UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
DC 20549








FORM
10-Q





x Quarterly Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the
quarterly period ended September 30,
2009





Commission
file number: 000-52490





Beyond
Commerce, Inc.


(Exact
name of registrant as specified in its charter)




Nevada
            98-0512515(State
      of incorporation or organization)
            (I.R.S.
      Employer Identification No.)





9029
South Pecos


Suite
2800


Henderson,
Nevada 89074


(Address
of principal executive offices, including zip code)





(702)
463-7000


(Registrant’s
telephone number, including area code)





SECURITIES
REGISTERED PURSUANT TO SECTION 12 (B) OF THE ACT


Title
of each class





NONE


SECURITIES
REGISTERED PURSUANT TO SECTION 12 (G) OF THE ACT:


COMMON
STOCK $0.001 PAR VALUE





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 has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such
files).       Yes  ̈ No  ̈.





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.




Large
      accelerated filer  ̈
            
            Accelerated
      filer  ̈Non-accelerated
      filer  ̈
            (Do
      not check if a smaller reporting company)
            Smaller
      reporting company 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





As of
November 13, 2009, there were outstanding 56,793,311 shares of the registrant’s
common stock.








BEYOND
COMMERCE, INC.


FORM
10-Q FOR THE QUARTER ENDED


September
30, 2009





Table of
Contents




PagePART
      I. FINANCIAL INFORMATIONItem
      1.   Financial StatementsCondensed
      Consolidated Balance Sheet at September 30, 2009 and December 31,
      2008 (Unaudited)
              
              3Condensed
      Consolidated Statements of Operations for the Three and Nine month period
      ended September 30, 2009 & 2008 (Unaudited)
              
              4-5Condensed
      Consolidated Statements of Cash Flows for the Nine month period ended
      September 30, 2009 & 2008 (Unaudited)
              
              6Notes
      to the Condensed Consolidated Financial Statements
    (Unaudited)
              
              7-
      24Item
      2. Management's Discussion and Analysis of Financial Condition and Results
      of Operations
              
              25-29Item
      3.Quantitative and
      Qualitative Information About Market Risk
              
              30Item4T.
      Controls and Procedures
              
              30PART
      II. OTHER INFORMATIONItem
      1.   Legal Proceedings
              
              30Item
      1A. Risk Factors
              
              31Item
      2.   Unregistered Sales of Equity Securities and Use of
      Proceeds
              
              31Item
      3.    Defaults upon Senior Securities
              
              31Item
      4.   Submission of Matters to Vote of Security
      Holders
              
              31Item
      5.   Other Information
              
              31Item
      6. Exhibits
              
              32SIGNATURES
              
              33


~ 2
~


PART
I - FINANCIAL INFORMATION


Item
1.   Financial Statements





BEYOND
COMMERCE


CONDENSED
CONSOLIDATED BALANCE SHEET


Unaudited




September 30,
                                          2009
                                        
                                        
                                        December 31,
                                          2008
                                          as adjusted,
                                          (Note 16)ASSETSCurrent
      assets :Cash
                                        
                                        $
                                        -
                                        
                                        
                                        $
                                        100,086Accounts
      receivable
                                        
                                        
                                        10,697
                                        
                                        
                                        
                                        226,091Prepaid
      loan cost
                                        
                                        
                                        1,079,633
                                        
                                        
                                        
                                        562,665Prepaid
      commissions
                                        
                                        
                                        736,274
                                        
                                        
                                        
                                        260,055Other
      current assets
                                        
                                        
                                        931,265
                                        
                                        
                                        
                                        46,230Total
      current assets
                                        
                                        $
                                        2,757,869
                                        
                                        
                                        $
                                        1,195,127Property,
      Web site and computer equipment
                                        
                                        
                                        1,392,447
                                        
                                        
                                        
                                        871,180Less:
      Accumulated depreciation and amortization
                                        
                                        
                                        (515,898
                                        )
                                        
                                        
                                        (320,366
                                        )Property,
      Web site and computer equipment – net
                                        
                                        $
                                        876,549
                                        
                                        
                                        $
                                        550,814Other
      Assets
                                        
                                        
                                        75,656
                                        
                                        
                                        
                                        60,067Total
      assets
                                        
                                        $
                                        3,710,074
                                        
                                        
                                        $
                                        1,806,008LIABILITIES AND STOCKHOLDERS’
      DEFICITCurrent
      liabilities:Short
      term borrowings, net of discount
                                        
                                        $
                                        7,079,079
                                        
                                        
                                        $
                                        2,400,555Short
      term borrowings, net of discount – related party
                                        
                                        
                                        1,160,305
                                        
                                        
                                        
                                        -Accounts
      payable
                                        
                                        
                                        1,962,157
                                        
                                        
                                        
                                        1,490,590Accounts
      payable - related party
                                        
                                        
                                        135,302
                                        
                                        
                                        
                                        19,552Checks
      Written In Excess of Cash
                                        
                                        
                                        134,217
                                        
                                        
                                        
                                        -Note
      derivative liability
                                        
                                        
                                        3,451,215
                                        
                                        
                                        
                                        3,396,935Other
      current liabilities
                                        
                                        
                                        2,299,685
                                        
                                        
                                        
                                        1,374,534Deferred
      Revenue
                                        
                                        
                                        1,809,130
                                        
                                        
                                        
                                        609,987Total
      current liabilities
                                        
                                        $
                                        18,031,090
                                        
                                        
                                        $
                                        9,292,153Stockholders’
      Deficit :Common
      stock, $0.001 par value, 200,000,000 and 75,000,000 shares authorized as
      of  September 30, 2009  and December 31, 2008,
      respectively, and 46,640,941and 40,936,143 issued and outstanding at
      September 30, 2009  and December 31, 2008,
      respectively
                                        
                                        $
                                        46,641
                                        
                                        
                                        $
                                        40,936Additional
      paid in capital
                                        
                                        
                                        21,370,934
                                        
                                        
                                        
                                        11,096,604Accumulated
      deficit
                                        
                                        
                                        (35,738,591
                                        )
                                        
                                        
                                        (18,623,685
                                        )Total
      stockholders' deficit
                                        
                                        $
                                        (14,321,016
                                        )
                                        
                                        $
                                        (7,486,145
                                        )Total
      Liabilities and Stockholders' Deficit
                                        
                                        $
                                        3,710,074
                                        
                                        
                                        $
                                        1,806,008





See
accompanying notes of these unaudited condensed financial
statements.


~ 3
~


BEYOND
COMMERCE, INC.


CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS


For
the three month period ended September 30,


Unaudited




2009
                  
                  
                  2008RevenuesAdvertising
      Revenue
                  
                  $
                  1,811,788
                  
                  
                  $
                  57,562Merchandising
      Revenue
                  
                  
                  240,078
                  
                  
                  
                  147,248Total
      Revenue
                  
                  
                  2,051,866
                  
                  
                  
                  204,810Operating
      expensesCost
      of advertising
                  
                  $
                  1,441,623
                  
                  
                  $
                  -Cost
      of merchandising
                  
                  
                  42,942
                  
                  
                  
                  165,630Selling
      general & administrative
                  
                  
                  2,106,072
                  
                  
                  
                  2,261,636Selling
      general & administrative - related party
                  
                  
                  90,412
                  
                  
                  
                  -Professional
      fees
                  
                  
                  725,559
                  
                  
                  
                  470,603Professional
      fees - related party
                  
                  
                  9,240
                  
                  
                  
                  24,616Depreciation
      and amortization
                  
                  
                  88,759
                  
                  
                  
                  47,762Total
      costs and operating expenses
                  
                  $
                  4,504,607
                  
                  
                  $
                  2,970,247Loss
      from operations
                  
                  
                  (2,452,741
                  )
                  
                  
                  (2,765,437
                  )Non-operating
      income (expense)Interest
      expense, net
                  
                  
                  (3,077,517
                  )
                  
                  
                  (1,266,619
                  )Interest
      expense – related party
                  
                  
                  (62,800
                  )
                  
                  
                  -Change
      in derivative liability
                  
                  
                  (2,942,287
                  )
                  
                  
                  -Total
      non-operating expense
                  
                  $
                  (6,082,604
                  )
                  
                  $
                  (1,266,619
                  )Loss
      from operations before income taxes
                  
                  
                  (8,535,345
                  )
                  
                  
                  (4,032,056
                  )Provision
      for income tax
                  
                  
                  -
                  
                  
                  
                  -Net
      loss
                  
                  $
                  (8,535,345
                  )
                  
                  $
                  (4,032,056
                  )Net
      loss available to common stockholders
                  
                  $
                  (8,535,345
                  )
                  
                  $
                  (4,032,056
                  )Basic
      and diluted net loss per common share
                  
                  $
                  (0.18
                  )
                  
                  $
                  (0.10
                  )Weighted
      average shares of common stock outstanding - basic
                  
                  
                  46,619,719
                  
                  
                  
                  39,481,833





See
accompanying notes of these unaudited condensed financial
statements.


~ 4
~


BEYOND
COMMERCE, INC.


CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS


For
the nine month period ended September 30,


Unaudited




2009
                  
                  
                  2008RevenuesAdvertising
      Revenue
                  
                  $
                  12,299,017
                  
                  
                  $
                  57,562Merchandising
      Revenue
                  
                  
                  409,051
                  
                  
                  
                  967,461Total
      Revenue
                  
                  
                  12,708,068
                  
                  
                  
                  1,025,023Operating
      expensesCost
      of advertising
                  
                  $
                  11,464,512
                  
                  
                  $
                  -Cost
      of merchandising
                  
                  
                  63,437
                  
                  
                  
                  1,050,113Selling
      general & administrative
                  
                  
                  8,444,784
                  
                  
                  
                  5,128,603Selling
      general & administrative - related party
                  
                  
                  246,052
                  
                  
                  
                  76,650Professional
      fees
                  
                  
                  2,764,040
                  
                  
                  
                  1,141,854Professional
      fees - related party
                  
                  
                  39,578
                  
                  
                  
                  102,673Depreciation
      and amortization
                  
                  
                  195,533
                  
                  
                  
                  134,343Total
      costs and operating expenses
                  
                  $
                  23,217,936
                  
                  
                  $
                  7,634,236Loss
      from operations
                  
                  
                  (10,509,868
                  )
                  
                  
                  (6,609,213
                  )Non-operating
      income (expense)Interest
      expense, net
                  
                  
                  (7,565,985
                  )
                  
                  
                  (2,378,091
                  )Interest
      expense – related party
                  
                  
                  (94,800
                  )
                  
                  
                  -Change
      in derivative liability
                  
                  
                  1,055,747
                  
                  
                  
                  -Total
      non-operating expense
                  
                  $
                  (6,605,038
                  )
                  
                  $
                  (2,378,091
                  )Loss
      from operations before income taxes
                  
                  
                  (17,114,906
                  )
                  
                  
                  (8,987,304
                  )Provision
      for income tax
                  
                  
                  -
                  
                  
                  
                  -Net
      loss
                  
                  $
                  (17,114,906
                  )
                  
                  $
                  (8,987,304
                  )Net
      loss available to common stockholders
                  
                  $
                  (17,114,906
                  )
                  
                  $
                  (8,987,304
                  )Basic
      and diluted net loss per common share
                  
                  $
                  (0.39
                  )
                  
                  $
                  (0.23
                  )Weighted
      average shares of common stock outstanding - basic
                  
                  
                  43,737,435
                  
                  
                  
                  37,805,466





See
accompanying notes of these unaudited condensed financial
statements.


~ 5
~


BEYOND
COMMERCE, INC.


CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS


For
the nine month period ended September 30,


Unaudited




2009
                  
                  
                  2008Net
      cash used in operating activities
                  
                  $
                  (6,200,151)
                  
                  
                  $
                  (5,590,315
                  )Cash
      flows from investing activities:Cash
      paid to purchase property and equipment
                  
                  
                  (521,268
                  )
                  
                  
                  (121,882
                  )Net
      cash used in investing activities
                  
                  $
                  (521,268
                  )
                  
                  $
                  (121,882
                  )Cash
      flows from financing activities:Issuance
      of stock - net of offering costs
                  
                  
                  20,000
                  
                  
                  
                  530,927Cash
      received from short term borrowings
                  
                  
                  9,158,000
                  
                  
                  
                  5,733,232Cash
      Paid for debt financing fees
                  
                  
                  (826,500)
                  
                  
                  
                  -Payment
      on short term borrowings - related party
                  
                  
                  -
                  
                  
                  
                  (635,000)Payment
      on short term borrowings
                  
                  
                  (1,730,167
                  )
                  
                  
                  -Net
      cash provided by financing activities
                  
                  $
                  6,621,333
                  
                  
                  $
                  5,629,159Net
      increase (decrease) in cash & cash equivalents
                  
                  
                  (100,086
                  )
                  
                  
                  (83,038
                  )Cash
      & cash equivalents, beginning balance
                  
                  
                  100,086
                  
                  
                  
                  111,247Cash
      & cash equivalents, ending balance
                  
                  $
                  -
                  
                  
                  $
                  28,209





See
accompanying notes of these unaudited condensed financial
statements.


~ 6
~




BEYOND
COMMERCE, INC.


NOTES
TO CONDENSED FINANCIAL STATEMENTS


(Unaudited)




NOTE
1         DESCRIPTION OF BUSINESS AND BASIS OF
PRESENTATION





Beyond
Commerce, Inc., formerly known as BOOMj, Inc. (the “Company”, and “we”), is an
Internet company that has two interrelated business models aimed at generating
revenues primarily from Web site advertising and E-commerce transactions. 
Our initial business wasBOOMj.com, Inc., www.BOOMj.com,
a niche portal and social networking site for Baby Boomers and Generation
Jones.  Our BOOMj.com Web site provides social, political, financial,
and lifestyle content to the Baby Boomer/Generation Jones target audience as a
platform for our advertising and E-commerce businesses. Our LocalAdLink subsidiary
operates a website, a local search directory and advertising network that brings
local advertising to geo-targeted consumers.  On October 9, 2009,
LocalAdLink Inc., a wholly-owned subsidiary of the Company sold its LocalAdLink
Software (the “Software”) and all of their assets related to the Software
including the rights to the name LocalAdLink, the LocalAdLink trademark,
the  Web site,www.LocalAdLink.com
, and a local search directory and advertising network that brings local
advertising to geo-targeted consumers, (see Note 15).  The Company will
continue to sell advertising as it had prior to inception of Local Ad Link,
Inc., however on a different scale with a greater emphasis on business to
business sales.





