UNITED
STATES SECURITIES AND EXCHANGE COMMISSION


WASHINGTON,
D.C. 20549





___________





FORM
10-K


___________






x
                  ANNUAL
      REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIESEXCHANGE
      ACT OF 1934






For
the fiscal year ended December 31, 2008





Commission
File Number: 0-52561


___________________________________








ANOTEROS,
INC.


(Exact
name of Registrant as specified in its charter)






NEVADA
              88-0368849(State or other
      Jurisdiction of Incorporation or
      Organization)
              (IRS Employer
      Identification No.)





2445
      Fifth Avenue, Suite 440, San Diego,
      California
                92101(Address of
      principal executive offices)
                (Zip
      Code)


(619)
239-2900


(Issuer’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 a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.  o 
Yes   x  No




Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Exchange Act.  o  Yes   x  No




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




Indicate
by check mark if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-K contained in this form, and no disclosure will be
contained, to the best of registrant’s knowledge, in definitive proxy
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K or any amendment to this Form 10-K. 
o




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




Large Accelerated Filer
              o
              Accelerated
      Filer
              oNon-Accelerated
      Filer
              o
              Smaller
      Reporting Company
              x


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





Issuer’s
revenues for its most recent fiscal year:  None.





The
aggregate market value of the voting and non-voting common equity on June 30,
2008 held by non-affiliates of the registrant (based on the average bid and
asked price of such stock on such date of $0.175) was approximately
$554,547.   Shares of common stock held by each officer and director
and by each person who owns 10% or more of the outstanding common stock of the
registrant have been excluded in that such persons may be deemed to be
affiliates. This determination of affiliate status is not necessarily a
conclusive determination for other purposes.  Without acknowledging that
any individual director of registrant is an affiliate, all directors have been
included as affiliates with respect to shares owned by them.





As of
March 17, 2009, there were 6,978,769 shares of the registrant’s Common Stock
outstanding.












ANOTEROS
INC.


Report
on Form 10-KSB




PART I.Item 1.
                Description of Business
      .....................................................................................................................
                3Item 1A.
                Risk
      Factors  .....................................................................................................................................
                8Item 2.
                Description of Property
      ......................................................................................................................
                12Item 3.
                Legal Proceedings
      .............................................................................................................................
                12Item 4.
                Submission of Matters to a Vote of Security Holders
      ................................................................................
                12PART II.Item 5.
                Market
      for Common Equity, Related Stockholder Matters and Issuer Purchases
      ofEquity
      Securities .................
                12Item 6.
                Selected Financial Data
      ......................................................................................................................
                14Item 7.
                Management’s Discussion and Analysis of Financial
      Condition and Results of Operations ..............................
                14Item 7A.
                Quantitative and Qualitative Disclosures About Market
      Risk .....................................................................
                16Item 8.
                Financial Statements
      ..........................................................................................................................
                17Item 9.
                Changes
      In and Disagreements With Accountants onAccounting
      and Financial Disclosure ...........................
                34Item 9A(T)
                Controls and Procedures
      ...............................................................................................................................
                34Item 9B.
                Other
      Information..........................................................................................................................................
                35PART III.Item 10.
                Directors, Executive Officers and Corporate Governance
      .....................................................................................
                35Item 11.
                Executive Compensation
      ................................................................................................................................
                37Item 12.
                Security
      Ownership of Certain Beneficial Owners andManagement
      and Related Stockholder Matters................
                39Item 13.
                Certain Relationships and Related Transactions
      .................................................................................................
                40Item 14.
                Principal Accountant Fees and Services
      ..........................................................................................................
                40Item 15.
                Exhibits
      .......................................................................................................................................................
                41






Page
2


PART I.





FORWARD
LOOKING STATEMENTS





This
annual report contains certain forward-looking statements and for this purpose
any statements contained in this annual report that are not statements of
historical fact may be deemed to be forward-looking statements.  Without
limiting the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "estimate" or "continue" or comparable terminology are intended to
identify forward-looking statements.  These statements by their nature
involve substantial risks and uncertainties, and actual results may differ
materially depending on a variety of factors, many of which are not within our
control.  These factors include but are not limited to economic conditions
generally and in the markets in which Anoteros may participate, competition
within Anoteros’ chosen industry, technological advances and failure by us to
successfully develop business relationships.





ITEM 1.DESCRIPTION OF
BUSINESS.





Business
Development





Anoteros  Inc. (referred to
as “Anoteros”, the “Company”, “we”, “us”, or “our”) through its wholly-owned
subsidiary, Doolittle Edutainment, which holds all of our intellectual property,
is engaged and in the children’s education and entertainment
market.  Our mission is to entertain and educate children through
various avenues focused around our main character “Doolittle” and further
development of additional books and the exploitation of our intellectual
property rights.





The Company was incorporated on
September 25, 1996 under the laws of the State of Nevada, as Out of Bounds
Sports Co. and initially entered the sports wear market, manufacturing and
marketing tee shirts, golf shorts and hats with the “OB Golf” and “OB Sports”
logo.   The Company turned its focus to the children’s education
and entertainment arena utilizing the gorilla charter “Doolittle” depicted in
various sporting activities and worked on various story lines and character
treatments.  We completed the final story line and draft of Book 1 –
The Story of Doolittle, an Exceptional Young Gorilla in May 2000. The story line
and preliminary draft of Book 2 – The Adventures of Dynamic Doolittle – Episode
1 “The Problem with Paulie Python” was completed in October 2000 and, the story
line and preliminary draft of Book 3 - Doolittle’s Very, Very Bad Day was
completed in May 2001





On February 19, 2002 the Company formed
Doolittle Edutainment Corp., a Nevada corporation (“Doolittle Edutainment”) as a
wholly-owned subsidiary, for the purpose of holding the intellectual property
and other assets relating the Doolittle books and product line.





On September 22, 2004, we Company
changed our name from Out of Bounds Sports Co. to Anoteros, Inc





In 2006 and 2007, we completed layout,
compilation and assembly of Books 1, 2 and 3 and in 2007 we completed our first
three book titles which depict our main character named
“Doolittle”:





·  Book 1 -
titled “Doolittle – An
Exceptional Young Gorilla” addresses the issue of cheating on a very
elementary children’s level.





·  Book 2 -
titled “The Adventures of
Dynamic Doolittle Episode I – “The Problem with Paulie
Python.”  This book introduces additional characters and has
Doolittle taking on “super powers” (i.e. speed and strength). This book
addresses the concept of sharing.





·  Book 3 -
titled “Doolittle’s Very, Very
Bad Day”addresses Doolittle’s negative attitude regarding doing
home-work.





We have self published the initial
three books with an initial run of 250 copies which are being utilized in
exploring various distribution avenues.  In 2008, as a result of input
from the various parties that have reviewed the initial run, we undertook and
made various corrections and revisions to Books 1 through 3 which are in a
completed state and ready for printing and distribution.


Page
3


Business of
Issuer





The focal point and main character of
our books is “Doolittle” which was created to target toddlers and young
children. The character of Doolittle is portrayed as a charismatic, rough ‘n
tough little Gorilla who is a bit mischievous, has more than a little
“attitude,” but is also cool and cuddly. Doolittle has been developed to be an
all-round good guy, roll model and inspiration that will befriend, teach and
capture the imagination of kids by excelling at sports, seeking adventure and
enjoying things that are popular with children.





While there is no requirement for
Doolittle to be a “family values” character, good citizenship, decency and
manners are an underpinning we have instilled in the stories and assets
developed to date.   Our vision is to position Doolittle, along
with his sidekicks, “Ajax” and “R-Dub” in various situations that evoke a need
for children to make positive decisions.  The story lines are designed
to promote tolerant messages while keeping children engaged and
entertained.  Our goal is to teach and entertain kids with Doolittle
as a positive role model. We believe that our books, three of which have been
completed, along with additional education and entertainment products, which we
may choose to produce, such as workbooks, coloring books and puzzles, have and
will be developed in such a way that will complement and compete with the
existing industry.  With the success of competitor company characters
and products, we believe that we can create a successful niche for Doolittle
along with subsequent characters.


We will
endeavor to make Doolittle (and subsequent characters) a household name for
children and families. To obtain this goal we have various options to expand its
presence by licensing the character to one or more companies to produce,
distribute, market and retail the books and products  to the mass
market through highly visible and available channels including retailing, the
internet, software games, publishing and all visual media markets. Although no
significant relationships exist and no substantial relationships have been
formed at this time we intend to pursue such opportunities as they present
themselves.





Principal Products or
Services and Their Markets.





We have
completed and self published our initial three children’s books as well as
various articles of clothing and toys, such as T-shirts, sweat shirts, super
balls and stickers to develop and raise consumer awareness for the Doolittle
character.





We have
also completed character treatments (i.e an outline summary) and themes for
books 4 and 5 and at such time as we deem appropriate, based on the interest in,
and feedback for, our initial books, we will continue the further development of
these books. The goal will be to continually develop and produce quality books
geared towards children with the lessons conveyed through a recognizable and
respected character. Future products for character and name branding could
include plush toys (stuff animals), coloring books, puzzles, playground balls,
games and interactive software.





Market Analysis - Doolittle’s
Niche





Doolittle
is focused on the young children’s market specifically ages 3-10 years. We
believe we can develop a specialty niche with Doolittle in this market. As we
develop our brand name, we envision aligning our Doolittle character with
schools and pee-wee and junior league sport clubs to promote and support sports
activities. This will allow us to expand our brand name (i.e. character) loyalty
directly to the family and social infrastructure of society.





Distribution Methods of the
Products or Services.





Publishing





We are exploring the possibility of
traditional publishing for the first three books. Traditional publishing is
often difficult and time consuming to find a publisher willing to take on a new
book line. If traditional publishing does not prove successful, we will continue
to self-publish our books and seek to negotiate a distribution agreement with
one or more book distribution sources.  While having a publisher to
promote and market the Company’s books would be the preferred method to achieve
quicker market penetration, we believe that self publication and distribution
through the various available distribution sources would be a viable alternative
to traditional publishing and would allow us to retain total control of the
product from inception through distribution.






Page
4


Internet





Due to
the popularity of the internet, businesses must utilize the World Wide Web to
promote market and sell products and services to consumers. We see great
opportunities to build our brand name through a website and have secured the
website address www.doolittleedutainment.com which is under development. We
intend to develop the website as a dynamic and interactive website designed for
kids but also informative for parents, consumers and retailers.  We
intend that the completed version of the website will consist of information
about the Company, the stories of “Doolittle” and will include games and a
sports and adventures section that will be interactive, informative and
entertaining for kids. Pending sufficient funding and capital resources, we will
seek to establish and develop “Club Doolittle” as part of our website. We intent
is to utilize Club Doolittle to build a customer data base by allowing customers
to sign-up for free drawings to win books and other products.





The web
site will showcase our products to consumers and will provide an online
catalogue allowing the consumer to purchase our books, and other products via
the internet. Customers will be able to access our product brochure online which
will feature all designs, colors, options, sizing charts, inventory availability
and closeout specials. We envision that the website will be continually upgraded
and modified by adding content that will make the visitor’s experience as user
friendly, informative and entertaining as possible.





We view
our website as an important tool for building and marketing our brand name. At
this time the website is still in the development stages and no specific date
has been identified for the official launch of
www.doolittleedutainment.com.





Licensing





We plan
to focus on the potential for licensing of our intellectual property, namely the
Doolittle character and illustrations depicting Doolittle in various sporting
activities. This direction, if successful, would allow us to realize quicker
market penetration, growth and revenue.  We believe that our main
character Doolittle and his two friends Ajax and R-Dub along with our books,
apparel line and other accessory items have been developed to the point that we
have viable marketable properties for licensing.





Status of any Publicly
Announced New Product or Services.





As of the
date of this report there are no new products or services for which the company
has publicly announced the release date. As set forth herein, we have completed
and published Books 1, 2 and 3, and have completed the character treatment for
two potential future books.





Competitive Business
Conditions.





Our
products are in direct competition with many different companies in this highly
competitive industry. Many of these companies have substantial current assets
and cash reserves and include companies such as Disney, Warner Brothers, and
Nickelodeon among numerous others. This industry is highly competitive and it
takes time and capital to develop the concept of a character and bring it to the
marketplace. Since diverse distribution channels are available, we believe that
we can be successful in bringing our character representation to the
marketplace.





Sources and Availability of
Raw Materials.





We do not
utilize any specialized raw materials. All necessary required materials, if any,
are readily available. The Company is not aware of any existing or future
problem that will materially affect the source and availability of any materials
which would be required by the Company.





Dependence on One or a Few
Major Customers.





We do not
currently have any identifiable customers. We believe that the diversity of the
various avenues for the sale and distribution of our books and products offered
will alleviate the dependence on any customer. Through the widespread use of our
books and products in multimedia, electronic commerce, publishing, Internet and
other developing industries, we will seek to develop a wide base of customers.






