dollars)                                                 
|(Unaudited)                                                            

|                                                     |   |                    |   |   |                   |   |   |               |   |   |           |   |   | May 17,      |  
|---------------------------------------------------- | - | ------------------ | - | - | ----------------- | - | - | ------------- | - | - | --------- | - | - | ------------ | -
|                                                     |   |                    |   |   |                   |   |   |               |   |   |           |   |   | 2005(Date of |  
|                                                     |   | Three months ended |   |   | Nine months ended |   |   | Inception) to |  
|                                                     |   | April 30,          |   |   | April 30,         |   |   | April 30,     |  
|                                                     |   | 2007               |   |   | 2006              |   |   | 2007          |   |   | 2006      |   |   | 2007         |  
|Expenses                                             |   |                    |   |   |                   |   |   |               |   |   |           |   |   |              |  
|Amortization                                         | $ | 565                |   | $ | -                 |   | $ | 1,686         |   | $ | -         |   | $ | 2,671        |  
|General and
      administrative  Note 4            |   | 8,665              |   |   | 323               |   |   | 30,054        |   |   | ,730      |   |   | 45,173       |  
|Loss from operations                                 |   | (9,230             | ) |   | (323              | ) |   | (31,740       | ) |   | (4,730    | ) |   | (47,844      | )
|Interest income                                      |   | -                  |   |   | -                 |   |   | 880           |   |   | -         |   |   | 1,584        |  
|Loss before other                                    |   | (9,230             | ) |   | (323              | ) |   | (30,860       | ) |   | (4,730    | ) |   | (46,260      | )
|Other:                                               |   |                    |   |   |                   |   |   |               |   |   |           |   |   |              |  
|Foreign currency translation adjustment              |   | 1,017              |   |   | 3,581             |   |   | (448          | ) |   | 7,513     |   |   | 6,039        |  
|Net comprehensive income (loss) for the
      period | $ | (8,213             | ) | $ | 3,258             |   | $ | (31,308       | ) | $ | 2,783     |   | $ | (40,221      | )
|Basic and diluted loss per share                     | $ | (0.00              | ) | $ | (0.00             | ) | $ | (0.00         | ) | $ | (0.00     | ) |   |              |  
|Weighted average number of shares
      outstanding  |   | 9,010,000          |   |   | 9,010,000         |   |   | 9,010,000     |   |   | 9,010,000 |   |   |              |  

SEE ACCOMPANYING NOTES

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|6                                                                      
|-----------------------------------------------------------------------
|                                                                       
|                                                                       
|SEARCH BY HEADLINES.COM CORP.                                          
|(A Development Stage Company)                                          
|INTERIM STATEMENT OF STOCKHOLDERS EQUITY                              
|for the period May 17, 2005 (Date of Inception) to April
      30, 2007
|(Stated in US Dollars)                                                 
|(Unaudited)                                                            

|                                        |  |              |  |   |           |  |             |            |  |   |               |   |   | Deficit     |   |   |         |  
|--------------------------------------- |  | ------------ |  | - | --------- |  | ----------- | ---------- |  | - | ------------- | - | - | ----------- | - | - | ------- | -
|                                        |  | Common Stock |  |   |           |  | Accumulated |            |  |   |              
|                                        |  |              |  |   |           |  |             | Additional |  |   |               |   |   | During the  |   |   |         |  
|                                        |  |              |  |   |           |  |             | Paid-in    |  |   | Comprehensive |   |   | Development |   |   |         |  
|                                        |  | Shares       |  |   | Par Value |  |             | Capital    |  |   | Income        |   |   | Stage       |   |   | Total   |  
|Capital stock issued for cash:          |  |              |  |   |           |  |             |            |  |   |               |   |   |             |   |   |         |  
|August 2005 - at $0.001                 |  | 3,000,000    |  | $ | 3,000     |  | $           | -          |  | $ | -             |   | $ | -           |   | $ | 3,000   |  
|September 2005 -
      at $0.01         |  | 6,010,000    |  |   | 6,010     |  |             | 54,090     |  |   | -             |   |   | -           |   |   | 60,100  |  
|Foreign currency translation adjustment |  | -            |  |   | -         |  |             | -          |  |   | 6,487         |   |   | -           |   |   | 6,487   |  
|Net loss for the year                   |  | -            |  |   | -         |  |             | -          |  |   | -             |   |   | (15,400     | ) |   | (15,400 | )
|Balance, July 31, 2006                  |  | 9,010,000    |  |   | 9,010     |  |             | 54,090     |  |   | 6,487         |   |   | (15,400     | ) |   | 54,187  |  
|Foreign currency translation adjustment |  | -            |  |   | -         |  |             | -          |  |   | (448          | ) |   | -           |   |   | (448    | )
|Net loss for the period                 |  | -            |  |   | -         |  |             | -          |  |   | -             |   |   | (30,860     | ) |   | (30,860 | )
|Balance, April 30, 2007                 |  | 9,010,000    |  | $ | 9,010     |  | $           | 54,090     |  | $ | 6,039         |   | $ | (46,260     | ) | $ | 22,879  |  

