**UNITED
        STATES**
 **SECURITIES
        AND EXCHANGE COMMISSION**
 **WASHINGTON,
        DC 20549**
 
 **FORM
        10-KSB**
  [X]
        ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
        1934
 
 **For
        the fiscal year ended December 31, 2005**
 
 [_]
        TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
        OF
        1934
  For
        the
        transition period from ______________ to _____________
  **Commission
        File Number:**
 
 **NO
        BORDERS, INC.**
 (Exact
        name of registrant as specified in its charter)
  Nevada
                  
                  (State
                    of incorporation)
                88-0429812
                  (IRS
                      Employer ID
                      Number)
  **18301
        VON KARMON IRVINE CA 92612**
 (Address
        of principal executive offices) (Zip Code)
 
 **949-251-0722**
 (Registrant's
        telephone number, including area code)
 
 Securities
        registered under Section 12 (b) of the Exchange Act: None
 
 Securities
        registered under Section 12(g) of the Exchange Act: Common Stock:
 $0.001
        par value
  
 
 Indicate
        by check mark if the registrant is not required to file reports pursuant
        to
        Section 13 or Section 15(d) of the Act. Yes [  ] No [X]
 
 Check
        whether the registrant has (1) filed all reports required to be filed by
        Section
        13 or 15(d) of the Exchange Act 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 [  ]
        No [X]
 
 As
        of December 31, 2005, 169,542,359 shares of the registrant's common stock
        were
        issued and outstanding. Aggregate market value of the voting stock held by
        non-affiliates as of December 31, 2005 was $4,902,630.
 
 Indicate
        by check mark if disclosure of delinquent filers pursuant to Item 405 of
        Regulation S-K (ss.229.405 of this chapter) is not contained herein, and
        will
        not be contained, to the best of registrant's knowledge, in definitive proxy
        or
        information statements incorporated by reference in Part III of this Form
        10-K
        or any amendment to this Form 10-K. [  ]
 
 Indicate
        by check whether the registrant is a shell company (as defined in Rule 12b-2
        of
        the Act). Yes [  ] No [X]
  1
  **NO
        BORDERS, INC.**
 **TABLE
        OF CONTENTS**
 **PART
                    I****Page**Item
                  1.
                Business
                3Item
                  2.
                Property
                9Item
                  3.
                Proceedings
                9Item
                  4.
                Submission
                  of Matters to a Vote of Security Holders
                10**PART
                    II**Item
                  5.
                Market
                  for Common Equity, Related Stockholder Matters
                  and Issuer Purchases of Equity Securities
                10Item
                  6.
                Risk
                  Factors
                11Item
                  7.
                Management's
                  Discussion and Analysis or Plan of Operations
                16Item
                  8.
                Financial
                  Statements and Supplementary Data
                19Item
                  9.
                Changes
                  in and Disagreements With Accountants on Accounting and Financial
                  isclosure
                19Item
                  9A.
                Controls
                  and Procedures
                20Item
                    9B.
                Other
                  Information
                20**PART
                    III**Item
                  10.
                Directors,
                  Executive Officers, Promoters and Control Persons
                21Item
                  11.
                Executive
                  Compensation
                23Item
                  12.
                Security
                  Ownership of Certain Beneficial Owners and Management and
                  Related Stockholder Matters
                23Item
                  13.
                Certain
                  Relationships and Related Transactions
                24Item
                  14
                Exhibits
                24Item
                  15.
                Principal
                  Accountant Fees and Services
                24Item
                  15.
                Subsequent
                  Events
                24**PART
                    IV**Signatures
                
                28Index
                  to Exhibits
                
                29
 2
  CAUTION
        REGARDING FORWARD-LOOKING INFORMATION
 
 In
        addition to historical information, this Annual Report on Form 10-KSB contains
        forward-looking statements that involve risks and uncertainties that could
        cause
        our actual results to differ materially. Factors that might cause or contribute
        to such differences include, but are not limited to:
 
 o our
        ability to finance our activities and maintain our financial
        liquidity;
  o
        our
        ability to attract and retain qualified, knowledgeable employees;
  o
        our
        ability to complete product development;
  o
        our
        ability to design and market new products successfully;
  o
        our
        failure to acquire new customers in the future;
  o
        deterioration of business and economic conditions in our markets;
        and
  o
        competitive industry conditions.
 
 When
        used
        in this report, the words "expects," "anticipates," "intends," "plans,"
        "believes," "seeks," "estimates" and similar expressions are generally intended
        to identify forward-looking statements. You should not place undue reliance
        on
        these forward-looking statements, which reflect our opinions only as of the
        date
        of this Annual Report. We undertake no obligation to publicly release any
        revisions to the forward-looking statements after the date of this document.
        You
        should carefully review the risk factors described in other documents we
        file
        from time to time with the Securities and Exchange Commission.
 
 As
        used
        in this Form 10-KSB, unless the context requires otherwise, we refer to No
        Borders, Inc. as "we," "us," "our," "No Borders" and "the Company."
  
 **PART
        I**
  **ITEM
        1 - BUSINESS**
  **History,
        reorganizations and corporate structure of the Company**
  No
        Borders,Inc. (.the "Company"), incorporated on May 28, 1999 The Company changed
        its name to Harbour Front Holdings, Inc. in January 2003. On December 4,
        2003,
        the Company acquired 89.3% of the issued and outstanding shares of Eagle
        Corp.
        in exchange for 23,500,000 shares of the Company's common stock and on January
        27, 2003 Harbour Front Holdings, Inc. changed its name to American Eagle
        Manufacturing Company. Following that acquisition, the Company had 27,290,399
        shares of its common stock outstanding. On August 9, 2004 the Company's majority
        shareholders sold 72.5% of the outstanding common stock of the Company to
        Bad
        Toys, Inc. ("Bad Toys") and a change in control occurred. Bad Toys maintains
        its
        headquarters in Kingsport, Tennessee and is the successor to a motorcycle
        business, which was founded by one of its major shareholders, Larry N. Lunan.
        Subsequent to the sale of the Company's stock to Bad Toys (1) senior management
        of Bad Toys took control of the former Board of Directors of the Company,
        and
        (2) on August 17, 2004 the Company performed a 1 for 10 reverse stock split
        of
        the common stock of the Company which included a corresponding 1:10 reverse
        split of Company's authorized shares of common stock, and (3) On October
        22,
        2004, the Company sold all of its assets to Bad Toys Holdings, Inc., a Nevada
        corporation (the "Buyer"). As consideration and payment for the assets, the
        Company was to receive 1,818,182 shares of the Buyer's restricted common
        stock
        and the Company agreed to distribute the Shares pro rata to its shareholders
        of
        record as of September 15, 2004. Bad Toys Holdings assumed all liabilities
        and
        obligations of the Company as of the date of the asset purchase, including
        any
        and all additional consideration, and agreed to indemnify and hold Company
        and
        the shareholders of relieving Company.
  **Reverse
        Merger of No Borders**
  A
        Share
        Exchange Agreement between the Company and Intercommunity Financing Corp,
        dated
        October 21, 2004 (the "Share Exchange Agreement") was concluded, and deemed
        effective as of September 30, 2004, wherein the Company agreed to issue
        40,000,000 shares of its restricted common stock to the shareholders of
        Intercommunity Financing Corp in exchange for one hundred percent of the
        issued
        and outstanding common stock of Intercommunity Financing Corp. On October
        21,
        2004 the Company changed its name to No Borders, Inc. Following the completion
        of the share exchange agreement, Bad Toys Holdings, Inc. owned approximately
        3,600,000 of the company’s issued and outstanding shares of the Company's common
        stock. Description of the Business:
  3
  **Overview**
  No
        Borders, Inc. is an international payment and financial services enabler
        company
        with the mission of becoming the lowest cost provider of electronic payment
        mediums to the vast number of un-banked, uninsured and unconnected American
        immigrants from Latin America, Asia and Africa and the families they left
        back
        home. No Borders’ closed and open system card platform, noboNET, in conjunction
        with its unique business model, enables the Company to provide significantly
        lower-cost remittances to this growing market. The Company intends tol leverage
        these remittance business and customer relationships to offer its noboENVIO
        remittance product and its noboCARD debit cards and payroll cards, as well
        as a
        variety of additional products and services offered by affiliated product
        and
        service providers, at a lower cost than now available to this market. The
        products and services initially targeted and accessible through our open
        system
        debit card noboNET platform include life insurance, health insurance, discount
        health programs, prepaid telephony, direct bill payments and low-cost mortgage,
        business and personal loans.
  Our
        revenue sources include: fees and exchange rate surcharges per remittance
        transaction; fees based on each U.S. and foreign bank issued noboCARD
        transaction (including loading the card, ATM withdrawals, purchases via POS
        terminals, money transfers, balance inquiries); processing fees based on
        each
        transaction generated by debit cards issued through foreign banks which utilize
        the noboNET platform to manage card to card or card to bank remittance
        transactions; license fees based on each remittance transaction generated
        through third party remittance companies utilizing the noboNET platform;
        fees
        based on sales of products and services offered by affiliated vendors through
        the noboNET platform and purchased via No Borders cards; and development
        and
        training fees charged to licensees of the noboNET platform.
 
 **Target
        Market**
  Global
        remittances are expected to reach $250 Billion worldwide in 2006 exceeding
        $50
        Billion from the U.S. to Latin America, and $25 Billion from the U.S. to
        Mexico
        (the largest bi-lateral market in the world). Household expenditures of Latin
        American immigrants residing in the U.S. exceed $500 Billion. Expenditures
        for
        telephony, U.S-Mexico, l exceeded $5 Billion in 2005 and $9 Billion for
        telephony, U.S-Latin America. No
        Borders has developed a proprietary database of the 10,000 leading
“transnational corridors” of immigrant communities in the U.S. (by zip code and
        census track) and their villages/town origins, including detailed socio-economic
        data and the specific merchant locations responsible for the vast majority
        of
        remittance traffic within these corridors. Aside from targeted immigrants
        from
        Mexico and Latin America, No Borders will focus during the near term on those
        U.S. immigrants from Pakistan and the Persian Gulf.
 
 Our
        overall business plan is to penetrate these markets by offering lower cost
        and
        efficient remittance services, enticing those customers to rely upon the
        No
        Borders debit card for general utility, generating revenue from remittance
        fees,
        distribution fees related to sales of services and products through its debit
        cards and fees based upon each card transaction (ATM, point of sale purchases,
        loading etc). No Borders’ U.S. debit cards are issued through Central National
        Bank & Trust of Enid Oklahoma, a federally chartered bank. With the bank’s
        affiliation with various domestic and international card associations, such
        as
        STAR, VISA and MasterCard, No Borders’ cardholders may withdraw funds from ATMs
        and otherwise pay for products and services at POS terminals. We intend to
        expand our card issuing capability both domestically and internationally
        by
        partnering with financial institutions who desire to provide card issuing
        services with No Borders features and to target financial institution consumer
        specific markets.
  4
  **No
        Borders’ Products and
        Services**
 
 noboENVIO
  Via
        its
        network of money transfer merchants, No Borders offers customers a closed
        network proprietary identity card-based remittance product. The card is an
        internet enabled, plastic identity card with a magnetic strip that is swiped
        on
        a pin-pad connected to a computer, capturing the card number, the customer’s
        information, and transaction information in an electronic database. The card
        is
        not a stored value card, which means that customers cannot leave money on
        the
        card, use the card at an ATM machine, or make purchases with the
        card.
 
 No
        Borders customers can obtain a free No Borders card and become a member of
        the
        No Borders card loyalty program. As part of the program, when a customer
        uses
        their No Borders card to pull up their customer information when they send
        a
        remittance, the customer can send money at a significantly discounted cost.
        Their family members in Latin America and other regions can immediately receive
        the money will also receive a loyalty card at certain payout locations,
        including two of the major banks in Mexico (i.e. Bancomer, HSBC during the
        summer of 2006 and in excess of 900 exchange houses and independent businesses).
        In addition, we have a signed agreement with FEDECACES, a microfinance
        organization in El Salvador, to pay money transfer disbursements in l60 rural
        micro finance institutions throughout the republic of El Salvador. Our current
        payout networks cover more than 10 countries including but not limited to
        Mexico, El Salvador, Guatemala, Honduras, Nicaragua, Panama, Colombia, Peru,
        Chile, and Ecuador. The noboENVIO service can also operate without a card,
        in
        the traditional cash origination and acceptance model where customers can
        initiate a remittance at a merchant agent location or through a call center
        owned by InfoSpan Inc, a U.S. based company, operating in Zacatecas Mexico.
        With
        the traditional noboENVIO service, No Borders intends to capture market share
        by
        attracting consumers in existing money transfer agent locations providing
        the
        opportunity to change consumer and industry behavior by offering the noboCARD
        debit card and peripheral products and services.
 
 noboCARD
  In
        addition to the noboENVIO, we will offer the No Borders Stored Value Card,
        noboCARD, a re-loadable prepaid debit card is sponsored by the federally
        chartered Central National Bank & Trust of Enid Oklahoma (CNB) and is
        processed by E-Lysium, a subsidiary of CNB. The FDIC insured debit cards
        may
        hold funds and access ATMs and point of sale devices at merchant sites.
        Moreover, the system will allow for transferring funds from the closed system
        to
        a so-called open network, such as the financial institution supported card
        networks or Visa and MasterCard supported networks, as well as allow for
        transferring funds from a bank issued debit card to other bank issued debit
        cards and to traditional cash payout locations. Our system facilitates lower
        cost transaction fees when loading, transferring or withdrawing funds sent
        from
        the U.S. to a foreign beneficiary, because funds transferred to a closed
        system
        card or an open system card issued by a local foreign banking institution,
        the
        rate of exchange surcharges normally imposed can be significantly reduced.
        In
        addition, the noboNET platform is designed to interface with infinite numbers
        of
        financial institutions, vendors and others providing services and products,
        worldwide.
 
 The
        current U.S. bank issued noboCARD operates on the Pulse and Star networks
        which
        enables customers to withdraw money from ATMs and make purchases at retail
        locations in the United States via point-of-sale (POS) devices, and offers
        an
        integrated suite of unique products and services to No Borders customers.
        These
        products and services include: significantly low-cost remittances to a wide
        variety of payout locations in Latin America, card-to-card transfers, ATM
        and
        POS usage, payroll direct deposit onto the card, long distance calling, access
        to discount health programs, bill payment, reporting to credit bureaus and
        other
        financial services to the large and fast-growing transnational market. Customers
        will be able to load the card at over 180,000 locations including large and
        medium-sized retail chains, branches of large U.S. financial institutions,
        and
        smaller family-owned businesses that serve the Latino and other migrant
        communities. Remittances can be sent at an agent location or via the toll-free
        customer service number to a wide variety of payout locations across Latin
        America including banks, microfinance institutions, foreign exchange houses,
        independent payout locations, and bank issued stored-value cards in Mexico.
 
 Our
        noboCARD and international money transfers are secure and compliant with
        all
        state and federal laws, and will be backed in each state (where required)
        by a
        licensed money transfer organization or financial institution.
 
 No
        Borders services and products offered and through its noboNET platform
        include:
  ·
              No
                  Borders remittance services via Closed and Open (ATM/POS) Cards
                  at a cost
                  which is below what customers are now charged by competitors (when
                  adding
                  the foreign exchange rate charged)  ·
              Low
                  cost telephony services including domestic and international long
                  distance  ·
              No
                  Borders open system debit cards issued by financial institutions
                  within
                  the US  5
  ·
              Payroll
                  / Direct Deposit /ACH Card services  ·
              Direct
                  payment of bills by cardholders  ·
              Low
                  cost telephony services including voice mail, follow-me roaming,
                  phone-to-phone money transfer  ·
              No
                  Borders open system debit cards issued by financial institutions
                  outside
                  the US  ·
              Low
                  cost financial services and commercial products offered by No Borders
                  alliance partners and accessed through the No Borders cards and
                  noboNET
                  platform, such a, airline tickets, health insurance outside of
                  the US and
                  discount medical programs in the US, mortgages, small business
                  loans and
                  product purchase financing.
 **Sales
        and Marketing Strategy**
 
 To
        facilitate distribution of its products and services, No Borders has affiliated
        with existing remittance merchants and intends to license its noboNET platform
        to existing remittance companies with their own affiliated merchant networks,
        each having an existing and loyal base of customers who regularly send funds
        to
        families abroad. One example is the Company’s agreement with Palmeras Financial
        Services, Inc., a licensed remittance company in Florida. No Borders agreements
        with credit unions in the U.S., Mexico, and El Salvador provide expanded
        presence for No Borders’ customers to transfer and receive funds at even a lower
        cost through the No Borders noboNET platform. A memo of understandingwith
        PRONOFIM, the Mexican foundation funded by the Mexican government to provide
        small loans to over 1,500,000 individuals through over 120 micro finance
        institutions in Mexico, was concluded with the intent of distributing the
        No
        Borders cards to the loan recipients in Mexico while disbursing noboCARD
        debit
        cards issued by No Borders’ U.S. bank issuer to family members living in the
        U.S. No Borders intends to replicate this model on a global basis since it
        benefits financial institutions which do not otherwise attract deposits of
        funds
        remitted from the U.S.
 