Page
5




Patents, trademarks,
licenses, franchises, concessions, royalty agreements or labor
contracts.





We own
intellectual property rights including copyright and trademarks which are
encompassed in our books and proposed product line. Through our wholly-owned
subsidiary Doolittle Edutainment Corp. we received trademark and copyright
registration for the following:





Trademarks:





MARK
                REG.
      NO
                CLASS
                REG.
      DATE
                OWNER
      OF RECORD
                JURISDICTIONDoolittle
                2,545,806
                25
                March
      12, 2002
                Doolittle
      Edutainment Corp.
                United
      StatesDoolittle
                3,323,801
                16
      and 28
                October
      30, 2007
                Doolittle
      Edutainment Corp.
                United
      States





We previous held the trademark for
Doolittle Duds registered in the International class 25 which consists of
clothing, shirts, T-shirts, sweat shirts and hats, which was granted and
approved on July 4, 2000. In 2007 we ceased using the trademark “Doolittle Duds”
and therefore chose not to file an affidavit of continued use under Section 8,
whereupon the Doolittle Duds trademark was deemed abandon.





Copyrights:





TITLE
              REG.
      NO.
              DATE
      OFREGISTRATIONDoolittle
      Classics: Vol. 1
              VAU-419-090
              December
      12, 1997Doolittle
      Classics: Vol. 2
              VAU-476-300
              October
      28, 1999The
      Story of Doolittle: An Exceptional Young Gorilla
              TXU-950-710
              May
      3, 2000The
      Adventures of Dynamic Doolittle: Episode 1, The Problem with Paulie
      Python
              TXU-980-865
              October
      30, 2000Doolittle’s
      Very, Very Bad Day
              TXU-1-036-883
              May
      22, 2001Illustrations
      for Book 1
                The
      Story of Doolittle, an Exceptional Young Gorilla
              VAU-730-773
              January
      22, 2007Illustrations
      for Book 2
                The
      Adventures of Dynamic Doolittle - Episode 1 “The Problem with Paulie
      Python”
              VAU-730-772
              January
      22, 2007Illustrations
      for Book 3
                Doolittle’s
      Very, Very Bad Day
              VAU-730-774
              January
      22, 2007Completed
      Book 1  - The Story of Doolittle, an Exceptional Young
      Gorilla
              Pending
              Filed
      January 26, 2008Completed
      Book 2 - The Adventures of Dynamic Doolittle - Episode 1 “The Problem with
      Paulie Python”
              Pending
              Filed
      January 26, 2008Completed
      Book 3 –
                Doolittle’s
      Very, Very Bad Day
              Pending
              Filed
      January 26, 2008




Licenses and Royalty
Agreements.





Under the terms of that certain
Restated Independent Contractor Agreement between our subsidiary, Doolittle
Edutainment Corp. and James Wojtak dated February 18, 2000 (the ‘Wojtak
Agreement”), we have agreed to pay the following royalties to Mr.
Wojtak:





(i)           Level 1
Royalties.  With regard to each Form of Work as defined in that
Wojtak Agreement, upon our recovery of (x) certain advances, (y) our costs of
illustration and layout and (z) our cost of printing, Mr. Wojtak shall be paid a
royalty percentage equal to fifteen percent (15.0%) of the total gross revenue
received by us from the sale of the Forms of Work, (excluding shipping costs and
sales tax), on each unit sold up to ten thousand units (10,000) of any and all
Forms of Work as defined in that Wojtak Agreement, through any and all trade
channels both foreign and domestic.






Page
6




(ii)           Level 2
Royalties.  After we have recovered (x) certain advances, (y)
our costs of illustration and layout and (z) our cost of
printing,  and upon unit sales reaching 10,000, Mr. Wojtak shall be
paid a royalty equal to eighteen percent (18.0%) of the total gross revenue
received by us from the sale of the Forms of Work, (excluding shipping costs and
sales tax), on each unit sold in excess of ten thousand units (10,000) of any
and all Forms of Work as defined in that Wojtak Agreement, through any and all
trade channels both foreign and domestic.





(iii)           Level 3
Royalties.  After we have recovered (x) certain advances, (y)
our costs of illustration and layout and (z) our cost of printing, and upon unit
sales reaching 15,000, Mr. Wojtak shall be paid a royalty equal to twenty
percent (20.0%) of the total gross revenue received by us from the sale of the
Forms of Work, (excluding shipping costs and sales tax), on each unit sold in
excess of fifteen thousand units (15,000) of any and all Forms of Work as
defined in that Wojtak Agreement, through any and all trade channels both
foreign and domestic.




(iv)          Licensing
Agreements:   If we enter into any licensing agreement
with any or all of the Forms of Work as defined in that Wojtak Agreement, Mr.
Wojtak shall be paid ten percent (10%) of the total gross revenue received by us
from the licensee.  Units of Forms of Work as defined in that Wojtak
Agreement sold through any licensing agreement are valid toward fulfillment of
each Royalty Level set forth above.





WebSite





Doolittle
Edutainment Corp., owns the domain names www.doolittleedutainment.com,
www.doolittleduds.com and www.dynamicdoolittle.com and may obtain and utilize
additional websites to market the Company’s books and products.





Need for any Government
Approval of Principal Products or Services.





At this
time we do not require the approval of any federal, state or local agency with
regard to any of our products or services.





Effect of Existing or
Probable Governmental Regulations on the Business;





We are
subject to Regulation 14A of the Securities Exchange Act of 1934, as amended
(the “1934 Act”), which regulates proxy solicitations. Section 14(a) requires
all companies with securities registered pursuant to Section 12(g) thereof to
comply with the rules and regulations of the Commission regarding proxy
solicitations, as outlined in Regulation 14A. Matters submitted to stockholders
at a special or annual meeting thereof or pursuant to a written consent will
require us to provide its stockholders with the information outlined in
Schedules 14A or 14C of Regulation 14; preliminary copies of this information
must be submitted to the Commission at least 10 days prior to the date that
definitive copies of this information are forwarded to
stockholders.





We are
also required to file annual reports on Form 10-K and quarterly reports on Form
10-Q with the Commission on a regular basis, and will be required to timely
disclose certain events (e.g., changes in corporate control; acquisitions or
dispositions of a significant amount of assets other than in the ordinary course
of business; and bankruptcy) in a Current Report on Form 8-K.





We
believe that these reporting obligations will increase our annual legal and
accounting costs.





We not
aware of any other governmental regulations now in existence or that may arise
in the future that would have an effect on the business of the
Company.







Page
7


Research and Development
Costs.





We did
not make any expenditure on research and development activities during the last
two fiscal years, 2008 and 2007.





Cost of Compliance with
Environmental Laws.





At this
time our business activities are not subject to any environmental laws or
governmental regulation nor do we anticipate that our future business activities
will subject us to any environmental compliance regulations.





Employees.





As of the
date of this Annual Report other than George G, Chachas, our sole director and
executive officer, we have no other employees.  We do not expect
significant changes in the number of people we employ over the next twelve
months.  We plan to hire additional staff, on an as needed
basis,





ITEM 1A.RISK FACTORS.





Investment
in our common stock involves a high degree of risk. You should carefully
consider the risks described below together with all of the other information
included in this herein before making an investment decision.  If any of
the following risks actually occur, our business, financial condition or results
of operations could suffer. In that case, the market price of our common stock
could decline, and you may lose all or part of your investment.




Risks
Related to Our Business





There
may be conflicts of interest between our management and the
company.




Conflicts
of interest create the risk that management may have an incentive to act
adversely to the interests of the Company. A conflict of interest may arise
between the Company’s management’s personal pecuniary interest and their
fiduciary duty to our stockholders.





We
have no officer, director, or employee with any formal book publishing or market
education or training and will continue to rely on the outside
consultants  whose interests may not always be aligned with
ours.




We have
no officer, director, or employee with book publication, licensing or marketing
training or experience.  This increases our dependence on outside
consultants we may engage from time to time. The quality of such outside
consultants and the services which they provide may be influenced by the
Company’s financial condition and ability in retaining high equality
consultants.





We
have limited internal controls due to our small size and limited number of
people, which may keep us from preventing or detecting waste or
fraud.




We
currently have only one director and one officer, so we rely on computer and
manual systems without independent officers and employees to implement full,
formal, internal control systems. Accordingly, we do not have separate personnel
that provide dual signatures on checks, separate accounts receivable and cash
receipts, accounts payable and check writing, or other functions that frequently
are divided among several individuals as a method of reducing the likelihood of
improper activity. This reliance on a few individuals and the lack of
comprehensive internal control systems may impair our ability to detect and
prevent internal waste and fraud.




We
will need additional capital, which we may seek through additional financing or
the sale of equity securities.




We will
need additional funds to cover expenditures in the completion, publications and
marketing of our books and products. We will fund any additional amounts
required for such expenditures through additional debt financing or the sale of
additional equity securities, which would reduce the percentage interest in our
Company held by existing stockholders and may dilute the economic interest of
existing stockholders. Our board of directors can authorize the sale of
additional equity securities without stockholder consent.






Page
8




We
may not be able to obtain additional financing.




There can
be no assurance that any proceeds we receive from additional debt or equity
financing will satisfy our capital needs. We may require additional capital to
address unanticipated expenses. There is no assurance that additional financing
will be available when needed on terms favorable to us or at all. The
unavailability of adequate financing on acceptable terms could have a material
adverse effect on our financial condition and on our continued
operation.





Our
officers and directors will continue to control us in the foreseeable future and
they may take actions that are not in the best interests of our other
stockholders.




George G.
Chachas, the President, CEO, CFO, Secretary and a director, and Gregory J.
Chachas, a former director who resigned effective December 31, 2007,
collectively beneficially own approximately 65.69% of our common stock. See
“Security Ownership of Certain Beneficial Owners and
Management.”  Accordingly, by virtue of their ownership of shares, the
stockholders referred to above acting together may effectively have the ability
to influence significant corporate actions. Such actions include the election of
our directors and the approval or disapproval of fundamental corporate
transactions, including mergers, the sale of all or substantially all of our
assets, liquidation, and the adoption or amendment of provisions in our articles
of incorporation and bylaws. Such actions could delay or prevent a change in our
control. See “Security Ownership of Certain Beneficial Owners and Management”
and “Description of Securities.”





If
we fail to predict consumer preferences and trends accurately, develop and
introduce new books and products rapidly or enhance and extend our existing core
products, our sales will suffer.





The
introduction of new books and products and the enhancement and extension of
existing products, through the introduction of additional content or by other
means, are critical to our future sales growth. The successful development of
new books, products and the enhancement and extension of our current products
will require us to anticipate the needs and preferences of consumers and
educators and to forecast market trends accurately. Consumer preferences, and
particularly children’s preferences, are continuously changing and are difficult
to predict. The development of learning products requires high levels of
innovation and this process can be lengthy and costly. To remain competitive, we
must continue to develop enhancements of our existing character base
successfully. We cannot assure you that future products will be introduced or,
if introduced, will be successful. The failure to enhance and extend our
existing products or to develop and introduce new books and products that
achieve and sustain market acceptance and produce acceptable margins would harm
our business and operating results.





Our
limited operating history makes it difficult to evaluate our current business
and prospects.





We have a
limited operating history for you or our management to use in evaluating our
business and prospects, particularly with regard to our books and product
acceptance by consumers. To date, we have recognized no sales from our books or
product and any sales from these operations may not meet our expectations or
those of analysts or investors. When making an investment decision regarding our
common stock, you must consider our business and prospects in light of the risks
and difficulties typically encountered by companies in their early stages of
development.





If
our products infringe or allege to infringe on the intellectual property rights
of others It could lead to costly disputes or disruptions.





In the
course of our business, we may periodically receive claims of infringement or
otherwise become aware of potentially relevant copyrights, trademarks or other
intellectual property rights held by other parties. Upon receipt of this type of
communication, we will evaluate the validity and applicability of allegations of
infringement of intellectual property rights to determine whether we must
negotiate licenses or cross-licenses to incorporate or use the proprietary
copyrights or trademarks or other proprietary matters in or on our products. Any
dispute or litigation regarding copyrights, trademarks or other intellectual
property rights, regardless of its outcome, may be costly and time-consuming,
and may divert our management and key personnel from our business operations. If
we, our potential distributors or our manufacturers are adjudged to be
infringing the intellectual property rights of any third party, we or they may
be required to obtain a license to use those rights, which may not be obtainable
on reasonable terms, if at all. And, we may incur costs in revising certain
books or products so as to not infringe on others rights. We also may be subject
to significant damages or injunctions against the development and sale of some
or all of our products or against the use of a trademark in the sale of some or
all of our products.  We do not have insurance to cover any such claim
of this type and may not have sufficient resources to defend an infringement
action.