During
the second quarter we relaunched  i-SUPPLY, www.i-SUPPLY.com,
an online storefront that offers easy to use, fully customizable E-commerce
services, and revenue solutions for any third party Web site large or small, and
hosts local ads, providing extensive reach for our proprietary advertising
partner network platform.  During the third quarter of 2009 the
Company started another subsidiary, KaChing KaChing, which is an E-commerce
platform that provides a complete turn-key E-commerce solution. Individual
KaChing KaChing on line store owners have the ability to create, manage and earn
money from product sales generated from their individual Web
stores.





The
condensed consolidated financial statements and the notes thereto for the
periods ended September 30, 2009 and 2008 included herein have been prepared by
management and are unaudited. Such condensed financial statements reflect, in
the opinion of management, all adjustments necessary to present fairly the
financial position and results of operations as of and for the periods indicated
and in order to make the financial statements not misleading. All such
adjustments are of a normal recurring nature except for those described in Note
16 and related to the derivatives in Note 7. These interim results are not
necessarily indicative of the results for any subsequent period or for the
fiscal year ending December 31, 2009.





Certain
information and footnote disclosures normally included in the financial
statements prepared in accordance with accounting principles generally accepted
in the United States have been condensed or omitted pursuant to the rules and
regulations of the Securities and Exchange Commission.  These
consolidated financial statements should be read in conjunction with the audited
financial statements and the notes thereto for the fiscal year ended December
31, 2008 in the Form 10-K, filed with the SEC on April 3, 2009.





History
of the Company





The
Company, formerly known as Reel Estate Services, Inc. (“RES”), was incorporated
in Nevada on January 12, 2006.  As of December 28, 2007, RES was a
public shell company, defined by the Securities and Exchange Commission as an
inactive, publicly quoted company with nominal assets and
liabilities.





In
December 2008, the Company changed its name from BOOMj, Inc. to Beyond Commerce,
Inc. to more accurately reflect the new structure of the Company consisting of
two operating divisions: BOOMj.com dba i-SUPPLY and until its assets
were sold, LocalAdLink, Inc. (see Note 15).





The
Company currently maintains its corporate office in Henderson,
Nevada.


~ 7
~


NOTE 2 - SELECTED ACCOUNTING
POLICIES





Reclassifications





Certain
comparative amounts from prior periods have been reclassified to conform to the
current year's presentation. These changes did not affect previously reported
net loss.





Employee
Benefits


The
Company currently offers employees vacation benefits and during the second
quarter began offering a healthcare plan. During 2008, the Company implemented
the 2008 Equity Incentive Plan.





Accounting
Pronouncements





On
January 1, 2009, the Company adopted SFAS No. 157,Fair Value Measurements
(“SFAS 157”), for financial assets and financial liabilities. SFAS 157 defines
fair value, establishes a framework for measuring fair value under GAAP, and
expands disclosures about fair value measurements.





NOTE
3 – GOING CONCERN





The
Company's financial statements are prepared using generally accepted accounting
principles, which contemplate the realization of assets and liquidation of
liabilities in the normal course of business. However, even though the Company
has some degree of sales, it reflected a loss of $17,114,906 for the nine months
ended September 30, 2009 and it will need to accelerate its business model
implementation otherwise there is a need to raise additional capital and or
obtain financing to continue operations into 2010. The failure to realize the
improvement in the business model presents conditions that raise substantial
doubt about the Company’s ability to continue as a going concern. The financial
statements do not include any adjustments relating to the recoverability and
classification of recorded asset amounts or amounts and classification of
liabilities that might be necessary should the Company be unable to continue as
a going concern.





Management
has taken steps to improve the business operations along with raising additional
funds to address its operating and financial cash requirements to continue
operations in the next twelve months (see Notes 8 and 15). Management continues
to devote a significant amount of time in the raising of capital from additional
debt and equity financing. However, the Company’s ability to continue as a going
concern is dependent upon raising additional funds through debt and equity
financing and generating revenue. There are no assurances the Company will
receive the necessary funding or generate revenue necessary to fund
operations.





NOTE
4 - PROPERTY, WEB SITE AND COMPUTER EQUIPMENT





Property
and equipment at September 30, 2009 and December 31, 2008 consisted of the
following:




2009
                          
                          
                          2008Office
      and computer equipment
                          
                          $
                          307,542
                          
                          
                          $
                          186,614Web
      site and software
                          
                          
                          1,084,905
                          
                          
                          
                          684,566Total
      property, Web site and computer equipment
                          
                          
                          1,392,447
                          
                          
                          
                          871,180Less:
      accumulated depreciation and amortization
                          
                          
                          (515,898
                          )
                          
                          
                          (320,366
                          )$
                          876,549
                          
                          
                          $
                          550,814





Depreciation
and amortization expense for the three months and nine months ended September
30, 2009 were $88,759 and $195,533, respectively compared to $47,762 and
$134,343 for the same periods in 2008.





NOTE
5 – OTHER CURRENT ASSETS


Other
current assets consist of the following at September 30, 2009 and December 31,
2008





2009
                        
                        
                        2008Credit
      Card processor retention
                        
                        $
                        728,255
                        
                        
                        $
                        1,362Prepaid
      Insurance, legal, rent and advertising
                        
                        
                        8,356
                        
                        
                        
                        -Other
                        
                        
                        194,654
                        
                        
                        
                        44,868TOTAL
                        
                        $
                        931,265
                        
                        
                        $
                        46,230


~ 8
~


OTHER
ASSETS


Other
assets consist of the following at September 30, 2009 and December 31,
2008




2009
                    
                    
                    2008Rent
      Deposits
                    
                    $
                    49,904
                    
                    
                    $
                    20,828Credit
      Card Reserve
                    
                    
                    
                    
                    
                    
                    33,387Vendor
      Deposit
                    
                    
                    25,752
                    
                    
                    
                    5,852TOTAL
                    
                    $
                    75,656
                    
                    
                    $
                    60,067





NOTE
6 - ACCRUED EXPENSES





Accrued
expenses consist of the following at September 30, 2009 and December 31,
2008:





2009
                    
                    
                    2008Accrued
      interest
                    
                    
                    522,163
                    
                    
                    
                    388,783Accrued
      commission
                    
                    
                    -
                    
                    
                    
                    220,869Accrued
      payroll and related expenses
                    
                    
                    1,460,517
                    
                    
                    
                    625,997Other
                    
                    
                    317,005
                    
                    
                    
                    138,885$
                    2,299,685
                    
                    
                    $
                    1,374,534





See
Note 14 for related parties.





NOTE
7 – DERIVATIVE INSTRUMENTS





Several
of the notes contain provisions which if triggered would reset the conversion
price of the Notes including; (1) In the event the Company failed to timely
convert or deliver the conversion shares, the Notes went into default as defined
under the agreement or a change of control event; (2) a reset provision in the
conversion and exercise prices, should the Company subsequently issue any common
stock or instruments convertible or exchangeable into common stock of the
Company at a per share price lower than the then-in-effect conversion price
which, would automatically reset the conversion price of the Notes to that lower
price.  Because of these provisions, the Company determined that the
conversion feature was not clearly and closely related to the Note host contract
and under the guidance of Emerging Issues Task Force (“EITF”) 05-2 “The Meaning
of Conventional Convertible Debt Instrument Under EITF 00-19” and SFAS 133
“Accounting for Derivative Instruments and Hedging Activities” (“SFAS 133”) it
has bifurcated the conversion feature.  Because the conversion feature
is not considered to be conventional convertible and note holders have the
ability to demand cash settlement of the conversion feature, the amount recorded
has been shown as a liability at September 30, 2009 of
$3,451,215.  This liability was $3,396,935, as adjusted at December
31, 2008.  Under the requirements of SFAS 133, the Company has
remeasured the fair value of the conversion feature at each reporting period
after inception, with those changes in fair value being recorded in
the statement of operations.





NOTE
8 – SHORT TERM BORROWINGS





9/30/2009
                  
                  
                  12/31/2008Note
      payable to Carole Harder bearing an annual interest rate of 12%,
      unsecured, due 10/6/2009
                  
                  $
                  140,000
                  
                  
                  $
                  140,000Convertible
      Promissory Notes, bearing an annual interest rate of 12%, secured, due
      1/31/10
                  
                  
                  2,280,000
                  
                  
                  
                  4,280,000Convertible
      Promissory Notes, bearing an annual interest rate of 18%, secured, due
      11/16/09
                  
                  
                  1,333,333
                  
                  
                  
                  -Convertible
      Promissory Notes due 6/26/2010 (original note discount of
      $83,330)
                  
                  
                  583,330
                  
                  
                  
                  -Convertible
      Promissory Notes due 7/2/2010 (original note discount of
      $83,330)
                  
                  
                  583,330
                  
                  
                  
                  -Convertible
      Promissory Notes due 7/10/2010 (original note discount of
      $83,330)
                  
                  
                  583,330
                  
                  
                  
                  -Convertible
      Promissory Notes due 7/21/2010 (original note discount of
      $250,010)
                  
                  
                  1,750,010
                  
                  
                  
                  -Convertible
      Promissory Notes due 7/29/2010 (original note discount of
      $98,145)
                  
                  
                  641,663
                  
                  
                  
                  -Convertible
      Promissory Notes due 8/11/2010 (original note discount of
      $41,665)
                  
                  
                  291,665
                  
                  
                  
                  -Convertible
      Promissory Notes due 8/20/2010 (original note discount of
      $11,666)
                  
                  
                  116,666
                  
                  
                  
                  -Convertible
      Promissory Notes due 8/27/2010 (original note discount of
      $53,332)
                  
                  
                  373,332
                  
                  
                  
                  -Convertible
      Promissory Notes due 9/3/2010 (original note discount of
      $99,996)
                  
                  
                  699,996
                  
                  
                  
                  -Sundry Bridge Notes, bearing an annual
      interest rate 12%, unsecured, due between
      10/6/09-1/4/2010
                  
                  
                  1,280,000
                  
                  
                  
                  508,500Total
      principal
                  
                  $
                  10,656,655
                  
                  
                  $
                  4,928,500Less
      debt discount
                  
                  
                  (2,417,271
                  )
                  
                  
                  (2,527,945
                  )Net
      balance
                  
                  $
                  8,239,384
                  
                  
                  $
                  2,400,555


~ 9
~


The above
notes listed as Convertible Promissory Note Holders, except for $1,333,333, have
a lien on all the assets of the Company,





On
January 7, 2009 and February 10, 2009 the Company raised $100,000 and $60,000
respectively in a private offering from accredited investors. The securities
sold by the Company consisted of its 12% secured convertible promissory notes
and warrants to purchase 100,000 and 60,000 shares of the Company’s common
stock, respectively at an exercise price of $1.00. The warrants were valued
using the Black–Scholes method. This resulted in a total value of $117,885
assuming a fair value per share of $1.00, risk-free interest rates ranging of
1.50% to 1.74% respectively, based on the note issuance and 100% volatility
index.  Under EITF 00-27 and APB No. 14, we allocated the proceeds
from issuance of these notes and warrants based on the proportional fair value
for each item.  Consequently, we recorded a discount of $131,894 which
is being amortized over the term of these notes using an effective periodic
interest rate of between 46 and 63,146%,.  A beneficial conversion
discount was recorded on these convertible notes since these notes were
convertible into shares of common stock at an effective conversion price lower
than the fair value of the common stock.  The beneficial conversion
amount was limited to the portion of the cash proceeds allocated to those
convertible notes.





On
January 30 and February 25 and March 9, 2009, three of our 12% convertible note
holders converted their notes of $50,000, $105,000 and $50,000 respectively,
into shares of common stock at a conversion rate of $0.70.  This
resulted in an issuance of 71,429, 150,000 and 71,429 shares of common stock,
respectively.  In addition the three note holders also converted their
accumulated interest on their respective notes into shares of the Company’s
common stock at a conversion rate of $0.70.  The total interest
converted was $6,283, $13,727 and $3,617 respectively and converted into 8,976,
19,609 and 5,167 of the Company’s common shares, respectively.





During
March 2009, the holders of $2,025,000 of our secured convertible promissory
notes that were scheduled to mature on March 31, 2009 agreed to extend the
maturity date to July 31, 2009.  As consideration for their agreement
to extend the maturity date, we issued three-year warrants to the note holders
granting them the right to purchase an aggregate of 600,000 shares of our common
stock, at an exercise price of $1.00 per share. The Company recorded these
warrants at a value of $149,675 which is being amortized over the term of the
loan extensions.  During July 2009, the note holders, who had not yet
converted their notes into common shares, along with our July and August
noteholders having this same July 31st
maturity date agreed to extend the maturity date to January 31, 2010. These
holders have an aggregate of $2,380,000 of our secured convertible
promissory notes. We issued three-year warrants to the note holders granting
them the right to purchase an aggregate of 680,000 shares of our common stock,
at an exercise price of $1.00 per share. The Company recorded these warrants at
a value of $115,600 which is being amortized over the term of the loan
extensions.





On April
9, 2009,  the Company entered into financing with OmniReliant
Holdings, Inc. (“Omni”) pursuant to a purchase agreement whereby it sold to Omni
a convertible original issue discount promissory note in the principal amount of
$550,000 (the “First Note”), with the Company receiving proceeds of
$500,000.  The First Note is convertible at any time at the option of
Omni at a conversion price of $1.00 and is due on May 9, 2009.  Omni
also received warrants to purchase up to 500,000 shares of the Company’s Common
Stock with an exercise price of $1.00. There was a reset provision associated
with the note in regards to subsequent equity sales affecting the note and
warrants.  Based on subsequent financing transactions, the exercise
price of the warrants and the conversion price of the debt was reset to
$0.70.  In accordance with EITF 07-5, “Determining Whether an
Instrument (or Embedded Feature) is Indexed to an Entity’s Own Stock”, related
to the valuation of convertible notes and warrants with conversion features
and/or exercise features that can reset the conversion and/or exercise price
based on future equity transactions, the Company valued the warrants and
conversion feature of this note and bifurcated them from the host contract as a
derivative under SFAS 133 “Accounting for Derivative Instruments and Hedging
Activities” by recognizing an additional liability for the fair value assigned
to those derivative features of approximately  $92,000.  At
June 30, 2009 the value of the derivative related to the warrants was
approximately $10,000.  The value of this derivative at September 30,
2009 was $55,000.The change in the derivative was reported in the statement of
operations for the period ended September 30, 2009.  The company
recorded a discount on this note of approximately $216,000 related to the value
of the warrants to be amortized over the term of the note.  Since this
note was paid off on May 7, 2009, this discount was expensed and the derivative
related to the note was removed during the quarter ended June 30,
2009.


