**UNITED
        STATES**
 **SECURITIES
        AND EXCHANGE COMMISSION**
 **Washington,
        DC 20549**
 **FORM
          10-Q**
 
  x
              **QUARTERLY
                  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                  EXCHANGE ACT OF 1934**
 **For
          the quarterly period ended September 30, 2007**
  OR
  ̈
              **TRANSITION
                  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                  EXCHANGE ACT OF 1934**
  Commission
        file number 000-26809
  **UVUMOBILE,
        INC.**
 (Exact
        name of registrant as specified in its charter)
  **Delaware**
              
              **91-1962104**(State
                  or other jurisdiction of incorporation or organization)
              
              (I.R.S.
                  Employer Identification No.)
  **2160
                  Satellite Boulevard, Suite 130, Duluth, Georgia**
              
              **30097**(Address
                  of principal executive offices)
              
              (Zip
                  Code)
  **(770)
        279-3100**
 Registrant's telephone
        number, including area code
  Indicate
        by check mark whether the registrant (1) has filed all reports required to
        be
        filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
        the
        past 12 months (or for such shorter period that the registrant was required
        to
        file such reports), and (2) has been subject to such filing requirements
        for the
        past 90 days.   Yes  xNo 
 ̈
  Indicate
        by check mark whether the registrant is a large accelerated filer, an
        accelerated filer, or a non-accelerated filer. See definition of accelerated
        filer and large accelerated filer in Rule 12(b)-2 of the Exchange
        Act.
  Large
        Accelerated Filer   ̈Accelerated
        Filer   ̈Non-accelerated
        Filerx
  Indicate
        by check mark whether the registrant is a shell company (as defined in Rule
        12b-2 of the Exchange Act): Yes   ̈ No  x
  The
        total
        number of shares of the issuer's common stock, $.001 par value, outstanding
        on
        November 9, 2007 was 67,511,966.
 
 
 
 
 **UVUMOBILE,
        INC.**
  **Index
        to Form 10-Q**
 
 Forward-Looking
                  Statements**PART
                  I - FINANCIAL INFORMATION**Item
                  1. Financial StatementsHistorical
                  Financial StatementsCondensed
                  Consolidated Balance Sheet
                  (Unaudited)
              1Condensed
                  Consolidated Statements of Operations
                  (Unaudited
              2Condensed
                  Consolidated Statements of Cash Flows
                  (Unaudited)
              3Notes
                  to Condensed Consolidated Financial Statements
                  (Unaudited)
              4-16Item
                  2. Management's Discussion and Analysis of Financial
                  Condition and Results of Operations
              17Item
                  3. Quantitative and Qualitative Disclosures About Market
                  RiskItem
                  4. Controls and Procedures
              22**PART
                  II - OTHER INFORMATION**
              23Item
                  1. Legal Proceedings
              23Item
                  2. Unregistered Sales of Equity Securities and Use of
                  Proceeds
              23Item
                  3. Submission of Matters to a Vote of Security
                  Holders
              23Item
                  6. Exhibits
              23Signatures
              24
 
 
 -i-
 *Index*
  *Unless
        the context otherwise requires, all references to “uVuMobile*TM***,”****“SmartVideo*TM*,”
the
        “Company,” “we,” “us” or “our” refers to uVuMobile, Inc. and its subsidiary.
        References in this report to annual financial data for uVuMobile refer to
        fiscal
        years ended December 31.*
  *General
        information about uVuMobile can be found at www.uvumobile.com. We make our
        annual report on Form 10-K, quarterly reports on Form 10-Q, current reports
        on
        Form 8-K and amendments to these reports filed or furnished pursuant to Section
        13 or 15(d) of the Securities Exchange Act of 1934 available free of charge
        on
        our website, as soon as reasonably practicable after they are electronically
        filed with the SEC. The information on our websites is not incorporated into
        this report.*
  **FORWARD-LOOKING
        STATEMENTS**
  We
        caution readers that this report includes “forward-looking statements” as that
        term is used in the Private Securities Litigation Reform Act of 1995.
        Forward-looking statements are based on current expectations rather than
        historical facts and they are indicated by words or phrases such as
“anticipate,” “could,” “may,” “might,” “potential,” “predict,” “should,”
“estimate,” “expect,” “project,” “believe,” “intend,” “plan,” “envision,”
“continue,” “target,” “contemplate,” or “will” and similar words or phrases or
        comparable terminology. We have based such forward-looking statements on
        our
        current expectations, assumptions, estimates and projections. While we believe
        these expectations, assumptions, estimates and projections are reasonable,
        such
        forward-looking statements are only predictions and involve known and unknown
        risks and uncertainties, and other factors that may cause actual results,
        performance or achievements to be materially different from any future results,
        performance or achievements expressed or implied by such forward-looking
        statements, many of which are beyond our control. Some of the factors that
        could
        affect our financial performance, cause actual results to differ from our
        estimates, or underlie such forward-looking statements, are set forth below
        and
        in various places in this report, including under the heading Item 2
“Management's Discussion and Analysis of Financial Condition and Results of
        Operations”. Additional factors that could lead to material changes in
        performance are contained in Item 1A. “Risk Factors” of our Annual Report on
        Form 10-K for the year ended December 31, 2006. These factors
        include:
 