Page
9




If
we are unable to compete effectively with existing or new competitors, our sales
and market share could be affected.





We
anticipate that we will compete primarily in the preschool and elementary school
category of the U.S. book and toy industry and, to some degree, in the overall
U.S. and international book and toy industry. Each of these markets is very
competitive and we expect competition to increase in the future. We believe that
we will compete in the future, with makers of popular cartoons, children’s books
and other educational products. Accordingly, many of our direct, indirect and
potential competitors have significantly longer operating histories, greater
brand recognition and substantially greater financial, technical and marketing
resources than we do. These competitors may be able to respond more rapidly than
we can to changes in consumer preferences. They may also devote greater
resources to the development, promotion and sale of their products than we are
able to. We cannot assure you that we will be able to compete effectively in our
markets. See “Business – Competitive Business Conditions” for a discussion of
the companies with which we believe we compete as well as the principal
competitive factors in our markets.





We
do not have long-term agreements with manufacturers and suppliers.





As a
development stage company we presently order our products on a purchase order
basis from manufacturers and suppliers, and we do not have long-term
manufacturing agreements with any of them. The absence of long-term agreements
means that, with little or no notice, our manufacturers and suppliers could
refuse to manufacture some or all of our products, reduce the number of units of
a product that they will manufacture or change the terms under which they
manufacture our products. If our manufacturers and suppliers stop manufacturing
our products, we may be unable to find alternative manufacturers or suppliers on
a timely or cost-effective basis, if at all, which would harm our operating
results. In addition, if any of our manufacturers or suppliers changes the terms
under which they manufacture for us, our costs could increase and our
profitability would suffer.





If
we cannot attract, retain, motivate and integrate additional skilled personnel,
our ability to compete will be impaired.





Many of
our current and potential competitors have employees and we do not. Our success
depends in large part on our ability to attract, retain and motivate highly
qualified management and technical personnel. We face intense competition for
qualified personnel. The industry in which we compete has a high level of
employee mobility and aggressive recruiting of skilled personnel. If we are
unable to continue to employ our key personnel or to attract and retain
qualified personnel in the future, our ability to successfully execute our
business plan will be jeopardized and our growth will be inhibited.





Because
our officers and directors are indemnified against certain losses, we may be
exposed to costs associated with litigation.





If our
directors or officers become exposed to liabilities invoking the indemnification
provisions, we could be exposed to additional un-reimbursable costs, including
legal fees. Our Articles of Incorporation, provide that our directors and
officers will not be liable to us or to any shareholder and will be indemnified
and held harmless for any consequences of any act or omission by the directors
and officers unless the act or omission constitutes gross negligence or willful
misconduct. Extended or protracted litigation could have a material adverse
effect on our cash flow.




Page
10


Our
stock price may be volatile.





The
market price of our common stock will likely fluctuate significantly in response
to the following factors, some of which are beyond our control: variations in
our quarterly operating results; changes in financial estimates of our revenues
and operating results by securities analysts; changes in market valuations;
announcements by us of significant contracts, acquisitions, strategic
partnerships, joint ventures or capital commitments; additions or departures of
key personnel; future sales of our common stock; stock market price and volume
fluctuations attributable to inconsistent trading volume levels of our stock;
commencement of or involvement in litigation.





Authorization
of Preferred Stock.




Our
Articles of Incorporation authorizes the issuance of up to 25,000,000 shares of
preferred stock with designations, rights and preferences determined from time
to time by its Board of Directors. Accordingly, our Board of Directors is
empowered, without stockholder approval, to issue preferred stock with dividend,
liquidation, conversion, voting, or other rights which could adversely affect
the voting power or other rights of the holders of the common
stock.  The preferred stock could be utilized, under certain
circumstances, as a method of discouraging, delaying or preventing a change in
control of the Company. Although we have no present intention to issue any
shares of our authorized preferred stock, there can be no assurance that the
Company will not do so in the future.




If
we are subject to SEC regulations relating to low-priced stocks, the market for
our common stock could be adversely affected.





The
Securities and Exchange Commission has adopted regulations concerning low-priced
(or “penny”) stocks. The regulations generally define “penny stock” to be any
equity security that has a market price less than $5.00 per share, subject to
certain exceptions. Our stock will be classified as a penny stock.





The penny
stock regulations require that broker-dealers, who recommend penny stocks to
persons other than institutional accredited investors make a special suitability
determination for the purchaser, receive the purchaser’s written agreement to
the transaction prior to the sale and provide the purchaser with risk disclosure
documents that identify risks associated with investing in penny stocks.
Furthermore, the broker-dealer must obtain a signed and dated acknowledgment
from the purchaser demonstrating that the purchaser has actually received the
required risk disclosure document before effecting a transaction in penny stock.
These requirements have historically resulted in reducing the level of trading
activity in securities that become subject to the penny stock
rules.





The
additional burdens imposed upon broker-dealers by these penny stock requirements
may discourage broker-dealers from effecting transactions in the common stock,
which could severely limit the market liquidity of our common stock and our
shareholders’ ability to sell our common stock in the secondary
market.





Recent
legislation addressing corporate and auditing scandals may result in increased
costs of compliance.





An
immediate and specific risk relates to the our ability to achieve and maintain
effective internal controls in accordance with Section 404 of the Sarbanes-Oxley
Act the failure of which could lead to loss of investor confidence in our
reported financial information. Pursuant to Section 404 of the Sarbanes-Oxley
Act of 2002, we will be required to furnish a report by our management on our
internal control over financial reporting.  If we cannot provide reliable
financial reports or prevent fraud, then our business and operating results
could be harmed, investors could lose confidence in our reported financial
information, and the trading price of our stock could drop
significantly.   In order to achieve compliance with Section 404
of the Act, we will need to engage in a process to document and evaluate our
internal control over financial reporting, which will be both costly and
challenging.  In this regard, management will need to dedicate internal
resources, engage outside consultants and adopt a detailed work
plan.





Page
11


ITEM 2. DESCRIPTION OF
PROPERTY.





Our
corporate headquarters address at 2445 Fifth Avenue, Suite 440, San Diego, CA
92101 is the business office address of our President, George G. Chachas, which
office space is provided at no cost. The property is generic office space that
meets the Company’s executive and administrative requirements.





ITEM 3. LEGAL
PROCEEDINGS.





We are
not a party to any pending legal proceeding. No federal, state or local
governmental agency is presently contemplating any proceeding against the
Company. No director, executive officer or affiliate of the Company or owner of
record or beneficially of more than five percent of the Company's common stock
is a party adverse to the Company or has a material interest adverse to the
Company in any proceeding.





ITEM 4. SUBMISSION OF MATTERS
TO A VOTE OF THE SECURITY HOLDERS.





During
the fourth quarter of 2008, there were no matters submitted to a vote of the
stockholders.




PART II.





ITEM
5. MARKET FOR COMMON
EQUITY, RELATED STOCKHOLDER MATTERS ANDISSUER
PURCHASES OF EQUITY SECURITIES.





Market
Information





Our
common stock is traded on OTC Bulletin Board under the symbol
“AROS.”  The following table sets forth, in U.S. dollars the high and
low bid prices for each of the calendar quarters indicated, as reported by the
OTC Bulletin Board.  The prices in the table may not represent actual
transactions and do not include retail markups, markdowns or
commissions.





Company Common Stock
                                                  Bid
      PricesHigh
                                                
                                                
                                                Low2008Quarter
      ended December 31
                                                
                                                $
                                                0.15
                                                
                                                
                                                $
                                                0.05Quarter
      ended September 30
                                                
                                                
                                                0.15
                                                
                                                
                                                
                                                0.05Quarter
      ended June 30
                                                
                                                
                                                0.25
                                                
                                                
                                                
                                                0.10Quarter
      ended March 31
                                                
                                                
                                                0.25
                                                
                                                
                                                
                                                0.102007Quarter
      ended December 31
                                                
                                                $
                                                0.10
                                                
                                                
                                                $
                                                0.05Quarter
      ended September 30
                                                
                                                
                                                0.10
                                                
                                                
                                                
                                                0.05Quarter
      ended June 30
                                                
                                                
                                                0.10
                                                
                                                
                                                
                                                0.05Quarter
      ended March 31
                                                
                                                
                                                0.20
                                                
                                                
                                                
                                                0.10





On March
2, 2009, the last bid and ask of our common stock as reported on the OTC
Bulletin Board was $0.10 and $0.25, respectively.




Holders of Our Common
Stock




As
of March 2, 2009, we had 38 stockholders of record based on information provided
by our transfer agent.




Page
12


Dividends





We have not declared or paid cash
dividends on our common stock since our inception. We intend to retain all
future earnings, if any, to fund the operation of our business, and, therefore,
do not anticipate paying dividends in the foreseeable future. Future cash
dividends, if any, will be determined by our board of directors.




There are
no restrictions in our articles of incorporation or bylaws that prevent us from
declaring dividends. The Nevada Revised Statutes, however, do prohibit us from
declaring dividends where, after giving effect to the distribution of the
dividend:




1.           We
would not be able to pay our debts as they become due in the usual course of
business; or




2.           Our
total assets would be less than the sum of our total liabilities plus the amount
that would be needed to satisfy the rights of shareholders who have preferential
rights superior to those receiving the distribution.




Securities Authorized for
Issuance Under Equity Compensation Plans




The
following table sets forth information as of December 31, 2008 and 2007, with
respect to our equity compensation plans previously approved by stockholders and
equity compensation plans not previously approved by stockholders.




Equity Compensation Plan InformationPlan Category
                                    Number of securities to
                                      be issued upon exercise
                                      of outstanding options,
                                      warrants and rights
                                    
                                    Weighted average
                                      exercise price of
                                      outstanding options,
                                      warrants and rights
                                    
                                    Number of securities
                                      remaining available for
                                      future issuance under
                                      equity compensation
                                      plans (excluding
                                      securities reflected in
                                      column (a))(a)
                                    
                                    (b)
                                    
                                    (c)Equity
      compensation plans approved by stockholders
                                    100,000
                                    
                                    $
                                    0.25
                                    
                                    4,900,000Equity
      compensation plans not approved by stockholders
                                    0
                                    
                                    0
                                    
                                    0Total
                                    100,000
                                    
                                    $
                                    0.25
                                    
                                    4,900,000





Issuer Purchases of Equity
Securities




There
were no stock repurchases during the fourth quarter of 2008.




Recent Sales of Unregistered
Securities




The were
no sales of unregistered securities during the period covered by this
report.





Page
13


ITEM 6. SELECTED FINANCIAL
DATA.





We are a
smaller reporting company as defined by Rule 12b-2 of the Securities Exchange
Act of 1934 and are not required to provide the information under this
item.





ITEM 7. MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.





The
following discussion and analysis is intended as a review of significant factors
affecting our financial condition and results of operations for the periods
indicated.  The discussion should be read in conjunction with our
consolidated financial statements and the notes presented herein.  In
addition to historical information, the following Management's Discussion and
Analysis of Financial Condition and Results of Operations contains
forward-looking statements that involve risks and uncertainties. Our actual
results could differ significantly from those anticipated in these
forward-looking statements as a result of certain factors discussed in this
report.





A.           Management’s
Plan of Operation




The following discussion of our
financial condition, changes in financial condition and results of operations
for the year ended December 31, 2008 should be read in conjunction with our
audited consolidated financial statements and related notes for the year ended
December 31, 2008.






Our
Plan of Operations




Our wholly-owned subsidiary, Doolittle
Edutainment, which holds all intellectual property for the Company, is engaged
in the children’s education and entertainment market. With the completion and
initial publication and printing of our first three book titles we will seek to
solidify a traditional publishing relationship while at the same time continuing
to self-publish our books and seek to negotiate a distribution agreement with
one or more book distribution sources.  We further plan continue to
utilize our intellectual property to entertain and educate children through
various avenues focused around our main character, “Doolittle” and further the
development of additional books and exploitation of our intellectual property
rights through licensing, branding or any other acceptable manner.





We
recently have begun to focus on developing the market for this book. As a
result, we are a development stage enterprise as defined by SFAS
7.  In our most recent operating period ended December 31, 2008, we
recorded no revenue. Additionally, there were no revenues for the fiscal year
ended December 31, 2007.  Accordingly, we have issued a comment
regarding our ability to continue as a going concern (please refer to the
footnotes to the financial statements).  Until such time that we are
able to establish a consistent flow of revenues from our Doolittle products,
sufficient to sustain our operations, Management intends to rely primarily upon
debt financing as needed to supplement the cash flows generated by the sale of
our products.