 Itt
        is
        critical that our cardholders have the ability to load funds onto cards at
        multiple locations. In addition to affiliated remittance merchant sites,
        our
        agreement with Transaction Management LLC provides the Company with the ability
        to offer its customers direct bill payment services and an additional 1400
        loading sites. We intend to seek additional agreements with networks of loading
        points in the United States **.** Our
        agreements with Morgan Beaumont and Western ATM further increase access to
        over
        180,000 loading points in the U.S. It is also critical to provide ease to
        those
        receiving funds from our U.S customers. Our agreement with Palmeras Financial
        provides access to over 4900 payout sites in Mexico plus Bancomer branches
        in 17
        other countries. Our agreements with credit unions in Mexico and El Salvador
        provide additional and low cost payout locations. Our agreement with HSBC
        adds
        an additional 1500 payout sites in Mexico. Moreover, if we successfully conclude
        agreements with micro finance institutions globally, our reach would increase
        exponentially.
 
 Our
        noboNET platform facilitates the management and tracking, in real time, of
        all
        funds loaded onto our closed or open system cards. The noboNET platform also
        facilitates a transfer of funds from a debit card issued in the U.S. to a
        separate debit card issued by a bank outside the U.S. This functionality
        requires agreements with foreign card-issuing banks. Our agreement with HSBC
        in
        Mexico links debit cards issued by HSBC in Mexico to our noboNET platform
        so as
        to facilitate U.S. card to Mexican debit card transfers. Again, this arrangement
        will be replicated on a global basis. To further increase market penetration
        opportunities and to increase the global scope of the target customer base,
        the
        Company has entered into an alliance which provides access to international
        banking institutions in Pakistan and Dubai to deploy the No Borders noboNET
        platform and issue debit cards in the Persian Gulf remitting countries as
        well
        as the countries which receive remittances from those rich nations as well
        as
        the United States (such as Pakistan). This in turn facilitates the disbursement
        of debit cards directly to the immigrants in the Unites States who regularly
        send funds to those areas of the world.
 
 To
        illustrate , we have entered into a MOU with the National Bank of Pakistan
        which
        articulates the Bank’s intent to issue linked U.S.-Pakistan debit cards to
        remittance recipients in Pakistan, while No Borders (through its arrangement
        with the Central National Bank & Trust in the U.S.) issues debit cards to
        Pakistanis residing in the U.S. Our goal is to facilitate the marketing and
        distribution of No Borders’s U.S. bank issued cards to Pakistani immigrants.
  6
  **Distribution
        Channels**
  No
        Borders’ intends to leverage the following channels to market and distribute its
        products and services:
  ·
              Affiliations
                  with existing remittance merchants with loyal customers;  ·
              The
                  acquisition of, or affiliation with, existing licensed remittance
                  companies with affiliated networks of remittance merchants;  ·
              Affiliations
                  with credit unions, micro finance institutions and banking institutions;  ·
              Affiliations
                  with hometown associations and other community, sports and religious
                  organizations comprised of immigrants from specific areas outside
                  of the
                  US, issuing Affinity Debit Cards for distribution to the constituents
                  of
                  these associations and groups;  ·
              Agreements
                  with card issuing banking institutions outside of the United States
                  providing No Borders with added resources to facilitate the disbursement
                  and marketing of U.S. bank issued cards to those in the U.S sending
                  funds
                  to the cardholders and/or to those maintaining bank accounts in
                  the
                  foreign country.  ·
              Agreements
                  with various foreign government agencies to facilitate the disbursement
                  of
                  bank issued debit cards in that country to residents within specific
                  regions of the applicable country and at the same time provide
                  resources
                  to facilitate the marketing and disbursement of U.S. bank issued
                  debit
                  cards to those in the U.S. who send funds to those receiving cards
                  from or
                  maintaining accounts at the foreign banks.  ·
              Agreements
                  to distribute prepaid stored value and debit cards through current
                  distributors of pre-paid telephone cards to retail outlets;  ·
              Agreements
                  to distribute prepaid debit cards through existing direct bill
                  pay
                  outlets;  ·
              Agreements
                  with Employers to distribute payroll cards to their employees.  **Sources
          of Revenue**
  ·
              Remittance
                  transactions through existing merchants affiliated with No Borders
                  directly or through merchants affiliated with remittance companies
                  acquired by No Borders.  ·
              Remittance
                  transactions through remittance companies deploying the No Borders’s
                  noboNET platform via a license.  ·
              Remittance
                  transactions through debit cards distributed via the various other
                  channels described above;  ·
              Transaction
                  and monthly service fees attributed to the activation and use of
                  the No
                  Borders’ U.S. bank issued debit cards (such as fees charged for loading
                  funds, purchases at POS terminals, domestic card to card transfers,
                  balance inquiries, ATM withdrawals);  ·
              Processing
                  fees and transaction fees attributed to the use of foreign bank
                  issued
                  debit cards linked to the No Borders noboNET platform;.  ·
              Fees
                  derived from the sale of all other services and products via the
                  debit
                  cards managed through the No Borders’ noboNET platform;  ·
              Set-up
                  and other fees from licensees of the No Borders noboNET
                  platform;  ·
              Development
                  fees paid by third parties to modify the No Borders noboNET platform
                  for
                  use in foreign countries and to interface with various financial
                  institutions; and
 ·
              Dividends
                  from ownership interests in foreign
                  entities.
 7
 
 **CURRENT
        AGREEMENTS**
  Central
        National Bank and Trust / Elysium (Card Processing)
  No
        Borders and the Central National Bank have established a relationship where
        CNB
        provides both card issuing and processing services for the U.S. issued ***noboCARD.*** In
        addition, CNB provides money transfer services for ***noboCARD*** consumers through an interactive voice response unit with distribution through
        Bancomer Transfer Services. No Borders is in the process of negotiating a
        contract that will allow for the initiation of money transfers from the U.S. ***noboCARD*** to
        payout distribution channels operational with ***noboENVIO*** and
        future payout distribution channels planned by No Borders. No Borders has
        contracts with CNB that include a Card Marketing Agreement, Trust Agreement,
        and
        Card Network Sponsor Agreement The ***noboCARD*** is fully
        operational on the CNB card processing platform, Elysium
  Transaction
        Management Services Empasys / Security Bank of Texas (Empasys Card Load and
        Bill
        Payment Network)
  No
        Borders and Transaction Management Services LLC (TMLLC), of Dallas Texas,
        have
        established a relationship where TMLLC provides card load and bill payment
        services for the ***noboCARD*** through
        its Empasys network, a network of retailers with over 1,500 locations throughout
        the United States. Development work to integrate the Empasys network with
        the ***noboNET*** platform
        is in process and is expected to be completed in early July, 2006.
  Fedecaces
        (El Salvador Payout Network)
  No
        Borders, and FEDECACES, a credit union and savings institution cooperative
        in El
        Salvador , have
        established a relationship where FEDECACES provides money transfer payout
        distribution through its network of over 41 credit union and savings
        institutions and branches through the republic of El Salvador. The network
        is
        partially operational with access to the ***noboNET*** platform
        through the web based ***noboAGENT*** system
        but additional network participants require training. Marketing and sales
        efforts are required to acquire consumers in U.S. corridors where El Salvadoran
        migrants affect money transfers to fully leverage the relationship.
 
 Palmeras
        Financial
 
 In
        December 2005 the Company entered into an agreement with PalmermasFinancial
        Services Inc., a licensed remittance company in Florida for Palmeras to pilot
        the use of the noboNET platform. The pilot resulted in the consummation of
        additional agreements in 2006.
 
 Agreements
        with credit unions in the U.S., Mexico, El Salvador and Ecuador:
 
 These
        agreements provide for the credit unions to serve as originating remittance
        merchants in the US and payout sites outside of the US and to provide financial
        services to No Borders customers through the No Borders’ platform. These credit
        unions will also pay No Borders its standard net remittance fees (including
        the
        originating merchant commission) for one transaction per month for each
        beneficiary of a remittance from the U.S. who opens an account at a credit
        union
        branch, thus allowing No Borders to charge the U.S. customer nothing for
        one
        remittance per month.
  8
  **EMPLOYEES**
 
 As
        of December 15, 2006, the Company has nine employees and consultants. The
        Company's CEO, and President have not received cash payment of salaries.
        During
        the first quarter of 2007, the Company intends to convert prior consulting
        agreements to employment agreements with management personnel, including
        the
        President, the Acting CEO, VP of Sales, and Chief Operating Officer; and
        the
        Company intends to engage a CEO to replace the Acting CEO, a Chief Financial
        Officer as well operational, sales and marketing staff personnel.
  **ITEM
          2 - PROPERTIES******
  **Company’s
          offices in Venice California, with space of approximately 4,500 square
          feet, are
          rented at a cost of $10,800 per month, commencing in February, 2005.**
  **ITEM
        3 - LEGAL PROCEEDINGS****:**
  Nobosoft
        Corporation vs. No Borders et. al.
  In
        July,
        2005, Nobosoft Corporation commenced legal proceedings in Ontario Canada
        against
        the Company and Michael Rosenfeld, Raul Hinojosa and Ruben Sanchez claiming
        damages of $750,000 (USD) and seeking a declaration of ownership of property
        created for No Borders Inc by Nobosoft. No Borders is defending the matter
        vigorously and intends to remove the proceedings from Canada and to file
        counterclaims against Nobosoft for failure to deliver working software.
  There
        are
        pending claims against our predecessor American Eagle and its subsidiaries.
        Badtoys Holdings Inc has agreed to assume all of these potential liabilities
        and
        claims which had been asserted against subsidiary or subsidiaries of American
        Eagle Manufacturing Company, and has agreed to indemnify and hold the Company
        harmless from and against any of such claims. The Company could be responsible
        for such claims if the plaintiffs prevailed and If Badtoys Holdings Inc breached
        such indemnification and hold harmless agreements.
  1.
        Comerica Bank vs. American Eagle and American Eagle vs. Gregory Spak and
        A.E.
        Technologies, Inc. and Fastrak Motorcycles and Hellbent
        Motorcycles filed
        suit on June 20, 2003, Case No. Gv-818041 in the Superior Court of Santa
        Clara
        County. Comerica Bank is seeking to recover equipment that secured a loan
        to
        A.E. Technologies and Gregory Spak. A portion of the equipment has been received
        by American Eagle and is being stored awaiting instructions to return it
        to
        Comerica Bank. Comerica Bank is seeking $689,335. Management of Badtoys Holdings
        Inc is defending this matter.
  2.
        A.E. Technologies, Inc. and Gregory Spak vs. Aemrican Eagle
        Corporation ,
        Et Al
        filed November 6, 2003 Case No. 03CC00518 Superior Court of Orange County
        California. Gregory Spak and A.E. Technologies, Inc. are suing to recover
        assets
        and damages for the breach of the contract that was rescinded by American
        Eagle.
        A.E. Technologies and Gregory Spak are seeking $15,750,000 in damages. American
        Eagle Management feels that they have very little if any liability in this
        matter. The Superior Court has ordered all action in this case stayed until
        the
        case filed in Santa Clara county has been settled.
  9
  **ITEM
        4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**
 
 No
        matters were submitted to a vote of our security holders during the fourth
        quarter of our fiscal year ended December 31, 2005.
  
 **PART
        II**
 
 **ITEM
        5 -
        MARKET FOR THE COMPANY'S COMMON STOCK, RELATED STOCKHOLDER****MATTERS
        AND ISSUER PURCHASES OF EQUITY SECURITIES**
 
 Our
        common stock was traded on the Over the Counter Bulletin Board under the
        symbol
        "NBDR.OB”; we are no longer listed because our Form 10-KSB for our year ended
        December 31, 2005 was filed late.
 
 The
        following table sets forth the quarterly high and low closing prices for
        our
        common stock on the OTCBB for the periods indicated. The prices set forth
        below
        represent inter-dealer quotations, without retail markup, markdown or commission
        and may not be reflective of actual transactions.
  **HIGH**
              
              **LOW**Fiscal
                Year 2005First
                  Quarter
              
              $
              .84
              
              $
              .17Second
                  Quarter
              
              $
              .28
              
              $
              .11Third
                  Quarter
              
              $
              .35
              
              $
              .06Fourth
                  Quarter
              
              $
              .12
              
              $
              .06Fiscal
                Year 2004Fourth
                  Quarter *
              
              $
              2.50
              
              $
              .40
 *commencing
          October 2004
  We
        have
        never paid any dividends on the common stock. We currently anticipate that
        any
        future earnings will be retained for the development of our business and
        do not
        anticipate paying any dividends on the common stock in the foreseeable future.
 
 **EQUITY
        COMPENSATION PLAN INFORMATION**
 
 As
        of
        Decemberr 31, 2005 we had no option plan, outstanding options or other
        compensation plans.
  10
  **Item
        6. - RISK FACTORS**
 
 **WE
        HAVE A HISTORY OF LOSSES AND AN ACCUMULATED DEFICIT OF $16,878,537 AS OF
        DECEMBER 31, 2005, AND WE MAY NEVER ACHIEVE PROFITABILITY.**
 
 We
        have
        yet to establish any history of profitable operations. We are a development
        stage company and have not had any revenues since our inception in February
        2002. We have incurred net losses of $ 13,075,832 in
        2005,
        $3,465,045 in 2004, and $16,878,537 since inception. These losses have resulted
        from research and development and general and administrative expenses, with
        an
        additional $7,901,172 of that amount in impairment of goodwill expenses incurred
        in 2005.
 
 **WE
        HAVE RECEIVED AN OPINION OF GOING CONCERN FROM OUR AUDITORS. IF WE DO NOT
        RECEIVE ADDITIONAL FUNDING, WE WOULD HAVE TO CURTAIL OR CEASE
        OPERATIONS.**
 