SEE ACCOMPANYING NOTES

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|7                                                                      
|-----------------------------------------------------------------------
|                                                                       
|                                                                       
|SEARCH BY HEADLINES.COM CORP.                                          
|(A Development Stage Company)                                          
|INTERIM STATEMENT OF CASH FLOWS                                        
|for the nine months ended April 30, 2007 and 2006 and                  
|for the period May 17, 2005 (Date of Inception) to April
      30, 2007
|(Stated in US Dollars)                                                 
|(Unaudited)                                                            

|                                                         |   |                   |   |   |               |   |   | May 17       |  
|-------------------------------------------------------- | - | ----------------- | - | - | ------------- | - | - | ------------ | -
|                                                         |   |                   |   |   |               |   |   | 2005(Date of |  
|                                                         |   | Nine months ended |   |   | Inception) to |  
|                                                         |   | April 30,         |   |   | April 30,     |  
|                                                         |   | 2007              |   |   | 2006          |   |   | 2007         |  
|                                                         |   |                   |   |   |               |   |   |              |  
|Operating Activities                                     |   |                   |   |   |               |   |   |              |  
|Net loss for the period                                  | $ | (30,860           | ) | $ | (4,730        | ) | $ | (46,260      | )
|Amortization expense                                     |   | 1,686             |   |   | -             |   |   | 2,671        |  
|Changes in operating working capital items:              |   |                   |   |   |               |   |   |              |  
|Interest
      receivable                                |   | 610               |   |   | (617          | ) |   | -            |  
|Subscriptions receivable                                 |   | -                 |   |   | (1,128        | ) |   | -            |  
|Accounts
      payable                                   |   | 6,904             |   |   | 1,586         |   |   | 16,220       |  
|                                                         |   |                   |   |   |               |   |   |              |  
|                                                         |   | (21,660           | ) |   | (4,889        | ) |   | (27,369      | )
|                                                         |   |                   |   |   |               |   |   |              |  
|Investing Activity                                       |   |                   |   |   |               |   |   |              |  
|Website development                                      |   | (3,775            | ) |   | (2,955        | ) |   | (6,730       | )
|                                                         |   |                   |   |   |               |   |   |              |  
|Financing Activity                                       |   |                   |   |   |               |   |   |              |  
|Issuance of common stock
      for cash                  |   | -                 |   |   | 63,100        |   |   | 63,100       |  
|                                                         |   |                   |   |   |               |   |   |              |  
|Effect of foreign exchange on cash                       |   | (448              | ) |   | 7,513         |   |   | 6,039        |  
|                                                         |   |                   |   |   |               |   |   |              |  
|Increase (decrease) in cash during the period            |   | (25,883           | ) |   | 62,769        |   |   | 35,040       |  
|                                                         |   |                   |   |   |               |   |   |              |  
|Cash and cash equivalents, beginning of the
      period |   | 60,923            |   |   | -             |   |   | -            |  
|                                                         |   |                   |   |   |               |   |   |              |  
|Cash and cash equivalents, end of the period             | $ | 35,040            |   | $ | 62,769        |   | $ | 35,040       |  

SEE ACCOMPANYING NOTES

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|8                                        
|-----------------------------------------
|                                         
|                                         
|SEARCH BY HEADLINES.COM CORP.            
|(A Development Stage Company)            
|NOTES TO THE INTERIM FINANCIAL STATEMENTS
|April 30, 2007                           
|(Stated in US Dollars)                   
|(Unaudited)                              

|Note 1 | Interim Reporting
|------ | -----------------

While
the information presented in the accompanying interim three months financial
statements is unaudited, it includes all adjustments which are, in the opinion
of management, necessary to present fairly the financial position, results of
operations and cash flows for the interim periods presented. These interim
financial statements follow the same accounting policies and methods of their
application as the Companys July 31, 2006 annual financial statements. All
adjustments are of a normal recurring nature. It is suggested that these interim
financial statements be read in conjunction with the Companys July 31, 2006
annual financial statements.

|Note 2 | Organization and Nature of Business
|------ | -----------------------------------

Search
by Headlines.com Corp. was incorporated in the State of Nevada on May 17, 2005,
with 100,000,000 authorized common shares with a par value of $0.001 per share.
The Company provides a specialized internet search engine that features news in
a format that allows users to search or submit news by headline.

The
Companys fiscal year end is July 31.

|Note 3 | Website
|------ | -------

| |         |   |       |  |   | April 30, 2007 |  |   |            | 
| | ------- | - | ----- |  | - | -------------- |  | - | ---------- | 
| |         |   |       |  |   | Accumulated    |  |   | Net        | 
| |         |   | Cost  |  |   | Amortization   |  |   | Book Value | 
| |         |   |       |  |   |                |  |   |            | 
| | Website | $ | 6,730 |  | $ | 2,671          |  | $ | 4,059      | 
| |         |   |       |  |   |                |  |   |            | 
| |         |   |       |  |   |                |  |   |            | 
| |         |   |       |  |   | July 31, 2006  |  |   |            | 
| |         |   |       |  |   | Accumulated    |  |   | Net        | 
| |         |   | Cost  |  |   | Amortization   |  |   | Book Value | 
| |         |   |       |  |   |                |  |   |            | 
| | Website | $ | 2,955 |  | $ | 985            |  | $ | 1,970      | 

|Note 4 | Related Party Transactions
|------ | --------------------------

During
the nine months ended April 30, 2007, the Company incurred website development
costs charged by a director of the Company totalling $1,888 (April 30, 2006:
$Nil) and incurred consulting fees charged by a company controlled by a director
of the Company totalling $10,399 (2006: $Nil).

As at
April 30, 2007, directors of the Company own 3,000,000 common shares.

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9

Item 2. Management's Discussion and Analysis or Plan
of Operation.

FORWARD-LOOKING STATEMENTS

This quarterly report contains
forward-looking statements as that term is defined in Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. These statements relate to future events or our future
financial performance. In some cases, you can identify forward-looking
statements by terminology such as "may", "should", "expects", "plans",
"anticipates", "believes", "estimates", "predicts", "potential" or "continue" or
the negative of these terms or other comparable terminology. These statements
are only predictions and involve known and unknown risks, uncertainties and
other factors, including the risks in the section entitled "Risk Factors", that
may cause our or our industry's actual results, levels of activity, performance
or achievements to be materially different from any future results, levels of
activity, performance or achievements expressed or implied by these
forward-looking statements. Although we believe that the expectations reflected
in the forward-looking statements are reasonable, we cannot guarantee future
results, levels of activity, performance or achievements. Except as required by
applicable law, including the securities laws of the United States, we do not
intend to update any of the forward-looking statements to conform these
statements to actual results.