Our plan of operations for the next
twelve months is to complete, subject to our achieving the necessary financing,
are as follows:





1.           We
plan to carry out our sales and marketing efforts and seek to negotiate and
facilitate a publishing contract for the publication of Book 1, 2 and 3 or
pursue self publication through Bookmaster and distribution through one or more
online and store-front distribution channels.  We anticipate spending
approximately $10,000 over the next twelve months for the printing of additional
copies of Books 1, 2 and 3.





2.           We
anticipate spending approximately $15,000 over the next twelve months on the
development of Books 4 and possibly Book 5.





3.           We
anticipate spending approximately $25,000 in complying with our obligations as a
reporting company under the Securities Exchange Act of 1934. These expenses will
consist primarily of professional fees relating to the preparation of our
financial statements and completing our annual report, quarterly report, current
report and proxy statement filings with the SEC.






Page
14




During
the twelve month period following the date of this annual report, we anticipate
that we will not generate revenues to cover our operating costs. We anticipate
based on our current cash and workingcapital and our planned
expenses that we will be able to continue our plan of operations for three more
months without additional financing. We believe that we will require substantial
additional financing in order to print additional copies of our books to
effectively commercial market our books in order to earn revenues that exceed
our operating expenses.  We believe that debt financing from third
parties will not be an alternative for funding of our planned activities as we
do not have tangible assets to secure any debt financing. We anticipate that
additional funding will be in the form of debt financing from our principal
shareholder and executive officer or equity financing from the sale of our
common stock or sales of convertible promissory notes that are convertible into
shares of our common stock. If we do not obtain the necessary additional
financing, we will be forced to scale back our plan of operations and our
business activities.





Our total
operating expenses for the period from September 25, 1996, (inception) to
December 31, 2008 were $427,477, of which approximately 46% were general and
administrative. Our current monthly operating expenses average less than $5,000
exclusive of management’s salaries, which are deferred until we begin selling
our books.  The following table quantifies the components that
comprise our operating expenses for this period:




DESCRIPTION
                
                AMOUNTLegal and
      Professional Fees
                
                $
                231,844Other General
      and Administrative
                
                
                195,633Wages and
      Salaries
                
                
                0Taxes
                
                
                0Total General and
      Administrative Expenses
                
                $
                427,477





As we grow our business and obtain a
publishing deal and/or purchase orders for our books and other products, our
revenues should grow on a consistent basis. By focusing our efforts on limiting
general and administrative expenses as we increase revenue, we expect to
increase our net income on a consistent basis as well.





RESULTS
OF OPERATIONS





For
the year ended December 31, 2008 compared to the year ended December 31,
2007.





As of September 25, 1996, (inception)
to December 31, 2008, we have generated only minimal revenue.  We
earned no revenues during the twelve month period ended December 31, 2008 and no
revenues for the twelve months ended December 31, 2007.  As a
development stage company, our revenue is expected to be derived from the sale
of our Doolittle products.





Operating expenses for the twelve
months ended December 31, 2008 totaled $50,673, resulting in an increase of
approximately one percent from the comparable period of 2007.  This
increase resulted primarily from a 7% increase in general and administrative
expenses, slightly offset by a 4% decrease in legal and professional fees during
the current period.





We incurred a net loss of $58,968
during the twelve month period ended December 31, 2008, resulting in an
increased loss of approximately 4% from the comparable period of
2007.  Basic net loss per share was $0.01for the twelve month period
ended December 31, 2008, representing no change from the comparable period of
2007.






Page
15




Liquidity
and Capital Resources




As of December 31, 2008, we had a
negative working capital of $207,475 compared to a negative working capital of
$148,207 at December 31, 2007. The change in working capital resulted primarily
from our operating losses.





During the twelve months ended December
31, 2008 we experienced negative cash flow of $23,165 from operating activities,
and had negative cash flows from investing activities of $300.  We met
our cash requirements during this period through debt financing, realizing a
cash inflow from shareholder loans in the amount of $23,643.





ITEM 7A – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.





We are a
smaller reporting company as defined by Rule 12b-2 of the Securities Exchange
Act of 1934 and are not required to provide the information under this
item.





Page
16


ITEM 8. FINANCIAL
STATEMENTS.











ANOTEROS,
INC. AND SUBSIDIARY





CONSOLIDATED
FINANCIAL STATEMENTS





December
31, 2008








C
O N T E N T S







Report of
      Independent Registered Public Accounting Firm
            18Consolidated
      Balance Sheets
            19Consolidated
      Statements of Operations
            20Consolidated
      Statements of Stockholders’ Equity (Deficit)
            21Consolidated
      Statements of Cash Flows
            25Notes to the
      Consolidated Financial Statements
            27










Page
17


REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM





To the
Stockholders of


Anoteros,
Inc. and Subsidiary


(A
Development Stage Company)


San
Diego, California





We have
audited the accompanying consolidated balance sheets of Anoteros, Inc. and
Subsidiary (a development stage company) as of December 31, 2008 and 2007 and
the related consolidated statements of operations, stockholders’ equity
(deficit), and cash flows for the years ended December 31, 2008 and 2007 and
from inception of the development stage on September 25, 1996 through December
31, 2008.  These consolidated financial statements are the
responsibility of the Company's management.  Our responsibility is to
express an opinion on these consolidated financial statements based on our
audits.





We
conducted our audits 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 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 audits provide a reasonable basis
for our opinion.





In our
opinion, the consolidated financial statements referred to above present fairly,
in all material respects, the consolidated financial positions of Anoteros, Inc.
and Subsidiary (a development stage company) as of December 31, 2008 and
2007, and the results of their operations and their cash flows for the years
ended December 31, 2008 and 2007 and from inception of the development stage on
September 25, 1996 through December 31, 2008 in conformity with U.S. generally
accepted accounting principles.





We were
not engaged to examine management's assessment of the effectiveness of Anoteros,
Inc. and Subsidiary’s (a development stage company) internal control over
financial reporting as of December 31, 2008 included in the accompanying
Management’s Annual Report on Internal Control Over Financial Reporting and,
accordingly, we do not express an opinion thereon.





The
accompanying consolidated financial statements have been prepared assuming that
the Company will continue as a going concern.   As discussed in
Note 3 to the consolidated financial statements, the Company does not have
significant operations to date and has a net capital deficiency that raise
substantial doubt about its ability to continue as a going concern. Management’s
plans in regard to these matters are also described in Note 3.  The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.











HJ
Associates & Consultants, LLP


Salt Lake
City, Utah


March 17,
2009








Page
18


ANOTEROS,
      INC. AND SUBSIDIARY(A
      Development Stage Company)Consolidated
      Balance SheetsASSETSDecember
      31,
                        
                        December
      31,2008
                        
                        2007CURRENT
      ASSETSCash
                        
                        $
                        1,226
                        
                        
                        $
                        1,048Total
      Current Assets
                        
                        
                        1,226
                        
                        
                        
                        1,048OTHER
      ASSETSArtwork
                        
                        
                        31,715
                        
                        
                        
                        31,415Total
      Other Assets
                        
                        
                        31,715
                        
                        
                        
                        31,415TOTAL
      ASSETS
                        
                        $
                        32,941
                        
                        
                        $
                        32,463LIABILITIES AND STOCKHOLDERS' EQUITY
      (DEFICIT)CURRENT
      LIABILITIESAccounts
      payable
                        
                        $
                        -
                        
                        
                        $
                        641Accounts
      payable and accrued expenses - related party
                        
                        
                        59,390
                        
                        
                        
                        31,241Notes
      payable - related party
                        
                        
                        113,717
                        
                        
                        
                        90,074Accrued
      interest payable - related party
                        
                        
                        35,594
                        
                        
                        
                        27,299Total
      Current Liabilities
                        
                        
                        208,701
                        
                        
                        
                        149,255TOTAL
      LIABILITIES
                        
                        
                        208,701
                        
                        
                        
                        149,255STOCKHOLDERS'
      EQUITY (DEFICIT)Preferred
      stock: 25,000,000 shares authorized;$0.001
      par value; -0- shares issued and outstanding
                        
                        
                        -
                        
                        
                        
                        -Common
      stock: 100,000,000 shares authorized;$0.001
      par value; 6,978,769 shares issued andoutstanding
                        
                        
                        6,979
                        
                        
                        
                        6,979Additional
      paid-in capital
                        
                        
                        260,206
                        
                        
                        
                        260,206Deficit
      accumulated during the development stage
                        
                        
                        (442,945
                        )
                        
                        
                        (383,977
                        )Total
      Stockholders' Equity (Deficit)
                        
                        
                        (175,760
                        )
                        
                        
                        (116,792
                        )TOTAL
      LIABILITIES AND STOCKHOLDERS'EQUITY
      (DEFICIT)
                        
                        $
                        32,941
                        
                        
                        $
                        32,463






The
accompanying notes are an integral part of these consolidated financial
statements
 
 Page
19


ANOTEROS,
      INC. AND SUBSIDIARY(A
      Development Stage Company)Consolidated
      Statements of OperationsFrom
      Inceptionof
      theDevelopment
      Stageon
      September 25,For
      the Years Ended
                  
                  
                  1996
      throughDecember
      31,
                  
                  
                  December
      31,2008
                  
                  
                  2007
                  
                  
                  2008REVENUES
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  867OPERATING
      EXPENSESLegal
      and professional
                  
                  
                  27,622
                  
                  
                  
                  28,712
                  
                  
                  
                  231,844General
      and administrative
                  
                  
                  23,051
                  
                  
                  
                  21,344
                  
                  
                  
                  195,633Total
      Operating Expenses
                  
                  
                  50,673
                  
                  
                  
                  50,056
                  
                  
                  
                  427,477LOSS
      FROM OPERATIONS
                  
                  
                  (50,673
                  )
                  
                  
                  (50,056
                  )
                  
                  
                  (426,610
                  )OTHER
      EXPENSESInterest
      expense
                  
                  
                  (8,295
                  )
                  
                  
                  (6,778
                  )
                  
                  
                  (37,852
                  )Loss
      on disposal of fixed assets
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (250
                  )Gain
      on sale of fixed assets
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  1,767Gain
      on sale of intellectual property
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  20,000Total
      Other Expenses
                  
                  
                  (8,295
                  )
                  
                  
                  (6,778
                  )
                  
                  
                  (16,335
                  )NET
      LOSS
                  
                  $
                  (58,968
                  )
                  
                  $
                  (56,834
                  )
                  
                  $
                  (442,945
                  )BASIC
      LOSS PER SHARE
                  
                  $
                  (0.01
                  )
                  
                  $
                  (0.01
                  )WEIGHTED
      AVERAGE NUMBER OFSHARES
      OUTSTANDING
                  
                  
                  6,978,769
                  
                  
                  
                  6,791,446





The
accompanying notes are an integral part of these consolidated financial
statements
 
 Page
20


ANOTEROS,
      INC. AND SUBSIDIARY(A
      Development Stage Company)Consolidated
      Statements of Stockholders' Equity (Deficit)DeficitAccumulatedAdditional
                  
                  
                  During
      theCommon
      Stock
                  
                  
                  Paid-In
                  
                  
                  DevelopmentShares
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  StageBalance
      at inception of the developmentstage
      on September 25, 1996
                  
                  
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -Common
      stock issued for cashat
      $0.001 per share
                  
                  
                  2,000,000
                  
                  
                  
                  2,000
                  
                  
                  
                  (165
                  )
                  
                  
                  -Net
      loss from inception of thedevelopment
      stage on September25,
      1996, through December 31, 1996
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (1,109
                  )Balance,
      December 31, 1996
                  
                  
                  2,000,000
                  
                  
                  
                  2,000
                  
                  
                  
                  (165
                  )
                  
                  
                  (1,109
                  )Common
      stock issued for cashat
      $0.003 per share
                  
                  
                  1,330,000
                  
                  
                  
                  1,330
                  
                  
                  
                  2,670
                  
                  
                  
                  -Common
      stock issued for artworkat
      0.05 per share
                  
                  
                  5,000
                  
                  
                  
                  5
                  
                  
                  
                  245
                  
                  
                  
                  -Net
      income for the year endedDecember
      31, 1997
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (2,976
                  )Balance,
      December 31, 1997
                  
                  
                  3,335,000
                  
                  
                  
                  3,335
                  
                  
                  
                  2,750
                  
                  
                  
                  (4,085
                  )Common
      stock issued on January 19, 1998for
      services rendered at $0.05 per share
                  
                  
                  5,000
                  
                  
                  
                  5
                  
                  
                  
                  245
                  
                  
                  
                  -Common
      stock issued for cash onApril
      16, 1998 for $0.05 per share
                  
                  
                  24,000
                  
                  
                  
                  24
                  
                  
                  
                  1,176
                  
                  
                  
                  -Common
      stock issued for cash onJune
      2, 1998 for $0.05 per share
                  
                  
                  30,000
                  
                  
                  
                  30
                  
                  
                  
                  1,470
                  
                  
                  