 Our
        independent auditors noted in their report accompanying our financial statements
        for each of the years ended December 31, 2005 and December 31, 2004 that
        we have
        incurred losses and generated no revenues since inception and that additional
        capital will be necessary for the continuation of our existence. They further
        stated that the uncertainty related to these conditions raised substantial
        doubt
        about our ability to continue as a going concern. To date, we have funded
        our
        operations through equity offerings and loans. It is highly likely that we
        will
        continue to raise money through private sales of our securities, debt financing
        or short-term bank loans, or a combination of the foregoing.
  To
        the
        extent that money is raised through the sale of our securities, the issuance
        of
        those securities will result in dilution to our existing shareholders. If
        we
        raise money through debt financing or bank loans, we may be required to secure
        the financing with all of our business assets, which could be sold or retained
        by the creditor should we default in our payment obligations. If we fail
        to
        raise sufficient funds, we would have to curtail or cease operations.
  **SECURING
        REMITTANCE AGENTS**
  The
        Company's performance depends upon its ability to secure affiliation with
        remittance merchants and convert them to use the No Borders platform. We
        cannot
        assure you that wecan secure the volume of merchants so as to create a viable
        network of customers and cardholders.
  **SECURING
        SITES FOR LOADING FUNDS ONTO THE NOBO DEBIT CARD**
  The
        Company’s performance depends upon its ability to secure agreements with
        networks of merchants which are not affiliated with remittance companies
        but
        which will collect and load funds onto noboCARDs for a fee. Although we have
        secured agreements for customer access to a significant number of these loading
        sites, we cannot assure you that we will continue to secure additional numbers
        of these loading sites so as to attract continuing expansion of customers
        and
        cardholders **.**
  **ADDITIONAL
        FINANCING IS REQUIRED**
  The
        conduct of the Company's business requires availability of additional funds.
        The
        Company may encounter difficulty in obtaining these funds. Moreover, even
        if
        financing were to become available, there is no assurance that it would be
        upon
        terms acceptable to the Company or favorable to its existing shareholders.
  **ONGOING
        CAPITAL REQUIREMENTS TO COVER THE “FLOAT”**
  Our
        ability to expand the number of remittance transactions in a significant
        manner
        depends on our ability to cover the sums collected by affiliated merchants
        from
        our customers for a period of approximately three days since the funds collected
        for transfer must be available to the intended beneficiaries immediately,
        while
        the funds so collected will not be deposited in ourbank accounts for a period
        of
        up to three days. Without such financing, we would be forced to use our own
        operating profits, if any, to fulfill such requirements and this would severely
        limit our ability to grow. The risk of loss based on fraud or theft perpetrated
        by those collecting funds from our customers is, per industry standards,
        very
        low (less than .05% (.0005), but we cannotsurances assure you that we will
        be
        able to secure the funds required to facilitate our intended increase in
        remittance transactions.
  **INDUSTRY
        COMPETITION**
  The
        Company will encounter competition from remittance companies, financial
        institutions and telephone companies which are already offering, or will
        offer
        in the future, the same or similar services as those proposed to be offered
        by
        the Company. Many competitors have greater financial resources and more
        experience in the area. There can be no assurance that the Company's offerings
        will be marketed successfully, or once successful, will continue to be marketed
        successfully. Moreover, there can be no assurance that the Company's solutions
        will be able to compete on a technological or cost basis with other solutions
        which may become available in the future. Entities may develop platforms
        that
        are competitive with or superior to the Company's solutions or which can
        be
        marketed more effectively.
  11
  **DEPENDENCE
        ON KEY PERSONNEL**
  The
        future success or failure of the Company is dependent in the near term upon
        the
        efforts of Dr. Hinojosa, Co-founder and Chairman and President If for any
        reason
        Dr. Hinojosa's services became unavailable to the Company, the Company's
        future
        operations could be materially and adversely affected. The Company does not
        maintain key man life insurance or employment contracts with Dr. Hinojosa
        or
        other management.
  **IF
        THE COMPANY DOES NOT ADAPT TO RAPID TECHNOLOGICAL CHANGE, THE BUSINESS MAY
        FAIL**.
  No
        Borders success depends on its ability to develop new and enhanced services,
        and
        related products that meet changing customer needs. The market is characterized
        by rapidly changing technology, evolving industry standards, emerging
        competition and frequent new and enhanced software, service and related product
        introductions. In addition, the software market is subject to rapid and
        substantial technological change. To remain successful, No Borders must respond
        to new developments in hardware and semiconductor technology, operating systems,
        programming technology and computer capabilities. In many instances, new
        and
        enhanced services, products and technologies are in the emerging stages of
        development and marketing, and are subject to the risks inherent in the
        development and marketing of new software, services and products. The Company
        may not successfully identify new service opportunities, and develop and
        bring
        new and enhanced services and related products to market in a timely manner.
  **If
        THE COMPANY'S SOFTWARE FAILS, AND IT NEEDS TO REPAIR OR REPLACE IT, COSTS
        COULD
        INCREASE.**
  No
        Borders stored value card platform could contain errors or "bugs" that could
        adversely affect the performance of services. Despite the existence of various
        security precautions, the computer infrastructure may also be vulnerable
        to
        viruses or similar disruptive problems caused by the Company's customers
        or
        third parties gaining access to the No Borders processing system. If the
        software fails, and the Company needs to replace or repair it, our services
        could be delayed and operating costs could increase.
  **IF
        THE COMPANY DOES NOT MANAGE ITS GROWTH, IT MAY NOT ACHIEVE OR SUSTAIN
        PROFITABILITY.**
  No
        Borders may experience a period of rapid growth that could place a significant
        strain on resources. In order to manage growth successfully, No Borders will
        have to continue to establish operational, management and financial systems
        and
        expand its work force. A significant increase in No Borders customer base
        will
        require hiring a significant number of additional personnel. Qualified
        candidates may be in short supply at the time needed. In addition, the expansion
        and adaptation of the Company's computer and administrative infrastructure
        will
        require substantial operational, management and financial resources. The
        Company
        may not be able to expand and adapt its personnel requirements and its
        infrastructure to meet additional demand on a timely basis, at a commercially
        reasonable cost, or at all. If management is unable to manage growth
        effectively, hire needed personnel, and improve operational, management,
        and
        financial systems and controls, the Company may not attain or sustain
        profitability.
  **IF
        NO BORDERS DOES NOT MANAGE ITS CREDIT RISKS RELATED TO ITS REMITTANCE
        TRANSACTIONS AND MERCHANT ACCOUNTS, IT MAY INCUR SIGNIFICANT LOSSES.**
  No
        Borders intends to rely in part on the Federal Reserve's ACH system for
        electronic fund transfers and on different networks for the settlement of
        payments through our stored value card platform. We will also rely on our
        affiliated remittance merchants to collect and deposit funds collected. By
        using
        these established payment clearance systems, we bear the credit risks arising
        from stop payment orders, closed accounts, unauthorized use, disputes, customer
        charge backs, theft or fraud. No Borders also assumes the credit risk of
        merchant or remittance agent dispute, fraud, insolvency or bankruptcy in
        the
        event we attempt to recover funds related to such transactions from our
        remittance agents, merchants and customers. No Borders utilizes a number
        of
        systems and procedures to manage and limit credit risks, but if these actions
        are not successful in managing such risks, the Company may incur significant
        losses.
  12
  **THE
        ELECTRONIC COMMERCE MARKET IS RELATIVELY NEW AND IF IT DOES NOT GROW, WE
        MAY NOT
        BE ABLE TO SELL SUFFICIENT SERVICES TO MAKE OUR BUSINESS VIABLE.**
  The
        electronic commerce market is a relatively new and growing service industry.
        If
        the electronic commerce market fails to grow or grows slower than anticipated
        or
        if the Company's services and related products do not maintain a proportionate
        degree of acceptance in this growing market, No Borders business may not
        grow
        and could even fail. For example, the security and privacy concerns of existing
        and potential customers may inhibit the growth of the electronic commerce
        market
        in general, and the No Borders intended customer base and revenues, in
        particular. Similar to the emergence of the credit card and automatic teller
        machine, or ATM, industries, No Borders and other organizations serving the
        electronic commerce market must educate users that electronic transactions
        use
        encryption technology and other electronic security measures that make
        electronic transactions more secure than paper-based transactions. We cannot
        assure you that electronic commerce will have the success of credit card
        or ATM
        industries.
  **CHANGES
        IN REGULATION OF ELECTRONIC COMMERCE AND RELATED FINANCIAL SERVICES INDUSTRIES
        COULD INCREASE OUR COSTS AND LIMIT OUR BUSINESS
        OPPORTUNITIES.**
  No
        Borders believes that it is not required to be licensed by the Office of
        the
        Comptroller of the Currency, the Federal Reserve Board, or other federal
        or
        state agencies that regulate or monitor banks. It is possible that a federal
        or
        state agency will attempt to regulate providers of electronic commerce services,
        which could impede the Company's ability to do business in the regulator's
        jurisdiction. The Company is subject to various licensing laws and regulations
        relating to remittance transactions in certain states of the United States,
        and
        to the extent the Company does not obtain such licenses directly or via
        partnerships or acquisitions or affiliations with licensed remittance companies
        or banking institutions, the Company's ability to conduct remittance
        transactions would be impeded in those states. Given the expansion of the
        electronic commerce market, the Federal Reserve Board might revise Regulation
        E
        or adopt new rules for electronic funds affecting users other than consumers.
        Because of growth in the electronic commerce market, Congress has held hearings
        on whether to regulate providers of services and transactions in the electronic
        commerce market. It is possible that Congress or individual states could
        enact
        laws regulating the electronic commerce market. If enacted, such laws, rules
        and
        regulations could be imposed on the Company's business and industry and would
        likely increase our costs and limit our business opportunities..
  **INDEMNIFICATION**
  Indemnification
        may be permitted by a company to directors, officers or controlling persons
        pursuant to the General Corporation Law of the State of Nevada and the Company's
        By-laws. Indemnification may include expenses, such as attorney's fees, and,
        in
        certain circumstances, judgments, fines and settlement amounts actually paid
        or
        incurred in connection with actual or threatened actions, suits or proceedings
        involving such person and arising from his or her relationship with the Company
        except in certain circumstances where a person is adjudged to be guilty of
        gross
        negligence or willful misconduct unless a court determines that such
        indemnification is fair and reasonable under the circumstances.
   **RISKS
        RELATED WITH OWNERSHIP OF OUR SECURITIES**
 
 **WE
        ARE SOLELY TRADED ON THE PINK SHEETS**
 
 Although
        we were previously quoted on the OTC.BB, we were delisted on ________, 2006
        because we failed to file on Form 10KSB by the OTC deadline. A market maker
        can
        reapply for our common stock to be included on the bulletin board so long
        as we
        remain in compliance with bulletin board rules. In particular, there is a
        prohibition on including a security of a company that has missed a filing
        deadline three times since December 31, 2005. We have been untimely two filings
        so far (the From 10-KSB and the Form 10-QSB for the quarter ended March 31,
        2006
        and must now be timely in order to maintain our ability to have a market
        maker
        reapply for our listing. Therefore, if we have another late filing in 2006,
        our
        common stock will not be eligible for listing on the OTC.BB for a 12 month
        period. The “pink sheets” is considered less prestigious than the
        OTC.BB.
  **THE
        VALUE OF OUR COMMON STOCK MAY DECREASE DUE TO FACTORS BEYOND OUR CONTROL.
        THIS
        MAY RESULT IN SUBSTANTIAL LOSSES TO INVESTORS IF THEY ARE UNABLE TO SELL
        THEIR
        SHARES AT OR ABOVE THEIR PURCHASE PRICE.**
  13
 
 The
        value
        of our common stock is subject to significant fluctuations due to a number
        of
        factors, including:
  o
                our
                    status as a development stage company with a limited operating
                    history and
                    no revenues to date, which may make risk-averse investors more
                    inclined to
                    sell their shares on the market more quickly and at greater discounts
                    than
                    would be the case with the shares of a seasoned issuer in the
                    event of
                    negative news or lack of progress;
 
 o
                announcements
                    of new products by us or our competitors;
 
 o
                the
                    timing and development of our products;
 
 o
                general
                    and industry-specific economic conditions;
 
 o
                actual
                    or anticipated fluctuations in our operating results;
 
 o
                our
                    capital commitments; and
 
 o
                the
                    loss of any of our key management personnel.
 In
        addition, the financial markets have experienced extreme price and volume
        fluctuations. The market prices of the securities of biotechnology companies,
        particularly companies like ours without consistent revenues and earnings,
        have
        been highly volatile and may continue to be highly volatile in the future,
        some
        of which may be unrelated to the operating performance of particular companies.
        The sale or attempted sale of a large amount of common stock into the market
        may
        also have a significant impact on the trading price of our common stock.
        Many of
        these factors are beyond our control and may decrease the market price of
        our
        common stock, regardless of our operating performance. In the past, securities
        class action litigation has often been brought against companies that experience
        volatility in the market price of their securities. Whether or not meritorious,
        litigation brought against us could result in substantial costs, divert
        management's attention and resources and harm our financial condition and
        results of operations.
 
 **WE
        DO NOT ANTICIPATE PAYING ANY CASH DIVIDENDS IN THE FORESEEABLE FUTURE, WHICH
        MAY
        REDUCE YOUR RETURN ON AN INVESTMENT IN OUR COMMON STOCK.**
 
 We
        plan
        to use earnings, to the extent we have earnings, to fund our operations.
        We do
        not plan to pay any cash dividends in the foreseeable future. We cannot
        guarantee that we will, at any time, generate sufficient surplus cash that
        would
        be available for distribution as a dividend to the holders of our common
        stock.
        Therefore, any return on your investment would derive from an increase in
        the
        price of our stock, which may or may not occur.
 
 **WE
        MAY RAISE ADDITIONAL CAPITAL THROUGH A SECURITIES OFFERING THAT WOULD DILUTE
        YOUR OWNERSHIP INTEREST AND VOTING RIGHTS.**
 
 Our
        certificate of incorporation currently authorizes our board of directors
        to
        issue up to 200,000,000 shares of common stock and 25,000,000 shares of
        preferred stock. As of June_30, 2006, after taking into consideration our
        outstanding shares of common stock, our board of directors is entitled to
        issue
        up to **8,000,000**  additional
        common shares and 25,000,000 preferred shares. The power of the board of
        directors to issue shares of common stock, preferred stock or warrants or
        options to purchase shares of our stock is generally not subject to shareholder
        approval.
 
 We
        require substantial working capital to fund our business. If we raise additional
        funds through the issuance of equity, equity-related or convertible debt
        securities, these securities may have rights, preferences or privileges senior
        to those of the holders of our common stock. The issuance of additional common
        stock or securities convertible into common stock by our board of directors
        will
        also have the effect of diluting the proportionate equity interest and voting
        power of holders of our common stock.
 
 **WE
        WILL NEED ADDITIONAL COMMON STOCK TO RAISE CAPITAL**
  We
        have
        only 8,000,000 shares of common stock available for issuance. This is a very
        small number relative to our shares of outstanding stock. IThe Board of
        Directors will likely initiate an amendment to the Company’s Articles of
        Incorporation so as to facilitate an increase in the number of authorized
        shares. Such an increase requires the approval of a majority of the Company’s
        voting power.
 
 **WE
        ARE CONTROLLED BY OUR PRINCIPAL STOCKHOLDERS AND AS A RESULT, THE TRADING
        PRICE
        FOR OUR SHARES MAY BE DEPRESSED AND THESE STOCKHOLDERS CAN TAKE ACTIONS THAT
        MAY
        BE ADVERSE TO YOUR INTERESTS.**
  14
 
 Our
        principal stockholder, Infospan Inc beneficially owns approximately 50% our
        stock. They will have the ability to exert substantial influence over all
        matters requiring approval by our stockholders, including the election and
        removal of directors and any proposed merger, consolidation or sale of all
        or
        substantially all of our assets. In addition, they could dictate the management
        of our business and affairs. This concentration of ownership could have the
        affect of delaying, deferring or preventing a change in control, or impeding
        a
        merger or consolidation, takeover or other business combination that could
        be
        favorable to you. This significant concentration of share ownership may also
        adversely affect the trading price for our common stock because investors
        may
        perceive disadvantages in owning stock in companies with controlling
        stockholders.
  **WE
        ARE SUBJECT TO THE PENNY STOCK RULES. THESE RULES MAY ADVERSELY AFFECT TRADING
        IN OUR COMMON STOCK.**
 
 Our
        common stock is a low-priced security under the penny stock rules promulgated
        under the Securities Exchange Act of 1934. In accordance with these rules,
        broker-dealers participating in transactions in low-priced securities must
        first
        deliver a risk disclosure document which describes the risks associated with
        such stocks, the broker-dealer's duties in selling the stock, the customer's
        rights and remedies and certain market and other information. Furthermore,
        the
        broker-dealer must make a suitability determination approving the customer
        for
        low-priced stock transactions based on the customer's financial situation,
        investment experience and objectives. Broker-dealers must also disclose these
        restrictions in writing to the customer, obtain specific written consent
        from
        the customer, and provide monthly account statements to the customer. The
        effect
        of these restrictions may decrease the willingness of broker-dealers to make
        a
        market in our common stock, decrease liquidity of our common stock and increase
        transaction costs for sales and purchases of our common stock as compared
        to
        other securities.
 
 Stockholders
        should be aware that, according to Securities and Exchange Commission Release
        No. 34-29093, dated April 17, 1991, the market for penny stocks has suffered
        in
        recent years from patterns of fraud and abuse. Such patterns include:
  (i)
                control
                    of the market for the security by one or a few broker-dealers
                    that are
                    often related to the promoter or issuer;
 
 (ii)
                manipulation
                    of prices through prearranged matching of purchases and sales
                    and false
                    and misleading press releases;
 
 (iii)
                boiler
                    room practices involving high-pressure sales tactics and unrealistic
                    price
                    projections by inexperienced sales persons;
 
 (iv)
                excessive
                    and undisclosed bid-ask differential and markups by selling
                    broker-dealers; and
 
 (v)
                the
                    wholesale dumping of the same securities by promoters and broker-dealers
                    after prices have been manipulated to a desired level, along
                    with the
                    resulting inevitable collapse of those prices and with consequent
                    investor
                    losses.
 Our
          management is aware of the abuses that have occurred historically in the
          penny
          stock market. Although we do not expect to be in a position to dictate
          the
          behavior of the market or of broker-dealers who participate in the market,
          management will strive within the confines of practical limitations to
          prevent
          the described patterns from being established with respect to our securities.
  15
  **ITEM
        7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF
        OPERATION**
 **Forward
        Looking Statements**
 
 Our
        Management’s Discussion and Analysis contains not only statements that are
        historical facts, but also statements that are forward-looking (within the
        meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
        Securities Exchange Act of 1934). Forward-looking statements are, by their
        very
        nature, uncertain and risky. These risks and uncertainties include
        international, national and local general economic and market conditions;
        demographic changes; our ability to sustain, manage, or forecast growth;
        our
        ability to successfully make and integrate acquisitions; raw material costs
        and
        availability; new product development and introduction; existing government
        regulations and changes in, or the failure to comply with, government
        regulations; adverse publicity; competition; the loss of significant customers
        or suppliers; fluctuations and difficulty in forecasting operating results;
        changes in business strategy or development plans; business disruptions;
        the
        ability to attract and retain qualified personnel; the ability to protect
        technology; and other risks that might be detailed from time to time in our
        filings with the Securities and Exchange Commission.
 