Our unaudited financial
statements are stated in United States Dollars (US$) and are prepared in
accordance with United States Generally Accepted Accounting Principles. The
following discussion should be read in conjunction with our financial statements
and the related notes that appear elsewhere in this quarterly report. The
following discussion contains forward-looking statements that reflect our plans,
estimates and beliefs. Our actual results could differ materially from those
discussed in the forward looking statements. Factors that could cause or
contribute to such differences include, but are not limited to, those discussed
below and elsewhere in this quarterly report, particularly in the section
entitled "Risk Factors" of this quarterly report.

In this quarterly report, unless
otherwise specified, all dollar amounts are expressed in United States dollars.
All references to "common shares" refer to the common shares in our capital
stock.

As used in this quarterly report,
the terms "we", "us", "our" and "Search By Headlines" mean Search By
Headlines.Com. Corp.

Item 2. Managements Discussion and Analysis or Plan of
Operation

General

We were incorporated on May 17,
2005, in the State of Nevada. Following incorporation, we commenced the business
of marketing our website and accessories throughout our target markets of North
America.

Current Business

SearchbyHeadlines.com
features news in a format that users search or submit news by headline. News is
broken down by headline under industry sectors, then once again by: Public
Company News, Private Company News or Association and Non-Profit News. The site
offers free news submission service for public relations and investor relations
representatives as well as upgraded services. Upgraded users can submit news
releases with up to three different headlines that rotate every four hours.

The three rotating
headlines expose the news to visitors every four hours. The results give
companies and organizations valuable search feedback and data that can be
implemented in to an overall online marketing strategy.

Search by Headlines allows
users to search by keywords or headlines for the most relevant targeted news
results. News is broken down by headlines and industry sector so users don't
waste time searching news that isn't relevant to their topic. Search by
Headline, Industry Sector and choose from: Public Company News, Private Company
News or Association and Non-Profit News!

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10

Search by Headlines
focuses its content and search on headlines based on internet usage feedback and
data, which suggests that by placing the right headline in a news release,
companies can optimize visibility for a more specific, targeted audience. As
internet users are exposed to increasing content and content formats, readers
tend to read and scan headlines for keywords and phrases, followed by the first
paragraph.

The Company has become a
recognized news source for Google news , so when news is posted on the site by
online registered users, it is redistributed by Google news within 1-3 hours.
The site is currently building and adding distribution partners.

Google has over 4500 news
sources updated continuously. Google News editors may choose a site of their own
accord or they may evaluate and choose to accept a site upon request by a
particular company. In our case, we requested Google to list us as one of their
news sources. Google evaluated our website and chose to list it as a Google news
source after we made a few adjustments to our website to meet Googles criteria
and standards. To become a news source for Google, there is no direct cost but
we did incur some expenses to make the required changes to our website. For
example we adjusted our page naming system and modified our service to ensure
that the news would be continuously updated. Google may remove news sources from
its index by its own choice or on popular request, which would most likely be
the case concerning content that is harmful or unacceptable to the public at
large.

Marketing

We have submitted the site
to multiple search engine directories, search directories online and have
submitted and posted news releases describing the companies services on online
destinations. Currently, searching www.Google.com results in the companys
services being found referred to on multiple sites.

We have become a
recognized news source for Google news, so when news is posted on the site by
online registered users, it is redistributed by Google news within one to three
hours. The site is currently building and adding distribution partners.

We have built a customer
prospect database of potentially 2000 public relations firms that may
potentially use our news distribution services. We plan to contact many of these
prospective clients or target our advertising to the type of prospective client
that we find are in the website. None of these public relations firm have yet
become our customers.

We may attend or sponsor
industry trade shows for Search Engine Optimization related businesses and or
Internet Marketing Trade Shows

Until we obtain further
funding our president, Mr Loeppky, will carry out our on marketing efforts. In
the future, we may consider hiring a marketing contractor or employee, if it is
in the best interests of out company.

Technology

We provide two major
services to our clients:

| | 1) | A news resources and provider, allowing users to search
      through our headlines and organize their search results. With our built-
      in search software, we accurately index news as it is submitted to our
      site.                                                                                                                                                                                                                                                                                                                                          
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | 2) | A news submission service that allows users to submit
      their news and categorize it in the appropriate group. To help keep our
      search results accurate, the user can also enter keywords relevant to
      their news. The unique feature to the news submission service is the
      rotating headline feature, allowing users to submit their news with up to
      three different headlines. Our software changes those headlines every four
      hours. To help syndicate our users news, we offer news feeds separated
      into our major categories.

The system consists of a
Web Server, SQL Database, ASPX web pages, HTML web pages with client side
scripting language, and web browsers. The system handles two types of requests
from the user: 1) single page requests; and 2) multiple listing requests. Each
piece of news may contain up to three headlines which are in a four hour
rotation.

---

11

Suppliers

We host our website and
email on servers which are owned and operated by Web Strike Solutions . On June
1, 2006, we paid approximately $161 to In Vancouver Web Services for web hosting
services which includes 0.5 gigabytes of bandwith and 100 megabytes of storage.
Additionally, we paid In-Vancouver Web Services approximately $27 for domain
linking of our website, www.searchbyheadlines.com. The web hosting services are
prepaid for one year and we are not required to pay any additional web hosting
fees until June 1, 2007. There are numerous hosting companies all over North
America that could meet our hosting needs. In the event that In-Vancouver Web
Services ceases operations or discontinues its business relationship with us, we
will be able to resume services with another hosting company on substantially
similar terms as currently exist between our company and In-Vancouver Web
Services without significant disruption to our business.