~ 10
~


During
April 2009, eight of our note holders converted the principal and interest of
their convertible promissory notes into shares of the Company common stock at a
conversion rate of $0.70 per share.  Total principal converted was
$665,000, which was converted into 950,000 of the Company common
shares.  Total accrued interest of $77,137 was converted into 110,580
of the Company common shares.





On May 1,
2009, the Company issued a 120 day promissory note at 12% interest to an
accredited investor for $800,000.  As a condition of the note, the
company issued the lender 400,000 warrants to purchase the Company's common
shares at a price of $1.00 per share. The warrants were valued using the
Black–Scholes method. This resulted in a total value of $363,965, assuming a
fair value per share of $1.00, risk-free interest rate of 1.98% and, based on
the note issuance and 100% volatility index.  Under EITF 00-27 and APB
No. 14, we allocated the proceeds from issuance of this note and warrants based
on the proportional fair value for each item.  The relative fair value
of the warrant was $250,160.  A beneficial conversion discount was
recorded on the convertible note since the note is convertible into shares of
common stock at an effective conversion price lower than the fair value of the
common stock. Consequently, we recorded a total discount of $772,160 which is
being amortized over the term of these notes using an effective periodic
interest rate of 436%.  The note was extended on July 15, 2009 in return
for monthly cash interest payments with the maturity date being moved to January
28, 2010. The broker received a cash fee of $80,000





On May 7,
2009 one of our note holders converted the principal and interest of their
convertible promissory note into shares of the Company common stock at a
conversion rate of $1.00 per share. Total principal converted was $100,000,
which was converted into 100,000 shares of the Company common
stock.  Total accrued interest converted was $4,000 into 4,000 of the
Company common shares.





On May
20, 2009, the Company executed a convertible promissory note (the “Note”) in the
principal amount of $1,600,000 payable to Linlithgow Holdings, LLC
(“Linlithgow”).  Pursuant to the Note, the Company promises to pay to
Linlithgow $1,600,000 in cash on November 20, 2009. The Note is convertible at
any time at a conversion price of $1.00 per share which was reset to $0.70 due
to a subsequent offering.  The Note bears an initial interest rate of
1.5% for the first month and increases by 1.5% per month until maturity. After
the maturity date, the default rate of interest becomes 18% per month or the
highest rate allowed by law, whichever is lower, until the date the Note amount
is actually paid. Further, as part of the consideration provided to the
Holder for the Note, the Holder also received a warrant for the purchase of up
to 1,782,000 shares of the Company’s common stock at an exercise price of $0.90
per share. The warrants are exercisable, in whole or in part, any time from and
after the date of issuance of the warrant. Due to a
subsequent  ratchet adjustment based on the issuance of warrants at a
lower per share price, the exercise price of these warrants has been adjusted to
$0.70. In accordance with EITF 07-5, “Determining Whether an Instrument (or
Embedded Feature) is Indexed to an Entity’s Own Stock”, related to the valuation
of convertible notes and warrants with conversion features and/or exercise
features that can reset the conversion and/or exercise price based on future
equity transactions, the Company valued the warrants and conversion feature of
this note and bifurcated them from the host contract as a derivative under SFAS
133 “Accounting for Derivative Instruments and Hedging Activities” by
recognizing an additional liability for the fair value assigned to those
derivative features of  approximately $618,000 at inception of the
agreement.  At September 30, 2009 the value of the derivative was
approximately $182,000.  The change in the derivative was reported in
the statement of operations for the period ended September 30,
2009.  The company recorded the discount on this note of approximately
$465,000 related to the value of the warrants and derivative liability to be
amortized over the term of the note at an effective rate
12%.  Additionally, the warrants issued as costs of this financing
were valued at approximately $1,125,000 and are being amortized over the term of
the note.  The broker also received a cash fee of $120,000
from the proceeds of this note.





During
May 2009, seven of our note holders converted the principal and interest of
their convertible promissory notes into shares of the Company common stock at a
conversion rate of $.70 per share.  Total principal converted was
$920,000, which was converted into 1,314,285 of the Company common
shares.  Total accrued interest of $105,340 was converted into 150,487
of the Company common shares.


~ 11
~


On June
4, 2009 the Company sold a Convertible Original Issue Discounted (OID)
promissory note for $526,316 to an accredited investor which is due
1/15/2010.  The Company paid the broker a cash fee of
$50,000.  However, on June 19, 2009, the average trading volume of the
common stock of the Company was under $80,000 for the ten prior consecutive
trading days, which constituted a technical “Event of Default” under the
Company’s Series 2009 Secured Convertible Original Issue Discount Note Due
January 15, 2010, dated June 4, 2009 (the “Note”), made by the Company, in favor
of St. George Investments, LLC (St. George). As a result of the Event of
Default, the principal amount of the Note, equal to $714,286, plus a penalty of
$71,428.60 (equal to 10% of the principal amount), became immediately due and
payable. At any time following either the Maturity Date or occurrence of an
Event of Default, the note may be convertible into shares of the Common Stock of
the Company valued at the Market Price which is hundred percent (100%) of the
lower of (a) the closing bid price on the trading day on which the Share
Conversion Request is made or (b) the average of the volume weighted average
prices as reported by Bloomberg, L.P. during the ten (10) trading days in the
primary trading market for Common Shares prior to and including the trading day
on which the Share Conversion Request is made.





The St.
George Note was secured by an aggregate of 4,020,000 shares of the Company’s
common stock pledged by affiliates of the Company, pursuant to stock pledge
agreements entered into by the affiliates in favor of St. George, including
2,020,000 shares pledged by Mark Noffke, the Company’s chief financial officer.
Pursuant to the pledge agreement entered into by Mr. Noffke, shares pledged by
Mr. Noffke may be transferred to St. George and sold in full satisfaction of the
Company’s obligations under the Note.





Subsequently,
the Company and St. George Investments, LLC, entered into an agreement dated
July 30, 2009 (the “Agreement”) pursuant to which the Company would satisfy the
remaining outstanding balance of $420,593.40 on its Series 2009 Secured
Convertible Original Issue Discount Note, due June 15, 2010, issued to St.
George (the “Note”).  Pursuant to the Agreement, the Company was to
make the following payments (the “Scheduled Payments”) on the
Note:  (i) $100,000 paid on July 30, 2009, (ii) $50,000 was to be paid
by August 6, 2009, (iii) 50,000 was to be paid by August 13, 2009, (iv) $50,000
was to be paid by August 20, 2009, (v) $50,000 shall be paid by August 27, 2009,
(vi) $50,000 was to be paid on or before September  3, 2009, (vii)
$50,000 was to be paid on or before September 10, 2009 and (viii) $20,995.40 was
to be paid on or before September 17, 2009.  The Company settled the
first two payments of the Agreement.  In addition, when the note was
deemed in default, St. George took collateral and monetized it towards payment
of the note.  Provided the Scheduled Payments continued to be made in
accordance with the Agreement, the Note would be deemed paid in full and St.
George would return the remaining 3,015,424 shares of the Company’s common stock
not previously monetized which had been pledged as security for repayment of the
Note, and would not hold any other shares pledged in connection with the
Note.  The August payments were not made and St. George monetized
1,988,592 of the 2,020,000 shares pledged by Mark Noffke for full payment of the
note. The average sale price of these shares range from $0.70 to $0.16 over a
three month period ending September 9, 2009 when the Company used $95,000 to pay
off the balance of the note.





On June
16, 2009, the Company entered into another financing with Omni pursuant to a
second purchase agreement whereby it sold Omni a convertible original issue
discount promissory note (the “Second Note”) in the principal amount of
$575,000, with the Company receiving proceeds of $500,000.  Pursuant
to the terms of the Second Note, the Company must pay to the Holder $575,000 in
cash on August 1, 2009. The Second Note is convertible at any time at a
conversion price of $0.70 per share. In addition, the Company gave the lender
700,000 and the broker 121,714 warrants to purchase the Company stock,
respectively, both with an exercise price of $0.70. In accordance with EITF
07-5, “Determining Whether an Instrument (or Embedded Feature) is Indexed to an
Entity’s Own Stock”, related to the valuation of convertible notes and warrants
with conversion features and/or exercise features that can reset the conversion
and/or exercise price based on future equity transactions, the Company valued
the warrants and conversion feature of this note and bifurcated them from the
host contract as a derivative under SFAS 133 “Accounting for Derivative
Instruments and Hedging Activities” by recognizing an additional liability for
the fair value assigned to those derivative features of  approximately
$24,000 at inception of the agreement.  At September 30, 2009 the
value of the derivative was approximately $77,000.  The change in the
derivative was reported in the statement of operations for the period ended
September 30, 2009.  The company recorded a discount on this note of
approximately $175,000 related to the value of the warrants and derivative
liabilities to be amortized over the term of the note at an effective rate of
24%.  Additionally, the warrants and related derivative liability
issued as costs of this financing were valued at approximately $25,000 and are
being amortized over the term of the note. The Broker received a cash payment of
$40,000 from the proceeds of the note. The note was paid in full on July 20,
2009.





On June
29, 2009, the Company entered into a Securities Purchase Agreement (the
“Securities Purchase Agreement”) with Omni. Additionally, on July 2, 2009, the
Company and Omni entered into an amended and restated Securities Purchase
Agreement (the Purchase Agreement as amended and restated is referred to herein
as the “Securities Purchase Agreement”).  Pursuant to the Securities
Purchase Agreement, Omni agreed to purchase up to $3,500,000 in principal amount
of the Company’s Original Issue Discount Secured Convertible Debentures (the
“Debentures”) for a purchase price of up to $3,000,000.  As part of
this Agreement 5,000,000 shares of the Company’s Common Stock held by Linlithgow
Holdings, LLC was pledged as collateral.


~ 12
~


Pursuant
to the Securities Purchase Agreement, the Company sold Omni an aggregate of
$1,166,660 of Debentures and received gross proceeds of $1,000,000 and Omni
agreed to purchase an additional Debenture with a face value of up to $2,333,340
on or before July 30, 2009.  Omni was also issued warrants to purchase
4,999,972 shares of the Company’s Common Stock with an exercise price of $0.70
per share subject to a reset provision. The warrants are exercisable, for five
years from the date of issuance.  The Debentures are convertible into
shares of the Company’s Common Stock at any time at the option of the Holder at
a conversion price of $0.70 per share, subject to adjustment (the “Conversion
Price”).  Interest on the Debenture is 10% per annum.  The
first Debenture was issued on June 29, 2009 and the second Debenture to be
issued on July 2, 2009.  The principal amount of each of the
Debentures is $583,350 and each has a maturity date of twelve months from the
date of issuance.  The Debentures cannot be converted to common stock
to the extent such conversion would cause the holder of the Debenture, together
with such holder’s affiliates, to beneficially own in excess of 4.99% (or a
maximum 9.99% in certain cases) of the Company’s outstanding common stock
immediately following such conversion.  As part of the Agreement,
2,499,986 five year warrants to purchase the Company stock at $0.70 were issued
to Omni at a value of $270,000.





Beginning
six months from the original issue date of the  Debentures, on the 1st of
each month (the “Monthly Redemption Date”) the Company must redeem the Monthly
Redemption Amount ($97,221.66 for each $583,330 Debenture, plus accrued but
unpaid interest, liquidated damages and any other amounts then owing to the
Holder under the Debenture). The Monthly Redemption Amount payable on each
Monthly Redemption Date shall be paid in cash at a rate of 110% of the Monthly
Redemption Amount or upon 30 trading days’ notice the Company may in lieu of
cash pay all or part of the Monthly Redemption Amount in conversion
shares.





Payment
of the Debentures issued to Omni is secured pursuant to a security interest and
pledge agreement (the “Security Interest and Pledge Agreement”) whereby, on June
29, 2009, Linlithgow Holdings LLC pledged 2,500,000 shares of BYOC common
stock.  On July 2, 2009, the Company and Omni amended the Security
Interest and Pledge Agreement so that additional pledgors could pledge their
respective unpledged shares of BYOC Common Stock (the Security Interest and
Pledge Agreement, as amended and restated, is referred to herein as the
“Security Interest and Pledge Agreement”).  Pursuant to the terms of
the Security Interest and Pledge Agreement, Linlithgow Holdings, LLC pledged an
additional 3,982,000 shares of BYOC Common Stock, Wendy Borow-Johnson, the
President of Brand Management pledged 480,000 shares BYOC Common Stock, and
Robert McNulty, the Chief Executive Officer of the Company, pledged 505,000
shares of BYOC Common Stock.





On June
29, 2009, the Company issued Omni the first Debenture in the amount of $583,350
and received gross proceeds of $500,000. There is a reset provision associated
with the note in regards to the payment date.  Additionally, there is a
provision in the agreement, whereby, if there is a change in control of the
Company, the holder has the right to accelerate payment which is based off a
formula which could result in a payment greater than the principal and interest
amount owing before the change of control.  In addition for the receipt of
funds, the company issued the lender 2,499,986 and the broker 266,669 warrants
to purchase the Company’s common stock at a price of $0.70, respectively. In
accordance with EITF 07-5, “Determining Whether an Instrument (or Embedded
Feature) is Indexed to an Entity’s Own Stock”, related to the valuation of
convertible notes and warrants with conversion features and/or exercise features
that can reset the conversion and/or exercise price based on future equity
transactions, the Company valued the warrants and conversion feature of this
note and bifurcated them from the host contract as a derivative under SFAS 133
“Accounting for Derivative Instruments and Hedging Activities” by recognizing an
additional liability for the fair value assigned to those derivative features
of  approximately $74,000 at inception of the agreement.  At
September 30, 2009 the value of the derivative was approximately
$287,000.  The change in the derivative was reported in the statement
of operations for the period ended September 30, 2009.  The company
recorded a discount on this note of approximately $298,000 related to the value
of the warrants and derivative liability to be amortized over the term of the
note at an effective rate of 20%.  Additionally, the warrants issued
and related derivative liability as costs of this financing were valued at
approximately $65,000 and are being amortized over the term of the note. 
The Company also paid the broker a $40,000 cash fee.