 Although
        the forward-looking statements in this annual report reflect the good faith
        judgment of our management, such statements can only be based on facts and
        factors currently known by them. Consequently, and because forward-looking
        statements are inherently subject to risks and uncertainties, the actual
        results
        and outcomes may differ materially from the results and outcomes discussed
        in
        the forward-looking statements. You are urged to carefully review and consider
        the various disclosures made by us in this report and in our other reports
        as we
        attempt to advise interested parties of the risks and factors that may affect
        our business, financial condition, and results of operations and
        prospects.
  The
        following discussion of our financial condition and plan of operations should
        be
        read in conjunction with the financial statements and related notes thereto.
        The
        following discussion contains certain forward-looking statements that involve
        risks and uncertainties. Our actual results could differ materially from
        those
        discussed herein. We undertake no obligation publicly to release the results
        of
        any revisions to these forward-looking statements that may be made to reflect
        any future events or circumstances.
 
 **OVERVIEW**
  Since
        inception through December 31, 2005, we have generated no revenue. We incurred
        net losses of $13,075,832 in 2005
        and $3,465,045 in 2004. As of December 31, 2005, we had an accumulated deficit
        of $16,878,537.  Our
        continued existence is dependent upon our ability to obtain additional financing
        until our revenue is sufficient to cover our operations and capital
        requirements.. Our capital requirements for the next 12 months assuming a
        full
        rollout of products and the full development of our platform will equal
        approximately **$1,500,000.**
  As
        of
        December 31, 2005, our independent auditors have added an explanatory paragraph
        to their report of our audited financial statements for the year ended December
        31, 2005 stating that our net losses, lack of revenues and dependence on
        our
        ability to raise additional capital to continue our existence, raise substantial
        doubt about our ability to continue as a going concern. Our consolidated
        financial statements and their explanatory notes included as part of this
        annual
        report do not include any adjustments that might result from the outcome
        of this
        uncertainty.
  **Results
        of Operations**
  **Revenues**
  For
        the
        year ended December 31, 2005, the Company generated no revenue nd no revenue
        was
        generated in 2004. For the period from January 2003 through December 31,
        2003,
        Intercommunity Financing Corp., d/b/a No Borders ("IFC") the entity acquired
        by
        Company through the reverse merger into American Eagle Manufacturing Company
        had
        no revenue.
  **Costs
        and Expenses.**
  All
        references to the period January 1, 2003 through December 31, 2003, or reference
        to the period ending December 31, 2003 relate to results for Intercommunity
        Financing Corp., d/b/a No Borders, the entity acquired by Company through
        the
        reverse merger into American Eagle Manufacturing Company. For the year ended
        December 31, 2005, the Company's costs and expenses were $13,075,832 as compared
        to **$3,465,045
        for the period January 1, 2004 through December 31, 2004** and
        as
        compared to $337,660 for the period January 1, 2003 through December 31,
        2003.
        Of those costs and expenses for 2005, **$1,684,712_** was
        based
        on shares issued for services, $7,901,172 was based on impairment of goodwill,
        $460,623 was based on abandonment loss and $372,838 was based on interest
        expense. Of **those costs and expenses for 2004, $1,259,715 was based on shares issued
        for
        services.**
  16
  **Loss
        from Operations**
  The
        Company had a loss from operations of $4,341,199 for the year ended December
        31,
        2005, as compared to a loss from operations of $3,465,045 for the year ended
        December 31, 2004. Of the loss for 2005, $1,684,712 was based on shares issued
        for services.
  **Net
        Loss Per Share**
  The
        Company had a net loss per share of $0.18 for the year ended December 31,
        2005.as compared to a net loss of $0.08__ per share for the year ended December
        31, 2004. The lower loss per share as of December 31, 2005 is the result
        of a
        greater percentage increase in the number of outstanding shares when compared
        to
        the percentage increase in losses
  **Liquidity
        and Capital Resources**
  During
        2005, the Company raised **$1,808,100
        from financing activities** ,
        of
        which **$699,990** was
        raised by selling **7,334,231
        shares** of its
        common stock, with an additional $244,990 subscriptions for an 2,405,000
        shares
        of its common stock, such stock not having been issued as of December 31,
        2005;
        and **$363,120** was
        raised in the form of loan proceeds and $50,000 of loan principle was repaid,
        leaving a balance of $`313,120; . and **$500,000
        in funds were raised** by
        selling convertible debentures **** The
        Company’s sale of debentures for $500,000 is described in Note _ below. The
        Company borrowed from a group of individuals $250,000 in December 2004 and
        $50,000 in January 2005 which was secured by shares of stock issued previously
        to Robert M Rosenfeld and those loans were not repaid by the Company, but
        as of
        December 31, 2005, the principal had been repaid by Mr. Rosenfeld as the
        lenders
        foreclosed on the security provided.
  For
        the
        year ended December 31, 2005, the Company produced no revenues. The Company
        does
        not anticipate producing nominal revenues until the second quarter, 2005.
        The
        Company will require additional working capital to rollout its business
        operations until the Company achieves a level of revenues adequate to generate
        sufficient cash flows from operations or obtains additional financing necessary
        to support its working capital requirement. The Company estimates that it
        requires a minimum of **$750,000
        during the period of June through December 2006 in order to cover its projected
        costs of operations and development to fulfill anticipated agreements during
        that same period, as well as financing to cover the remittance fund “float” of
        up to $200,000..**  **Management
        believes that these sums, other than the “float” financing, will be obtained by
        generating revenue during the third and fourth quarters of 2006 and by the
        sale
        of securities via a private placement or placements and/or be obtaining debt
        financing.. The Company estimates that it will generate revenue from its
        operations so as reach a point of break-even by June, 2007.**
  As
        of
        December 31, 2005, the Company's assets equaled $4,034,845 as compared to **$120,489** as of
        December 31, 2004 .
  **Critical
        Accounting Policies**
  Our
        discussion and analysis of our financial condition and results of operations
        are
        based on our consolidated financial statements, which have been prepared
        in
        accordance with accounting principles generally accepted in the U.S. The
        preparation of these financial statements requires us to make estimates and
        judgments that affect the reported amounts of assets, liabilities, revenues
        and
        expenses for each period. The following represents a summary of our critical
        accounting policies, defined as those policies that we believe are the most
        important to the portrayal of our financial condition and results of operations
        and that require management's most difficult, subjective or complex judgments,
        often as a result of the need to make estimates about the effects of matters
        that are inherently uncertain.
 
 **Stock
        compensation costs**
 
 We
        account for stock option and warrant grants issued to non-employees using
        the
        guidance of SFAS No. 123, "Accounting for Stock-Based Compensation" and EITF
        No.
        96-18: "Accounting for Equity Instruments that are Issued to Other Than
        Employees for Acquiring, or in Conjunction with Selling, Goods or Services,"
        whereby the fair value of such option and warrant grants is determined using
        the
        Black-Scholes option pricing model at the date of grant.
 
 In
        December 2004, the FASB issued SFAS No. 123(R), "Share-Based Payment". This
        Statement revises FASB Statement No. 123, "Accounting for Stock-Based
        Compensation" and supersedes APB Opinion No. 25, "Accounting for Stock Issued
        to
        Employees". SFAS No. 123(R) focuses primarily on the accounting for transactions
        in which an entity obtains employee services in share-based payment transactions
        SFAS No. 123(R) requires companies to recognize in the statement of operations
        the cost of employee services received in exchange for awards of equity
        instruments based on the grant-date fair value of those awards (with limited
        exceptions). This Statement is effective as of the first fiscal year reporting
        period that begins after June 15, 2005 for large business issuers and December
        15, 2005 for small business issuers. We decided to adopt SFAS 123(R) ahead
        of
        the requirement schedule in the fourth quarter of 2005. We account for stock
        options or other compensation to employees using SFAS No. 123(R).
  17
 
 Impairment
        of long-lived assets. We account for long-lived assets in accordance with
        SFAS
        No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets,
        or SFAS
        No. 144, which was adopted on January 1, 2002. SFAS No. 144 supersedes SFAS
        No.
        121, Accounting for the Impairment of Long-Lived Assets and for Long- Lived
        Assets To Be Disposed of, or SFAS No. 121. Our long-lived assets consist
        of land
        use right, notes, fixed assets, construction in process, and prepaid consulting
        fees. We regularly evaluate our long-lived assets, including our intangible
        assets, for indicators of possible impairment whenever events or changes
        in
        business circumstances indicate that the carrying amount of the assets may
        not
        be fully recoverable. An impairment loss would be recognized when estimated
        undiscounted future cash flows expected to result from the use of an asset
        and
        its eventual disposition are less than its carrying amount. Impairment, if
        any,
        is measured using discounted cash flows. In the years ending December 31,,
        2004
        and 2003, we performed an evaluation of our long-lived assets and noted no
        impairment. For the year ending December 31, 2005, we noted an impairment
        of
        goodwill in connection with our acquisition of minority interests in the
        stock
        of Infospan Private Ltd (Pakistan) and Infospan Mexico S.A. of
        $7,901,172..
  Research
        and Development Costs-We account for research and development expense under
        the
        guidance of SFAS No.2, Accounting for Research and Development Costs, which
        was
        adopted in October 1974. Research and development costs are charged to
        operations as incurred. Our research and development costs include salaries
        of
        research and development personnel, contract service expense for software
        development and related travel and office expenses. The
        Company has expended $35,650 in software development costs through December
        31,
        2003 for internal use software. The software being developed is to facilitate
        the unified Stored Value Card platform. The software is entirely proprietary.
        The Company expended an additional $403,241 in development cost in 2004.
        In
        April 2004 the management reviewed the software development to date and
        determined while some of the code will be salvaged the project has been
        abandoned as written. Accordingly all software development cost incurred
        in 2004
        were expensed in 2004. In 2005 the company expended $185,000 in additional
        software development costs.
  **Income
        taxes**
  The
        Company accounts for income taxes under the provisions of Statements of
        Financial Accounting Standards No. 109 "Accounting for Income Taxes", which
        requires a company to recognize deferred tax assets and liabilities for the
        expected future tax consequences of events that have been recognized in a
        company's financial statements or tax returns. Under this method, deferred
        tax
        assets and liabilities are determined based on the difference between the
        financial statement carrying amounts and tax basis of assets and liabilities
        using enacted tax rates. The Company has no differences between book and
        tax
        accounting. At December 31, 2005 the Company had a net operating loss carry
        forward of approximately $13,559,000.
  **Use
        of Estimates**
  The
        preparation of consolidated financial statements in conformity with generally
        accepted accounting principles requires management to make estimates and
        assumptions that affect certain reported amounts and disclosures. Accordingly,
        actual results could differ from those estimates.
  **Commitments
        and contingencies**
  Development
        Agreement In April, 2005 the Company entered into a software development
        agreement with Croem, Inc whereby Croem agreed to provide required development
        services to complete the open and closed system card platform designed by
        Company. The term of the agreement is two years and calls for a monthly payment
        of $15,000. The Company shall own full right title and interest to the software
        developed at the end of the term.
  **Lease
        Commitment**
  On
        December 15, 2004, the Company entered into a lease for office space for
        3
        years. The lease is for $10,800 a month and required a $64,800 deposit.
  As
        of
        December 31, 2005, the Company abandoned the premises and forfeited the lease
        deposit of $64,800 and telephone equipment with a net book value of $24,675.
        The
        Company accrued rent for the future minimum lease payments of $371,148, although
        management believes the lessor will accept the lease deposit and telephone
        equipment as complete payment for the lease and not pursue collection of
        remaining $371,148. The total abandonment loss recorded in the financial
        statements was $460,623.
  18
  **Investor
        Relations Consulting Contracts**
 
 In
        January 2005 we entered into a investor relations consulting agreement with
        Hanover Capital Corporation for a period of two years whereby the Company
        committed to pay the sum of $3,500 per month and provide a total of 2,500,000
        shares of its common stock, of which 1,000,000 shares were issued in 2005.
  **Acquisition
        Agreements**
 
 **On
        September 29, 2005 the Company entered into a Stock Purchase and Strategic
        Alliance Agreement with Infospan Inc. Pursuant to the terms of that agreement,
        the Company acquired 15% of the issued and outstanding shares of Infospan
        Private Ltd (Pakistan) and 20% of Infospan Mexico. The agreement also included
        the formation of a strategic alliance, which was subsequently amended on
        December 29, 2005.. The Company issued 95,995,000 shares of its common stock
        to
        Infospan, Inc. and on September 29, 2005, the closing price per share equaled
        $.12 of the US. The value placed upo the acquisitions eaual a total of
        $3,730,769.**
 
 **The
        Company closed the acquisition of ASI Cardservices International Inc and
        ASI
        Punto de Pago S.A. which was described in Company’s 10QSB filed on August 22,
        2005. The agreement provided for the issuance of 400,000 shares to the
        shareholders of ASI Cardservices, Inc. and 74,000 shares to the shareholders
        of
        ASI Punto de Pago S.A. The closing price of the Company’s stock on the date of
        issuance of shares was $.10 per share.**
 
 **The
        Company determined that it would not complete the intended acquisitions of
        either Samsos International Inc or Cybacom Inc. However the Company entered
        into
        a settlement agreement with Cybacom Inc in June, 2005, and obtained a
        non-exclusive license to utilize the card processing technology of Cybacom
        and
        the consulting services of Richard Schofield and Greg DelVecchio. Pursuant
        to
        this agreement, Cybacom received 500,000 shares of Company’s common stock plus a
        total of $ $50,000, payable in installments plus options to purchase 200,000
        shares of Company’s common stock at an exercise price of $.25 subject to
        adjustment if Company failed to make the monetary payments when due; and
        Schofield and DelVechhio agreed to render consulting services and received
        an
        aggregate of 225,000 shares and 300,000 options to purchase Company’s common
        stock bearing an exercise price equal to 25% of the market price, with a
        floor
        of $.06, pus an additional 300,000 options to purchase Company’s common stock at
        $.25 per share, the exercise prices subject to adjustment if Company failed
        to
        make the monetary payments when due, plus payments in installments which
        total
        $60,000.**
 
 **The
        Company determined that it would not consummate the acquisition of Froncom
        inc.after conducting its due diligence.**
 
  **ITEM
        8 - FINANCIAL STATEMENTS AND NOTES TO FINANCIAL
        STATEMENTS**
 
 The
        financial statements together with the independent auditors report thereon
        appear beginning on Page F-1 of this Report.
 
 **ITEM
        9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
        DISCLOSURE**
 
 **None**
  19
 
 **ITEM
        9A - CONTROLS AND PROCEDURES**
 
 (a)
        Evaluation of disclosure controls and procedures. As of the end of the period
        covered by this report, we carried out an evaluation, under the supervision
        and
        with the participation of our management, including our Chief Executive Officer
        and Chief Financial Officer, 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. Based upon
        that
        evaluation, our Chief Executive Officer and Chief Financial Officer concluded
        that our disclosure controls and procedures were effective as of the end
        of the
        applicable period to ensure that the information required to be disclosed
        by us
        in reports that we file or submit under the Exchange Act (i) is recorded,
        processed, summarized and reported within the time periods specified in
        Securities and Exchange Commission 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
        disclosures.
 
 (b)
        Changes in internal controls over financial reporting. There was no change
        in
        our internal control over financial reporting during our most recent fiscal
        quarter that has materially affected, or is reasonably likely to materially
        affect, our internal control over financial reporting.
 