                  -Common
      stock issued for cash onJuly
      21, 1998 for $0.05 per share
                  
                  
                  10,000
                  
                  
                  
                  10
                  
                  
                  
                  490
                  
                  
                  
                  -Common
      stock issued on July 29, 1998for
      services rendered at $0.05 per share
                  
                  
                  25,000
                  
                  
                  
                  25
                  
                  
                  
                  2,475
                  
                  
                  
                  -Common
      stock issued for cash onDecember
      7, 1998 for $0.05 per share
                  
                  
                  20,000
                  
                  
                  
                  20
                  
                  
                  
                  980
                  
                  
                  
                  -Common
      stock issued for cash onDecember
      21, 1998 for $0.05 per share
                  
                  
                  15,000
                  
                  
                  
                  15
                  
                  
                  
                  735
                  
                  
                  
                  -Net
      loss for the year endedDecember
      31, 1998
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (7,779
                  )Balance,
      December 31, 1998
                  
                  
                  3,464,000
                  
                  
                  $
                  3,464
                  
                  
                  $
                  10,321
                  
                  
                  $
                  (11,864
                  )





The
accompanying notes are an integral part of these consolidated financial
statements
 
 Page
21


ANOTEROS,
      INC. AND SUBSIDIARY(A
      Development Stage Company)Consolidated
      Statements of Stockholders' Equity (Deficit) (Continued)DeficitAccumulatedAdditional
                  
                  
                  During
      theCommon
      Stock
                  
                  
                  Paid-In
                  
                  
                  DevelopmentShares
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  StageBalance,
      December 31, 1998
                  
                  
                  3,464,000
                  
                  
                  $
                  3,464
                  
                  
                  $
                  10,321
                  
                  
                  $
                  (11,864
                  )Common
      stock issued for cash onFebruary
      16, 1999 for $0.05 per share
                  
                  
                  5,000
                  
                  
                  
                  5
                  
                  
                  
                  245
                  
                  
                  
                  -Common
      stock issued for cash onMarch
      30, 1999 for $0.05 per share
                  
                  
                  16,000
                  
                  
                  
                  16
                  
                  
                  
                  784
                  
                  
                  
                  -Common
      stock issued for cash onMay
      4, 1999 for $0.05 per share
                  
                  
                  40,000
                  
                  
                  
                  40
                  
                  
                  
                  1,960
                  
                  
                  
                  -Common
      stock issued for cash onMay
      18, 1999 at $0.05 per share
                  
                  
                  20,000
                  
                  
                  
                  20
                  
                  
                  
                  980
                  
                  
                  
                  -Common
      stock issued on May 18, 1999for
      services rendered at $0.05 per share
                  
                  
                  200,000
                  
                  
                  
                  200
                  
                  
                  
                  9,800
                  
                  
                  
                  -Common
      stock issued for cash onAugust
      12, 1999 at $0.05 per share
                  
                  
                  20,000
                  
                  
                  
                  20
                  
                  
                  
                  980
                  
                  
                  
                  -Common
      stock issued for cash onSeptember
      16, 1999 at $0.05 per share
                  
                  
                  20,000
                  
                  
                  
                  20
                  
                  
                  
                  980
                  
                  
                  
                  -Common
      stock issued on September 16, 1999for
      services rendered at $0.05 per share
                  
                  
                  120,000
                  
                  
                  
                  120
                  
                  
                  
                  5,880
                  
                  
                  
                  -Common
      stock issued for cash onSeptember
      21, 1999 at $0.05 per share
                  
                  
                  40,000
                  
                  
                  
                  40
                  
                  
                  
                  1,960
                  
                  
                  
                  -Common
      stock issued for cash onOctober
      11, 1999 at $0.05 per share
                  
                  
                  70,000
                  
                  
                  
                  70
                  
                  
                  
                  3,430
                  
                  
                  
                  -Common
      stock issued on October 11, 1999for
      services rendered at $0.05 per share
                  
                  
                  470,000
                  
                  
                  
                  470
                  
                  
                  
                  23,030
                  
                  
                  
                  -Net
      loss for the year endedDecember
      31, 1999
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (58,531
                  )Balance,
      December 31, 1999
                  
                  
                  4,485,000
                  
                  
                  
                  4,485
                  
                  
                  
                  60,350
                  
                  
                  
                  (70,395
                  )Common
      stock issued on February 18, 2000for
      services rendered at $0.05 per share
                  
                  
                  10,000
                  
                  
                  
                  10
                  
                  
                  
                  490
                  
                  
                  
                  -Common
      stock issued on March 10, 2000for
      services rendered at $0.05 per share
                  
                  
                  110,000
                  
                  
                  
                  110
                  
                  
                  
                  5,390
                  
                  
                  
                  -Net
      loss for the year endedDecember
      31, 2000
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (22,150
                  )Balance,
      December 31, 2000
                  
                  
                  4,605,000
                  
                  
                  $
                  4,605
                  
                  
                  $
                  66,230
                  
                  
                  $
                  (92,545
                  )





The
accompanying notes are an integral part of these consolidated financial
statements
 
 Page
22


ANOTEROS,
      INC. AND SUBSIDIARY(A
      Development Stage Company)Consolidated
      Statements of Stockholders' Equity (Deficit) (Continued)DeficitAccumulatedAdditional
                  
                  
                  During
      theCommon
      Stock
                  
                  
                  Paid-In
                  
                  
                  DevelopmentShares
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  StageBalance,
      December 31, 2000
                  
                  
                  4,605,000
                  
                  
                  $
                  4,605
                  
                  
                  $
                  66,230
                  
                  
                  $
                  (92,545
                  )Common
      stock issued on November 15, 2001for
      services rendered at $0.10 per share
                  
                  
                  75,000
                  
                  
                  
                  75
                  
                  
                  
                  7,425
                  
                  
                  
                  -Net
      loss for the year endedDecember
      31, 2001
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (14,626
                  )Balance,
      December 31, 2001
                  
                  
                  4,680,000
                  
                  
                  
                  4,680
                  
                  
                  
                  73,655
                  
                  
                  
                  (107,171
                  )Common
      stock issued for cash onMay
      2, 2002 at $0.10 per share
                  
                  
                  5,000
                  
                  
                  
                  5
                  
                  
                  
                  495
                  
                  
                  
                  -Net
      income for the year endedDecember
      31, 2002
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (4,054
                  )Balance,
      December 31, 2002
                  
                  
                  4,685,000
                  
                  
                  
                  4,685
                  
                  
                  
                  74,150
                  
                  
                  
                  (111,225
                  )Common
      stock issued on January 13, 2003for
      services rendered at $0.10 per share
                  
                  
                  5,000
                  
                  
                  
                  5
                  
                  
                  
                  495
                  
                  
                  
                  -Common
      stock issued on July 28, 2003in
      payment of debts at $0.10 per share
                  
                  
                  6,700
                  
                  
                  
                  7
                  
                  
                  
                  663
                  
                  
                  
                  -Net
      loss for the year endedDecember
      31, 2003
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (8,877
                  )Balance,
      December 31, 2003
                  
                  
                  4,696,700
                  
                  
                  
                  4,697
                  
                  
                  
                  75,308
                  
                  
                  
                  (120,102
                  )Common
      shares issued for extinguishment ofdebt
      on March 31, 2004 at $0.10 per share
                  
                  
                  11,729
                  
                  
                  
                  12
                  
                  
                  
                  1,151
                  
                  
                  
                  -Common
      shares issued on March 31, 2004for
      services rendered at $0.10 per share
                  
                  
                  150,000
                  
                  
                  
                  150
                  
                  
                  
                  14,850
                  
                  
                  
                  -Common
      shares issued on September 15, 2004for
      services rendered at $0.10 per share
                  
                  
                  350,000
                  
                  
                  
                  350
                  
                  
                  
                  34,650
                  
                  
                  
                  -Net
      loss for the year endedDecember
      31, 2004
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (60,127
                  )Balance,
      December 31, 2004
                  
                  
                  5,208,429
                  
                  
                  
                  5,209
                  
                  
                  
                  125,959
                  
                  
                  
                  (180,229
                  )Common
      shares issued on February 22, 2005for
      services rendered at $0.10 per share
                  
                  
                  25,000
                  
                  
                  
                  25
                  
                  
                  
                  2,475
                  
                  
                  
                  -Balance
      forward
                  
                  
                  5,233,429
                  
                  
                  $
                  5,234
                  
                  
                  $
                  128,434
                  
                  
                  $
                  (180,229
                  )





The
accompanying notes are an integral part of these consolidated financial
statements
 
 Page
23


ANOTEROS,
      INC. AND SUBSIDIARY(A
      Development Stage Company)Consolidated
      Statements of Stockholders' Equity (Deficit) (Continued)DeficitAccumulatedAdditional
                  
                  
                  During
      theCommon
      Stock
                  
                  
                  Paid-In
                  
                  
                  DevelopmentShares
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  StageBalance
      forward
                  
                  
                  5,233,429
                  
                  
                  $
                  5,234
                  
                  
                  $
                  128,434
                  
                  
                  $
                  (180,229
                  )Common
      shares issued on March 25, 2005for
      services rendered at $0.10 per share
                  
                  
                  575,000
                  
                  
                  
                  575
                  
                  
                  
                  56,925
                  
                  
                  
                  -Common
      shares issued on December 22, 2005for
      services rendered at $0.10 per share
                  
                  
                  300,000
                  
                  
                  
                  300
                  
                  
                  
                  29,700
                  
                  
                  
                  -Net
      loss for the year endedDecember
      31, 2005
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (101,039
                  )Balance,
      December 31, 2005
                  
                  
                  6,108,429
                  
                  
                  
                  6,109
                  
                  
                  
                  215,059
                  
                  
                  
                  (281,268
                  )Common
      shares issued on July 6, 2006 forservices
      rendered at $0.05 per share
                  
                  
                  338,840
                  
                  
                  
                  338
                  
                  
                  
                  16,602
                  
                  
                  
                  -Common
      shares issued on September 18, 2006for
      accrued wages at $0.05 per share
                  
                  
                  100,000
                  
                  
                  
                  100
                  
                  
                  
                  4,900
                  
                  
                  
                  -Common
      shares issued on September 26, 2006for
      cash at $0.05 per share
                  
                  
                  70,000
                  
                  
                  
                  70
                  
                  
                  
                  3,430
                  
                  
                  
                  -Common
      stock issued on November 1, 2006for
      cash at $0.05 per share
                  
                  
                  120,000
                  
                  
                  
                  120
                  
                  
                  
                  5,880
                  
                  
                  
                  -Net
      loss for the year endedDecember
      31, 2006
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (45,875
                  )Balance,
      December 31, 2006
                  
                  
                  6,737,269
                  
                  
                  
                  6,737
                  
                  
                  
                  245,871
                  
                  
                  
                  (327,143
                  )Common
      shares issued on January 15, 2007for
      accrued wages at $0.05 per share
                  
                  
                  50,000
                  
                  
                  
                  50
                  
                  
                  
                  4,950
                  
                  
                  
                  -Common
      shares issued on December 11, 2007for
      services rendered at $0.05 per share
                  
                  
                  100,000
                  
                  
                  
                  100
                  
                  
                  
                  4,900
                  
                  
                  
                  -Common
      shares issued on December 28, 2007for
      debt at $0.05 per share
                  
                  
                  91,500
                  
                  
                  
                  92
                  
                  
                  
                  4,485
                  
                  
                  
                  -Net
      loss for the year endedDecember
      31, 2007
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (56,834
                  )Balance,
      December 31, 2007
                  
                  
                  6,978,769
                  
                  
                  
                  6,979
                  
                  
                  
                  260,206
                  
                  
                  
                  (383,977
                  )Net
      loss for the year endedDecember
      31, 2008
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (58,968
                  )Balance,
      December 31, 2008
                  
                  
                  6,978,769
                  
                  
                  $
                  6,979
                  
                  
                  $
                  260,206
                  
                  
                  $
                  (442,945
                  )





The
accompanying notes are an integral part of these consolidated financial
statements
 
 Page
24


ANOTEROS,
      INC. AND SUBSIDIARY(A
      Development Stage Company)Statements
      of Cash FlowsFrom
      Inceptionof
      theDevelopment
      Stageon
      September 25For
      the Years Ended
                    
                    
                    1996
      ThroughDecember
      31,
                    
                    
                    December
      31,2008
                    
                    
                    2007
                    
                    
                    2008CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      loss
                    
                    $
                    (58,968
                    )
                    
                    $
                    (56,834
                    )
                    
                    $
                    (442,945
                    )Adjustments to
      reconcile net loss tonet
      cash used by operating activities:Depreciation
      expense
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    257Loss on disposal of equipment
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    250Loss on sale
      of equipment
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    133Common stock issued for services and fees
                    