Also,
during June 2009, two of our note holders converted the principal and interest
of their convertible promissory notes into shares of the Company common stock at
a conversion rate of $.70 per share.  Total principal converted was
$110,000, which was converted into 157,143 of the Company common
shares.  Total accrued interest of $12,940 was converted into 18,485
of the Company common shares.


~ 13
~


On July
2, 2009, the Company issued Omni the second Debenture in the amount of $583,350
and received gross proceeds of $500,000. There is reset provision associated
with the note in regards to the payment date.  Additionally, there is a
provision in the agreement, whereby, if there is a change in control of the
Company, the holder has the right to accelerate payment which is based off a
formula which could result in a payment greater than the principal and interest
amount owing before the change of control.  In addition for the receipt of
funds, the company issued the lender 2,499,986 and the broker 266,669 warrants
to purchase the Company’s common stock at a price of $0.70, respectively. In
accordance with EITF 07-5, “Determining Whether an Instrument (or Embedded
Feature) is Indexed to an Entity’s Own Stock”, related to the valuation of
convertible notes and warrants with conversion features and/or exercise features
that can reset the conversion and/or exercise price based on future equity
transactions, the Company valued the warrants and conversion feature of this
note and bifurcated them from the host contract as a derivative under SFAS 133
“Accounting for Derivative Instruments and Hedging Activities” by recognizing an
additional liability for the fair value assigned to those derivative features
of  approximately $46,000 at inception of the agreement.  At
September 30, 2009 the value of the derivative was approximately
$286,000.  The change in the derivative was reported in the statement
of operations for the period ended September 30, 2009.  The company
recorded a discount on this note of approximately $325,000 related to the value
of the warrants, derivative liability and OID to be amortized over the term of
the note at an effective rate of 20%.  Additionally, the warrants
issued and related derivative liability as costs of this financing were valued
at approximately $51,000 and are being amortized over the term of the
note.  The Company also paid the broker a $40,000 cash fee.





On July
10, 2009, the Company issued Omni the third Debenture in the amount of $583,350
and received gross proceeds of $500,000. There is reset provision associated
with the note in regards to the payment date.  Additionally, there is a
provision in the agreement, whereby, if there is a change in control of the
Company, the holder has the right to accelerate payment which is based off a
formula which could result in a payment greater than the principal and interest
amount owing before the change of control.  In addition for the receipt of
funds, the company issued the lender 2,499,986 and the broker 266,669 warrants
to purchase the Company’s common stock at a price of $0.70. In accordance with
EITF 07-5, “Determining Whether an Instrument (or Embedded Feature) is Indexed
to an Entity’s Own Stock”, related to the valuation of convertible notes and
warrants with conversion features and/or exercise features that can reset the
conversion and/or exercise price based on future equity transactions, the
Company valued the warrants and conversion feature of this note and bifurcated
them from the host contract as a derivative under SFAS 133 “Accounting for
Derivative Instruments and Hedging Activities” by recognizing an additional
liability for the fair value assigned to those derivative features
of  approximately $46,000 at inception of the agreement.  At
September 30, 2009 the value of the derivative was approximately
$288,000.  The change in the derivative was reported in the statement
of operations for the period ended September 30, 2009.  The company
recorded a discount on this note of approximately $319,000 related to the value
of the warrants, derivative liability and OID to be amortized over the term of
the note at an effective rate of 20%.  Additionally, the warrants
issued and related derivative liability as costs of this financing were valued
at approximately $49,000 and are being amortized over the term of the
note.  The Company also paid the broker a $40,000 cash fee.





On July
21, 2009, the Company issued Omni the fourth Debenture in the amount of
$1,750,010 and received gross proceeds of $1,500,000. There is reset provision
associated with the note in regards to the payment date.  Additionally,
there is a provision in the agreement, whereby, if there is a change in control
of the Company, the holder has the right to accelerate payment which is based
off a formula which could result in a payment greater than the principal and
interest amount owing before the change of control.  In addition for the
receipt of funds, the company issued the lender 7,500,042 and the broker 800,001
warrants to purchase the company common stock at a price of $0.70. In accordance
with EITF 07-5, “Determining Whether an Instrument (or Embedded Feature) is
Indexed to an Entity’s Own Stock”, related to the valuation of convertible notes
and warrants with conversion features and/or exercise features that can reset
the conversion and/or exercise price based on future equity transactions, the
Company valued the warrants and conversion feature of this note and bifurcated
them from the host contract as a derivative under SFAS 133 “Accounting for
Derivative Instruments and Hedging Activities” by recognizing an additional
liability for the fair value assigned to those derivative features
of  approximately $112,000 at inception of the
agreement.  At September 30, 2009 the value of the derivative was
approximately $863,000.  The change in the derivative was reported in
the statement of operations for the period ended September 30,
2009.  The company recorded a discount on this note of approximately
$853,000 related to the value of the warrants, derivative liability and OID to
be amortized over the term of the note at an effective rate of
20%.  Additionally, the warrants issued and related derivative
liability as  costs of this financing were valued at approximately
$112,000 and are being amortized over the term of the note.  The Company
also paid the broker a $120,000 cash fee.





On July
21, 2009, the Company paid Omni  in full an OID promissory note dated
June16, 2009 in the amount of $575,000. Also on this date, the Company paid on
behalf of Linlithgow Holdings, Inc, Debt Opportunity Fund a payment of $266,667
on a promissory note dated 5/20/09.


~ 14
~


On July
29, 2009, the Company issued Omni the fifth Debenture in the amount of $641,663
and received gross proceeds of $550,000. There is reset provision associated
with the note in regards to the payment date.  Additionally, there is a
provision in the agreement, whereby, if there is a change in control of the
Company, the holder has the right to accelerate payment which is based off a
formula which could result in a payment greater than the principal and interest
amount owing before the change of control.  In addition for the receipt of
funds, the company issued the lender 2,777,764 and the broker 293,333 warrants
to purchase the Company’s common stock at a price of $0.70, respectively. In
accordance with EITF 07-5, “Determining Whether an Instrument (or Embedded
Feature) is Indexed to an Entity’s Own Stock”, related to the valuation of
convertible notes and warrants with conversion features and/or exercise features
that can reset the conversion and/or exercise price based on future equity
transactions, the Company valued the warrants and conversion feature of this
note and bifurcated them from the host contract as a derivative under SFAS 133
“Accounting for Derivative Instruments and Hedging Activities” by recognizing an
additional liability for the fair value assigned to those derivative features
of  approximately $43,000 at inception of the agreement.  At
September 30, 2009 the value of the derivative was approximately
$319,000.  The change in the derivative was reported in the statement
of operations for the period ended September 30, 2009.  The company
recorded a discount on this note of approximately $324,000 related to the value
of the warrants, derivative liability and OID to be amortized over the term of
the note at an effective rate of 20%.  Additionally, the warrants
issued and related derivative liability as costs of this financing were valued
at approximately $44,000 and are being amortized over the term of the
note.  The Company also paid the broker a $44,000 cash fee.





On August
4, 2009, one of our 12% convertible note holders converted their note of
$100,000 into shares of common stock at a conversion rate of $0.35. This
resulted in an issuance of 285,714 shares of common stock.  In
addition the note holder also converted their accumulated interest on their note
into shares of the Company’s common stock at a conversion rate of
$0.35.  The total interest converted was $18,567 and converted into
53,048 of the Company’s common shares.





On August
11, 2009 the Company issued Omni the sixth Debenture in the amount of $291,665
and received gross proceeds of $250,000. There is reset provision associated
with the note in regards to the payment date.  Additionally, there is a
provision in the agreement, whereby, if there is a change in control of the
Company, the holder has the right to accelerate payment which is based off a
formula which could result in a payment greater than the principal and interest
amount owing before the change of control. In addition for the receipt of funds,
the company issued the lender 1,250,000 and the broker 133,333 warrants to
purchase the Company’s common stock at a price of $0.70, respectively. In
accordance with EITF 07-5, “Determining Whether an Instrument (or Embedded
Feature) is Indexed to an Entity’s Own Stock”, related to the valuation of
convertible notes and warrants with conversion features and/or exercise features
that can reset the conversion and/or exercise price based on future equity
transactions, the Company valued the warrants and conversion feature of this
note and bifurcated them from the host contract as a derivative under SFAS 133
“Accounting for Derivative Instruments and Hedging Activities” by recognizing an
additional liability for the fair value assigned to those derivative features
of  approximately $19,000 at inception of the agreement.  At
September 30, 2009 the value of the derivative was approximately
$139,000.  The change in the derivative was reported in the statement
of operations for the period ended September 30, 2009.  The company
recorded a discount on this note of approximately $142,000 related to the value
of the warrants, derivative liability and OID to be amortized over the term of
the note at an effective rate of 20%.  Additionally, the warrants
issued and related derivative liability as costs of this financing were valued
at approximately $19,000 and are being amortized over the term of the
note.  The Company also paid the broker a $20,000 cash fee.





On August
20, 2009, the Company issued Omni the seventh Debenture in the amount of
$116,666 and received gross proceeds of $100,000. There is reset provision
associated with the note in regards to the payment date.  Additionally,
there is a provision in the agreement, whereby, if there is a change in control
of the Company, the holder has the right to accelerate payment which is based
off a formula which could result in a payment greater than the principal and
interest amount owing before the change of control.  In addition for the
receipt of funds, the company issued the lender 500,000and the broker 53,333
warrants to purchase the Company’s common stock at a price of $0.70,
respectively. In accordance with EITF 07-5, “Determining Whether an Instrument
(or Embedded Feature) is Indexed to an Entity’s Own Stock”, related to the
valuation of convertible notes and warrants with conversion features and/or
exercise features that can reset the conversion and/or exercise price based on
future equity transactions, the Company valued the warrants and conversion
feature of this note and bifurcated them from the host contract as a derivative
under SFAS 133 “Accounting for Derivative Instruments and Hedging Activities” by
recognizing an additional liability for the fair value assigned to those
derivative features of  approximately $3,000 at inception of the
agreement.  At September 30, 2009 the value of the derivative was
approximately $55,000.  The change in the derivative was reported in
the statement of operations for the period ended September 30,
2009.  The company recorded a discount on this note of approximately
$43,000 related to the value of the warrants, derivative liability and OID to be
amortized over the term of the note at an effective rate of
20%.  Additionally, the warrants issued and related derivative
liability as costs of this financing were valued at approximately $5,000 and are
being amortized over the term of the note.


~ 15
~


On August
27, 2009 the Company issued Omni the eighth Debenture in the amount of $373,332
and received gross proceeds of $320,000. There is reset provision associated
with the note in regards to the payment date.  Additionally, there is a
provision in the agreement, whereby, if there is a change in control of the
Company, the holder has the right to accelerate payment which is based off a
formula which could result in a payment greater than the principal and interest
amount owing before the change of control.  In addition for the receipt of
funds, the company issued the lender 1,600,000 and the broker 170,667 warrants
to purchase the Company’s common stock at a price of $0.70, respectively. In
accordance with EITF 07-5, “Determining Whether an Instrument (or Embedded
Feature) is Indexed to an Entity’s Own Stock”, related to the valuation of
convertible notes and warrants with conversion features and/or exercise features
that can reset the conversion and/or exercise price based on future equity
transactions, the Company valued the warrants and conversion feature of this
note and bifurcated them from the host contract as a derivative under SFAS 133
“Accounting for Derivative Instruments and Hedging Activities” by recognizing an
additional liability for the fair value assigned to those derivative features
of  approximately $10,000 at inception of the agreement.  At
September 30, 2009 the value of the derivative was approximately
$178,000.  The change in the derivative was reported in the statement
of operations for the period ended September 30, 2009.  The company
recorded a discount on this note of approximately $138,000 related to the value
of the warrants, derivative liability and OID to be amortized over the term of
the note at an effective rate of 20%.  Additionally, the warrants
issued and related derivative liability as costs of this financing were valued
at approximately $13,000 and are being amortized over the term of the
note.





On
September 3, 2009 the Company issued Omni the ninth Debenture in the amount of
$699,996 and received gross proceeds of $600,000. There is reset provision
associated with the note in regards to the payment date.  Additionally,
there is a provision in the agreement, whereby, if there is a change in control
of the Company, the holder has the right to accelerate payment which is based
off a formula which could result in a payment greater than the principal and
interest amount owing before the change of control.  In addition for the
receipt of funds, the company issued the lender 3,000,000 and the broker 266,669
warrants to purchase the C ompany’s common stock at
a price of $0.70, respectively. In accordance with EITF 07-5, “Determining
Whether an Instrument (or Embedded Feature) is Indexed to an Entity’s Own
Stock”, related to the valuation of convertible notes and warrants with
conversion features and/or exercise features that can reset the conversion
and/or exercise price based on future equity transactions, the Company valued
the warrants and conversion feature of this note and bifurcated them from the
host contract as a derivative under SFAS 133 “Accounting for Derivative
Instruments and Hedging Activities” by recognizing an additional liability for
the fair value assigned to those derivative features of  approximately
$22,000 at inception of the agreement.  At September 30, 2009 the
value of the derivative was approximately $329,000.  The change in the
derivative was reported in the statement of operations for the period ended
September 30, 2009.  The company recorded a discount on this note of
approximately $275,000 related to the value of the warrants, derivative
liability and OID to be amortized over the term of the note at an effective rate
of 20%.  Additionally, the warrants issued and related derivative
liability as costs of this financing were valued at approximately $23,000 and
are being amortized over the term of the note.  The Company also paid the
broker a $40,000 cash fee.





The
Company recorded $7,608,178 and $3,136,792 as interest expense on the above
notes for nine month period ended September 30, 2009 and 2008, respectively.
Included in the interest expense amount noted above is the amortization of
$6,723,076 and $2,909,890 of loan origination fees and discount associated with
these notes for the Nine months ended September 30, 2009 and 2008
respectively.





NOTE
9 - COMMON STOCK, WARRANTS AND PAID IN CAPITAL





Common
Stock





On
January 5, 2009, we issued 1,000 shares of common stock to an individual for
services rendered with setting up our debit card program used for paying our
sales representatives valued at $1.00 per share





On
January 12, 2009 we issued 25,000 shares of common stock for cash at $0.80 per
share to an accredited investor.


~ 16
~


On
January 30, February 25 and March 9, 2009, three of our 12% convertible note
holders converted their notes of $50,000, $105,000 and $50,000 respectively,
into shares of common stock at a conversion rate of $0.70.  This
resulted in an issuance of 71,429, 150,000 and 71,429 shares of common stock,
respectively.  In addition these three note holders also converted
their accumulated interest on their respective notes into shares of the
Company’s common stock at a conversion rate of $0.70.  The total
interest converted was $6,283, $13,727 and $3,617 respectively and converted
into 8,976, 19,609 and 5,167 of the Company’s common shares,
respectively.