 **ITEM
        9B - OTHER INFORMATION**
 
 **None.**
 
 **PART
        III**
 
 **ITEM 9
        - DIRECTORS AND EXECUTIVE OFFICERS/CONSULTANTS OF THE
        REGISTRANT**
 
 The
        following table sets forth the names, ages, and positions of our directors
        and
        executive officers or those providing services as consultants fulfilling
        the
        positions listed:
  **Name**
                **Age**
                **Position
                    Held**Raul
                    Hinojosa-Ojeda
                48
                Chairman,
                    President/DirectorRobert
                    M Rosenfeld
                64
                Acting
                    CEO/DirectorRandy
                    Gutierrez
                48
                Consultant
                    -Operations/TechnologyGuillermo
                    Rodriguez
                35
                Consultant
                    -- Sales ManagerJorge
                    Hinojosa
                45
                Vice
                    President, Business DevelopmentPaule
                    Cruz Takash
                49
                Director
  **Except
        as otherwise set forth herein, based solely on review of the copies of such
        forms furnished to the Company, or written representations that no reports
        were
        required, the Company believes that for the fiscal year ended December 31,
        2005,
        beneficial owners complied with Section 16(a) filing requirements applicable
        to
        them, except:**
  Our
        executive officers are appointed by our board of directors and serve at the
        board's discretion. There is no arrangement or understanding between any
        of our
        directors or executive officers and any other person pursuant to which any
        director or officer was or is to be selected as a director or officer, and
        there
        is no arrangement, plan or understanding as to whether non-management
        stockholders will exercise their voting rights to continue to elect the current
        board of directors. There are also no arrangements, agreements or understandings
        to our knowledge between non-management stockholders that may directly or
        indirectly participate in or influence the management of our affairs. None
        of
        our directors or executive officers has, during the past five years,
  o
                had
                    any bankruptcy petition filed by or against any business of which
                    such
                    person was a general partner or executive officer, either at
                    the time of
                    the bankruptcy or within two years prior to that time,
 
 o
                been
                    convicted in a criminal proceeding and none of our directors
                    or executive
                    officers is subject to a pending criminal proceeding,
  20
 o
                been
                    subject to any order, judgment, or decree, not subsequently reversed,
                    suspended or vacated, of any court of competent jurisdiction,
                    permanently
                    or temporarily enjoining, barring, suspending or otherwise limiting
                    his
                    involvement in any type of business, securities, futures, commodities
                    or
                    banking activities, or
 
 o
                been
                    found by a court of competent jurisdiction (in a civil action),
                    the
                    Securities and Exchange Commission or the Commodity Futures Trading
                    Commission to have violated a federal or state securities or
                    commodities
                    law, and the judgment has not been reversed, suspended, or vacated.
   **ITEM
          10 - EXECUTIVE COMPENSATION**
 
 **Summary
        Compensation Table**
  The
        following compensation disclosure reflects all compensation awarded to, earned
        by and accrued or paid to or payable to the individuals below, for the calendar
        year ending December 31, 2005.
  **INDIVIDUAL
        AND POSITION** ****
  **COMPENSATION--2005****PAYABLE**
                **PAID**
                **DEFERRED**RM
                    ROSENFElD
                $5,000/Mo.
                00
                $60,000
                    (3)Acting
                    CEORAUL
                    HINOJOSA
                $5,000/Mo.
                00
                $60,000
                    (3)PresidentJORGE
                    HINOJOSAVP
                    Bus Dev
                $10,000/Mo.
                $50,000
                $70,000
                    (1)WILLIE
                    RODRIQUEZConsultant
                    - Sales Mgr
                $10,000/Mo.
                $71,000
                $49,000
                    (2)RANDY
                    GUTIERREZ
                $10,0000/Mo.
                $5,000
                $55,000Consultant
                    - COOFunctiona
                    July-Dec 2005
 (1)
        $65,000 of the deferred amount was paid in the form of shares of common stock
        issued by Company based on
        $.05
        per share, 1,300,000 shares, after Raul Hinojosa cancelled an equivalent number
        of
        shares in his name in March, 2006;.
 (2)
        $29,000 of the deferred compensation was paid in the form of shares of common
        stock issued by Company at
        $.05
        per share, 580,000 shares, after Raul Hinojosa cancelled 580,000 of shares
        in
        his name in March 2006.. ****
 (3)
        For
        payment when cash flow permits.
   **BIOGRAPHIES
        OF OFFICERS AND DIRECTORS.**
  Dr.
        Raul Hinojosa, Chairman and President
  The
        chief
        visionary behind No Borders, Dr. Hinojosa is a distinguished author, speaker,
        and regular media guest on a variety of issues centered around international
        economic development. As a Founding Research Director of the North American
        Integration and Development (NAID) Center, and as a Professor at UCLA, Dr.
        Hinojosa has devoted his considerable intellectual energies to issues of
        trade,
        investment, and migration relations between the U.S., Mexico, Latin America,
        and
        the Pacific Rim. After working at the World Bank and the Inter-American
        Development Bank, Dr. Hinojosa originated the proposal for the North American
        Development Bank, which was capitalized at $3 billion by the U.S. and Mexican
        government in 1994. Dr. Hinojosa has also founded several successful technology
        companies, including the Isadra Corporation, which was sold to VerticalNet
        for
        $50 million in 2000.
 
 21
  Robert
        M. Rosenfeld, Acting Chief Executive Officer
  Mr.
        Rosenfeld's legal expertise and business acumen bring a competitive advantage
        to
        No Borders. As the company's "Chief Architect," his ability to raise capital
        and
        construct strategic business alliances is a critical factor in positioning
        No
        Borders and accelerating its growth as a leader in the marketplace. As a
        respected attorney for more than 30 years, Mr. Rosenfeld has represented
        significant entities in entertainment and publishing. He has led business
        development and intellectual property ventures, and has served as an advisor
        to
        various political leaders. Mr. Rosenfeld's numerous legal articles have also
        helped him earn his well-deserved reputation. His most highly recognized
        contribution to the UCLA Law Review, "The Fourth and Fifth Amendments:
        Dimensions of an Intimate Relationship," confirmed the constitutional right
        of
        privacy. Until December 2004, Mr. Rosenfeld served as a member of the Board
        of
        Directors of the Audrey Hepburn Children's Fund. He is currently a member
        of the
        UCLA Roundtable.
 
 Willie
        Rodriguez, Consultantant-Sales
  Mr.
        Rodriguez is a nationally known pioneer in the remittance industry, as a
        result
        of innovative and successful sales methodologies developed through his deep
        understanding of the Latino market. During his 10-year career with two of
        the
        most successful remittance companies - Western Union/Orlandi Valuta and Sigue
        Corporation - Mr. Rodriguez perfected the art of agent recruitment and
        retention, resulting in a network of over 5,000 sites within the U.S. Mr.
        Rodriguez's close personal relationships with remittance agents, and his
        extensive professional network, have helped No Borders establish immediate
        credibility with, and access to, the remittance market. His knowledge of
        the
        industry helps ensure that No Borders pricing and commission structures offer
        a
        competitive advantage, and that the company recruits professionals of the
        highest quality.
 
 Jorge
        Hinojosa, General Manager of Business Development
  Mr.
        Hinojosa has significant experience in creating and managing partnerships
        between major U.S. corporations and community-based nonprofit organizations
        in
        the United States and Mexico. Until recently, Mr. Hinojosa was the Director
        of
        the Center for Latino Economic Opportunities at the National Council of La
        Raza,
        in Washington, DC. At No Borders, Mr. Hinojosa is leading the creation of
        strategic public, private, and nonprofit sector alliances that will bring
        affordable products and services to No Borders customers in the U.S. and
        abroad.
        In addition, Mr. Hinojosa oversees product branding and
        development.
 
 Randy
        Gutierrez-Consultant
  Randy
        Gutierrez has over 20 years of experience in financial services industries
        and
        30 years of detailed product, operations and technology experience. Randy
        held a
        variety of management positions for 15 years with Wells Fargo Bank in the
        areas
        of Domestic and International Wire Transfer, ACH, Risk Control, Credit Card,
        Bill Payment and International Consumer Money Transfers. Randy co-founded
        a
        private payment processing company, BankServ, based in San Francisco, which
        specializes in outsourcing and software sales for domestic and international
        wire transfer and ACH processing. Randy held a variety of positions at BankServ
        over a period of 8 years including CIO, CTO, and General Manager of the BankServ
        Domestic and International Wire Transfer divisions. During his tenure at
        BankServ, Randy worked closely with federal and state financial regulatory
        bodies to ensure compliance of financial payments products, oversaw two
        acquisitions expanding the BankServ financial institution client base to
        over
        350 clients both domestically and internationally, and led the Wire Transfer
        division to profitability through organic and acquisition growth. Randy has
        since focused his energies as principal of Alianza Consulting and currently
        assists stored value card, money transfer, and foreign exchange companies
        with
        implementing programs serving the unbanked with card, remittance, foreign
        exchange and other peripheral services.
  Paula
        Cruz Tekash -Director
  Dr.
        Paule
        Cruz Takash holds a Ph.D. in Sociocultural Anthropology from the University
        of
        California, Berkeley (1990). A research associate at the North American
        Integration and Development (NAID) Center at the University of California,
        Los
        Angeles, Takash also teaches in the UCLA Department of Chicana and Chicano
        Studies. Her areas of specialization include transnational migration,
        remittances and economic development (U.S. and Mexico); Latino immigrant
        participation in U.S. financial institutions (credit unions); post-1965
        immigrant settlement and ethnoracial transformation of California and other
        regions in the United States; and ethnic and gendered politics in the
        U.S..Takash is currently the President of the Association of Latina and Latino
        Anthropologists (ALLA) and was recently appointed by Los Angeles Mayor Antonio
        Villaraigosa to the LA City Human Relations Commission. Board appointments
        include the William C. Velásquez Institute and *Casa
        Libre* ;
        the
        former, a non-profit, non-partisan organization that conducts research on
        Latina/o political participation; the latter, a nonprofit organization based
        in
        Los Angeles that houses and otherwise supports homeless immigrant youth 12-18
        years of age.
  22
  **COMPENSATION
        OF DIRECTORS**
 
 Directors
        do not currently receive compensation for their services as directors, nor
        have
        they been reimbursed for expenses incurred in attending board meetings.
  **EMPLOYMENT
        AGREEMENTS, TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL ARRANGEMENTS**
 
 We
        currently do not have any employment agreements with our executive officers
        or
        our consultants
        providing the services of a COO and General Manager of Sales.
   **ITEM
        11 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
        STOCKHOLDER MATTERS**
  The
        following table sets forth, as
        of
        March 29, 2006 information regarding the beneficial ownership of shares of Common Stock
        by each
        person known by to own five percent or more of the outstanding shares of
        Common
        Stock, by each of the Company's Officers, by each of the Company's Directors,
        and by the Company's Officers and Directors as a group. The table is based
        upon
        191,000,000 outstanding shares of common stock as **of** **June
        30, 2006.**
  **Name
                    and Address of**Beneficial
                    Owners****
                **Shares
                    of**Common
                    Stock****
                **Percentage****RAUL
                    HINOJOSA-OJEDA**
                **9,345,140
                    (1)**
                **4.9%****RM
                    ROSENFELD**
                **7,800,000
                    (2)**
                **4.1%****Randy
                    Gutierriz**
                **580,000**
                **,3%****Infospan
                    Inc**
                **95,945,339
                    (3)**
                **50.2%****Jorge
                    Hinojosa**
                **2,449,860
                    (4)**
                **1.3%****Guillermo
                    Rodriguez**
                **630,000
                    (5)**
                **.3%****Total
                    -individuals serving In management capacity**
                **20,805,000
                  (6)**
                **10.9%**(five
                    persons)
  **CHANGE
        OF CONTROL**
 
 To
        the
        knowledge of management, there are no present arrangements or pledges of
        securities of our Company that may result in a change in control of the
        Company.
 
 **ITEM
        12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS**
 
 RM
        Rosenfeld, a director and acting CEO loaned the Company (through direct deposits
        to the Company or through payments made to third parties on the Company’s
        behalf) a total of $250,000 as of December 31, 2005 and 146,000 as of December
        31, 2004.
 
 In
        October, 2005,, Mr. Rosenfeld converted $250,000 of the sums advanced into
        3,495,000 shares of the Company’s common stock and then assigned those shares to
        third party consultants for services rendered to the Company. The balance
        of
        advances made to the Company, less reimbursements he received,, as of December
        31, 2005, was
        zero.
  In
        March,
        2006 Mr. Rosenfeld cancelled 1,205,000 of his shares to allow for the issuance
        of the same amount of shares to consultants and to lenders entitled to shares
        based on Company’s failure to file a registration .
 
 In
        addition, each of Mr. Rosenfeld and Dr. Hinojosa have received no payment
        of
        compensation from the inception of the Company and agreed to defer payment
        of
        their agreed salary of $5,000 per
        month from January 1, 2005 through December 31, 2005 until such time as cash
        flow permits such payment , and further agreed to defer the same compensation
        of
        $5,000 from January through December, 2006, with the then current compensation
        of $5,000 per month.
 
 Willie
        Rodriguez (Manager of Sales)and Jorge Hinojosa (VP of Business Development)
        and
        Randy Gutierrez (Consultant) deferred compensation equal to $49,000, $70,000
        and
        $55,000 as of December 31, 2005.. In March 2006, Raul Hinojosa cancelled
        1,849,860 of his shares to allow for the issuance of 1,849,860 shares to
        Jorge
        Hinojosa and 580,000 shares to Willie Rodriguez .
  23
 
 **Item
        13. PRINCIPAL ACCOUNTING FIRM FEES AND SERVICES**
 
 The
        following table sets forth information regarding fees incurred by our
        independent accountant during the last two fiscal years:
  **2005**
                
                **2004**Audit
                    Fees
                
                $
                _____
                
                $
                _____Audit
                    Related FeesAll
                    Other Fees
                
                $
                -0-
                
                $
                -0-
 The
          Board
          of Directors pre-approved all fees paid to our independent
          auditor.
   **ITEM
        14- EXHIBITS**
 
 The
        following documents are filed as part of this report:
 
 (1)
        Financial Statements - See Index to Consolidated Financial Statements under
        Item
        7 above.
 (2)
        Exhibits - See Index to Exhibits following the signatures to this report.
 
 The
        board
        of directors serves as the function of audit committee.
   **ITEM
          15 SUBSEQUENT EVENTS**
  In
        the
        first quarter of 2006, Company amended its second agreement with Infospan
        Inc.
        The overall agreement confirmed the issuance of 70 million shares of Company’s
        common stock in return for (1) Infospan guaranteeing a $500,000 loan to Company
        by third party investors; (2) Infospan agreeing to attempt to purchase the
        agreements and rights acquired by Bridgepoint Partners LLC and Miller Ventures,
        LLC; (3) Infospan providing the resources to accelerate the full development
        of
        the Company’s stored value card platform; (4) Infospan providing the funds to
        build up to three interfaces with banking institutions outside of the United
        States; and (5) Infospan assisting Company In efforts to secure agreements
        with
        foreign banking institutions, and targeting the Persian Gulf region among
        others.
 
 In
        the
        first quarter of 2006, Magvisor Inc., an affiliate of Infospan Inc. purchased
        the debentures and other rights acquired by Bridgepoint Partners LLC and
        Miller
        Ventures, LLC for the sum of $600,000, whereby each of Bridgepoint and Miller
        retained 1,000,000 of the 5,000,000 Warrants previously issued to them by
        Company, amending the Warrants to eliminate any re-set conversion price.
        Magvisor was issued the remaining 8,000,000 Warrants.
 
 On
        May
        2006, Magvisor Inc converted the debentures acquired and was issued 6,000,000
        shares of Company’s restricted common stock, converting at 10 cents per share,
        plus 150,000 shares converting interest accrued from the date Magvisor purchased
        the debentures to the date of conversion.; moreover, the 8,000,000 Warrants
        held
        by Magvisor were terminated with 1,200,000 Warrants re-issued to Magvisor,
        such
        Warrants eliminating the prior re-set conversion provisions and reducing
        the
        term of the Warrant from 10 years to two years. In consideration of the
        conversion of the debentures at the initial conversion rate of 10 cents per
        share, taking into account the sums paid by Magvisor to purchase the debentures
        and eliminating any penalties accrued under the terms of the original debentures
        as well as eliminating interest which had accrued from the date the original
        debentures were issued to the date of Advisor’s purchase, the elimination of the
        mandatory registration rights and the penalties associated with such rights
        and
        the elimination of any re-set provisions, the Company issued to Magvisor
        an
        additional 6,800,000 shares of its common stock. Company also agreed to file
        a
        registration statement within 90 days and include 5,000,000 of the shares
        issued
        in such registration statement; moreover Company agreed to include the remaining
        shares issued in any registration statement following the first registration
        filed by Company pursuant to a “piggyback” registration right, subject to
        certain limitations.
  24
 
 In
        the
        first quarter of 2006, the Company entered into an agreement with Morgan
        Beaumont on whereby Morgan Beaumont agreed to provide access to its approximate
        150,000 locations nationwide for the loading of funds onto the No Borders
        open
        system (bank issued) stored value card.
 
 Company
        entered into an agreement with Western ATM -whereby its30,000 Concena Load
        branches provide access for the loading of funds onto the No Borders open
        system
        stored value cards.
 
 Company
        signed an agreement with HSBC in Mexico , the terms of which call for HSBC
        to
        provide payout services at all of its branch locations in Mexico for remittances
        originating from the No Borders platform, such payout services to include
        payments of sums remitted in both pesos and dollars, at no charge; the agreement
        also calls for direct deposits of remittances from the U.S. into existing
        accounts at HSBC. In addition, the agreement provides for recipients of HSBC
        issued debit cards receiving funds through the No Borders’ platform to receive
        cash at no charge at 5000 ATM locations.
 
 Company
        entered into agreements with Palmeras Financial Services Inc, a licensed
        remittance company. The first agreement grants to Palmeras a license to utilize
        the No Borders Platform and closed card system for remittance, the terms
        of
        which provide No Borders with transaction fees for each remittance transaction
        at an average of $3.00 per transaction, The agreement also calls for Palmeras
        agents to distribute the No Borders open system stored value card, commencing
        in
        the third quarter of 2006 Additional Palmeras remittance agent sites are
        to be
        secured through the marketing efforts of No Borders. In addition, through
        Palmeras’ affiliations, No Borders has the unrestricted right to access over
        4900-payout sites in Mexico plus Bancomer branches in 18 other countries
        with
        respect to any remittances originating through the No Borders platform. No
        Borders further agreed to enter into an agreement to acquire Palmeras pursuant
        to a definitive agreement which is to be prepared and submitted, providing
        for a
        scheduled closing prior to the end of the 2006 calendar year, subject to
        due
        diligence. The precise financial terms are currently being negotiated.
 