                    
                    -
                    
                    
                    
                    5,000
                    
                    
                    
                    218,191Gain on sale of intellectual property
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (20,000
                    )Gain on sale of
      fixed assets
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (1,900
                    )Changes
      in operating assets and liabilities:Decrease in inventory
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    53Decrease in accounts payableand accrued expenses
                    
                    
                    (641
                    )
                    
                    
                    (1,691
                    )
                    
                    
                    (2,332
                    )Increase
      in accounts payableand accrued expenses - related
                    
                    
                    36,444
                    
                    
                    
                    38,020
                    
                    
                    
                    108,504Net
      Cash Used by Operating Activities
                    
                    
                    (23,165
                    )
                    
                    
                    (15,505
                    )
                    
                    
                    (139,789
                    )CASH
      FLOWS FROM INVESTING ACTIVITIESIncrease
      in artwork
                    
                    
                    (300
                    )
                    
                    
                    (10,975
                    )
                    
                    
                    (31,465
                    )Proceeds from sale of intellectual property
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    20,000Purchase
      of fixed assets
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (10,541
                    )Proceeds from sale of fixed assets
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    11,500Sale
      of equipment
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    300Net Cash Provided (Used) byInvesting
      Activities
                    
                    
                    (300
                    )
                    
                    
                    (10,975
                    )
                    
                    
                    (10,206
                    )CASH
      FLOWS FROM FINANCING ACTIVITIESPayments on notes payable - related parties
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (13,827
                    )Proceeds from notes payable - related parties
                    
                    
                    23,643
                    
                    
                    
                    23,050
                    
                    
                    
                    132,713Common
      stock issued for cash
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    32,335Net Cash Provided by OperatingActivities
                    
                    
                    23,643
                    
                    
                    
                    23,050
                    
                    
                    
                    151,221NET
      INCREASE IN CASH
                    
                    
                    178
                    
                    
                    
                    (3,430
                    )
                    
                    
                    1,226CASH AT BEGINNING OF PERIOD
                    
                    
                    1,048
                    
                    
                    
                    4,478
                    
                    
                    
                    -CASH AT END OF PERIOD
                    
                    $
                    1,226
                    
                    
                    $
                    1,048
                    
                    
                    $
                    1,226







The
accompanying notes are an integral part of these consolidated financial
statements
 
 Page
25


ANOTEROS,
      INC. AND SUBSIDIARY(A
      Development Stage Company)Statements
      of Cash Flows (Continued)From
      Inceptionof
      theDevelopment
      Stageon
      September 25For
      the Years Ended
                  
                  1996
      ThroughDecember
      31,
                  
                  December
      31,2008
                  
                  2007
                  
                  2008CASH
      PAID FORInterest
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -Taxes
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -SCHEDULE
      OF NON-CASH FINANCING ANDINVESTING
      ACTIVITIESCommon
      stock issued as paymenton
      debt
                  
                  $
                  -
                  
                  
                  $
                  9,577
                  
                  
                  $
                  11,410Common
      stock issued for artwork
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  250








The
accompanying notes are an integral part of these consolidated financial
statements
 
 Page
26


ANOTEROS,
INC. AND SUBSIDIARY


(A
Development Stage Company)


Notes to
the Consolidated Financial Statements


December
31, 2008 and 2007





NOTE 1
-        SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES





This
summary of significant accounting policies of Anoteros, Inc. and its
wholly-owned subsidiary, Doolittle EduTainment Corp., is presented to assist in
understanding the Company’s consolidated financial
statements.  Collectively, these entities are referred to as “the
Company”. The consolidated financial statements and notes are representations of
the Company’s management, which is responsible for their integrity and
objectivity.  These accounting policies conform to accounting
principles generally accepted in the Unites States of America, as well as
standards of the Public Company Accounting Oversight Board (United States) and
have been consistently applied in the preparation of the consolidated financial
statements.





a.  Organization
and Business Activities





Anoteros,
Inc. (“Anoteros”) was incorporated under the laws of the State of Nevada on
September 25, 1996 as Out of Bounds Sports Co.  Anoteros has been in
the development stage since inception.  Anoteros has created certain
pieces of artwork, and intends to further develop and market this artwork in
conjunction with its wholly-owned subsidiary, Doolittle EduTainment Corp.
(“Doolittle”).  Out of Bounds Sports Co. changed its name to Anoteros,
Inc. on September 21, 2004.





Doolittle
was incorporated under the laws of the State of Nevada on February 19, 2002 as a
wholly-owned subsidiary of Anoteros.  Doolittle is working toward
creating and marketing a series of children’s books and has completed the first
three initial titles and is exploring distribution avenues.





The
Company will  seek to further develop and market its artwork in
additional children’s book titles, as well as other related accessories such as
puzzles, coloring books, T-shirts, sweatshirts, superballs, etc., through the
Doolittle entity.  Additional external financing may be required to
proceed with this and any supplemental business plans which may be developed by
the Company.





b.  Revenue
Recognition Policy





The
Company currently has no source of revenues.  Revenue recognition
policies will be determined when principal operations begin.





c.  Basic
Loss Per Share





The
computations of basic loss per share of common stock are based on the
weighted-average number of shares outstanding during the period of the financial
statements:


Loss
                      (Numerator)
                    
                    
                    Shares
                      (Denominator)
                    
                    
                    Per
      Share
                      AmountFor the
      year ended
                      December
      31,
      2008
                    
                    $
                    (58,968
                    )
                    
                    
                    6,978,769
                    
                    
                    $
                    (0.01
                    )For
      the year ended
                      December
      31, 2007
                    
                    $
                    (56,834
                    )
                    
                    
                    6,791,446
                    
                    
                    $
                    (0.01
                    )
 Page 27


ANOTEROS,
INC. AND SUBSIDIARY


(A
Development Stage Company)


Notes to
the Consolidated Financial Statements (Continued)


December
31, 2008 and 2007





NOTE 1
-        SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (Continued)





d.  Estimates





The
preparation of financial statements in conformity 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 at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period.  Actual results could differ from those
estimates





e.  Income
Taxes





Deferred
taxes are provided on a liability method whereby deferred tax assets are
recognized for deductible temporary differences and operating loss and tax
credit carryforwards and deferred tax liabilities are recognized for taxable
temporary differences.  Temporary differences are differences between
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 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
deferred tax liabilities consist of the following components as of December 31,
2008 and 2007:


2008
                                
                                
                                2007Defered
      tax assets:NOL
      carryover
                                
                                $
                                47,936
                                
                                
                                $
                                39,296Accrued
      expenses
                                
                                
                                37,044
                                
                                
                                
                                18,447Deferred
      tax liabilities:
                                
                                
                                -
                                
                                
                                
                                -Valuation
      allowance
                                
                                
                                (84,980
                                )
                                
                                
                                (57,743
                                )Net
      deferred tax asset
                                
                                $
                                -
                                
                                
                                $
                                -





The
income tax provision differs from the amount of income tax determined by
applying the U.S. federal income tax rate to pretax income from continuing
operations for the years ended December 31, 2008 and 2007 due to the
following:


2008
                  
                  
                  2007Book
      Income
                  
                  $
                  (22,998
                  )
                  
                  $
                  (22,165
                  )Stock
      for services
                  
                  
                  -
                  
                  
                  
                  1,950Accrued
      interest
                  
                  
                  -
                  
                  
                  
                  2,643Accrued
      wages
                  
                  
                  -
                  
                  
                  
                  7,800Valuation
      allowance
                  
                  
                  22,998
                  
                  
                  
                  9,772$
                  -
                  
                  
                  $
                  -


Page
28


ANOTEROS,
INC. AND SUBSIDIARY


(A
Development Stage Company)


Notes to
the Consolidated Financial Statements (Continued)


December
31, 2008 and 2007




NOTE 1
-        SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (Continued)





e.  Income
Taxes (Continued)





At
December 31, 2008, the Company had net operating loss carryforwards of
approximately $122,912 that may be offset against future taxable income from the
year 2009 through 2029.  No tax benefit has been reported in the
December 31, 2008 consolidated financial statements since the potential tax
benefit is offset by a valuation allowance of the same amount.





Due to
the change in ownership provisions of the Tax Reform Act of 1986, net operating
loss carryforwards for Federal income tax reporting purposes are subject to
annual limitations.  Should a change in ownership occur, net operating
loss carryforwards may be limited as to use in future years.





The
Financial Accounting Standards Board ("FASB") has issued Financial
Interpretation No. 48, Accounting for Uncertainty in Income
Taxes- An
Interpretation of FASB Statement No.109 (FIN48). FIN 48 clarifies the
accounting for uncertainty in income taxes recognized in an enterprise's
financial statements in accordance with FASB Statement No. 109, Accounting for Income Taxes.FIN 48 requires a company to determine whether it is more likely than not
that a tax position will be sustained upon examination based upon the technical
merits of the position. If the more-like1y-than-not threshold is met, a company
must measure the tax position to determine the amount to recognize in the
financial statements. As a result of the implementation of FIN 48, the Company
performed a review of its material tax positions in accordance with recognition
and measurement standards established by FIN 48.





At the
adoption date of January 1, 2007, the Company had no unrecognized tax benefit
which would affect the effective tax rate if recognized.





The
Company includes interest and penalties arising from the underpayment of income
taxes in the consolidated statements of operations in the provision for income
taxes. As of December 31, 2008, the Company had no accrued interest or penalties
related to uncertain tax positions.





The
Company files income tax returns in the U.S. federal jurisdiction and in the
state of California. With few exceptions, the Company is still subject to U.S.
federal, state and local, or non-U.S. income tax examinations by tax authorities
for years after 2005.





f.  Newly
Issued Accounting Pronouncements





During
the year ended December 31, 2008, the Company adopted the following accounting
pronouncements:





In
June 2008, the FASB issued FASB Staff Position EITF 03-6-1, Determining Whether Instruments
Granted in Share-Based Payment Transactions Are Participating Securities,
(“FSP EITF 03-6-1”). FSP EITF 03-6-1 addresses whether instruments granted in
share-based payment transactions are participating securities prior to vesting,
and therefore need to be included in the computation of earnings per share under
the two-class method as described in FASB Statement of Financial Accounting
Standards No. 128, “Earnings per Share.” FSP EITF 03-6-1 is effective for
financial statements issued for fiscal years beginning on or after
December 15, 2008 and earlier adoption is prohibited. We are not required
to adopt FSP EITF 03-6-1; neither do we believe that FSP EITF 03-6-1 would have
material effect on our consolidated financial positionand results of
operations if adopted.






Page
29


ANOTEROS,
INC. AND SUBSIDIARY


(A
Development Stage Company)


Notes to
the Consolidated Financial Statements (Continued)


December
31, 2008 and 2007




NOTE 1
-        SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (Continued)





f.  Newly
Issued Accounting Pronouncements (Continued)





In May
2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 163,
“Accounting for Financial
Guarantee Insurance Contracts-and interpretation of FASB Statement No.
60”.SFAS
No. 163 clarifies how Statement 60 applies to financial guarantee insurance
contracts, including the recognition and measurement of  premium
revenue and claims liabilities. This statement also requires expanded
disclosures about financial guarantee insurance contracts. SFAS No. 163 is
effective for fiscal years beginning on or after December 15, 2008, and interim
periods within those years. SFAS No. 163 has no effect on the Company’s
financial position, statements of operations, or cash flows at this
time.





In May
2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 162,
“The Hierarchy of Generally
Accepted Accounting Principles”.SFAS No. 162 sets forth
the level of authority to a given accounting pronouncement or document by
category. Where there might be conflicting guidance between two categories, the
more authoritative category will prevail. SFAS No. 162 will become effective 60
days after the SEC approves the PCAOB’s amendments to AU Section 411 of the
AICPA Professional Standards. SFAS No. 162 has no effect on the Company’s
financial position, statements of operations, or cash flows at this
time.





In March
2008, the Financial Accounting Standards Board, or FASB, issued SFAS No. 161,
Disclosures about Derivative
Instruments and Hedging Activities—an amendment of FASB Statement No.
133.This standard requires companies to provide enhanced
disclosures about (a) how and why an entity uses derivative instruments, (b) how
derivative instruments and related hedged items are accounted for under
Statement 133 and its related interpretations, and (c) how derivative
instruments and related hedged items affect an entity’s financial position,
financial performance, and cash flows. This Statement is effective for financial
statements issued for fiscal years and interim periods beginning after November
15, 2008, with early application encouraged. The Company has not yet adopted the
provisions of SFAS No. 161, but does not expect it to have a material impact on
its financial position, results of operations or cash flows.