In
January 2009, we issued 10,000 shares of our common stock for services provided
as a commission for assisting the Company with fund raising. The shares were
valued at $1.00.





On
February 11, 2009, we issued 52,000 shares of our common stock for services
rendered in connection with our convertible bridge loans procured during the
fourth quarter 2008. This amount had been accrued for at $1.00 per share when
the service was provided in 2008.





On
February 18, 2009, we issued 5,000 shares of stock as compensation to an
employee with a value of $1.00 per share.





On April
6, 2009 three individual warrant holders exercised the cashless option and
converted their warrants into 189,086; 47,276 and 48,504 of Company common
stock.





On April
14 and April 24, 2009 two individual warrant holders exercised the cashless
option and converted their warrants into 36,160 and 39,920 shares of Company
common stock, respectively.





On April
15, 2009, the Company issued 25,000 shares of common stock at $1.44 per share
value for professional services received.





On April
30, 2009, the Company issued 126,988 unrestricted shares of common stock in lieu
of $198,101 of cash commissions earned by 16 different independent sales
representatives.





On May 1,
2009, the Company issued 70,000 unrestricted shares of common stock in payment
of $101,100 of professional services received.





On May
21, 2009, the Company issued 2,500 shares of common stock valued at $1.00 as
compensation to an employee.





On May
22, 2009, the Company issued 14,514 unrestricted shares of common stock in lieu
of $14,514 of cash commissions earned by 16 different independent sales
representatives.





On June
1, 2009, the Company issued 15,000 unrestricted shares of common stock and
40,000 shares of restricted common stock in lieu of $55,000 of cash commissions
earned by 4 different independent sales representatives.





On June
2, 2009, the Company issued 200,000 shares of unrestricted common stock for
professional services received with a value of $202,000.





On June
9, 2009, the Company issued 15,000 unrestricted shares of common stock and
35,000 shares of restricted common stock in lieu of $61,000 of cash commissions
earned by 2 different independent sales representatives.





On June
25, 2009, the Company issued 2,000 unrestricted shares of common stock and 7,500
shares of restricted common stock in lieu of $9,500 of cash commissions earned
by 2 different independent sales representatives.





On June
25, 2009, the Company issued 100,000 unrestricted common stock valued at $84,000
for professional services received.


~ 17
~


During
the three months ended June 30, 2009, the Company had 17 of our 12% convertible
notes converted into shares of our common stock by 16 individual note holders as
follows:




Conversion
                          Date
                        
                        Principal
                          Converted
                        
                        
                        Principal
                          Shares Issued
                        
                        
                        Interest
                          Converted
                        
                        
                        Interest Shares
                          Issued
                        
                        
                        Conversion
                          Rate4/6/2009
                        
                        $
                        75,000
                        
                        
                        
                        107,143
                        
                        
                        $
                        6,775
                        
                        
                        
                        9,679
                        
                        
                        
                        0.704/6/2009
                        
                        $
                        200,000
                        
                        
                        
                        285,714
                        
                        
                        $
                        17,533
                        
                        
                        
                        25,048
                        
                        
                        
                        0.704/6/2009
                        
                        $
                        100,000
                        
                        
                        
                        142,857
                        
                        
                        $
                        8,833
                        
                        
                        
                        12,619
                        
                        
                        
                        0.704/20/2009
                        
                        $
                        50,000
                        
                        
                        
                        71,429
                        
                        
                        $
                        7,983
                        
                        
                        
                        11,405
                        
                        
                        
                        0.704/27/2009
                        
                        $
                        50,000
                        
                        
                        
                        71,429
                        
                        
                        $
                        7,366
                        
                        
                        
                        10,905
                        
                        
                        
                        0.704/27/2009
                        
                        $
                        100,000
                        
                        
                        
                        142,857
                        
                        
                        $
                        15,267
                        
                        
                        
                        21,810
                        
                        
                        
                        0.704/6/2009
                        
                        $
                        5,000
                        
                        
                        
                        7,143
                        
                        
                        $
                        728
                        
                        
                        
                        1,040
                        
                        
                        
                        0.704/17/2009
                        
                        $
                        5,000
                        
                        
                        
                        7,143
                        
                        
                        $
                        747
                        
                        
                        
                        1,067
                        
                        
                        
                        0.704/22/2009
                        
                        $
                        5,000
                        
                        
                        
                        7,143
                        
                        
                        $
                        755
                        
                        
                        
                        1,079
                        
                        
                        
                        0.704/6/2009
                        
                        $
                        25,000
                        
                        
                        
                        35,714
                        
                        
                        $
                        3,642
                        
                        
                        
                        5,202
                        
                        
                        
                        0.704/17/2009
                        
                        $
                        25,000
                        
                        
                        
                        35,714
                        
                        
                        $
                        3,733
                        
                        
                        
                        5,333
                        
                        
                        
                        0.704/22/2009
                        
                        $
                        25,000
                        
                        
                        
                        35,714
                        
                        
                        $
                        3,775
                        
                        
                        
                        5,393
                        
                        
                        
                        0.705/6/2009
                        
                        $
                        10,000
                        
                        
                        
                        14,286
                        
                        
                        $
                        1,557
                        
                        
                        
                        2,224
                        
                        
                        
                        0.705/6/2009
                        
                        $
                        50,000
                        
                        
                        
                        71,429
                        
                        
                        $
                        7,783
                        
                        
                        
                        11,119
                        
                        
                        
                        0.705/1/2009
                        
                        $
                        300,000
                        
                        
                        
                        428,571
                        
                        
                        $
                        29,600
                        
                        
                        
                        42,286
                        
                        
                        
                        0.705/6/2009
                        
                        $
                        200,000
                        
                        
                        
                        285,714
                        
                        
                        $
                        20,200
                        
                        
                        
                        28,857
                        
                        
                        
                        0.705/6/2009
                        
                        $
                        200,000
                        
                        
                        
                        285,714
                        
                        
                        $
                        31,133
                        
                        
                        
                        44,476
                        
                        
                        
                        0.705/7/2009
                        
                        $
                        30,000
                        
                        
                        
                        42,857
                        
                        
                        $
                        2,750
                        
                        
                        
                        3,929
                        
                        
                        
                        0.705/7/2009
                        
                        $
                        30,000
                        
                        
                        
                        42,857
                        
                        
                        $
                        2,750
                        
                        
                        
                        3,929
                        
                        
                        
                        0.705/7/2009
                        
                        $
                        100,000
                        
                        
                        
                        100,000
                        
                        
                        $
                        4,000
                        
                        
                        
                        4,000
                        
                        
                        
                        1.005/19/2009
                        
                        $
                        100,000
                        
                        
                        
                        142,857
                        
                        
                        $
                        9,567
                        
                        
                        
                        13,667
                        
                        
                        
                        0.706/10/2009
                        
                        $
                        10,000
                        
                        
                        
                        14,286
                        
                        
                        $
                        1,673
                        
                        
                        
                        2,390
                        
                        
                        
                        0.706/12/2009
                        
                        $
                        100,000
                        
                        
                        
                        142,857
                        
                        
                        $
                        11,267
                        
                        
                        
                        16,095
                        
                        
                        
                        0.702nd
      Quarter Total
                        
                        $
                        1,795,000
                        
                        
                        $
                        2,521,428
                        
                        
                        $
                        199,417
                        
                        
                        
                        283,552





On July
6, 2009, the Company issued 60,000 restricted shares of the Company’s common
stock valued at $13,162 for professional services received.





On July
8, 2009, the Company issued 350,000 unrestricted shares of the Company’s common
stock valued at $96,520 for professional services received.





On July
8, 2009, the Company issued 5,000 restricted shares of the Company’s common
stock valued at $1,016 for professional services received.





On August
4, 2009, one of our 12% convertible note holders converted their notes of
$100,000 into shares of common stock at a conversion rate of
$0.35.  This resulted in an issuance of 285,714 shares of common
stock.  In addition the note holder also converted their accumulated
interest on their note into shares of the Company’s common stock at a conversion
rate of $0.35.  The total interest converted was $18,566.67 and
converted into 53,048 of the Company’s common shares.





On August
7, 2009, the Company issued 100,000 shares of the Company’s unrestricted common
stock valued at $20,715 for professional services received.





On August
10, 2009, the Company issued 250,000 shares of the Company’s unrestricted common
stock valued at $47,079 for professional services received.





On August
18, 2009, the Company issued 1,000 shares of the Company’s restricted common
stock valued at $180 to a current shareholder for compensation.


~ 18
~


On August
20, 2009, the Company issued 100,000 shares of the Company’s unrestricted common
stock valued at $16,000 for professional services received.





On
September 1, 2009, the Company issued 250,000 shares of the Company’s
unrestricted common stock valued at $47,500 for professional services
received.





Warrants





The
following is a summary of the Company’s outstanding common stock purchase
warrants:





Outstanding
                        
                        
                        Issued 9 months
                        
                        
                        
                        
                        
                        OutstandingExercise Price
                        
                        December 31, 2008
                        
                        
                        Ended September 30, 2009
                        
                        
                        Exercised
                        
                        
                        September30, 2009$     0.01
                        
                        
                        153,920
                        (1)
                        
                        
                        -
                        
                        
                        
                        (40,400
                        )
                        
                        
                        113,520
                        (1)$     0.30
                        
                        
                        30,300
                        
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        30,300$     0.50
                        
                        
                        101,000
                        (1)
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        101,000
                        (1)$     0.70
                        
                        
                        5,087,484
                        
                        
                        
                        30,288,821
                        
                        
                        
                        -
                        
                        
                        
                        35,376,305$     0.93
                        
                        
                        4,026,646
                        
                        
                        
                        -
                        
                        
                        
                        (898,786
                        )
                        
                        
                        3,127,860$     1.00
                        
                        
                        503,247
                        
                        
                        
                        2,239,999
                        
                        
                        
                        -
                        
                        
                        
                        2,743,246$     2.40
                        
                        
                        132,310
                        (1)
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        132,310
                        (1)10,034,907
                        
                        
                        
                        32,528,820
                        
                        
                        
                        (939,186
                        )
                        
                        
                        41,624,541




(1)
            The outstanding warrants as of
      December 31, 2008,  include an additional 260,442 warrants
      issued to replace the warrants previously issued by BOOMj.com, Inc., which
      new warrants were issued at a rate of 2.02 shares of the Company common
      stock for each warrant share of BOOMj.com. The Company has reserved a
      sufficient number of shares of authorized common stock for issuance upon
      exercise of the outstanding
warrants.





2008
Stock Option Plan





In
September 2008, the Company's Board of Directors approved the 2008 Equity
Incentive Plan of Beyond
Commerce (the "Plan"). On June 12, 2009, the Company’s Board of Directors
amended and approved increasing the plan from 3,500,000 available options to
7,000,000.  This amendment was approved by the shareholders on July
24, 2009 at the Company’s annual shareholder meeting.





Stock Options
Granted





On
September 11, 2008, the Board of Directors approved the issuance of stock
options as described below in accordance with the 2008 Equity Incentive
Plan. The employee options have a cliff vesting schedule over a three year
period that vest one third after one year of service and then 4.2% per month
over the remaining twenty-four months. Options issued to non-employees for
meeting performance-based goals vest immediately.







Outstanding
                        
                        
                        Issued 9 months
                        
                        
                        Cancelled or
                        
                        
                        OutstandingOption Group
                        
                        December 31, 2008
                        
                        
                        Ended September 30, 2009
                        
                        
                        Exercised
                        
                        
                        September 30, 2009$          0.35-0.49
                        
                        
                        
                        
                        
                        
                        173,000
                        
                        
                        
                        (21,000
                        )
                        
                        
                        152,000$          0.50-0.69
                        
                        
                        -
                        
                        
                        
                        991,658
                        
                        
                        
                        (223,384
                        )
                        
                        
                        868,274$          0.70-0.89
                        
                        
                        505,000
                        
                        
                        
                        890,574
                        
                        
                        
                        (119,445
                        )
                        
                        
                        1,276,102$          0.90-0.99
                        
                        
                        478,289
                        
                        
                        
                        505,201
                        
                        
                        
                        (286,646
                        )
                        
                        
                        696,844$          1.00-1.25
                        
                        
                        73,271
                        
                        
                        
                        1,377,500
                        
                        
                        
                        (350,577
                        )
                        
                        
                        1,100,194$          1.26-1.70
                        
                        
                        120,000
                        
                        
                        
                        410,170
                        
                        
                        
                        (185,533
                        )
                        
                        
                        344,6371,176,560
                        
                        
                        
                        4,390,316
                        
                        
                        
                        (1,066,585
                        )
                        
                        
                        4,438,051


~ 19
~


The
estimated fair value of the aforementioned options was calculated using the
Black-Scholes model.  Consequently, the Company recorded a share-based
compensation expense of $213,814 and $1,718,290 for the three and Nine months
ended September 30, 2009, respectively. The credit for the three months ended
September 30, 2009 is due to the cancellation of options for independent
representatives no longer working with the Company. Total compensation costs to
be recognized over the next three years will be $1,514,812 for all non-vested
options as of September 30, 2009. Expense will equal or exceed the vested amount
of the options.





Dividends





The
Company has never issued dividends.





NOTE
10 – COMMITMENTS AND CONTINGENCIES





Operating
Lease





The
Company leases certain office space, under operating leases which generally
require the Company to pay taxes, insurance and maintenance expenses related to
the leased property.  The leases for office space have lease extension
renewal options for an added two to three years at fair market rent values. The
Company believes that in the normal course of business, leases will be renewed
or replaced by other leases.  In December 2007 the Company entered
into a four year lease for 4,560 square feet in Henderson, Nevada which houses
its corporate office.  The Company also leases a fully furnished three
bedroom apartment in the Henderson, Nevada area effective June 11, 2009 through
July 30, 2010.  The monthly rent expense is $4,250 plus
utilities.  The Company rented the apartment for executives and
consultants to alleviate hotel expenses for these individuals that work in our
Henderson office but are not residents of the area. The Company closed its
Irvine, CA office on May 31, 2009.