 During
        2006, R.Michael Rosenfed, Raul Hinojosa and Jorge Hinojosa each loaned the
        Company the sums of $123,273, $343,447 and $69,000, respectively, each such
        loan
        to be repayable on demand with interest accruing from the date of Company’s
        receipt of loan proceeds at the rate of 5% per annum. Each is entitled to
        convert the unpaid principle of the loans made based upon the market price
        of
        Company’s common stock at the date(s) of conversion, but in no event at less
        than $.10 per share; in addition, for each $100,000 loaned, the Company agreed
        to issue options to purchase 300,000 shares, or a prorate portion based upon
        the
        amount loaned, of Company’s common stock at a price of $.05 per
        share.
 During
        the last quarter of 2006, the Company borrowed a total of $300,000 from two
        different lenders. The term of each loan is one year with interest accruing
        at
        20% per annum. The Company agreed to issue options to each lender to purchase
        300,000 shares of its common stock for each $100,000 in loan principle received,
        with the exercise price established to $.05 per share.
  In
        July,
        2006, Mark Abdou loaned the Company $12,500 and paid that sum directly to
        Mendoza Berger & Company, LLP, the Company’s auditors. The term of the loan
        was one year, and bore interest at 12% per annum. The principle amount of
        the
        loan is convertible into shares of Company’s common stock at $.02 per share; In
        addition, Mr Abdou was granted Warrants to purchase 1,200,000 shares of
        Company’s common stock at $.02 per share.
 In
        April
        2006, members of the law firm of Richardson & Patell loaned the Company
        $27,475. The term of the loan was one year and the principle amount of the
        loan
        plus accrued interest at 12% per annum is convertible into Company’s common
        stock at $.05 per share.
 
 25
    **FINANCIAL
        STATEMENTS AND NOTES TO FINANCIAL STATEMENTS**
   INTERCOMMUNITY
        FINANCING COPR.
        dba
 **NO
        BORDERS, INC. AND SUBSIDIARY**
 **(A
        Development Stage Company)**
 **FINANCIAL
        STATEMENTS**
 **FOR
        THE YEAR ENDED**
 **DECEMBER
        31, 2005 AND**
 **FOR
        THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
        DECEMBER 31, 2005**





26
  
 **TABLE
        OF CONTENTS**
  Report
                    of Independent Registered Public Accounting Firm
                F-1Balance
                    Sheets
                F-2Statements
                    of Operations
                F-4Statement
                    of Changes in Stockholders’ Equity
                F-5Statements
                    of Cash Flows
                F-7Notes
                    to Financial Statements
                F-8
 27
 **REPORT
        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
 
 
 To
        the
        Board of Directors and Stockholders
 Intercommunity
        Financing Corp. dba No Borders
 
 We
        have
        audited the accompanying balance sheet of Intercommunity Financing Corp.
        dba No
        Borders(a development stage company) and its subsidiary (the Company) as
        of
        December 31, 2005, and the related statements of operations, stockholders’
deficit, and cash flows for the years then ended. These financial statements
        are
        the responsibility of the Company’s management. Our responsibility is to express
        an opinion on these financial statements based on our audits. The financial
        statements of Intercommunity Financing Corp. dba No Borders as of December
        31,
        2004, were audited by other auditors whose report dated April 12, 2005,
        expressed an unqualified opinion on those statements (the April 12, 2005
        report
        was modified related to the uncertainty of the Company’s ability to continue as
        a going concern), have been furnished to us.
 
 We
        conducted our audit in accordance with the standards of the Public Company
        Accounting Oversight Board (United States). Those standards require that
        we plan
        and perform the audit to obtain reasonable assurance about whether the
        consolidated financial statements are free of material misstatement. An audit
        includes examining, on a test basis, evidence supporting the amounts and
        disclosures in the consolidated financial statements. An audit also includes
        assessing the accounting principles used and significant estimates made by
        management, as well as evaluating the overall consolidated financial statement
        presentation. We believe that our audit provides a reasonable basis for our
        opinion.
 
 In
        our
        opinion, the financial statements referred to above present fairly, in all
        material respects, the financial position of Intercommunity Financing Corp.
        dba
        No Borders, Inc. and its subsidiary as of December 31, 2005, and the results
        of
        its operations and its cash flows for the year then ended in conformity with
        accounting principles generally accepted in the United States of
        America.
 
 The
        accompanying financial statements have been prepared assuming that the Company
        will continue as a going concern. As more fully described in Note 3, the
        Company
        has incurred recurring operating losses and has an accumulated deficit. These
        conditions raise substantial doubt about the Company’s ability to continue as a
        going concern. Management’s plans in regard to these matters are also described
        in Note 3. The financial statements do not include any adjustments that may
        result from the outcome of this uncertainty.
   **Mendoza
        Berger & Company, LLP**
  
 Irvine,
        California
 June
        30,
        2006
  F-1
  **NO
        BORDERS, INC. AND SUBSIDIARY**
 **(A
        Development Stage Company)**
 **BALANCE
        SHEETS**
 **DECEMBER
        31**
 
 
 **ASSETS**
 **2005**
                
                **2004**Current
                    assets:Cash
                
                $
                2,039
                
                $
                -Total
                    current assets
                
                
                2,039
                
                
                -Fixed
                    assets:Computers
                
                
                37,434
                
                
                35,197Leasehold
                    improvements
                
                
                -
                
                
                4,200Accumulated
                    depreciation
                
                
                (20,417
                )
                
                (8,708
                )Total
                    fixed assets, net
                
                
                17,017
                
                
                30,689Deferred
                    financing costs, net (Note 4)
                
                
                285,020
                
                
                -Minority
                    interest (Note 9)
                
                
                3,730,769
                
                
                -Deposits
                
                
                -
                
                
                64,800License
                
                
                -
                
                
                25,000Total
                    assets$
                4,034,845
                
                $
                120,489
  The
          accompanying notes are an integral part of these financial
          statements.
 F-2
 
 **NO
        BORDERS, INC. AND SUBSIDIARY**
 **(A
        Development Stage Company)**
 **BALANCE
        SHEETS**
 **DECEMBER
        31**
 
 
 **LIABILITIES
        AND STOCKHOLDERS’ DEFICIT**
 
 2005
              
              2004Current
                  liabilities:Bank
                  overdraft
              
              $
              8,492
              
              $
              17,205Accounts
                  payable
              
              
              45,388
              
              
              17,276Accrued
                  rent
              
              
              371,148
              
              
              -Late
                  registration fees payable (Note 7 and
                  9)
              
              
              359,000
              
              
              -Notes
                  payable related party (Note
                  6)
              
              
              248,120
              
              
              200,000Interest
                  payable
              
              
              133,164
              
              
              -Notes
                  payable (Note 6)
              
              
              565,000
              
              
              -Total
                  current liabilities
              
              
              1,730,312
              
              
              234,481Commitments
                and contingencies (Note 8)
              
              
              -
              
              
              -Stockholders’
deficit:Common
                  stock, 200,000,000 shares
                  authorized,par
                  value $0.001, 169,542,359 and 48,886,686
                  sharesissued
                  and outstanding at December 31, 2005
                  and2004,
                  respectively
              
              
              169,542
              
              
              48,887Common
                  stock subscribed not issued, 2,405,000
                  shares
              
              
              244,990
              
              
              -Additional
                paid in capital
              
              
              18,768,538
              
              
              3,639,826Deficit
                  accumulated during development stage
              
              
              (16,878,537
              )
              
              (3,802,705
              )Total
                  stockholders’ equity (deficit)
              
              
              2,304,533
              
              
              (113,992
              )Total
                  liabilities and stockholders’ equity (deficit)
              
              $
              4,034,845
              
              $
              120,489
 
 The
          accompanying notes are an integral part of these financial
          statements.
 F-3
  
 **NO
        BORDERS, INC. AND SUBSIDIARY**
 **(A
        Development Stage Company)**
 **STATEMENTS
        OF OPERATIONS**
 **FOR
        THE YEAR ENDED DECEMBER 31, 2005 AND 2004**
 **FOR
        THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
        DECEMBER 31**
 
 
 **2005**
              
              ****
              **2004**
              
              
              **Cumulative
                  From Inception (October 25, 2002) Through December 31,
                  2005**Revenues
              
              $
              -
              
              
              -
              
              
              -Expenses:Marketing
                  and sales
              
              
              12,692
              
              
              12,462
              
              
              25,154General
                  and administrative
              
              
              4,328,507
              
              
              3,452,583
              
              
              8,118,750Total
                  expenses
              
              
              4,341,199
              
              
              3,465,045
              
              
              8,143,904Loss
                from
                operations
              
              
              4,341,199
              
              
              3,465,045
              
              
              8,143,904Other
                expenseAbandonment
                  loss (Note 8)
              
              
              460,623
              
              
              -
              
              
              460,623Impairment
                  of goodwill (Note 9)
              
              
              7,901,172
              
              
              -
              
              
              7,901,172Interest
                  expense
              
              
              372,838
              
              
              -
              
              
              372,838Loss
                  before income taxes
              
              
              (13,075,832)
              
              
              (3,465,045)
              
              
              (16,878,537)Income
                taxes (Note 5)
              
              
              -
              
              
              -
              
              
              -Net
                  loss
              
              $
              (13,075,832
              )
              $
              (3,465,045
              )
              $
              (16,878,537
              )Net
                  loss per share - basic and diluted
              
              $
              (0.18
              )
              $
              (0.08
              )Weighted
                  average number of stock outstanding - basic and diluted
              
              
              72,142,308
              
              
              45,249,436
   The
          accompanying notes are an integral part of these financial
          statements.
 F-4
  
 **NO
        BORDERS, INC. AND SUBSIDIARY**
 **(A
        Development Stage Company)**
 **STATEMENT
        OF STOCKHOLDERS’ DEFICIT**
 **FOR
        THE YEAR ENDED DECEMBER 31, 2005 AND**
 **FOR
        THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
        DECEMBER 31**
   **Deficit****Common
                  Stock**
              
              
              
              
              
              **Accumulated****Stock**
              
              
              **Additional**
              
              
              **During****Stock**
              
              
              **Common**
              
              
              **Subscribed**
              
              
              **Paid-In**
              
              
              **Development****Issued**
              
              
              **Stock**
              
              
              **Not
                  Issued**
              
              
              **Capital**
              
              
              **Stage**
              
              
              **Total**Common
                  stock outstanding, October 25, 2002
              
              
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -Initial
                  shares issues
              
              
              525
              
              
              -
              
              
              
              
              
              -
              
              
              -
              
              
              -Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Balance
                  at December 31, 2002
              
              
              525
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Capital
                  contributed
              
              
              -
              
              
              10,000
              
              
              -
              
              
              -
              
              
              -
              
              
              10,000Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (337,660
              )
              
              (337,660
              )Balance,
                  December 31, 2003
              
              
              525
              
              
              10,000
              
              
              -
              
              
              -
              
              
              (337,660
              )
              
              (327,660
              )Notes
                  payable converted to stock and shares sold
              
              
              475
              
              
              2,418,998
              
              
              -
              
              
              -
              
              
              -
              
              
              2,418,998Reverse
                  acquisition
              
              
              44,870,686
              
              
              (2,384,126
              )
              
              -
              
              
              2,384,126
              
              
              -
              
              
              -Common
                  stock issued for services
              
              
              4,015,000
              
              
              4,015
              
              
              -
              
              
              1,255,700
              
              
              -
              
              
              1,259,715Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (3,465,045
              )
              
              (3,465,045
              )Balance
                  at December 31, 2004
              
              
              48,886,686
              
              
              48,887
              
              
              -
              
              
              3,639,826
              
              
              (3,802,705
              )
              
              (113,992
              )
 
 The
          accompanying notes are an integral part of these financial
          statements.
 F-5
 
 **NO
        BORDERS, INC. AND SUBSIDIARY**
 **(A
        Development Stage Company)**
 **STATEMENT
        OF STOCKHOLDERS’ DEFICIT**
 **FOR
        THE YEAR ENDED DECEMBER 31, 2005 AND**
 **FOR
        THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
        DECEMBER 31**
   **Deficit****Common
                  Stock**
              
              
              
              
              
              **Accumulated****Stock**
              
              
              **Additional**
              
              
              **During****Stock**
              
              
              **Common**
              
              
              **Subscribed**
              
              
              **Paid-In**
              
              
              **Development****Issued**
              
              
              **Stock**
              
              
              **Not
                  Issued**
              
              
              **Capital**
              
              
              **Stage**
              
              
              **Total**
 Common
                  stock issued for cash
              
              
              7,334,231
              
              
              7,334
              
              
              -
              
              
              692,656
              
              
              -
              
              
              699,990Common
                  stock issued for services
              
              
              11,475,895
              
              
              11,476
              
              
              -
              
              
              1,673,236
              
              
              -
              
              
              1,684,712Common
                  stock issued for settlement payment
              
              
              750,000
              
              
              750
              
              
              -
              
              
              104,250
              
              
              -
              
              
              105,000Common
                  stock issued in connection with penalty payments
              
              
              1,181,208
              
              
              1,181
              
              
              -
              
              
              281,993
              
              
              -
              
              
              283,174Common
                  stock issued in connection with payments of loan
                  guarantees
              
              
              3,495,000
              
              
              3,495
              
              
              -
              
              
              311,055
              
              
              -
              
              
              314,550Intrinsic
                  value of beneficial conversion features of notes
              
              
              -
              
              
              -
              
              
              -
              
              
              330,000
              
              
              -
              
              
              330,000Warrants
                  issued
              
              
              -
              
              
              -
              
              
              -
              
              
              200,000
              
              
              -
              
              
              200,000Common
                  stock subscribed
              
              
              -
              
              
              -
              
              
              244,990
              
              
              -
              
              
              -
              
              
              244,990Common
                  stock issued for ASI acquisition
              
              
              474,000
              
              
              474
              
              
              -
              
              
              118,026
              
              
              -
              
              
              118,500Common
                  stock issued for Infospan acquisition
              
              
              95,945,339
              
              
              95,945
              
              
              -
              
              
              11,417,496
              
              
              -
              
              
              11,513,441Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (13,075,832
              )
              
              (13,075,832
              )Balance
                  at December 31, 2005
              
              
              169,542,359
              
              $
              169,542
              
              $
              244,990
              
              $
              18,768,538
              
              $
              (16,878,537
              )
              $
              2,304,533
   The
          accompanying notes are an integral part of these financial
          statements.
 F-6
 
 **NO
        BORDERS, INC. AND SUBSIDIARY**
 **(A
        Development Stage Company)**
 **STATEMENTS
        OF CASH FLOWS**
 **FOR
        THE YEAR ENDED DECEMBER 31, 2005 AND**
 **FOR
        THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
        DECEMBER 31**
   **For
                  the Year Ended December 31, 2005**
              
              
              **For
                  the Year Ended December 31, 2004**
              
              
              **Cumulative
                  From Inception (October 25, 2002) Through December 31,
                  2005**Cash
                  flows from operating activities:
                Net
                  loss
                Adjustments
                  to reconcile net loss to net cash used
                in
                  operating activities:
                Stock
                  issued for services and fees
                Impairment
                  of goodwill
                Depreciation
                  and amortization
                Loss
                  on disposal of assets
                Changes
                  in operating assets and liabilities:
                Deposits
                Bank
                  overdraft
                Accounts
                  payable
                Accrued
                  rent
                Late
                  registration fees payable
                Interest
                  payable
              
              $
              (13,075,832)
                
                
                2,337,436
                7,901,172
                50,573
                63,285
                
                64,800
                (8,713)
                28,112
                371,148
                359,000
                133,164
              
              $
              (3,465,045)
                
                
                1,259,715
                -
                8,708
                35,650
                
                (64,800)
                17,205
                11,406
                -
                (3,030)
                -
              
              $
              (16,878,537)
                
                
                3,591,091
                7,901,172
                59,281
                98,935
                
                (10,039)
                8,492
                45,388
                374,178
                359,000
                136,194Net
                  cash used in operating activities
              
              
              (1,775,855
              )
              
              (2,200,191
              )
              
              (4,314,845
              )Cash
                  flows from investment activities:Acquisition
                  (disposal)of assets
              
              
              (30,206
              )
              
              (54,358
              )
              
              (120,214
              )Net
                  cash used in investment activities
              
              
              (30,206
              )
              
              (54,358
              )
              
              (120,214
              )Cash
                  flows from financing activities:
                Stockholder
                  loan borrowings
                Stockholder
                  loan payments
                Subscribed
                  stock
                Issuance
                  of common stock
                Issuance
                  of notes payable
                Capital
                  contributed
              
              
              -
                -
                244,990
                699,990
                863,120
                -
              
              
              -
                (32,989)
                -
                2,038,998
                200,000
                -
              
              
              152,418
                (152,418)
                244,990
                2,738,988
                1,443,120
                10,000Net
                  cash provided by financing activities
              
              
              1,808,100
              
              
              2,206,009
              
              
              4,437,098Net
                  increase (decrease) in cash
                
                Cash,
                  beginning of period
              
              
              2,039
                
                
                -
              
              
              (48,540)
                
                
                48,540
              
              
              2,039
                
                
                -Cash,
                  end of period
              
              $
              2,039
              
              $
              -
              
              $
              2,039**Supplemental
                  disclosures of cash flow information:**Interest
                  paid
              
              $
              -
              
              $
              -
              
              $
              -Taxes
                  paid
              
              $
              -
              
              $
              -
              
              $
              -
 
 The
          accompanying notes are an integral part of these financial
          statements.
 F-7
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
 **1.**  **HISTORY
        AND ORGANIZATION OF THE COMPANY**
 
 No
        Borders, Inc. and subsidiary (formerly) Intercommunity Financing Corp. dba
        No
        Borders (the Company) was incorporated on October 25, 2002 as Intercommunity
        Financing Corp. in California. Beginning in 2003, the Company adopted the
        dba of
        No Borders. On October 21, 2004, a Share Exchange Agreement was entered into
        between the American Eagle Manufacturing Company and Intercommunity Financing
        Corp dba No Borders, Inc. The agreement was deemed effective as of September
        30,
        2004, wherein American Eagle Manufacturing Company agreed to issue 40,000,000
        shares of its restricted common stock to the shareholders of the Company
        in
        exchange for 100% of the issued and outstanding common stock of the Company.
        On
        October 21, 2004, the American Eagle Manufacturing Company changed its name
        to
        No Borders, Inc. The Company is classified as a development stage entity
        since
        it devotes most of its activities to establishing business and its principal
        activities have not yet commenced.
 