Competition

There are many companies
offering free online news submission and search services. For example, Prweb
(www.Prweb.com), 24-7 Press Release (www.24-7pressrelease.com) and Topix
(www.Topix.net). While these companies do offer such features as free and
upgraded news services, they do not allow users to search and submit news by
headlines. We also have unique features including multiple rotating headlines.
Some of our competitors, such as Prweb, do not offer the search capability
offered by us. Topix does not offer online news submission for online users.
Other unique features of Search By Headlines include the ability to search news
by category of stock news, private company news, association or non profit news
and by industry, and news can be submitted by three different, rotating
headlines.

We believe that we can
compete in this industry because we believe that our unique features, our
proposed marketing plan and our advertising options will enable us to attract
sufficient users and advertisers.

Growth Strategy

We plan on increasing our
revenues by increasing our product offerings and our marketing efforts for each
product. We plan to diversify and offer new services for news distribution
including the audio headline services, unique to the press release industry . We
also plan to build our news distribution partners, adding value to the current
services. We will grow our online content from the free news submission 
services, which will increase the revenue from the Google Adsense model. We can
also grow by partnering with other online content sites and providing suitable
news sources .

Employees

Our company is currently
operated by Joe Loeppky as our President, Secretary and Treasurer . We
periodically hire independent contractors to execute our marketing, sales, and
business development functions. Our company may hire employees when
circumstances warrant. At present, however, our company does not anticipate
hiring employees in the near future.

Intellectual Property

The company has filed a
Trade Mark for Search By Healdines.com with the U.S. Patent and Trade Mark
Office. We filed the Trade Mark on February 7, 2006.

Plan of Operation

The following discussion
should be read in conjunction with our financial statements and the related
notes that appear elsewhere in this quarterly report. The following discussion
contains forward-looking statements that reflect our plans, estimates and
beliefs. Our actual results could differ materially from those discussed in the
forward looking statements. Factors that could cause or contribute to such
differences include, but are not limited to, those discussed below and elsewhere
in this quarterly report, particularly in the section entitled "Risk Factors" of
this quarterly report.

Our audited financial
statements are stated in United States dollars and are prepared in accordance
with United States generally accepted accounting principles.

---

12

Results of Operations for the three month period ended April
30, 2007

During the three month
period ended April 30, 2007, covered by our unaudited financial statements, we
did not generate any revenues. Our loss from operations for the three month
period ended April 30, 2007 were $9,230 compared to a loss of $323 for the three
month period ended April 30, 2006. The increase was largely due to an increase
in general and administrative expenses and an increase in amortization
expense.

General and administrative
costs were $8,665 for the three months ended April 30, 2007, compared to $323
for the three months ended April 30, 2006. The increase was again due to an
increase in office rent and administration and legal fees.

Amortization expenses were
$565 for the three months ended April 30, 2007, compared to $nil for the three
months ended April 30, 2006. The increase was due to amortizing website costs
..We expect our amortization expense to remain constant over the next twelve
month period.

We did not record any
interest income for the three month periods ended April 30, 2007 or April 30,
2006.

Our net comprehensive loss
for the three months ended April 30, 2007 was $8,213, or $0.00 per share, as
compared to a net comprehensive gain of $3,258, or $0.00 per share, for the
three months ended April 30, 2006. The increase in the comprehensive loss was
due to an increase in general and administrative expenses and amortization
expense which was offset by a foreign currency translation gain of $1,017.

Results of Operations for the nine month period ended April
30, 2007

During the nine months
ended April 30, 2007, covered by our unaudited financial statements, we did not
generate any revenues. Our loss from operations for the nine months ended April
30, 2007 were $31,740, as compared to $4,730 for the nine month period ended
April 30, 2006. The increase was due to an increase in general and
administrative expenses and an increase in amortization expense.

General and administrative
costs were $30,054 for the nine months ended April 30, 2007 compared to $1,686
for the nine months ended April 30,2006. Amortization expenses were $1,686 for
the nine months ended April 30, 2007 but $nil for the nine months ended April
30, 2006. The increase in amortization expenses was due to amortizing the
website costs. We expect our amortization expenses to remain constant over the
next twelve month period.

We recorded interest
income of $0.00 and $880, respectively, for the three and nine months ended
April 30, 2007. The increase was due to interest paid by the bank on cash.

Our net comprehensive loss
for the nine months ended April 30, 2007 was $31,308, or $0.00 per share, as
compared to a net income of $2,783, or $0.00 per share, for the nine months
ended April 30, 2006.

Liquidity and Capital Resources

Presently, our revenue is
not sufficient to meet our operating and capital expenses. Management projects
that we will require additional funding to expand our current operations. We
have incurred losses since inception and this is likely to continue for an
indeterminate amount of time.

Management projects that
we may require $50,000 to $75,000 in addition to our current cash to fund our
operating expenditures for the next twelve month period. Projected working
capital requirements for the next twelve month period, are broken down as
follows:

---

13

| | Estimated Working Capital Expenditures During
      the Next Twelve Month Period
| | --------------------------------------------------------------------------------
| | Operating expenditures                                                          
| | Marketing                                                                       
| | General and Administrative                                                      
| | Legal and Accounting                                                            
| | Website development costs                                                       
| | Total                                                                           

Operating Activities

Operating activities used
cash of $21,660 for the nine month period ended April 30, 2007. The cash used
during the period was largely the result of our net loss for the period.

Investing Activities

Investing activities used
cash of $3,775 for the nine month period ended April 30, 2007, as a result of
our website development.

Financing Activities

Financing activities
provided cash of $Nil for the nine month period ended April 30, 2007.

Future Operations

Our primary objectives for
the next twelve month period include the further development of our website and
expansion of our marketplace. We intend on expanding our market-share by:

| | 1. | Marketing our companys news submission fees and multiple
      advertising packages; and,
| | -- | ------------------------------------------------------------------------------------------
| |    |                                                                                           
| | 2. | Adding additional distribution
partners.                                                  

Revenue Processing

Sales may be processed
either by cheque or through PayPal. PayPal is computer software that facilitates
electronic payments over the internet in exchange for a transaction fee. The
transaction fees we pay to PayPal are 3.5% of the sales amount. We plan to
establish a policy on additional charges to customers for using PayPal or
discounts for paying by cheque or wire to cover these costs.