Total
rent expense incurred by the Company, which includes the leases above and sundry
month to month rental expenditures was $220,533 and $164,643 for the nine month
period ended September 30th  2009
and 2008, respectively. The Company signed an amendment to its lease in
Henderson, Nevada in February 2009, effective March 16, 2009 for an additional
5,634 square feet of office space adjacent to the current
office.  This amendment ties to the expiration of the present lease
and will expire January 31, 2012.  The Company has future minimum
lease obligations as follows:





Twelve months ending
                            September 30,
                          
                          20092010
                          
                          $
                          553,2712011
                          
                          
                          326,9702012
                          
                          
                          94,536Total
                          
                          $
                          974,777





NOTE
11 – SEGMENT REPORTING





Beyond
Commerce, Inc manages its operations through two business segments:
BOOMj.com  dba i-Supply and LocalAdLink. Each unit owns and operates
the segments under the respective names.





The
Company evaluates performance based on net operating profit. Administrative
functions such as finance, treasury, and information systems are centralized and
although they are not considered operating segments are presented below for
informative purposes. However, where applicable, portions of the administrative
function expenses are allocated between the operating segments. The operating
segments do share facilities in Henderson NV. In the event any supplies and/or
services are provided to one operating segment by the other, the transaction is
valued according to the company’s transfer policy, which approximates market
price. The costs of operating the segments are captured discretely within each
segment. The Company’s leasehold improvements, property, computer equipment,
inventory, and results of operations are captured and reported discretely within
each operating segment.


~ 20
~


Summary
financial information for the two reportable segments as of the Nine months ended September 30
is as follows:





2009
                            
                            
                            2008Operations:
      BOOMj.com dba i-SupplyNet
      sales
                            
                            $
                            409,051
                            
                            
                            $
                            1,025,023Gross
      Margin
                            
                            
                            345,614
                            
                            
                            
                            (25,090
                            )Depreciation
                            
                            
                            (145,041
                            )
                            
                            
                            (133,509
                            )Assets
                            
                            
                            517,802
                            
                            
                            
                            755,703Capital
      Expenditures
                            
                            
                            11,333
                            
                            
                            
                            111,882Operations:
      LocalAdLinkNet
      sales
                            
                            $
                            12,299,017
                            
                            
                            
                            -Gross
      Margin
                            
                            
                            834,504
                            
                            
                            
                            -Depreciation
                            
                            
                            (50,492
                            )
                            
                            
                            (834
                            )Assets
                            
                            
                            2,088,816
                            
                            
                            
                            9,186Capital
      Expenditures
                            
                            
                            509,935
                            
                            
                            
                            10,000Net
      Loss
                            
                            
                            (4,734,251
                            )
                            
                            
                            (42,939
                            )Basic
      and Diluted Loss Per Share
                            
                            
                            (0.11)
                            
                            
                            
                            0.00Consolidated
      Operations:Net
      sales
                            
                            $
                            12,708,068
                            
                            
                            
                            1,025,023Gross
      Margin
                            
                            
                            1,180,118
                            
                            
                            
                            (25,090
                            )Other
      operating expenses
                            
                            
                            (11,494,453
                            )
                            
                            
                            (6,449,780
                            )Depreciation
                            
                            
                            (195,533
                            )
                            
                            
                            (134,343
                            )Non-operating
      income (expense)
                            
                            
                            (6,605,038
                            )
                            
                            
                            (2,378,091
                            )Loss
      from operations before income taxes
                            
                            
                            (17,114,906
                            )
                            
                            
                            (8,987,304
                            )Assets
                            
                            
                            3,710,074
                            
                            
                            
                            1,737,747Capital
      Expenditures
                            
                            
                            521,268
                            
                            
                            
                            121,882





Summary
financial information for the two reportable segments as of the three months ended September
30 is as follows:





2009
                          
                          
                          2008Operations:
      BOOMj.com dba i-SupplyNet
      sales
                          
                          $
                          240,078
                          
                          
                          $
                          204,810Gross
      Margin
                          
                          
                          197,903
                          
                          
                          
                          (39,180
                          )Depreciation
                          
                          
                          (48,473
                          )
                          
                          
                          (46,928
                          )Assets
                          
                          
                          517,802
                          
                          
                          
                          755,703Capital
      Expenditures
                          
                          
                          -
                          
                          
                          
                          33,659Operations:
      LocalAdLinkNet
      sales
                          
                          $
                          1,811,788
                          
                          
                          
                          -Gross
      Margin
                          
                          
                          369,396
                          
                          
                          
                          -Depreciation
                          
                          
                          (40,286
                          )
                          
                          
                          (834)Assets
                          
                          
                          2,088,816
                          
                          
                          
                          9,186Capital
      Expenditures
                          
                          
                          400,339
                          
                          
                          
                          10,000Net
      Loss
                          
                          
                          (410,070
                          )
                          
                          
                          (42,939
                          )Basic
      and Diluted Loss Per Share
                          
                          
                          (0.01
                          )
                          
                          
                          0.00Consolidated
      Operations:Net
      sales
                          
                          $
                          2,051,866
                          
                          
                          
                          204,810Gross
      Margin
                          
                          
                          567,299
                          
                          
                          
                          39,180Other
      operating expenses
                          
                          
                          (2,931,281
                          )
                          
                          
                          (2,756,856
                          )Depreciation
                          
                          
                          (88,759
                          )
                          
                          
                          (47,762
                          )Non-operating
      income (expense)
                          
                          
                          (6,082,604
                          )
                          
                          
                          (1,267,047
                          )Loss
      from operations before income taxes
                          
                          
                          (8,535,345
                          )
                          
                          
                          (4,032,056
                          )Assets
                          
                          
                          3,710,074
                          
                          
                          
                          1,737,747Capital
      Expenditures
                          
                          
                          400,339
                          
                          
                          
                          43,659


~ 21
~


NOTE
12 – NET LOSS PER SHARE OF COMMON STOCK





The
Company has adopted Financial Accounting Standards Board ("FASB") Statement
Number 128, "Earnings per Share," which requires presentation of basic and
diluted EPS on the face of the income statement for all entities with complex
capital structures and requires a reconciliation of the numerator and
denominator of the basic EPS computation to the numerator and denominator of the
diluted EPS computation. In the accompanying financial statements, basic loss
per share of common stock is computed by dividing net loss by the weighted
average number of shares of common stock outstanding during the
year.  Basic net loss per common share is based upon the weighted
average number of common shares outstanding during the period. Dilution is
computed by applying the treasury stock method. Under this method, options and
warrants are assumed to be exercised at the beginning of the period (or at the
time of issuance, if later), and as if funds obtained thereby were used to
purchase common stock at the average market price during the period. However,
shares associated with convertible debt, stock options and stock warrants
are not included because the inclusion would be anti-dilutive (i.e. reduce the
net loss per common share).  The total number of such stock option
warrant shares and potential shares to be issued upon conversion of debt
excluded from the diluted net loss per common share presentation was 46,619,719
and 14,634,396 at September 30, 2009 and 2008, respectively.





The above
amounts are not included in the computation of diluted earnings per share
because the effect of these instruments would be anti-dilutive (i.e., reduce the
loss per share) for the three and Nine months ended September 30, 2009. The
following is a reconciliation of the numerator and denominator of the basic and
diluted earnings per share computations for the period ended September 30, 2009
and 2008:





Numerator





Basic and
diluted net loss per share for the nine months ended September 30:




Unaudited
                    
                    
                    Unaudited2009
                    
                    
                    2008Net
      loss available to common stockholders
                    
                    $
                    (17,114,906
                    )
                    
                    $
                    (8,987,304
                    )DenominatorBasic
      and diluted weighted average number of shares outstanding
                    
                    
                    43,737,435
                    
                    
                    
                    37,805,466Basic
      and diluted net loss per share
                    
                    $
                    (0.
      39
                    )
                    
                    $
                    (0.23
                    )





NOTE 13 - SUPPLEMENTAL
DISCLOSURES OF CASH FLOWS (not described elsewhere)





The
Company prepares its statements of cash flows using the indirect method as
defined under the Financial Accounting Standard No. 95. The Company paid
$133,382 and $167,576 for the three months and nine months ended September 30,
2009 and $5,615 and $40,069 for the three months and nine months ended September
30 2008, respectively for interest. The Company did not make any payments for
income tax during the three months or nine months ended September 30, 2009 or
2008.




During
the quarter ended September 30, 2009, approximately $2,851,795 of expense was
recorded which was paid for by issuing stock, options and
warrants.


~ 22
~


NOTE 14 - RELATED
PARTIES (not described elsewhere)





The
Company paid Linlithgow Holdings, LLC. (an affiliate shareholder) $246,052
and $90,412   in commissions and consulting fees for the nine months
ended September 30, 2009 and the three months ended September 30, 2009
respectively, as compared to $76,650 and $0 for the same periods in 2008,
respectively. The Company also accrued interest due Linlithgow Holdings, LLC in
the amount of $94,800 and $62,800 for the nine months and three months
ended September 30, 2009, respectively.  We also have related party
transactions with FA Corp in which the principal shareholder is a member of our
board of directors, Murray Williams.  We incurred expenses for FA Corp
of $39,578 and $9,240 for services rendered for the nine months ended September
30, 2009 and the three months ended September 30, 2009, respectively compared to
$102,673 and $24,616 for the nine months ended September 30, 2008 and the three
months ended September 30, 2008, respectively.





The
Credit Card merchant accounts are personally guaranteed by an officer of the
Company.





NOTE 15 - SUBSEQUENT
EVENTS





On
October 1, 2009, the Company issued 1,000,000 shares of stock valued at $60,000
for professional services received.




The
Company in attempt to monetize the current sales level within Local Ad Link,
Inc.  and  reduce its debt began soliciting multi-level
sales company’s who need added products to distribute.  One of these
companies was an affiliate of Omni-Reliant Holdings called Zurvita Holdings Inc,
who showed interest in a potential transaction. On October 9, 2009, the
Company sold its LocalAdLink Software (the “Software”) and all of their assets
related to the Software, including the rights in the name LocalAdLink,
the  trademark LocalAdLink, the  Web site,www.LocalAdLink.com
, and a local search directory and advertising network that brings local
advertising to geo-targeted consumers.   The Company entered into
an asset purchase agreement (the “Purchase Agreement”) with OmniReliant
Holdings, Inc. (“Omni”), pursuant to which, the Company sold its LocalAdLink
software, name rights ,and trademark to Omni, and Omni (i) forgave $4,000,000
principal amount of outstanding convertible debentures, (ii) returned for
cancellation warrants to purchase 18,321,037 shares of common stock and (iii)
agreed to extend the maturity date of outstanding convertible notes in the
principal amount of $1,623,323 to October 9, 2010. Sales related to this Local
Ad Link, Inc. for the three and nine months ended September 30, 2009 were
$1,811,787 and $12,299,017, respectively. Total assets associated with the sale
was $1,721,840 of which $367,000 were software related and sold in the
transaction. All liabilities associated with this division were retained by the
Company.




On
October 9, 2009, the Company sold 3,000,000 shares of common stock to Zurvita
for a purchase price of $300,000 and the Company agreed to sell, and Zurvita
agreed to purchase, an additional 5,000,000 shares of common stock for a
purchase price of $500,000, in three tranches which was completed on October 29,
2009.  This triggered reset provisions for the remaining outstanding
debt and warrants as disclosed in Note 8.




On
October 26, 2009, one of our 12% convertible note holders converted their note
of $70,000 into shares of common stock at a conversion rate of $0.10. This
resulted in an issuance of 700,000 shares of common stock.  In
addition the note holder also converted their accumulated interest on their note
into shares of the Company’s common stock at a conversion rate of
$0.10.  The total interest converted was $15,237 and converted into
152,370 of the Company’s common shares.





On
October 26, 2009, one of our bridge loan note holders converted their note of
$30,000 into shares of common stock at a conversion rate of $0.10. This resulted
in an issuance of 300,000 shares of common stock.   The total interest
outstanding on the note of $1,085was paid to the note holder.





During
October the Company received an extension of due date from the bridge loan note
holders to January 31, 2010.


~ 23
~


NOTE
16 – CHANGE IN METHOD OF ACCOUNTING FOR CERTAIN CONVERSION AND EXERCISE
FEATURES





On
January 1, 2009, the Company adopted EITF 07-5, “Determining Whether an
Instrument (or Embedded Feature) Is Indexed to an Entity's Own Stock” and
changed its accounting, as required, for valuation of convertible notes and
warrants with conversion features and/or exercise features in which either the
conversion or exercise price or the number of warrant shares issuable was
determined by formula with inputs based on the operations of the
Company.  This change required the Company to bifurcate the features
from the host contracts as derivatives under SFAS 133 “Accounting for Derivative
Instruments and Hedging Activities” by recognizing an additional liability for
the fair value assigned to those derivate features, whereas in the prior year
those convertible notes and warrants were accounted for using Emerging Issues
Task Force No. 01-6 “The Meaning of ‘Indexed to a Company's Own
Stock’".   The new method of accounting for convertible notes and
warrants with these features requires that the Company revalue the instruments
at inception and each reporting date and to record the cumulative effect of the
changes in retained earnings into the opening period in which the standard is
adopted.





We
previously accounted for our convertible notes and warrants with these features
under EITF 01-6 which treated these features as if they were indexed to the
Company’s own stock and thus did not require separate accounting treatment or
bifurcation as derivatives.





Upon
implementing EITF 07-5 for all periods presented the Company recalculated and
replaced the original accounting by recognizing an additional liability for the
value of the bifurcated features.   In addition, because these
instruments are now accounted for as derivatives under SFAS 133, the Company no
longer treats the warrants issued in conjunction with the 12% Secured
Convertible Promissory Notes as Temporary Equity and instead the values assigned
are now included in Note derivative liability.