In
December 2007, the SEC issued Staff Accounting Bulletin (SAB) No. 110 regarding
the use of a "simplified" method, as discussed in SAB No. 107 (SAB 107), in
developing an estimate of expected term of "plain vanilla" share options in
accordance with SFAS No. 123 (R), Share-Based
Payment.  In particular, the staff indicated in SAB 107 that it
will accept a company's election to use the simplified method, regardless of
whether the company has sufficient information to make more refined estimates of
expected term. At the time SAB 107 was issued, the staff believed that more
detailed external information about employee exercise behavior (e.g., employee
exercise patterns by industry and/or other categories of companies) would, over
time, become readily available to companies. Therefore, the staff stated in SAB
107 that it would not expect a company to use the simplified method for share
option grants after December 31, 2007. The staff understands that such detailed
information about employee exercise behavior may not be widely available by
December 31, 2007. Accordingly, the staff will continue to accept, under certain
circumstances, the use of the simplified method beyond December 31, 2007. The
Company currently uses the simplified method for “plain vanilla” share options
and warrants, and will assess the impact of SAB 110 for fiscal year 2009. It is
not believed that this will have an impact on the Company’s financial position,
results of operations or cash flows.





Page
30


ANOTEROS,
INC. AND SUBSIDIARY


(A
Development Stage Company)


Notes to
the Consolidated Financial Statements (Continued)


December
31, 2008 and 2007




NOTE 1
-       SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued)





f.  Newly
Issued Accounting Pronouncements (Continued)





In
December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in
Consolidated Financial Statements—an amendment of ARB No.
51.  This statement amends ARB 51 to establish accounting and
reporting standards for the noncontrolling interest in a subsidiary and for the
deconsolidation of a subsidiary. It clarifies that a noncontrolling interest in
a subsidiary is an ownership interest in the consolidated entity that should be
reported as equity in the consolidated financial statements.





Before
this statement was issued, limited guidance existed for reporting noncontrolling
interests. As a result, considerable diversity in practice existed. So-called
minority interests were reported in the consolidated statement of financial
position as liabilities or in the mezzanine section between liabilities and
equity. This statement improves comparability by eliminating that diversity.
This statement is effective for fiscal years, and interim periods within those
fiscal years, beginning on or after December 15, 2008 (that is, January 1, 2009,
for entities with calendar year-ends). Earlier adoption is prohibited. The
effective date of this statement is the same as that of the related Statement
141 (revised 2007). The Company will adopt this Statement beginning March 1,
2009. It is not believed that this will have an impact on the Company’s
financial position, results of operations or cash flows.





In
December 2007, the FASB, issued FAS No. 141 (revised 2007), Business Combinations.’This
Statement replaces FASB Statement No. 141, Business Combinations, but
retains the fundamental requirements in Statement 141.  This
Statement establishes principles and requirements for how the acquirer: (a)
recognizes and measures in its financial statements the identifiable assets
acquired, the liabilities assumed, and any noncontrolling interest in the
acquiree; (b) recognizes and measures the goodwill acquired in the business
combination or a gain from a bargain purchase; and (c) determines what
information to disclose to enable users of the financial statements to evaluate
the nature and financial effects of the business combination. This statement
applies prospectively to business combinations for which the acquisition date is
on or after the beginning of the first annual reporting period beginning on or
after December 15, 2008. An entity may not apply it before that date. The
effective date of this statement is the same as that of the related FASB
Statement No. 160, Noncontrolling Interests in
Consolidated Financial Statements.  The Company will adopt this
statement beginning March 1, 2009. It is not believed that this will have an
impact on the Company’s financial position, results of operations or cash
flows.





In
February 2007, the FASB, issued SFAS No. 159,The Fair Value Option for Financial
Assets and Liabilities—Including an Amendment of FASB Statement No.
115.  This standard permits an entity to choose to measure many
financial instruments and certain other items at fair value. This option is
available to all entities. Most of the provisions in FAS 159 are elective;
however, an amendment to FAS 115 Accounting for Certain Investments
in Debt and Equity Securities applies to all entities with available for
sale or trading securities. Some requirements apply differently to entities that
do not report net income. SFAS No. 159 is effective as of the beginning of an
entities first fiscal year that begins after November 15, 2007. Early adoption
is permitted as of the beginning of the previous fiscal year provided that the
entity makes that choice in the first 120 days of that fiscal year and also
elects to apply the provisions of SFAS No. 157 Fair Value
Measurements.  The Company adopted SFAS No. 159 beginning March
1, 2008. The adoption of this pronouncement did not have an impact on the
Company’s financial position, results of operations or cash flows.






Page
31


ANOTEROS,
INC. AND SUBSIDIARY


(A
Development Stage Company)


Notes to
the Consolidated Financial Statements (Continued)


December
31, 2008 and 2007




NOTE 1
-       SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued)





f.  Newly
Issued Accounting Pronouncements (Continued)





In
September 2006, the FASB issued SFAS No. 157, Fair Value
Measurements  This statement defines fair value, establishes a
framework for measuring fair value in generally accepted accounting principles
(GAAP), and expands disclosures about fair value measurements. This statement
applies under other accounting pronouncements that require or permit fair value
measurements, the Board having previously concluded in those accounting
pronouncements that fair value is the relevant measurement attribute.
Accordingly, this statement does not require any new fair value measurements.
However, for some entities, the application of this statement will change
current practice. This statement is effective for financial statements issued
for fiscal years beginning after November 15, 2007, and interim periods within
those fiscal years. Earlier application is encouraged, provided that the
reporting entity has not yet issued financial statements for that fiscal year,
including financial statements for an interim period within that fiscal year.
The Company adopted this statement March 1, 2008. The adoption of this
pronouncement did not have an impact on the Company’s financial position,
results of operations or cash flows.





g.
            Preferred
      Stock





The
company has authorized 25,000,000 shares of preferred stock with the following
features such that the shares 1) may have voting powers (full or limited) or may
be without voting powers; 2) may be made convertible into, or exchangeable for,
shares of any other class of stock; and 3) may have rights upon distribution of
assets of the Company.  The Company will determine preferences upon
issuance.





h.
            Artwork





During
the year ended December 31, 2006 the Company determined its Artwork has reached
a point near enough to completion so as to necessitate capitalization of all
related expenses.  During the years ended December 31, 2008 and 2007
the Company capitalized $300 and $10,975, respectively, in artwork
expenses.





NOTE 2
-        SHAREHOLDER LOAN





In
October 1999, a shareholder advanced $10,000 to the Company.  From
that date through December 31, 2007, the shareholder has made several additional
advances, and the Company has made some partial payments on the
advances.  As of December 31, 2008, the total principal balance of
these advances totaled $113,717.   The loans accrue interest at
8.0% per annum.  Accrued interest at December 31, 2008 was
$35,594.  The loans are due on demand.






Page
32


ANOTEROS,
INC. AND SUBSIDIARY


(A
Development Stage Company)


Notes to
the Consolidated Financial Statements (Continued)


December
31, 2008 and 2007





NOTE
      3 -
            GOING
      CONCERN





The
Company’s consolidated financial statements are prepared using accounting
principles generally accepted in the United States of America applicable to a
going concern which contemplates the realization of assets and liquidation of
liabilities in the normal course of business.  However, the Company
does not have significant operations to date, nor does it have an established
source of revenues sufficient to allow it to continue as a going
concern.  External financing, which is necessary for the Company to
continue and proceed with operations, will either a) be loaned to the Company by
its founder and principal shareholder, or b) will be generated by means
of  a private placement being contemplated by management in which the
Company would attempt to raise between $20,000 and $35,000. The Company has
completed the first three book titles, Doolittle – An Exceptional Young Gorilla,
Dynamic Doolittle – the Problem with Paulie Python, and Doolittle’s Very Very
Bad Day. The Company self-published the initial three books with an initial run
of 250 copies which are being utilized in exploring various distribution
avenues.





NOTE
      4 -
            EQUITY
      ACTIVITY





On
January 14, 2007, the Company issued 50,000 shares of its common stock to a
former officer of the Company, as payment for accrued wages totaling
$5,000.  In addition, the Company granted to the same individual an
option to purchase 100,000 shares of the Company’s common stock, with an
exercise price of $0.25 per share.  The options vested in full on the
grant date, and expire on December 31, 2011.  The Company performed an
analysis of the valuation of these options according to the Black-Scholes
pricing model, and determined that as of the grant date no expense pertaining to
the options is to be recognized.





On
December 29, 2007, the Company issued 91,500 shares of common stock, at $0.05
per share, to the Company’s current president, as payment on the note held by
the Company’s president.  In addition, the Company issued 100,000
shares at $0.05 per share for legal services rendered.





Page
33


ITEM
9. CHANGES IN AND
DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTINGAND
FINANCIAL DISCLOSURE.





None.





ITEM
9A(T).          CONTROLS AND
PROCEDURES.





Disclosure Controls and
Procedures





Based on
an evaluation as of the date of the end of the period covered by report, our
Chief Executive Officer and Chief Financial Officer, conducted an evaluation of
the effectiveness of the design and operation of our disclosure controls and
procedures, as required by Exchange Act Rule 13a-15. Based on 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 period
covered by this report to ensure that information required to be disclosed by us
in the reports that we file or submit under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified by the
SEC’s rules and forms.




Disclosure
controls and procedures are controls and other procedures that are designed to
ensure that information required to be disclosed in our reports filed or
submitted under the Exchange Act is recorded, processed, summarized and
reported, within the time periods specified in the SEC’s rules and forms.
Disclosure controls and procedures include, without limitation, controls and
procedures designed to ensure that information required to be disclosed in our
reports filed under the Exchange Act is accumulated and communicated to
management, including our Chief Executive Officer and our Chief Financial
Officer, to allow timely decisions regarding required disclosure.




Management’s Annual Report
on Internal Control Over Financial Reporting




Management
is responsible for establishing and maintaining adequate internal control over
financial reporting as defined in Exchange Act Rule 13a-15(f).  Management
conducted an evaluation of the effectiveness of the internal control over
financial reporting as of December 31, 2008, using the criteria established in
Internal Control – Integrated
Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO).  Because of its inherent limitations, internal
control over financial reporting may not prevent or detect misstatements. 
Also, projections of any evaluation of effectiveness to future periods are
subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may
deteriorate.




A
material weakness is a control deficiency, or combination of control
deficiencies, that results in more than a remote likelihood that a material
misstatement of the annual or interim financial statements will not be prevented
or detected.  As a result of management’s assessment, management has
determined that there is a material weakness due to the lack of segregation of
duties.  In order to address and resolve this weakness we will
endeavor to locate and appoint additional qualified personnel to the board of
directors and pertinent officer positions.




This
Annual Report does not include an attestation report of the company's registered
public accounting firm regarding internal control over financial reporting.
Management's report was not subject to attestation by the company's registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit the company to provide only management's report
in this annual report.




Changes in Internal Control
Over Financial Reporting




There has
been no change in our internal control over financial reporting that occurred
during our last fiscal quarter (our fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, our internal control over financial reporting.






Page
34




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






(a)           Pertain
to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of the assets of the
registrant;






(b)           Provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditures of the registrant are
being made only in accordance with authorizations of management and directors of
the registrant; and






(c)           Provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the registrant’s assets that could have a
material effect on the financial statements.




ITEM 9B. OTHER
INFORMATION.





None. Not
applicable.





PART III.


ITEM 10. DIRECTORS AND
EXECUTIVE OFFICERS.





Identify of directors and
executive officers





Our
current directors and executive officers are as follows:





Name
                      Age
                      Position with the
      Company
                      Director
      SinceGeorge
      G. Chachas
                      46
                      President,
      Chief Executive Officer,  Chief Financial Officer, Secretaryand
      a director
                      December
      27, 2006





Term of Office





All of
our directors hold office until the next annual general meeting of the
shareholders or until their successors are elected and qualified. Our officers
are appointed by our board of directors and hold office until their earlier
death, retirement, resignation or removal.





Background and Business
Experience





The
business experience during the past five years of each of the persons presently
listed above as an Officer or Director of the Company is as
follows:





George G. Chachasis the founder of the Company served as the President, Treasurer,
Secretary and Director from inception through October 22, 2004, at which time he
resigned due to time constraints with his ongoing law practice. George was
appointed and assumed the role of CEO, President, Chief Financial Officer,
Secretary and Chairman of the Board on December 27, 2006. George is the founder
and managing partner of Chachas Law Group P.C. serving businesses and
individuals in a variety of transactional matters with extensive experience in
mergers and acquisitions, corporate and securities law, and financing
transactions. He has represented businesses and owners from entity formation and
business structuring through private and public financing transactions, in a
variety of corporate partnering, joint ventures, acquisition, merger and sales
transactions. Prior to forming Chachas Law Group in April 2006, George was the
Managing Partner of Wenthur & Chachas, LLP from 1987 through March 2006
which had an emphasis in corporate and securities transactions (including
private held and publicly traded companies, and SEC compliance), taxation
(including taxpayer disputes with government agencies and state sales and use
tax laws), real estate transactions, estate planning matters and related issues,
and copyright and trademark registrations. George is admitted to practice in
California (1987); District of Columbia (1989) and Colorado (1994). George
graduated from San Diego State University (B.A. 1985) and California Western
School of Law (J.D. 1987).