Our User Agreement with
PayPal is a contract between our company and PayPal and relates to our use of
the PayPal payment service and the services provided to us by PayPal. Sales
through PayPal are transferred periodically to our operating bank account.

Marketing

The following is our
marketing plan for the next twelve month period, which is expected to cost
approximately

$10,000 to $15,000. The costs will not be passed on to our
customers:

---

14

|1. | Website development to incorporate new and unique tools
      to benefit all aspects of our growing business.                                                                                                                                                                                                                                                                                             
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                           
|2. | The company has built a customer prospect database of
      potentially 2000 public relations firms that may potentially use our news
      distribution services. We plan to contact many of these prospective
      clients or target our advertising to the type of prospective client that
      we find are in the website. None of these public relations firms have yet
      become our customers.
|   |                                                                                                                                                                                                                                                                                                                                                                                                           
|3. | The company may attend or sponsor industry trade shows
      for Search Engine Optimization related businesses and or Internet
      Marketing Trade Shows                                                                                                                                                                                                                                                

General and Administration

General and administration
costs include administration costs, office, and miscellaneous expenses.
Management estimates that, over the next twelve months, these costs will be
between $2,900 per month to $3,300 per month based on previous costs and
possible expansion of our administration over the next twelve month period. Our
company is currently operated by Joe Loeppky as our President, Secretary and
Treasurer. We anticipate that we will periodically hire independent contractors
to execute our marketing, sales, and business development functions. In the next
twelve month period, we plan to hire independent contractors to assist in
business development with an emphasis on marketing. We may choose to compensate
such persons with consideration other than cash, such as shares of our common
stock or options to purchase shares of our common stock.

Other Expenses

We also incur expenses
unrelated to the sales operations including legal expenses. We expect our
ongoing legal expenses to be approximately $2,000 per month.

In managements opinion,
we need to achieve the following events or milestones in the next twelve month
period in order for us to continue to develop our business:

| | 1. | We must continue to develop new customers. New customers
      have been generated by cold-calls, email lists, web- site hits on our
      website www.searchbyheadlines.com and most importantly, by referrals from
      current customers; and,
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                   
| | 2. | We must increase the orders made by our existing
      customers. This will be accomplished by customer satisfaction with the
      performance and pricing of the existing packages.                                                             

Purchase or Sale of Equipment

We do not anticipate that
we will expend any significant amount on equipment for our present or future
operations. We may purchase computer hardware and software for our ongoing
operations, on which we plan to spend approximately $2,500.

Item 3. Controls and Procedures.

As required by Rule 13a-15
under the Securities Exchange Act of 1934, as of the end of the period covered
by the quarterly report, being April 30, 2007, we have carried out an evaluation
of the effectiveness of the design and operation of our company's disclosure
controls and procedures. This evaluation was carried out under the supervision
and with the participation of our company's management, including our company's
principal executive officer, principal financial officer and principal operating
officer. Based upon that evaluation, our company's principal executive officer,
principal financial officer and principal operating officer concluded that our
disclosure controls and procedures are effective in timely alerting management
to material information relating to us required to be included in our periodic
SEC filings as at the end of the period covered by this report. There have been
no changes in our internal controls or in other factors that could significantly
affect internal controls subsequent to the date we carried out our evaluation.

Disclosure controls and
procedures are controls and other procedures that are designed to ensure that
information required to be disclosed in our reports filed or submitted under the
Exchange Act is recorded, processed, summarized and

---

15

reported, within the time periods specified in the SECs rules
and forms. Disclosure controls and procedures include, without limitation,
controls and procedures designed to ensure that information required to be
disclosed in our reports filed under the Exchange Act is accumulated and
communicated to management, including our principal executive officer, principal
financial officer and principal operating officer, to allow timely decisions
regarding required disclosure.

During our most recently
completed fiscal quarter ended April 30, 2007 there were no changes in our
internal control over financial reporting that have materially affected, or are
reasonably likely to affect, our internal control over financial reporting.

The term internal control
over financial reporting is defined as a process designed by, or under the
supervision of, our principal executive and principal financial officers, or
persons performing similar functions, and effected by our board of directors,
management and other personnel, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting
principles and includes those policies and procedures that:

|(a) | Pertain to the maintenance of records that in reasonable
      detail accurately and fairly reflect the transactions and dispositions of
      our assets;                                                                                                                                                                                              
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                         
|(b) | Provide reasonable assurance that transactions are
      recorded as necessary to permit preparation of financial statements in
      accordance with generally accepted accounting principles, and that
      receipts and expenditures of our company are being made only in accordance
      with authorizations of our management and directors; and
|    |                                                                                                                                                                                                                                                                                                                                                         
|(c) | Provide reasonable assurance regarding prevention or
      timely detection of unauthorized acquisition, use or disposition of our
      assets that could have a material effect on the financial
    statements.                                                                                                                                      

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

We know of no material,
existing or pending legal proceedings against our company, nor are we involved
as a plaintiff in any material proceeding or pending litigation. There are no
proceedings in which any of our directors, officers or affiliates, or any
registered or beneficial shareholder, is an adverse party or has a material
interest adverse to our interest.