The
following financial statement line items as of December 31, 2008 were affected
by the change in accounting (no proforma has been presented for the income
statement or cash flows as none of these instruments were outstanding during the
nine months ended September 30, 2008):





CONSOLIDATED
BALANCE SHEET


AS OF
DECEMBER 31, 2008





As ComputedAs Originally
                          
                          
                          Under
                          
                          
                          Effect ofReported
                          
                          
                          & EITF 07-5
                          
                          
                          ChangeTotal
      Assets
                          
                          $
                          1,806,008
                          
                          
                          $
                          1,806,008
                          
                          
                          $
                          -Current
      LiabilitiesShort-term
      borrowings
                          
                          
                          2,400,555
                          
                          
                          
                          2,400,555
                          
                          
                          
                          -Accounts
      payable
                          
                          
                          1,490,590
                          
                          
                          
                          1,490,590
                          
                          
                          
                          -Accounts
      payable – related party
                          
                          
                          19,552
                          
                          
                          
                          19,552
                          
                          
                          
                          -Note
      derivative liability
                          
                          
                          1,523,651
                          
                          
                          
                          3,396,935
                          
                          
                          
                          1,873,284Other
      current liabilities
                          
                          
                          1,374,534
                          
                          
                          
                          1,374,534
                          
                          
                          
                          -Deferred
      revenue
                          
                          
                          609,987
                          
                          
                          
                          609,987
                          
                          
                          
                          -Total
      Current Liabilities
                          
                          
                          7,418,869
                          
                          
                          
                          9,292,153
                          
                          
                          
                          1,873,284Commitments
      and Contingencies
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          -Temporary
      Equity
                          
                          
                          1,135,980
                          
                          
                          
                          -
                          
                          
                          
                          (1,135,980
                          )Stockholders’
      Deficit:Common
      stock, $0.001 par value, 200,000,000 and 75,000,000 shares authorized as
      of December 31, 2008 and 2007, respectively, and 40,936,143and 36,108,067
      issued and outstanding at December 31, 2008 and 2007,
      respectively
                          
                          
                          40,936
                          
                          
                          
                          40,936
                          
                          
                          
                          -Preferred
      stock,$.001 par value of 50,000,000 shares authorized and no shares
      issued
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          -Additional
      paid-in capital
                          
                          
                          11,096,604
                          
                          
                          
                          11,096,604
                          
                          
                          
                          -Accumulated
      deficit
                          
                          
                          (17,886,381
                          )
                          
                          
                          (18,623,685
                          )
                          
                          
                          (737,304
                          )Total
      Stockholders’ Deficit
                          
                          
                          (6,748,841
                          )
                          
                          
                          (7,486,145
                          )
                          
                          
                          (737,304
                          )Total
      Liabilities and Stockholders' Deficit
                          
                          $
                          1,806,008
                          
                          
                          $
                          1,806,008
                          
                          
                          $
                          -


~ 24
~


As a
result of the accounting change, accumulated deficit as of January 1, 2009,
increased from $17,886,381, as originally reported, to $18,623,685 computed
under EITF 07-5.





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





Throughout
this Quarterly Report on Form 10-Q, the terms “we,” “us,” “our,” and “our
company” refer to Beyond Commerce, Inc., a Nevada corporation formerly known as
BOOMj, Inc. and Reel Estate Services, Inc. respectively and, unless otherwise
specified, also includes our two wholly-owned subsidiaries, BOOMj.com, Inc., a
Nevada corporation and LocalAdLink, Inc., a Nevada corporation.





Cautionary
Statement Regarding Forward-Looking Statements





This
Quarterly Report contains forward-looking statements, which reflect the views of
our management with respect to future events and financial performance. These
forward-looking statements are subject to a number of uncertainties and other
factors that could cause actual results to differ materially from such
statements. Forward-looking statements are identified by words such as
“anticipates,” “believes,” “estimates,” “expects,” “plans,” “projects,”
“targets” and similar expressions. Readers are cautioned not to place undue
reliance on these forward-looking statements, which are based on the information
available to management at this time and which speak only as of this date. We
undertake no obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise. For a
discussion of some of the factors that may cause actual results to differ
materially from those suggested by the forward-looking statements, please read
carefully the information in the “Risk Factors” section in our Form 10-K for the
year ended December 31, 2008 and the “Risk Factors” section set forth in Item 1A
of Part II of this Report. The identification in this Quarterly Report of
factors that may affect future performance and the accuracy of forward-looking
statements is meant to be illustrative and by no means exhaustive. All
forward-looking statements should be evaluated with the understanding of their
inherent uncertainty.





Description
of Business





Beyond
Commerce, Inc. operates a Web site that targets persons in the demographic group
commonly referred to as Baby Boomers and Generation Jones. On the Company’s Web
site, www.BOOMj.com, users/members can create their very own personal profile
for use on the Company’s state-of-the-art social network platform. Our BOOMj.com
Web site provides social, political, financial and lifestyle content to the Baby
Boomer/Generation Jones target audience as a platform for our advertising and
E-commerce businesses. These users/members can upload, watch and share their
videos and other interesting information with like-minded Boomers and Generation
Jones. The Web site provides entertainment news ranging from the latest movie
reviews, fashions and diets to show times and ticket sales. The Web site also
offers a variety of e-commerce product offerings, allowing users/members of the
Web site can buy leading brand name merchandise ranging from books and CD’s
to electronics, featuring computers and flat panel screen TV’s. The Company’s
product line typically consists of approximately 2.0 million SKUs. Baby Boomers
and Generation Jones are able to shop online through the online store.
Additionally, through BOOMj.com health network Boomers and Generation Jones have
access to a collection of BOOMj.com owned and operated Web sites and multi-media
affiliates providing timely and in-depth health, fitness nutrition information,
personalized tools and resources to make the right health choices. BOOMj.com
health network connects to a vast community of leading experts and people
seeking to manage and improve their health and wellness.





In
September 2008, the Company commenced the operations of a new the web site known
as LocalAdLink, which operates a Web site,www.LocalAdLink.com,
a local search directory and advertising network that brings local advertising
to geo-targeted consumers. This local search and advertising platform networks
high volume Web sites to allow local advertisers to increase revenues and brand
identity.  On October 9, 2009,  The Company entered into an
asset purchase agreement (the “Purchase Agreement”) with OmniReliant Holdings,
Inc. (“Omni”), pursuant to which, the Company sold its LocalAdLink software,
name rights ,and trademark to Omni, and Omni (i) forgave $4,000,000 principal
amount of outstanding convertible debentures, (ii) returned for cancellation
warrants to purchase 18,321,037 shares of common stock and (iii) agreed to
extend the maturity date of outstanding convertible notes in the principal
amount of $1,623,323 to October 9, 2010.




~ 25
~


The
Company will continue to sell advertising as it had prior to inception of Local
Ad Link, Inc. however on a different scale with a greater emphasis on business
to business sales.




During
the third quarter of 2009 the Company started another subsidiary, KaChing
KaChing, which is an E-commerce platform that provides a complete turn-key
E-commerce solution. Individual KaChing KaChing retail store owners have the
ability to create, manage and earn money from product sales generated from their
individual Web stores.





CORPORATE
HISTORY AND PLAN OF OPERATIONS





History





This
company, formerly known as Reel Estate Services Inc., was incorporated in Nevada
as a development stage company on January 12, 2006 to create a web-based service
that lists properties across the globe that are available for rental and/or use
by film and television companies as filming locations. We never earned any
revenue from our former Reel Estate Services internet site, and in September
2007 prior management terminated those operations.





On
December 28, 2007 Reel Estate Services, Inc. acquired BOOMj.com, Inc. through a
reorganization (the “Reorganization”) in which it issued 34,458,067 shares of
common stock to the former shareholders of BOOMj.com, Inc. As a result of this
Reorganization, the former shareholders of BOOMj.com, Inc. acquired a majority
ownership and control over Reel Estate Services, Inc.





BOOMj.com,
Inc. is now our wholly-owned subsidiary, although from an historical perspective
it was deemed to have been the accounting acquirer in the transaction and the
survivor of the Reorganization. Accordingly, prior to December 28, 2007 the
historical financial statements of BOOMj.com, Inc. have become our historical
financial statements. Subsequent to December 28, 2007 the consolidated
operations of both entities are included in our financial statements. BOOMj.com,
Inc. itself was incorporated on November 14, 2006.





Results
of Operations





We
reported a net loss of $17,114,906 and $8,535,345 for the nine and three months
ended September 30, 2009, respectively as compared to net losses of
$8,987,304and $4,032,056 reported for the nine and three months ended September
30, 2008, respectively. During the first quarter of 2009, the LocalAdLink
division was continuing to grow, however, at the end of February with the spike
in the volume of weekly credit card revenues generated, certain credit card
processing companies, without notice to the Company, put a hold on all of the
cash being remitted to Beyond Commerce’s LocalAdLink subsidiary. This hold was
initiated under the rationale of “potential business risk.” The Company had less
than 0.25% percent in charge-backs and a total of approximately $13,000 in
claims over a six month period of time prior to this risk reassessment. 
With the stoppage of the credit card processing and the processors holding back
over $900,000 of funds due to the Company, we inadvertently had 567 checks
returned totaling over $250,000 to valued employees, our commissioned sales
force and vendors.





The
reckless actions of the credit card processors negatively impacted the Company
and prevented us from achieving our projected first and second quarter revenues
and income. As a result of the hold, LocalAdLink was prevented from selling
advertising to local businesses for approximately 23 days during the month of
March. The negative impact of inadvertently returning 567 checks impacted the
Company’s credibility with its independent sales force. Due to the problems of
not being able to process credit cards, which caused 567 returned checks, during
the sixty days following the incident, the Company had to rebuild its
credibility with its independent sales representatives so they would reenergize
and once again sell ads. At the time of the incident, LocalAdLink was ramping up
revenues based on its prior month’s revenues at a rate of four and a half
million per month.





The
Company continues in evaluating any claims it may have against the
aforementioned credit card processing companies, as we believe that the damage
to the Company from the willful negligence of the processors has caused an
undetermined financial loss to Beyond Commerce. Furthermore, the credit card
processors’ holding of revenues forced us to change processors.  This
change has resulted in increased processing fees, personal guarantees and a
mandate for the Company to reserve 10% of its revenues received daily to
mitigate potential risk to the new processor.


~ 26
~


As more
fully explained in "Operating Expenses" below, the additional losses in 2009
were also attributable to increases in operating costs, interest from debt, the
issuance of warrants, and the delay in certain revenue generation
activities.





Revenues





Our goal
is to generate revenues from (i) the sale of various products to our Web site
users (our e-commerce operations), and (ii) both national and local advertising
fees. Revenue for the nine and three month periods ended September 30, 2009, was
$12,708,068 and $2,051,866, respectively as compared to $1,025,023 and $204,810
for the nine and three month periods ended September 30, 2008 respectively. The
increases are due to revenue from the LocalAdLink segment, which the Company
launched in November 2008, (and which has since been terminated as a result of
the asset sale described above).  LocalAdLink constituted $12,299,017
and $1,811,788 of total revenue for the nine and three months ended September
30, 2009, respectively.





Cost
of Advertising/ Merchandise Acquired





Cost
of sales for the nine and three month periods ended September 30, 2009 were
$11,527,949 and $1,484,565, respectively compared to $1,050,113 and $165,630 for
the nine and three month periods ended September 30, 2008,
respectively.  LocalAdLink constituted $11,464,512 and $1,441,623 of
the total cost of sales for the nine and three months ended September 30, 2009,
respectively. These costs consist mainly of commissions paid to independent
sales representatives of $10,054,601 and $1,256,749for the nine and three months
ended September 30, 2009 respectively. As described above, certain assets of
LocalAdLink were sold in October 2009.





Operating
Expenses





Selling,
general and administrative expenses, including related party expenses,
(SG&A) for the nine month and three month periods ended September 30, 2009
were $8,690,836 and $2,196,484. This is an increase of $3,485,583 and $65,152 in
SG&A expenses from the $5,205,253 and $2,261,636 reported for the nine month
and three month periods ended September 30, 2008, respectively. This increase is
mainly attributable to the increase in employees, programming, merchant fees,
travel, marketing and the issuance of options.  The Company had 86
employees at the end of September 2009 as compared to 52 at the end of September
2008. This accounts for an increase in payroll expenses for the nine
and three months ended September 30, 2009 of $1,281,245 and $173,759,
respectively as compared to the expense for the nine and three months ended
September 30, 2008.  Payroll expenses were $3,492,459 and $1,075,362
for the nine and three months ended September 30, 2009 and $2,211,214 and
$901,603 for the same periods ended September 30, 2008,
respectively.





Programming
and computer expenses increased by $513,400 and $202,981 to $833,253and $332,287
for the nine and three months ended September 30, 2009, respectively.
Programming and computer expenses were $319,853 and $129,306 for the nine
and three months ended September 30, 2008, respectively.  A large part
of the increase is attributable to the maintenance of the LocalAdLink, (of which
certain assets were sold in October 2009), i-Supply and KaChing KaChing
software, and the increase in computer related expenses for new
employees.  The issuance of options for stock-based compensation
created an expense of $1,718,290 and a $213,814 from the nine and three month
periods ended September 30, 2009, respectively as compared to zero for the same
periods of 2008.  Merchant and bank fees of $742,268 and $127,106 for
the nine and three months ended September 30, 2009, respectively is an increase
of $708,508 and $122,265 from $33,760 and $4,841 for the nine and three months
ended September 30, 2008, respectively.  This increase in merchant and
bank fees is due to the volume of credit card sales through LocalAdLink,
i-Supply and KaChing KaChing. Travel expense increased $407,192 and
$116,017 for the nine and three months ended 2009, respectively to $516,153 and
$148,652 respectively, as compared to total travel expense of $108,961 and
$32,635 for the nine and three months ended September 30, 2008,
respectively.  Marketing and selling expense for the nine and three
months ended September 30, 2009 was $1,593,349 and $143,894,
respectively.  This is a decrease of $190,503 and $569,577 from the
$1,783,852 and $713,471 for the nine and three months ended September 30, 2008,
respectively.  This decrease was due to the marketing enhancements of
LocalAdLink as it launched during the quarter ended September 30,
2008.


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Professional
fees, including related party professional fees, for the nine and three month
periods ended September 30, 2009 were $2,803,618 and $734,799, respectively.
This is an increase of $1,559,091 and $239,580 in professional fees from
the $1,244,527 and $495,219 for the nine month and three month periods ended
September 30, 2008, respectively. The largest component of the increase in
professional fees consisted of consulting and support services due to the rapid
growth of activity in the LocalAdLink division. The increase in LocalAdLink
consulting fees was $447,524 and a decrease of $400,200 for the nine month and
three month periods ended September 30, 2009, respectively as compared to the
same periods for September 30, 2008. The decrease for the three month period
ended September 30, 2009 was created by a reversal of over-billing by a former
consulting team.  There was also an increase in accounting fees of
$242,806 and $18,004 for the nine month and three month periods ended September
30, 2009, respectively as compared to the same periods for September 30, 2008.
This increase is due to an increase in our audit and compliance expenses as a
result of ramping up operations, and the filing of registration
statements.  Legal fees increased $148,277 and $116,196 for the nine
and three months ended September 30, 2009 as compared to the same periods for
September 30, 2008, respectively.  This is due to an increase in fees
paid for SEC filings and pending litigation against credit card processors (see
results of operations).  Professional fees for marketing decreased in
2009 due to the hiring of internal marketing professionals.