Page
35




Identify Significant
      Employees




We have
no significant employees other than George G. Chachas, our President, Chief
Executive Officer and sole director.




Family
      Relationships




We
currently do not have any officers or directors of our company who are related
to each other.




Involvement in Certain
      Legal Proceedings





During
the last five years no director, executive officer, promoter or control person
of the Company has had or has been subject to:





(1)           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;





(2)           any
conviction in a criminal proceeding or being subject to a pending criminal
proceeding;





(3)           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 or banking activities; or





(4)           being
found by a court of competent jurisdiction, the Commission or the Commodity
Futures Trading  Commission to have violated any federal or state
securities or commodities law, and the judgment has not been reversed,
suspended, or vacated.





Section 16(a) Beneficial
Ownership Reporting Compliance




Section
16(a) of the Securities Exchange Act of 1934 requires the Company's executive
officers, directors and persons who own more than ten percent of the Company's
Common Stock, to file initial reports of beneficial ownership on Form 3, changes
in beneficial ownership on Form 4 and an annual statement of beneficial
ownership on Form 5, with the SEC.  Such executive officers, directors
and greater than ten percent shareholders are required by SEC rules to furnish
the Company with copies of all such forms that they have filed.






Based
solely on its review of the copies of such forms filed with the SEC
electronically, received by the Company and representations from certain
reporting persons, the Company believes that for the fiscal year ended December
31, 2008, all the officers, directors and more than 10% beneficial owners
complied with the above described filing requirements.




Page
36




Code of
Ethics




Our board
of directors has not adopted a code of ethics due to the fact that we presently
only have one director and officer, namely George G. Chachas, and we are in the
development stage of our operations. We anticipate that we will adopt a code of
ethics when we increase either the number of our directors and officers or the
number of our employees.




Audit Committee and Audit
Committee Financial Expert




Our board
of directors is comprised of one director and has not established an audit
committee. Accordingly, our sole board of director presently performs the
functions that would customarily be undertaken by an audit
committee.




Our board
of directors has determined that George G. Chachas, our sole director and
officer, does not qualify as an “audit committee financial expert”, as defined
by the rules of the SEC and is not “independent”, as he is our sole executive
officer in addition to being our sole director.




ITEM 11. EXECUTIVE
COMPENSATION.





Summary
Compensation Table




The
following table sets forth the compensation paid to our Chief Executive Officer
and those executive officers that earned in excess of $100,000 during the twelve
month periods ended December 31, 2008 and 2007 (collectively, the “Named
Executive Officers”):




Stock
                
                
                OptionName and Principal
      Position
                
                Year
                
                
                Salary
    ($)
                
                
                Bonus
($)
                
                
                Awards
    ($)
                
                
                Awards
    ($)
                
                
                Total
                  ($)George
      G. Chachas, President
                  Chief
      Executive Officer, Chief Financial Officer and Secretary(1)
                
                2008
                
                
                20,000
                (1)
                
                -
                
                
                -
                
                
                -
                
                
                20,0002007
                
                
                20,000
                (1)
                
                -
                
                
                -
                
                
                -
                
                
                20,000





(1)
            During
      2008 and 2007 George G. Chachas was compensated for his services rendered
      as an officer of the Company at the rate of $5,000 per quarter which
              amount
      is being deferred until such time as we have sufficient funds for
      payment.





Narrative
Disclosure to Summary Compensation Table





Currently,
we do not have any written employment agreements.  On January 15,
2007, the board of directors resolved and agreed to pay George G. Chachas $5,000
per quarter payable in cash or shares of our Common Stock based on the closing
price of our Common Stock as reported on the Pink Sheets on the last day of each
calendar quarter, at the option of Mr. Chachas.  Mr. Chachas has
agreed to defer the payment of such amount and as of December 31, 2008, there is
deferred salary due and owing to Mr. Chachas in the amount of
$40,000.





There are
no employment contracts, compensatory plans or arrangements, including payments
to be received from the Company with respect to any executive officer, that
would result in payments to such person because of his or her resignation,
retirement or other termination of employment with the Company, or its
subsidiaries, any change in control, or a change in the person’s
responsibilities following a change in control of the Company.






Page
37


Outstanding
Equity Awards at Fiscal Year-End





No Named
Executive Officer received any equity awards, or holds exercisable or
unexercisbale options, as of the years ended December 31, 2008 and
2007.





Additional
Narrative Disclosure




On
December 27, 2006, the Company adopted the 2007 Long Term Incentive Plan (the
“Plan”) to reward and provide incentives to our employees, who may include our
directors who are also employees and our officers, as well as consultants and
affiliates. The Company has set aside 5,000,000 shares of our common stock for
issuance under the Plan.





There are
no agreements or understandings for any executive officer to resign at the
request of another person. None of our executive officers acts or will act on
behalf of or at the direction of any other person.





Compensation
of Directors




The
following table sets forth information relating to compensation paid to our
directors in 2008 and 2007:




Fees
    Earnedor Paid
                
                
                Stock
                
                
                OptionName
                
                in Cash
    ($)
                
                
                Awards
    ($)
                
                
                Awards
    ($)
                
                
                Total
      ($)George
      G. Chachas
                
                -
                
                
                -
                
                
                -
                
                
                -Gregory
      J. Chachas
                
                -
                
                
                -
                
                
                5,000
                (1)
                
                5,000





(1)
            On January 15, 2007, the Company
      granted Gregory J. Chachas, a Director, an option to purchase 100,000
      shares of common stock at an exercise price of
              $0.25 per share, which option
      expires on December 31,
2011.





There was
no director compensation paid to any director who was a Named Executive Officer
during the year ended December 31, 2008.





There are
no employment contracts, compensatory plans or arrangements, including payments
to be received from the Company with respect to any Director that would result
in payments to such person because of his or her resignation with the Company,
or its subsidiaries, any change in control of the Company. There are no
agreements or understandings for any Director to resign at the request of
another person. None of our Directors or executive officers acts or will act on
behalf of or at the direction of any other person.





Page
38


ITEM
12. SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENTAND
RELATED STOCKHOLDER MATTERS.





Security
Ownership of Certain Beneficial Owners





The
following table sets forth the amount and nature of beneficial ownership of any
class of the Company’s voting securities of any person known to the Company to
be the beneficial owner of more than five percent, as of the close of business
on December 31, 2008.





Title
      of
                  Class
                Name
      and
                  Address
      of
                  Beneficial
                  Owner
                Amount
      and
                  Nature
      of
                  Beneficial
                  Owner
                Percent
      of
                  ClassCommon
      Stock
                George
      G. Chachas
                  2445
      Fifth Avenue
                  Suite
      440
                  San
      Diego, CA 92101SaSan Diego, CA 92101
                3,810,158(1)
                54.59%Common
      Stock
                Gregory
      J. Chachas
                  1200
      South Bell Avenue
                  1200
      South Bell AvenuEly, Nevada 89301
                675,000(2)
                9.67%





(1)
            Includes
      3,718,429 shares of which George Chachas has direct beneficial ownership
      of, 40,000 shares which are held by TUVA Co., LLC, of which George
              Chachas
      owns a 50% interest in, and 51,729 shares held by Chachas Land Co., Inc.,
      a corporation of which George Chachas owns a 33.33% interest and
              is
      an officer and director.





(2)
            Includes
      650,000 shares of which Gregory J. Chachas has direct beneficial ownership
      of, 25,000 shares held by the Chachas Family Spendthrift
      Trust.





Security
Ownership of Management





The
following table sets forth the amount and nature of beneficial ownership of any
class of the Company’s voting securities of all of the Company’s directors and
nominees and “named executive officers” as such term is defined in Item
402(a)(2) of SEC Regulation S-B, as of the close of business on December 31,
2008.





Title
      of
                    Class
                  Name
      of Beneficial
                    Owner
                  Amount
      and
                    Nature
      of
                    Beneficial
                    Ownership
                  Percent
      of
                    ClassCommon
      Stock
                  George
      G. Chachas(1)
                  3,810,158(1)
                  54.59%Common
      Stock
                  Directors
      and Officers as a Group
                  3,810,158
                  54.59%





(1)
            Includes
      3,718,429 shares of which George Chachas has direct beneficial ownership
      of, 40,000 shares which are held by TUVA Co., LLC, of which George
              Chachas
      owns a 50% interest in, and 51,729 shares held by Chachas Land Co., Inc.,
      a corporation of which George Chachas owns a 33.33% interest and
              is
      an officer and director.






Page
39


Changes
in Control.





There are no present arrangements or
pledges of the Company’s securities which may result in a change in control of
the Company.




ITEM 13. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS, AND
DIRECTOR INDEPENDENCE.


The
Company receives rent-free office space in San Diego, California from its
president. The value of the space is not considered materially significant for
financial reporting purposes.





Other
than the transactions stated above, none of the directors or executive officers
of the Company, nor any person who owned of record or was known to own
beneficially more than 5% of the Company’s outstanding shares of its Common
Stock, nor any associate or affiliate of such persons or companies, has any
material interest, direct or indirect, in any transaction that has occurred
since November 1, 2006, or in any proposed transaction, which has
materially affected or will affect the Company.




ITEM 14. PRINCIPAL
ACCOUNTANT FEES AND SERVICES.




Audit
Fees





During
the fiscal year ended December 31, 2008, we incurred approximately
$11,000 in fees to our principal independent accountants for professional
services rendered in connection with the audit and reviews of our financial
statements for fiscal year ended December 31, 2008.





During
the fiscal year ended December 31, 2007, we incurred approximately $10,500 in
fees to our principal independent accountants for professional services rendered
in connection with the audit and reviews of our financial statements for fiscal
year ended December 31, 2007.





Audit-Related
Fees





The
aggregate fees billed during the fiscal years ended December 31, 2008 and 2007
for assurance and related services by our principal independent accountants that
are reasonably related to the performance of the audit or review of our
financial statements (and are not reported under Item 9(e)(1) of Schedule
14A was $0 and $0, respectively.





Tax
Fees





The
aggregate fees billed during the fiscal years ended December 31, 2008 and 2007
for professional services rendered by our principal accountant tax compliance,
tax advice and tax planning was $880 and $830, respectively.





All
Other Fees





The aggregate
fees billed during the fiscal years ended December 31, 2008 and 2007 for
products and services provided by our principal independent accountants (other
than the services reported in Items 9(e)(1) through 9(e)(3) of Schedule 14A was
$0 and $0, respectively.





Page
40




ITEM 15. EXHIBITS.
  The
following exhibits are filed with this Annual Report on Form 10-K:




ExhibitNumber
            Description of
      Exhibit3.01
            Articles
      of Incorporation(1)3.02
            Restated
      Articles of Incorporation(1)3.03
            Bylaws(1)10.01
            Independent
      Contractor Agreement with James Wojtak dated October 11, 1999(1)10.02
            Restated
      Independent Contractor Agreement with James Wojtak dated February 18, 2000
      (1)10.03
            Independent
      Contractor Agreement with Ben De Soto dated December 5, 2002(1)10.04
            First
      Amendment to Independent Contractor Agreement with Ben De Soto dated
      February 11, 2003(1)10.05
            Independent
      Contractor Agreement with Gerry De Soto dated November 21, 2006(1)10.06
            2007
      Long Term Incentive Plan(2)31.01
            Certification
      of Principal Executive Officer Pursuant to Rule 13a-14(3)31.02
            Certification
      of Principal Financial Officer Pursuant to Rule 13a-14(3)32.01
            CEO
      and CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley
      Act(3)


___________________________________________________________________________________________________





(1)
            Incorporated
      by reference to our Registration Statement on Form 10SB filed with the SEC
      on April 12, 2007.(2)
            Incorporated
      by reference to our Annual Report on Form 10-KSB filed with the SEC on
      March 27, 2008.(3)
            Filed
      herewith.





*
            All
      exhibits are numbered with the number preceding the decimal indicating the
      applicable SEC reference number in Item 601 and the number following the
      decimal indicating the sequence of the particular
  document.





Page
41





SIGNATURES





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





ANOTEROS INC.








Dated:
March 17,
2009 ____________________________
 By: George G. Chachas
 Its: President and Principal Executive
Officer








Dated:
March 17,
2009 ____________________________
 By: George G. Chachas
 Its: Chief Financial Officer and
Principal Accounting Officer





Pursuant
to the requirement of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the Registrant and in the
capacities and on the dates indicated:








Dated:
March 17,
2009 ____________________________
 By: George G. Chachas, Sole
Director







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42