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

In August, 2005, we issued
3,000,000 common shares to Joe Loeppky, Jason Hanson and Peter Hornstein at an
offering price of $0.001 per share for gross offering proceeds of $3,000 in an
offshore transaction pursuant to Rule 903 of Regulation S of the Securities Act
of 1933. Mr. Leoppky, Mr. Hanson and Mr. Hornstein are directors of our company
and subscribed for 1,000,000 shares each. None of the three subscribers were
U.S. persons as that term is defined in Regulation S. No directed selling
efforts were made in the United States by our company, any distributor, any of
their respective affiliates or any person acting on behalf of any of the
foregoing. We are subject to Category 3 of Rule 903 of Regulation S and
accordingly we implemented the offering restrictions required by Category 3 of
Rule 903 of Regulation S by including a legend on all offering materials and
documents which stated that the shares have not been registered under the
Securities Act of 1933 and may not be offered or sold in the United States or to
US persons unless the shares are registered under the Securities Act of 1933, or
an exemption from the registration requirements of the Securities Act of 1933 is
available. The offering materials and documents also contained a statement that
hedging transactions involving the shares may not be conducted unless in
compliance with the Securities Act of 1933.

In September 2005, we issued
6,010,000 common shares to 28 subscribers at an offering price of $0.01 per
share for gross offering proceeds of $60,100 in an off-share transaction relying
on Rule 903 of Regulation S of the Securities Act

---

16

of 1933. None of the subscribers were US persons as that term
is defined in Regulation S. No directed selling efforts were made in the United
States by our company, any distributor, any of their respective affiliates or
any person acting on behalf of any of the foregoing. We are subject to Category
3 of Rule 903 of Regulation S and accordingly we implemented the offering
restrictions required by Category 3 of Rule 903 of Regulation S by including a
legend on all offering materials and documents which stated that the shares have
not been registered under the Securities Act of 1933 and may not be offered or
sold in the United States or to US persons unless the shares are registered
under the Securities Act of 1933, or an exemption from the registration
requirements of the Securities Act of 1933 is available. The offering materials
and documents also contained a statement that hedging transactions involving the
shares may not be conducted unless in compliance with the Securities Act of
1933.

Item 3. Defaults Upon Senior Securities.

None.

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

None.

Item 5. Other Information

None.

RISK FACTORS

An investment in our
common stock involves a number of very significant risks. You should carefully
consider the following risks and uncertainties in addition to other information
in this quarterly report in evaluating our company and its business before
purchasing shares of our companys common stock. Our business, operating results
and financial condition could be seriously harmed due to any of the following
risks. You could lose all or part of your investment due to any of these risks.

RISKS RELATED TO OUR BUSINESS

We have had no revenues from operations and if we are not
able to obtain further financing or generate significant revenues from
operations we may be forced to scale back or cease operations or our business
operations may fail.

To date we have not
generated any income from our operations and we have been dependent on sales of
our equity securities to meet the majority of our cash requirements. From our
date of inception on May 17, 2005 to our six month period ended April 30, 2007,
we generated no revenues. As at April 30, 2007, we had working capital of
$18,820. We estimate that we will require approximately $50,000 to $75,000 to
carry out our business plan for the next twelve months. Because we cannot
anticipate when, if ever, we will be able to generate significant revenues from
sales, we will need to raise additional funds to continue to develop our website
to respond to competitive pressures, to sign agreements with advertisers or to
respond to unanticipated requirements or expenses. If we are unable to generate
significant revenues from operations or obtain financing, then we will not be
able to maintain our operations.

We have only commenced our business operations in May, 2005
and we have a limited operating history. If we cannot successfully manage the
risks normally faced by start-up companies, we may not achieve profitable
operations and ultimately our business may fail.

We have a limited
operating history. Our operating activities since our incorporation on May 17,
2005 consisted primarily of developing our website, followed by structuring of
our marketing efforts and company systems. Our prospects are subject to the
risks and expenses encountered by start up companies, such as uncertainties
regarding our level of future revenues and our inability to budget expenses and
manage growth accordingly and our inability to access sources of financing when
required and at rates favorable to us. Our limited operating history and the
highly competitive nature of the internet news industry make it difficult or
impossible to predict future results of our operations. We may not establish a
clientele that will make us profitable, which may result in the loss of some or
all of your investment in our common stock.

---

17

The fact that we have not generated limited revenues since
our incorporation raises substantial doubt about our ability to continue as a
going concern.

We have not generated any
revenues since our inception on May 17, 2005. Since we are still in the early
stages of operating our company and because of the lack of operating history at
April 30, 2007, we will, in all likelihood, continue to incur operating expenses
without significant revenues until our website gains significant popularity.
Between May 17, 2005 and April 30, 2007, we raised $63,100 through the sale of
shares of our common stock. We estimate our average monthly operating expenses,
not including one time expenses in marketing and in completing construction of
our website (approximately $1,500 a month), to be approximately $7,500 per
month. We will not be able to expand our operations beyond current levels
without generating significant revenues from our current operations or obtaining
further financing. Our primary source of funds has been the sale of our common
stock. We cannot assure that we will be able to generate enough interest in our
website. If we cannot attract a significant customer base, we will not be able
to generate any significant revenues or income. In addition, if we are unable to
establish and generate material revenues, or obtain adequate future financing,
our business will fail and you may lose some or all of your investment in our
common stock.

We will need to raise additional funds in the near future.
If we are not able to obtain future financing when required, we might be forced
to scale back or cease operations or discontinue our business.

We do not currently have
any arrangements for financing and we can provide no assurance to investors we
will be able to find such financing when such funding is required. Obtaining
additional financing would be subject to a number of factors, including investor
acceptance of our product selection and our business model. Furthermore, there
is no assurance that we will not incur further debt in the future, that we will
have sufficient funds to repay our future indebtedness or that we will not
default on our future debts, thereby jeopardizing our business viability.
Finally, we may not be able to borrow or raise additional capital in the future
to meet our needs or to otherwise provide the capital necessary to maintain our
operations, which might result in the loss of some or all of your investment in
our common stock.