 **Description
        of Business**
 
 The
        Company is presently focused on the delivery of significantly lower cost
        remittance transfers and long distance telephony services through a unified
        Stored Value Card platform issued through a network of affiliated agents
        to
        individual card-holders in both underserved U.S. migrant-receiving as well
        as
        non-U.S. rural migrant-sending communities that need to stay
        connected.
 
 **2.**  **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES**
 
 **Cash
        and Cash Equivalents**
 
 For
        purposes of the statement of cash flows, the Company considers all short-term
        debt securities to be cash equivalents.
 
 **Property
        and Equipment**
 
 Property
        and equipment are carried at cost. Maintenance, repairs and renewals are
        expensed as incurred. Depreciation is computed on the straight-line basis
        over
        their estimated useful life of three years for computers and 39 years for
        leasehold improvements. Depreciation expense was $17,825 and $8,708 for the
        years ended December 31, 2005 and December 31, 2004, respectively.
  F-8
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
  **2.**  **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)
 
 **Use
        of Estimates**
 
 The
        preparation of financial statements in accordance with accounting principles
        generally accepted in the United States of America requires management to
        make
        estimates and assumptions that affect the reported amounts of assets and
        liabilities and disclosure of contingent assets and liabilities, and the
        reported amounts of revenues and expenses during the reporting period. Actual
        results could differ from those estimates.
 
 **Impairment
        of Long-Lived Assets**
 
 The
        Company adopted Statement of Financial Accounting Standards No. 142,
“ *Goodwill
        and Other Intangible Assets* ”
(“SFAS
        No. 142”) effective August 1, 2002. SFAS No. 142 addresses how intangible assets
        that are acquired individually or with a group of other assets should be
        accounted for in financial statements upon their acquisition. This statement
        requires goodwill amortization to cease and for goodwill to be periodically
        reviewed for impairment.
 
 Under
        SFAS No. 142, goodwill impairment occurs if the net book value of a reporting
        unit exceeds its estimated fair value. The test completed in the second and
        third quarter of 2004 indicated that the recorded book value of the goodwill
        exceeded its fair value, as determined by discounted cash flows.
 
 The
        Company reviews the carrying values of its long-lived and intangible assets
        for
        possible impairment whenever events or changes in circumstances indicate
        that
        the carrying amount of the assets may not be recoverable.
 
 On
        February 27, 2004, the Company entered into a license agreement valued at
        $25,000 to use “Balance” Mural Images logo for a five year period and the right
        to renew for an additional five years with notification and payment of an
        additional fee. On December 12, 2005, the Company adopted a new logo and
        expensed the license.
 
 **Software
        Development Costs**
 
 The
        Company expensed $35,650 in software development costs through December 31,
        2003
        for internal use software. The software was developed to facilitate the unified
        Stored Value Card platform. The software was entirely proprietary. The Company
        expensed an additional $403,241 in development cost in 2004. In April 2005,
        the
        management reviewed the software development to date and determined while
        some
        of the code will be salvaged the project has been abandoned as written.
        Accordingly all software development cost were expensed in 2004.
  F-9
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
  **2.**  **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)
 
 **Fair
        Value of Financial Instruments**
 
 Financial
        instruments consist principally of cash and payables. The estimated fair
        value
        of these instruments approximate their carrying value.
 
 **Stock
        Based Compensation**
 
 The
        Company did not issue any stock-based employee compensation during the years
        ended December 31, 2005 and 2004.
 
 In
        December 2002, the FASB issued SFAS No. 148, “ *Accounting
        for Stock-Based Compensation-Transition and Disclosure-an amendment of SFAS
        123* .”
This
        statement amends SFAS No. 123, “ *Accounting
        for Stock-Based Compensation* ”,
        to
        provide alternative methods of transition for a voluntary charge to the fair
        value based method of accounting for stock-based employee compensation. In
        addition, this statement amends the disclosure requirements of SFAS No. 123
        to
        require prominent disclosures in both annual and interim financial statements
        about the method of accounting for stock-based employee compensation and
        the
        effect of the method used on reported results. The Company has chosen to
        continue to account for stock-based compensation using the intrinsic value
        method prescribed in APB Opinion No. 25 and related interpretations.
        Accordingly, compensation expense for stock options is measured as the excess,
        if any, of the fair market value of the Company’s stock at the date of the grant
        over the exercise price of the related option. The Company has adopted the
        annual disclosure provisions of SFAS No. 148 in its financial reports for
        the
        year ended December 31, 2005 and 2004 and for subsequent periods.
 
 In
        December 2004, the Financial Accounting Standards Board issued Statement
        of
        Financial Accounting Standards No. 123R, “ *Share-Based
        Payment* ”
(“SFAS
        123R”), which is effective as of the beginning of the first interim or annual
        period beginning after December 31, 2005. SFAS 123R requires all share-based
        payments to
        employees to be expensed over the requisite service period based on the
        grant-date fair value of the awards. The Statement allows for either prospective
        or retrospective adoption and requires that the unvested portion of all
        outstanding awards upon adoption be recognized using the same fair value
        and
        attribution methodologies previously determined under Statement No 123,
“ *Accounting
        for Stock-Based Compensation* ”.
        Since
        the Company does not have any defined benefit post-retirement plans, the
        adoption of this pronouncement did not have any impact on the Company’s results
        of operations or financial condition.
 
 
 F-10
  **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
 **2.**  **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)
 
 In
        March
        2005, the SEC released Staff Accounting Bulletin No. 107, “ *Share-Based
        Payment* ”
(“SAB
        107”), which provides interpretive guidance related to the interaction between
        SFAS 123(R) and certain SEC rules and regulations. It also provides the SEC
        staff’s views regarding valuation of share-based payment arrangements. In April
        2005, the SEC amended the compliance dates for SFAS 123(R), to allow companies
        to implement the standard at the beginning of their next fiscal year, instead
        of
        the next reporting period beginning after June 15, 2005. Management is currently
        evaluating the impact SAB 107 will have on the financial
        statements.
 
 **Income
        Taxes**
 
 Deferred
        income taxes are reported using the liability method. Deferred tax assets
        are
        recognized for deductible temporary differences and deferred tax liabilities
        are
        recognized for taxable temporary differences. Temporary differences are the
        differences between the reported amounts of assets and liabilities and their
        tax
        bases. Deferred tax assets are reduced by a valuation allowance when, in
        the
        opinion of management, it is more likely than not that some portion or all
        of
        the deferred tax assets will not be realized. Deferred tax assets and
        liabilities are adjusted for the effects of changes in tax laws and rates
        on the
        date of enactment.
 
 **Net
        Loss Per Share**
 
 In
        February 1997, the Financial Accounting Standards Board (FASB) issued SFAS
        No.
        128, “ *Earnings
        Per Share* ” *,* which
        requires the Company to present basic and diluted earnings per share, for
        all
        periods presented. The computation of loss per common share (basic and diluted)
        is based on the weighted average number of stock actually outstanding during
        the
        period. The Company has no common stock equivalents, which would dilute earnings
        per share.
 
 **Reclassifications**
 
 Certain
        reclassifications have been made in prior year's financial statements to
        conform
        to classifications used in the current year.
  F-11
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
 
 **2.**  **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)
 
 **Recent
        Accounting Pronouncements**
 
 On
        December 16, 2004, FASB issued Statement of Financial Accounting Standards
        No.
        153, “ *Exchanges
        of Nonmonetary Assets* ”,
        an
        amendment of APB Opinion No. 29, “ *Accounting
        for Nonmonetary Transactions* ”
(“FAS
        153”). This statement amends APB Opinion 29 to eliminate the exception for
        nonmonetary exchanges of similar productive assets and replaces it with a
        general exception for exchanges of nonmonetary assets that do not have
        commercial substance. Under SFAS 153, if a nonmonetary exchange of similar
        productive assets meets a commercial-substance criterion and fair value is
        determinable, the transaction must be accounted for at fair value resulting
        in
        recognition of any gain or loss. SFAS 153 is effective for nonmonetary
        transactions in fiscal periods that begin after June 15, 2005. The Company
        does
        not anticipate that the implementation of this standard will have a material
        impact on its financial position, results of operations or cash
        flows.
 
 In
        February 2006, the FASB issued SFAS 155, “ *Accounting
        for Certain Hybrid Financial Instruments* ”,
        an
        amendment of FASB Statements No. 133 and In February 2006, the FASB issued
        SFAS
        155 “ *Accounting
        for Certain Hybrid Financial Instruments* ”,
        an
        amendment of FASB Statements No. 133 and 140. This Statement amends FASB
        Statements No. 133, “ *Accounting
        for Derivative Instruments and Hedging Activities* ”,
        and
        No. 140, “ *Accounting
        for Transfers and Servicing of Financial Assets and Extinguishments of
        Liabilities* ”.
        This
        Statement resolves issues addressed in Statement 133 Implementation Issue
        No.
        D1, “ *Application
        of Statement 133 to Beneficial Interests in Securitized Financial
        Assets* ”.
        This
        Statement:
 
 a.
              permits
                  fair value remeasurement for any hybrid financial instrument that
                  contains
                  an embedded derivative that otherwise would require
                  bifurcation;
 
 b.
              clarifies
                  which interest-only strips and principal-only strips are not subject
                  to
                  the requirements of Statement 133;
 
 c.
              establishes
                  a requirement to evaluate interests in securitized financial assets
                  to
                  identify interests that are freestanding derivatives or that are
                  hybrid
                  financial instruments that contain an embedded derivative requiring
                  bifurcation;
 
 d.
              clarifies
                  that concentrations of credit risk in the form of subordination
                  are not
                  embedded derivatives; and
 
 e.
              amends
                  Statement 140 to eliminate the prohibition on a qualifying special-purpose
                  entity from holding a derivative financial instrument that pertains
                  to a
                  beneficial interest other than another derivative financial
                  instrument.
 
 
 F-12
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
  **2.**  **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)
 
 This
        Statement is effective for all financial instruments acquired or issued after
        the beginning of an entity’s first fiscal year that begins after September 15,
        2006. The fair value election provided for in paragraph 4(c) of this Statement
        may also be applied upon adoption of this Statement for hybrid financial
        instruments that had been bifurcated under paragraph 12 of Statement 133
        prior
        to the adoption of this Statement. Earlier adoption is permitted as of the
        beginning of an entity’s fiscal year, provided the entity has not yet issued
        financial statements, including financial statements for any interim period
        for
        that fiscal year. Provisions of this Statement may be applied to instruments
        that an entity holds at the date of adoption on an instrument-by-instrument
        basis. The Company is currently evaluating the impact of SFAS 155.
 
 In
        September 2006, the SEC issued Staff Accounting Bulletin (“SAB”) No. 108,
“ *Considering
        the Effects of Prior Year Misstatements when Qualifying Misstatements in
        Current
        Year Financial Statements* ”,
        which
        provides interpretive guidance on the consideration of the effects of prior
        year
        misstatements in quantifying current year misstatements for the purpose of
        a
        materiality assessment. SAB No. 108 is effective for companies with fiscal
        years
        ending after November 15, 2006 and is required to be adopted by the Company
        in
        its fiscal year ending December 30, 2006. The Company is currently assessing
        the
        impact, if any, of the adoption of SAB No. 108.
 
 The
        Company has reviewed recent accounting pronouncements that have been adopted
        and
        have concluded that they will not have any material impact on its financial
        statements.
 
 **3.**  **GOING
        CONCERN**
 
 The
        accompanying financial statements, which have been prepared in conformity
        with
        accounting principles generally accepted in the United States of America,
        contemplates the continuation of the Company as a going concern. However,
        the
        Company has been in the development stage since late 2002, sustained significant
        losses and has used capital raised through the issuance of stock and stock
        subscriptions to fund activities. Continuation of the Company as a going
        concern
        is contingent upon establishing and achieving profitable operations. Such
        operations will require management to secure additional financing for the
        Company in the form of debt or equity.
 
 Management
        believes that actions currently being taken to revise the Company’s funding
        requirements will allow the Company to continue its development stage
        operations. However, there is no assurance that the necessary funds will
        be
        realized by securing debt or through stock offerings. No adjustment has been
        recorded in the financial statements that may result from the outcome of
        this
        uncertainty.
 
 
 F-13
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
  **4.**  **DEFERRED
        FINANCING COSTS AND IMPUTED INTEREST**
 
 The
        Company has paid certain financing fees associated with debentures issued
        to
        BridgePointe Partners, LP and Miller Investments, LLC (see Note 6), which
        are
        being amortized over the term of the debentures.
 
 The
        components of the deferred financing costs are as follows at December
        31:
 
 **2005**
              ****
              ****
              **2004**Deferred
                  financing costs
                Less:
                  accumulated amortization of fees
              
              $
              330,000
                (44,980
              )
              $
              -
                -Net
                  deferred financing costs
              
              $
              285,020
              
              $
              -
 
 **5.**  **INCOME
        TAXES**
 
 The
        components of the deferred tax assets are as follows:
  **2005**
              
              
              **2004**Deferred
                tax assets:Net
                  operating loss carry-forward
              
              $
              5,319,000
              
              $
              476,000Accrued
                  expenses
              
              
              365,000
              
              
              -Valuation
                allowance
              
              
              (5,684,000
              )
              
              (476,000
              )Net
                  deferred tax assets
              
              $
              -
              
              $
              -
 
 The
        Company had available approximately $13,559,000 and $1,400,000 of unused
        federal
        net operating loss carry-forwards at December 31, 2005 and 2004, respectively
        that may be applied against future taxable income. These net operating loss
        carry-forwards expire through 2025. There is no assurance that the Company
        will
        realize the benefit of the net operating loss carry-forwards. Change in
        ownership provisions may limit the benefits from net operating losses for
        tax
        purposes. The Company has not determined the impact of any
        limitations.
 
 SFAS
        No.
        109 requires a valuation allowance to be recorded when it is more likely
        than
        not that some or all of the deferred tax assets will not be realized. At
        December 31, 2005 and 2004, valuation allowances for the full amount of the
        net
        deferred tax asset were established due to the uncertainties as to the amount
        of
        the taxable income that would be generated in future years.
 
 
 F-14
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
  **5.**  **INCOME
        TAXES** (Continued)
 
 Reconciliation
        of the differences between the statutory tax rate and the effective income
        tax
        rates are as follows:
  
 **2005**
              
              ****
              **2004**Statutory
                  federal tax benefit rate
              
              
              34.00
              %
              
              34.00
              %Statutory
                  state tax benefit rate
              
              
              5.83
              %
              
              0.00
              %39.83
              %
              
              34.00
              %Valuation
                  allowance
              
              
              (39.83
              %)
              
              (34.00
              %)Effective
                  income tax rate
              
              
              0.00
              %
              
              0.00
              %
 
 **6.**  **NOTES
        PAYABLE**
 
 During
        2003, the Company entered into a series of notes payable with individuals.
        The
        notes were due December 28, 2004 and bear interest at 5% per annum. The notes
        had conversion rights to shares of the Company’s common stock. The notes’
co-makers are two shareholders of the Company. The holders of these notes
        converted them to common stock in October 2004.
 
 In
        December 2004, the Company borrowed $200,000 from three individuals. The
        individuals were granted 500,000 shares of common stock valued at $.13 per
        share
        or $65,000 as an inducement to enter this transaction. The note was for 60
        days
        at 12% interest. In addition a major shareholder of the Company pledged
        2,000,000 shares of his stock as additional security for the loan. The loan
        was
        not paid by the Company when due and the underlying lender, a bank, seized
        the
        collateral in satisfaction of the loan. The Company issued 3,495,000 shares
        to
        the majority shareholder in satisfaction of the guarantee (see Note
        9).
 