Depreciation
expense for the nine month and three month periods ended September 30, 2009 was
$195,533 and $88,759, respectively. This reflects an increase of $61,190 and
$40,997 from $134,343 and $47,762 reported for the nine month and three month
periods ended September 30, 2008, respectively. This increase in expense is
attributable to the amortization of the asset additions, which consist mostly of
hardware purchased for new employees and the development costs of
software.





Other
income (expense)





Income
related to the change in derivative liability value for the nine month period
ended September 30, 2009 was $1,055,747 and expense for the three month period
ended September 30, 2009 was $2,942,287.  These derivatives related to
notes issued in the third and fourth quarters of 2008 and notes and warrants
issued during the second and third quarter of 2009.





Interest
expense net, including related party interest, for the nine month and three
month periods ended September 30, 2009 was $7,660,785, and $3,140,317,
respectively, compared to $2,378,091and $1,266,619 for the nine and three month
periods ended September 30, 2008, respectively. Interest expense includes
non-cash expenses related to the value of warrants issued to investors who
invested in our convertible notes and discounts from beneficial conversion
features. Loan fees and loan discount amortization expenses of $6,682,337 and
$2,878,804 related to our promissory notes for the nine and three month periods
ended September 30, 2009, respectively.   Interest expense on the note
balances accrued for the nine and three months ended September 30, 2009 was
$522,163 and $226,441, respectively.





Liquidity
and Capital Resources





Cash and
cash equivalents at September 30, 2009 was $0 and $100,086 at December 31, 2008.
Since our business model is in the early stages of maturing, the majority of our
capital resources have been derived through the sale of debt and equity
securities. No assurance can be made that these operations will continue to
improve or that we will have access to capital markets in the future, or that
financing will be available on acceptable terms to satisfy our future and
on-going cash requirements that we need to implement our business strategies.
Our inability to fulfill our business plan, access the capital markets or obtain
acceptable financing could have a material adverse affect on our results of
operations and financial condition, and could severely threaten our ability to
continue as a going concern.





As shown
in the accompanying consolidated financial statements, we incurred a loss of
$17,114,906 and $8,535,345 for the nine and three month periods ended September
30, 2009, respectively, as compared to $8,987,304 and $4,032,056 for the same
periods ended September 30, 2008, respectively. Our current liabilities exceeded
our current assets by $15,273,221 at September 30, 2009 and negative cash flow
from operating activities for the nine months ended September 30, 2009 was
$6,200,151.  Included in current liabilities is deferred revenue of
$1,809,130, derivative liability of $3,451,215 and notes payable of $8,239,384.
These factors, and our inability to meet our obligations from current
operations, and the need to raise additional capital to accomplish our
objectives, create considerable doubt about our ability to continue as a going
concern.





We
currently do not have sufficient funds on hand to fund our current obligations
until we reach our projected break-even level of operations. We do not have any
bank credit lines. Accordingly, we will have to obtain additional funding in the
near future in order to continue our operations until our revenues are
sufficient to fund our operating expenses. Although we have again re-commenced
our on-line e-commerce business and now are generating revenues from our
e-commerce business, we do not anticipate that we will generate sufficient cash
from operations to fund our working capital needs for at least another three
months. Accordingly, we intend to continue to seek additional financing from
various sources, including from the sale of debt or equity securities. We have
not yet identified, and cannot be sure that we will be able to obtain any
additional funding from either of these sources, or that the terms under which
we may be able to obtain such funding will be beneficial to us. If we do not
obtain sufficient additional funds in the near future, we will have to suspend
some of our operations, further scale down our current and proposed future
operations or, if those actions are not sufficient, terminate our
operations.


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All of
the convertible notes that we have issued in order to fund our working capital
needs mature within the next twelve months. Accordingly, in addition to having
to raise funds to continue to operate, we also will have to raise funds to repay
these convertible notes (to the extent that such notes are not converted in
shares of our common stock by the holders). As of September 30, 2009, the total
principal amount of our short-term borrowings was $10,656,655. Some of the
convertible notes that we issued are secured by a lien on certain of our assets
and/or the assets of our subsidiaries. During the first nine months of 2009,
$2,100,000 of the secured promissory notes were converted into Company common
stock. In the event that we fail to repay these remaining secured promissory
notes as they mature, we will be at risk of losing our assets through
foreclosure of our assets. Accordingly, a default under the secured convertible
notes could result in the loss of our assets and the termination of our
operations.  On October 9, 2009, we sold from our wholly owned
subsidiary, LocalAdLink the assets relating to the software, name rights, and
trademark, LocalAdLink, which operates a Web site,www.LocalAdLink.com , and a
local search directory and advertising network that brings local advertising to
geo-targeted consumers.   In consideration for the sale of
LocalAdLink, the Company had their secured promissory note balance reduced by
$4,000,000.  Additionally, the Company issued 8,000,000 shares of
common stock in exchange for $800,000.





Management
is taking steps to raise additional funds to address its operating and financial
cash requirements to continue operations in the next twelve months.
Management has devoted a significant amount of time to raising capital from
additional debt and equity financing.





Operating
Activities





Net cash
used in operating activities for the nine month period ended September 30, 2009
was $6,200,151 compared to a use of cash of $5,590,315 for the nine month
period ended September 30, 2008. This change was mainly attributable to the
increase in Local Ad Link and I-Supply operations and related overhead demands
compared to the start up of operations incurred in 2008.





Investing
Activities





Net cash
used in investing activities for the nine month period ended September 30, 2009
and 2008 was $521,268 and $121,882, respectively, representing cash expended for
the purchase of computers and office furniture and equipment.





Financing
Activities





Net cash
provided by financing activities for the nine month period ended September 30,
2009 and 2008 was $6,621,333 and $5,629,159, respectively, due primarily to net
cash received from the sale of debt securities of $9,158,000 and 5,733,232,
respectively. During the nine month period ended September 30, 2009 we received
$20,000 from the issuance of common stock, repaid $1,730,167 of a short term
loans, received short term unsecured borrowings of $228,000 and paid cash for
debt placement fees of $826,500.





As a
result of the above activities, we experienced a net decrease in cash of
$100,086 for the nine month period ended September 30, 2009 as compared to a net
decrease for the nine month period September 30, 2008 of $83,038. Our ability to
continue as a going concern is dependent on our success in obtaining additional
financing from investors through the sale of our securities and continuing our
stream of revenue through LocalAdLink ads and our e-commerce stores. There is no
assurance that we will be able to raise any additional funds.





Other





As of
September 30, 2009, we had no long-term debt obligations, no
capital  lease obligations, no material  long-term purchase
obligations or other similar long-term liabilities. We are not a party to any
off-balance sheet arrangements, and we do not engage in trading activities
involving non-exchange traded contracts.


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~


Inflation
and changing prices have had no effect on our net sales and revenues or on our
income from continuing operations





Item 3.
Quantitative and Qualitative Disclosures About Market Risk





Not
applicable.





Item
4T. Controls and Procedures





Evaluation
of Disclosure Controls and Procedures





Under the
supervision and with the participation of our senior management, including our
chief executive officer and chief financial officer, we conducted an evaluation
of the effectiveness of the design and operation of our disclosure controls and
procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities
Exchange Act of 1934, as amended, as of the end of the period covered by this
quarterly report (the “Evaluation Date”). Based on this evaluation, our chief
executive officer and chief financial officer concluded as of the Evaluation
Date that our disclosure controls and procedures were effective such that the
information relating to the Company, including our consolidated subsidiaries,
required to be disclosed in our SEC reports (i) is recorded, processed,
summarized and reported within the time periods specified in SEC rules and
forms, and (ii) is accumulated and communicated to our management,
including our chief executive officer and chief financial officer, as
appropriate to allow timely decisions regarding required
disclosure.





Changes
in Internal Control over Financial Reporting





During
the three months ended September 30, 2009 , there were no changes in our
internal control over financial reporting (under the Exchange Act) or in other
factors that have materially affected, or are reasonably likely to materially
affect, our internal control over financial reporting.





Inherent
Limitations of Internal Controls





Our
management, including our chief executive officer and chief financial officer,
does not expect that our disclosure controls and procedures or our internal
controls will prevent all error and all fraud. A control system, no matter how
well conceived and operated, can provide only reasonable, not absolute,
assurance that the objectives of the control system are met. Because of the
inherent limitations in all control systems, no evaluation of controls can
provide absolute assurance that all control issues and instances of fraud, if
any, within the Company have been detected. These inherent limitations include
the realities that judgments in decision-making can be faulty, and that
breakdowns can occur because of a simple error or mistake. Additionally,
controls can be circumvented by the individual acts of some persons, by
collusion of two or more people, or by management override of the control. The
design of any system of controls also is based in part upon certain assumptions
about the likelihood of future events, and there can be no assurance that any
design will succeed in achieving its stated goals under all potential future
conditions. Over time, controls may become inadequate because of changes in
conditions, or the degree of compliance with the policies or procedures may
deteriorate. Because of the inherent limitations in a cost-effective control
system, misstatements due to error or fraud may occur and not be
detected.





PART
II - OTHER INFORMATION


Item
1. Legal Proceedings





The
Company is presently involved in litigation as part of its normal business
process. Management does not have reason to believe that any of these lawsuits
will have a material adverse impact on the Company.


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~


Item
1A.  Risk Factors





There has
been no material change in the Risk Factors set forth in the “Risk Factors”
section of the Company’s Form 10-K for the year ended December 31, 2008, other
than as set forth below:





We
currently have outstanding  $3,833,322of short-term convertible
promissory notes that are secured by a lien on all of this company’s assets.
Accordingly, a default under the convertible promissory notes, or our inability
to repay them when these notes become due, could result in the foreclosure of
all of our assets and the termination of our business.





We
currently have outstanding approximately $2,210,000 of short-term, secured notes
that mature and must be repaid in full, both principal and interest on January
31, 2010. In addition we also have outstanding $1,623,322 of short-term, secured
notes that mature and must be repaid in full, both principal and interest
between July and September 2010.  Failure to make any payment as
required under the convertible promissory notes could result in the acceleration
of the convertible promissory notes and the foreclosure of our assets. If we are
unable to repay the notes in full upon their maturity, or if we otherwise
default under our obligations to the holders of those notes, the holders of the
convertible promissory notes will have the right to foreclose on all of our
assets, which would materially and adversely affect our ability to continue our
operations and could terminate our existence. No assurance can be given that we
will be able to make all payments as required or that we will be able to repay
the convertible promissory notes.  The Company has successfully
completed the extension of  these note holders until January 31,
2010.





We
will need significant additional capital, which we may be unable to
obtain.





We
currently only have sufficient cash available to continue our current operations
into November 15th  2009.
Our capital requirements in connection with our expanding commercial operations
have been, and will continue to be, significant. We need to obtain a significant
amount of additional funds to fund our working capital needs, to continue to
market our Web site, to offer a broader range of products on our e-commerce
site, and to otherwise expand our business. There can be no assurance that
financing will be available in amounts or on terms acceptable to us, if at all.
If we are not able to raise additional funds in the near future, we may have to
severely reduce our operations or even terminate our business.  There
can be no assurance that we will be able to obtain additional
funds.





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





NA





Item
3. Defaults Upon Senior Securities





none





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





None.





Item
5. Other Information





None.


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~


Item
6. Exhibits and Reports on Form 8-K





Exhibit No.
                                    
                                    Description of Document10.1
                                    
                                    Amended
      and Restated Securities Purchase Agreement dated July 2, 2009 by and
      between the Company and OmniReliant Holdings, Inc.(filed as exhibit to Form 8-K filed with the SEC on July 6, 2009 and
      incorporated herein by reference).10.2
                                    
                                    Amended
      and Restated Pledge and Security Agreement dated July 2, 2009 by
      and between the Company, Linlithgow Holdings LLC and OmniReliant Holdings,
      Inc. (filed
      as exhibit to Form 8-K filed with the SEC on July 6, 2009 and incorporated
      herein by reference).10.3
                                    
                                    Security
      Agreement, dated July 2, 2009, by and between Beyond Commerce, Inc,
      BoomJ.com, Inc., Local Ad Link, Inc. and Omnireliant Holdings, Inc. (filed
      as exhibit to Form 8-K filed with the SEC on July 6, 2009 and incorporated
      herein by reference).10.4
                                    
                                    Subsidiary
      Guarantee, dated July 2, 2009, by and between BoomJ.com, Local Ad Link,
      Inc. and OmniReliant Holdings, Inc. (filed
      as exhibit to Form 8-K filed with the SEC on July 6, 2009 and incorporated
      herein by reference).10.5
                                    
                                    Amended
      and Restated Securities Purchase Agreement dated July 10, 2009 by and
      between the Company and OmniReliant Holdings, Inc. (filed
      as exhibit to Form 8-K filed with the SEC on July 16, 2009 and
      incorporated herein by reference).10.6
                                    
                                    Securities
      Purchase Agreement, dated July 30, 2009 by and between the Company and
      OmniReliant Holdings, Inc. (filed
      as exhibit to Form 8-K filed with the SEC on August 4, 2009 and
      incorporated herein by reference).10.7
                                    
                                    Security Interest
      and Pledge Agreement, dated July 30, 2009, by and between the Company
      and OmniReliant Holdings, Inc. (filed
      as exhibit to Form 8-K filed with the SEC on August 4, 2009 and
      incorporated herein by reference).31.1
                                    
                                    Certification
      of Chief Executive Officer31.2
                                    
                                    Certification
      of Chief Financial Officer (Principal Accounting
  Officer)32.1
                                    
                                    Certification
      of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley
      Act of 2002, 18 U.S.C. Section 1350.32.2
                                    
                                    Certification
      of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley
      Act of 2002, 18 U.S.C. Section
1350.


~ 32
~


SIGNATURES





Pursuant
to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of
1934, Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized on the 13th day of November
2009.





By:
                  /s/ Robert J. McNultyRobert
      J. McNulty, Chief Executive Officer
                    (Principal
      Executive
Officer)




By:
                /s/ Mark V. NoffkeMark
      V. Noffke, Chief Financial Officer(Principal
      Financial Officer)


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