Our company anticipates
that the funds that were raised from private placements by way of 31
subscription agreements entered into between May 17, 2005 and April 30, 2007
will not be sufficient to satisfy our cash requirements for the next twelve
month period. Also, there is no assurance that actual cash requirements will not
exceed our estimates. In particular, additional capital may be required in the
event that:

| | 1. | we incur unexpected costs in developing and marketing our
      website;        
| | -- | --------------------------------------------------------------------------------
| |    |                                                                                 
| | 2. | we incur delays and additional expenses as a result of
      technology failure;
| |    |                                                                                 
| | 3. | we are unable to create a substantial market for our
      website; or          
| |    |                                                                                 
| | 4. | we incur any significant unanticipated
  expenses.                              

The occurrence of any of
the aforementioned events could prevent us from pursuing our business plan,
expanding our business operations and ultimately achieving a profitable level of
such operations.

We will depend almost
exclusively on outside capital to pay for the continued development and
marketing of our products. Such outside capital may include the sale of
additional stock, shareholder advances and/or commercial borrowing. There can be
no assurance that capital will continue to be available if necessary to meet
these continuing development costs or, if the capital is available, that it will
be on terms acceptable to us. The issuance of additional equity securities by us
will result in a significant dilution in the equity interests of our current
stockholders. Obtaining commercial loans, assuming those loans would be
available, will increase our liabilities and future cash commitments.

Two of our directors and officers are engaged in other
business activities and accordingly may not devote sufficient time to our
business affairs, which may affect our ability to conduct operations and
generate revenues.

Two of our
directors and officers are involved in other business activities. Joe Loeppky,
our President, Secretary, Treasurer and director spends approximately 30 hours
per month, or 15%, of his business time on the management of our company and
Peter Hornstein, director, spends approximately 15 hours per month, or 7%, of
his business time on the management of our company. As a result of their other
business endeavors, Mr. Loeppky and Mr. Hornstein may not be

---

18

able to devote sufficient time to our business affairs, which
may negatively affect our ability to conduct our ongoing operations and our
ability to generate revenues. In addition, the management of our company may be
periodically interrupted or delayed as a result of other business interests.

All of our assets and all of our directors and officers are
outside the United States, with the result that it may be difficult for
investors to enforce within the United States any judgments obtained against us
or any of our directors or officers.

All of our assets are
located outside the United States and we do not currently maintain a permanent
place of business within the United States. In addition, all of our directors
and officers are nationals and/or residents of countries other than the United
States, and all or a substantial portion of such persons assets are located
outside the United States. As a result, it may be difficult for investors to
enforce within the United States any judgments obtained against us or our
officers or directors, including judgments predicated upon the civil liability
provisions of the securities laws of the United States or any state thereof.
Consequently, you may be effectively prevented from pursuing remedies under U.S.
federal securities laws against them.

If we are unable to protect our internet domain name, our
efforts to increase public recognition of our brand may be impaired.

We currently hold the
internet domain names SEARCH BY HEADLINES.com and SEARCH BY HEADLINES.ca.
The acquisition and maintenance of domain names generally is regulated by
governmental agencies and their designees. The regulation of domain names in
Canada and in foreign countries is subject to change. As a result, we may be
unable to acquire or maintain relevant domain names in all countries in which we
intend to conduct business. This could impair our efforts to build brand
recognition and to increase traffic to our website and sales. Furthermore, the
relationship between regulations governing domain names and laws protecting
trademarks and similar proprietary rights is unclear. Therefore, we may be
unable to prevent third parties from acquiring domain names that are similar to
our domain names, and infringing upon or otherwise decreasing the value of any
future trademarks or other proprietary rights that we may develop. We may need
to bring legal claims to enforce or protect such intellectual property rights.
Any litigation, whether successful or unsuccessful, could result in substantial
costs and diversions of resources. Any claims, by or against us, could be time
consuming and costly to defend or litigate, divert our attention and resources
and result in the loss of goodwill associated with our trade names.

If our operations are
disrupted by technological or other problems, we may lose audience members and
not be able to generate revenues from the sale of advertising on our
website.

The establishment and maintenance of our website services
business will be essential to the success of the business.

Our systems could be
overwhelmed or could fail for any number of reasons. We currently promote our
products through the internet, and rely on the use of email to send distributors
and wholesalers information regarding our products. We may not be able to expand
our on-line marketing efforts, and may suffer obstacles in marketing on-line
should the following circumstances occur:

| | 1. | a power or telecommunications failure;  
| | -- | ----------------------------------------
| |    |                                         
| | 2. | human error; or                         
| |    |                                         
| | 3. | a fire, flood or other natural
disaster.

Additionally, our computer
systems and those of the third parties on which we depend may be vulnerable to
damage or interruption due to sabotage, computer viruses or other criminal
activities or security breaches.

The computer servers which
house our incoming email and our website are provided through Webstrike
Solutions, a non-related, Dallas based company. If the systems of this company
slow down significantly or fail even for a short time, our customers would
suffer delays in data access. These delays could damage our reputation and cause
customers to choose other lighting product suppliers. We currently do not have
any property and business interruption insurance to compensate us for any losses
we may incur. If any of these circumstances occur, then our ongoing operations
may be

---

19

harmed to the extent that we will be unable to sell our
products through our website, and/or promote via email and, as a result, you may
lose some or all of your investment in our common stock.

Because our officers, directors and principal shareholders
control a large percentage of our common stock, such insiders have the ability
to influence matters affecting our shareholders.

Our officers and
directors, in the aggregate, beneficially own 33.3% of the issued and
outstanding shares of our common stock. As a result, they have the ability to
influence matters affecting our shareholders, including the election of our
directors, the acquisition or disposition of our assets, and the future issuance
of our shares. Because our officers, directors and principal shareholders
control such shares, investors may find it difficult to replace our management
if they disagree with the way our business is being operated. Because the
influence by these insiders could result in management making decisions that are
in the best interest of those insiders and not in the best interest of the
investors, you may lose some or all of the value of your investment in our
common stock.