 
 F-15
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
  **6.**  **NOTES
        PAYABLE** (Continued)
 
 In
        June
        2005, the Company entered into a note payable agreement with an individual
        to
        borrow $5,000. The note was due December 2005 and bears interest at 10% per
        annum. The note provides the right for the Company to convert any unpaid
        principal and interest to Company common stock equal to $.20 per common share
        of
        Company common stock if during the seven trading day period immediately
        preceding the conversion date as specified by the Company if the Company
        average
        closing stock price equals or exceeds $.30 per share. The notes provides
        the
        right for the lender to convert any unpaid principal and interest to Company
        common stock equal to 80% of the average closing price of Company common
        stock
        during the seven trading day period immediately preceding the conversion
        date as
        specified by the lender if during the seven trading day period immediately
        preceding the conversion date as specified by the lender, the Company average
        closing stock price equals or exceeds $.40 per share. In addition, the Company
        agreed to issue 5,000 shares of common stock valued at $3,307 as a fee to
        initiating the loan, but such shares were not issued as of December 31,
        2005.
 
 In
        July
        2005, the Company entered into a note payable agreement with an individual
        to
        borrow $10,000. The note is due January 2006 and bears interest at 10% per
        annum. The notes provides the right for the lender to convert any unpaid
        principal and interest to Company common stock equal to 75% of the average
        closing price of Company common stock during the seven trading day period
        immediately preceding the conversion date as specified by the lender. In
        addition, the Company agreed to issue 10,000 shares of common stock valued
        at
        $10,440 as a fee to initiating the loan, but such shares were not issued
        as of
        December 31, 2005. In connection with the note payable, the Company accrued
        $6,111 of interest expense related to the beneficial conversion rights of
        this
        note.
 
 In
        July
        2005, the Company entered into a note payable agreement with an individual
        to
        borrow $25,000. The note is due January 2006 and bears interest at 10% per
        annum. The note provides the right for the lender to convert any unpaid
        principal and interest to Company common stock equal to 75% of the average
        closing price of Company common stock during the seven trading day period
        immediately preceding the conversion date as specified by the lender. In
        addition, the Company issued 100,000 shares of common stock valued at $26,100
        as
        a fee to initiating the loan. In connection with the note payable, the Company
        accrued $15,278 of interest expense related to the beneficial conversion
        rights
        of this note.
 
 
 F-16
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
  **6.**  **NOTES
        PAYABLE** (Continued)
 
 In
        August
        2005, the Company entered into a note payable agreement with an individual
        to
        borrow $25,000. The note was due February 2006 and bears interest at 10%
        per
        annum. The notes provides the right for the Company to convert any unpaid
        principal and interest to Company common stock equal to $.20 per common share
        of
        Company common stock if during the seven trading day period immediately
        preceding the conversion date as specified by the Company if the Company
        average
        closing stock price equals or exceeds $.30 per share. The notes provides
        the
        right for the lender to convert any unpaid principal and interest to Company
        common stock equal to 80% of the average closing price of Company common
        stock
        during the seven trading day period immediately preceding the conversion
        date as
        specified by the lender if during the seven trading day period immediately
        preceding the conversion date as specified by the lender, the Company average
        closing stock price equals or exceeds $.40 per share. In addition, the Company
        agreed to issue 25,000 shares of common stock valued at $4,504 as a fee to
        initiating the loan, but shares were not issued as of December 31, 2005.
        In
        connection with the note payable, the Company accrued $4,948 of interest
        expense
        related to the beneficial conversion rights of this note.
 
 **Notes
        Payable to Related Parties**
 
 In
        August
        2005, Company borrowed an aggregate of $35,000 pursuant to an unsecured
        promissory note to a related party. The note is due on demand and bears interest
        at 5% per annum.
 
 In
        2005,
        Company borrowed $10,000 pursuant to an unsecured promissory note to a related
        party. The note is due on demand and bear interest at 5% per annum.
 
 In
        November 2005, The Company borrowed $203,120 from Infospan Inc. pursuant
        to an
        unsecured promissory note. The note is due in one year and bears interest
        at 20%
        per annum.
 
 **7.**  **CONVERTIBLE
        DEBENTURES**
 
 In
        September 2005, the Company entered into agreements with BridgePoint Partners
        LLC and Miller Ventures, LLC, issuing two $250,000 debentures which are
        redeemable in September 2007, bear interest at 8% per annum and are convertible
        into shares of Company’s common stock at a price equal to the lesser of the
        market price at the date of issuance or $.10 per share. In connection with
        these
        debentures, the Company accrued $330,000 of deferred financing costs related
        to
        the beneficial conversion rights. The Company expensed $44,980 of the deferred
        financing costs for the year ended December 31, 2005 (see Note 4). The Company
        accrued $195,000 of late registration fees for failing to file a registration
        statement by a specific date.
 
 
 F-17
 
 **NO
        BORDERS, INC. AND SUBSIDIARY**
 **(A
        Development Stage Company)**
 **NOTES
        TO FINANCIAL STATEMENTS**
 **FOR
        THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
        THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
        DECEMBER 31, 2005**


**8.**  **COMMITMENTS
        AND CONTINGENCIES**
 
 On
        October 22, 2004, the Company as American Eagle Manufacturing Company, sold
        substantially all of its assets related to its custom motorcycle manufacturing
        business to its former parent company, Bad Toys Holdings, Inc. As consideration
        and payment for the assets, the shareholders of No Borders, Inc., were to
        receive 1,818,182 shares of the Bad Toys Holdings, Inc. restricted common
        stock
        and Bad Toys Holdings, Inc. assumed all liabilities and obligations of the
        American Eagle Manufacturing Company outstanding on the date of purchase.
        No
        Borders, Inc. remains primarily liable on these obligations until paid by
        Bad
        Toys Holding, Inc. As of December 31, 2005, the 1,818,182 shares of Bad Toys
        Holdings, Inc. had not been issued.
 
 The
        Company is a defendant in a lawsuit with Nobosoft Corporation, which involves
        allegations that the Company used the plaintiff’s code in software developed by
        the Company. The Company believes that the allegations against the Company
        and
        have no substance or merit and intends to vigorously defend the suit. The
        Company does not expect the effect, if any, of the outcome of this litigation
        to
        be material to the Company’s financial condition.
 
 On
        December 15, 2004, the Company entered into a lease for office space three
        years. As of December 31, 2005, the Company abandoned the premises and forfeited
        the lease deposit of $64,800 and telephone equipment with a net book value
        of
        $24,675. The Company accrued rent for the future minimum lease payments of
        $371,148, although management believes the lessor will accept the lease deposit
        and telephone equipment as complete payment for the lease and not pursue
        collection of remaining $371,148. The total abandonment loss recorded in
        the
        financial statements related to these premises was $460,623.
 
 **9.**  **COMMON
        STOCK**
 
 **Issued
        and Outstanding**
 
 The
        Company is authorized to issue 200,000,000 shares of $0.001 par value common
        stock. As of December 31, 2005 and 2004, the Company had 169,542,359 and
        $48,886,686 shares of common stock issued and outstanding, respectively.
        As
        discussed below, the Company had 2,405,000 shares in the amount of $244,990
        subscribed for future issuance as of December 31, 2005. There were no subscribed
        shares at December 31, 2004.
 
 In
        September 2004, the Company completed a Share Exchange Agreement between
        the
        Company and Intercommunity Financing Corp. wherein the Company issued 44,870,686
        shares of common stock to the shareholders of Intercommunity Financing Corp
        in
        exchange for 100% of the issued and outstanding common stock of Intercommunity
        Financing Corp.
 
 F-18
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
  **9.**  **COMMON
        STOCK** (Continued)
 
 During
        the year ended December 31, 2004, the Company issued an aggregate of 4,015,000
        shares of common stock to various outside service providers in exchange for
        various consulting and professional services. The shares were issued at the
        par
        value of $0.001 per share, which represented the fair value of the stock
        issued,
        which did not differ materially from the value of the services
        rendered.
 
 On
        February 15, 2005, the Company entered into a Share Exchange Agreement with
        the
        shareholders of two dormant card service companies, to acquire 100% of the
        outstanding stock of the companies for 474,000 shares of the Company’s common
        stock. The value placed on the assets acquired equals the closing market
        price
        of the shares of Company’s common stock of $118,500 based on the February 15,
        2005 agreement date. As of December 31, 2005, the amount of the consideration
        in
        excess of the value of $118,500 had been expensed in the statements of
        operations as impairment of goodwill.
 
 On
        September 23, 2005, the Company entered into an agreement with InfoSpan Inc.
        and, as a part of that agreement, the Company acquired a 20% of the outstanding
        stock of InfoSpan Mexico SA, its operating corporation in Mexico as well
        as 15%
        of the outstanding stock of InfoSpan Private Ltd. (Pakistan), its operating
        company in Pakistan. The value placed on the assets acquired equals the closing
        market price of the shares of Company’s common stock issued to Infospan Inc., or
        $11,513,441 based on the issuance of 95,945,339 shares at $0.12 per share.
        As of
        December 31, 2005, the amount of the consideration in excess of the value
        of
        goodwill in the amount of $7,901,172 has been expensed in the statements
        of
        operations as impairment of goodwill.
 
 During
        the year ended December 31, 2005, the Company issued an aggregate of 11,475,895
        shares of common stock to various outside service providers in exchange for
        various consulting and professional services. The shares were issued at the
        par
        value of $0.001 per share, which represented the fair value of the stock
        issued.
        This value did not differ materially from the value of the services
        rendered.
 
 During
        the year ended December 31, 2005, the Company issued 7,334,231 shares of
        common
        stock pursuant to private placement agreements and received net cash proceeds
        of
        $699,990.
 
 During
        the year ended December 31, 2005, the Company issued 3,495,000 shares of
        common
        stock to a shareholder to satisfy the repayment of a $250,000 note payable
        the shareholder paid on behalf of the Company.
 
 During
        the year ended December 31, 2005, the Company issued 750,000 shares of common
        stock for settlement of a contract. The fair value of the settlement was
        $105,000.
 
 
 F-19
 
 **NO
        BORDERS, INC. AND SUBSIDIARY**
 **(A
        Development Stage Company)**
 **NOTES
        TO FINANCIAL STATEMENTS**
 **FOR
        THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
        THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
        DECEMBER 31, 2005**


**9.**  **COMMON
        STOCK** (Continued)
 
 During
        the year ended December 31, 2005, the Company entered into agreements with
        various third parties that provided funding to the Company, whereby the Company
        guaranteed issuance of predetermined numbers of shares of common stock to
        these
        third parties if the Company failed to file a registration statement by
        specified dates. The Company issued 1,181,208 shares of common stock with
        a fair
        value of $283,174 pursuant to these agreements. The Company also accrued
        $164,000 for shares owed under a guarantee agreement for which the Company
        has
        not yet issued the common stock. The value of the guarantees was based upon
        the
        market price of Company stock as of the date the common stock was to be issued
        in accordance with the agreement.
 
 Additional
        penalties were accrued in connection with the debentures discussed in Note
        7.
        The total late registration fees payable are $359,000 at December 31,
        2005.
 
 **Shares
        Subscribed, Not Issued**
 
 During
        the year ended December 31, 2005, the Company, through private placements,
        subscribed 2,405,000 shares of common stock to  investors
        for cash of $244,990. The shares had not been issued as of December 31,
        2005.
 
 **10.**  **WARRANTS
        CONVERTIBLE TO COMMON STOCK**
 
 The
        Company granted warrants in connection with the convertible debentures (see
        Note
        7), whereby the Company is required to issue the a warrant equal to the original
        principle amount of the initial debenture divided by the initial conversion
        price multiplied by 200%. The exercise price of the warrant is equal to the
        lower of $.10 per share or the price on each three month anniversary of the
        date
        of issue of the debenture. The value attributed to the warrants has been
        credited to additional paid-in capital. The Company did not grant any stock
        options during the years ended December 31, 2005 or 2004.
 
 Transactions
        involving warrants are summarized below:
  **Warrants**
                **outstanding**
              
              **Weighted**
                **average**
                **exercise
                  price**Balance
                  at December 31, 2004
                Granted
                Exercised
                Cancelled
              
              -
                10,000,000
                -
                -
              
              $
              -
                10,000,000
                -
                -Balance
                  at December 31, 2005
              
              10,000,000
              
              $
              992,246
 
 F-20
 **NO
          BORDERS, INC. AND SUBSIDIARY**
 **(A
          Development Stage Company)**
 **NOTES
          TO FINANCIAL STATEMENTS**
 **FOR
          THE YEARS ENDED DECEMBER 31, 2005 AND 2004 AND**
 **FOR
          THE PERIOD FROM INCEPTION (October 25, 2002)**
 **THROUGH
          DECEMBER 31, 2005**
  **10.**  **WARRANTS
        CONVERTIBLE TO COMMON STOCK** (Continued)
 
 The
        following is a further breakdown of the warrants outstanding as of December
        31,
        2005:
 
 **Exercise**
                **Prices**
              
              **Number
                  Outstanding and**
                **Exercisable**
              
              **Weighted
                  Average**
                **Remaining**
                **Contractual
                  Life**
                **(Years)**
              
              **Weighted
                  Average**
                **Exercise
                  Price**
                **Outstanding
                  and**
                **Exercisable**$0.10
              
              1,000,000
              
              1.73
              
              $0.101,000,000
              
              1.73
              
              $0.10
 
 **11.**  **SUPPLEMENTAL
        CASH FLOW DISCLOSURES**
 
 In
        addition to cash provided or used for operations, investing, and financing,
        the
        Company had the following non-cash investing and financing
        activities:
 
 **For
                  the Year Ended December 31, 2005**
              
              **For
                  the Year Ended December 31, 2004**
              
              **Cumulative
                  From**
                **Inception**
                **(October
                  25, 2002) to December 31, 2005**Common
                  stock issued for financing
              $
              283,174
              
              $
              -
              
              $
              283,174Common
                  stock issued for services
              $
              1,684,712
              
              $
              1,259,715
              
              $
              2,944,427Common
                  stock issued for beneficial conversion feature
              $
              530,000
              
              $
              -
              
              $
              530,000Common
                  stock issued for license settlement
              $
              105,000
              
              $
              -
              
              $
              105,000Common
                  stock issued for payment of note
              $
              250,000
              
              $
              -
              
              $
              250,000Common
                  stock issued for guarantee of note payable
              $
              314,550
              
              $
              -
              
              $
              314,550Common
                  stock issued for ASI acquisition
              $
              118,500
              
              $
              -
              
              $
              118,500Common
                  stock issued for Infospan acquisition
              $
              11,513,441
              
              $
              -
              
              $
              11,513,441
 
 F-21
 
 **SIGNATURES**
 
 Pursuant
        to the requirements of Section 13 or 15 (d) of the Securities Exchange Act
        of
        1934, the registrant has duly caused this report to be signed on our behalf
        by
        the undersigned, thereunto duly authorized.
  **NO
                BORDERS, INC.**Date: January
                9, 2007
              By:
              /s/ **Raul
                Hinojosa-Ojeda**Raul Hinojosa-Ojeda
                President
   Pursuant
          to the requirements of the Securities Exchange Act of 1934, the Registrant
          has
          duly caused this report to be signed on its behalf by the undersigned,
          thereunto
          duly authorized.
 **NO
        BORDERS, INC.**
 (Registrant)
   **Signature**
                
                **Title**
                
                **Date**/s/ Robert
                  M.
                  RosenfeldRobert
                  M. Rosenfeld
                
                Chief
                    Financial
                    Officer and President and Director
                  (Principal
                    Executive Officer and Principal Accounting Officer)
                
                January
                  9, 2007/s/Paula Cruz TekashPaula
                  Cruz Tekash
                
                Director
                
                January 9, 2007/s/
                    Robert M. RosenfeldDirector,
                    Acting Chief Executive
                
                January 9,
                  2007
 28
   **Exhibit
        Index**
  Exhibit
                    No.
                Description3.1(1)
                Amended
                    and Restated Articles of Incorporation3.2(1)
                Amended
                    Bylaws3.3(2)
                Certificate
                    of Amendment21
                Subsidiaries
                    of the Registrant31.1
                Certification
                    of Chief Executive Officer, as required by Rule 13a-14(a) or
                    Rule
                    15d-14(a) of the Securities Exchange Act of 193431.2
                Certification
                    of Chief Financial Officer, as required by Rule 13a-14(a) or
                    Rule
                    15d-14(a) of the Securities Exchange Act of 193432
                Certification
                    of Chief Executive Officer and Chief Financial Officer, as required
                    by
                    Section 1350 of Chapter 63 of Title 18 of the United States Code
                    (18
                    U.S.C. 1350)
  (1)
          Previously filed with Form 8-K filed on December 13, 2001.  (2)
          Previously filed with Form 8-K filed on January 27, 2003.
   29