Because we do not have sufficient insurance to cover our
business losses, we might have uninsured losses, increasing the possibility that
you would lose your investment.

We may incur uninsured
liabilities and losses as a result of the conduct of our business. We do not
currently maintain any comprehensive liability or property insurance. Even if we
obtain such insurance in the future, we may not carry sufficient insurance
coverage to satisfy potential claims. We do not carry any business interruption
insurance. Should uninsured losses occur, any purchasers of our common stock
could lose their entire investment.

Because we can issue additional common shares, purchasers of
our common stock may incur immediate dilution and may experience further
dilution.

We are authorized to issue
up to 100,000,000 common shares, of which 9,010,000 are issued and outstanding.
Our board of directors has the authority to cause our company to issue
additional shares of common stock without the consent of any of our
shareholders. Consequently, our shareholders may experience more dilution in
their ownership of our company in the future.

RISKS ASSOCIATED WITH OUR COMMON STOCK

Because we do not intend to pay any dividends on our common
shares, investors seeking dividend income or liquidity should not purchase
shares in this offering.

We do not currently
anticipate declaring and paying dividends to our shareholders in the near
future. It is our current intention to apply net earnings, if any, in the
foreseeable future to increasing our working capital. Prospective investors
seeking or needing dividend income or liquidity should, therefore, not purchase
our common stock. We currently have no revenues and a history of losses, so
there can be no assurance that we will ever have sufficient earnings to declare
and pay dividends to the holders of our shares, and in any event, a decision to
declare and pay dividends is at the sole discretion of our board of directors,
who currently do not intend to pay any dividends on our common shares for the
foreseeable future.

Our stock is a penny stock. Trading of our stock may be
restricted by the Securities and Exchange Commissions penny stock regulations
which may limit a stockholders ability to buy and sell our stock.

Our stock is a penny
stock. The Securities and Exchange Commission has adopted Rule 15g-9 which
generally defines penny stock to be any equity security that has a market
price (as defined) less than $5.00 per share or an exercise price of less than
$5.00 per share, subject to certain exceptions. Our securities are covered by
the penny stock rules, which impose additional sales practice requirements on
broker-dealers who sell to persons other than established customers and
accredited investors. The term accredited investor refers generally to
institutions with assets in excess of $5,000,000 or individuals with a net worth
in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly
with their spouse. The penny stock rules require a broker-dealer, prior to a
transaction in a penny stock not otherwise exempt from the rules, to deliver a
standardized risk disclosure document in a form prepared by the SEC which
provides information about penny stocks and the nature and level of risks in the
penny stock market. The broker-dealer also must provide the customer with
current bid and offer quotations for the penny stock, the compensation of the
broker-dealer and

---

20

its salesperson in the transaction and monthly account
statements showing the market value of each penny stock held in the customers
account. The bid and offer quotations, and the broker-dealer and salesperson
compensation information, must be given to the customer orally or in writing
prior to effecting the transaction and must be given to the customer in writing
before or with the customers confirmation. In addition, the penny stock rules
require that prior to a transaction in a penny stock not otherwise exempt from
these rules; the broker-dealer must make a special written determination that
the penny stock is a suitable investment for the purchaser and receive the
purchasers written agreement to the transaction. These disclosure requirements
may have the effect of reducing the level of trading activity in the secondary
market for the stock that is subject to these penny stock rules. Consequently,
these penny stock rules may affect the ability of broker-dealers to trade our
securities. We believe that the penny stock rules discourage investor interest
in and limit the marketability of our common stock.

NASD sales practice requirements may also limit a
stockholders ability to buy and sell our stock.

In addition to the penny
stock rules promulgated by the Securities and Exchange Commission (see above
and the Market for Common Equity and Related Stockholder Matters section at
page 27 for discussions of penny stock rules), the NASD has adopted rules that
require that in recommending an investment to a customer, a broker-dealer must
have reasonable grounds for believing that the investment is suitable for that
customer. Prior to recommending speculative low priced securities to their
non-institutional customers, broker-dealers must make reasonable efforts to
obtain information about the customers financial status, tax status, investment
objectives and other information. Under interpretations of these rules, the NASD
believes that there is a high probability that speculative low priced securities
will not be suitable for at least some customers. The NASD requirements make it
more difficult for broker-dealers to recommend that their customers buy our
common stock, which may limit your ability to buy and sell our stock and have an
adverse effect on the market for our shares.

Item 6. Exhibits.

| | Exhibit | Description                                                                                                                                                                                             
| | ------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Number  |                                                                                                                                                                                                         
| | (3)     | Articles of Incorporation
      and Bylaws                                                                                                                                                              
| | 3.1     | Articles of Incorporation (incorporated by
      reference to our Registration Statement on Form SB-2 filed December 8,
      2006)                                                                     
| |         |                                                                                                                                                                                                         
| | 3.2     | Bylaws (incorporated by reference to our
      Registration Statement on Form SB-2 filed December 8, 2006)                                                                                              
| |         |                                                                                                                                                                                                         
| | (31)    | Section 302 Certifications                                                                                                                                                                              
| | 31.1*   | Certification
      of Principal Executive Officer and Principal Financial Officer filed pursuant
      to Section 302 of the Sarbanes-Oxley Act of 2002.                                               
| |         |                                                                                                                                                                                                         
| | (32)    | Section 906
      Certifications                                                                                                                                                                        
| | 32.1*   | Certification of Principal
      Executive Officer and Principal Financial Officer pursuant to 18 U.S.C.
      Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
      of 2002.

* Filed herewith

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21

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

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|By: /s/ Joe
      Loeppky                                                       | 
|------------------------------------------------------------------------------- | 
|Joe Loeppky President, Chief Executive Officer and Director                     | 
|(Principal Executive Officer, Principal Financial Officer
      and Controller) | 
|June 13, 2007                                                                   | 

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