 ·
              lack
                  of funding to continue our operations and our ability to obtain
                  future
                  financing or funds;
 ·
              general
                  economic conditions;
 ·
              significant
                  uncertainty inherent in the mobile entertainment services
                  industry;
 ·
              we
                  face intense and increasing competition from the telecommunications
                  industry and the satellite and cable television industry; new competitors
                  are likely to emerge and new technologies may further increase
                  competition;
 ·
              our
                  programming costs may increase beyond our current expectations
                  and we may
                  be unable to obtain or renew programming agreements on acceptable
                  terms or
                  at all;
 ·
              we
                  are heavily dependent on complex information technologies and their
                  support infrastructures; weaknesses in our information technology
                  systems
                  could have an adverse impact on our business; we may have difficulty
                  attracting and retaining qualified personnel to maintain our information
                  technology infrastructure;
 ·
              our
                  ability to successfully obtain a diverse customer base or retain
                  our
                  existing customers;
 ·
              our
                  ability to protect our intellectual property through patents, trademarks,
                  copyrights and confidentiality
                  agreements;
 ·
              our
                  ability to attract and retain a qualified employee
                  base;
 ·
              our
                  ability to respond to new developments in technology and new applications
                  of existing technology before our
                  competitors;
 ·
              our
                  ability to develop, maintain and enhance our strategic relationships
                  with
                  wireless carriers, Multi-Service Operators (MSO's), handset manufacturers
                  and distributors, key streaming media technology companies and
                  content
                  providers;
 ·
              acquisitions,
                  business combinations, strategic partnerships, divestures, and
                  other
                  significant transactions may involve additional
                  uncertainties;
 ·
              our
                  ability to maintain and execute a successful business strategy;
                  and
 ·
              we
                  may face other risks described from time to time in periodic and
                  current
                  reports we file with the United States Securities and Exchange
                  Commission
                  (“SEC”).
  You
        are
        cautioned not to place undue reliance on these forward-looking statements,
        which
        are valid only as of the date they were made. We undertake no obligation
        to
        update or revise any forward-looking statements to reflect new information
        or
        the occurrence of unanticipated events or otherwise.
  -ii-
 *Index*
 **PART
          I –
FINANCIAL********INFORMATION**
 
 **uVuMobile,
          Inc.**
 **Consolidated
          Balance Sheets**
 **September
          30, 2007 and December 31, 2006**
 
 **September
                    30,**
                
                
                **December
                    31,****2007**
                
                
                **2006****Assets**
                
                **(Unaudited)****Current
                    Assets**Cash
                
                $
                358,258
                
                
                $
                3,696,581Certificate
                    of deposit
                
                
                -
                
                
                
                201,447Accounts
                    receivable - net of allowance for doubtful accounts of $11,000
                    and
                    $0
                
                
                391,071
                
                
                
                162,795Broadcast
                    rights - net of accumulated amortization of $0 and
                    $2,273,192
                
                
                -
                
                
                
                301,281Prepaid
                    expenses
                
                
                37,288
                
                
                
                125,189**Total
                    Current Assets**
                
                ****
                **786,617**
                
                
                ****
                **4,487,293****Property
                    and Equipment, net of accumulated depreciation of $1,578,538
                    and
                    $936,614**
                
                ****
                **1,156,117**
                
                
                ****
                **1,541,390****Other
                    Assets**Broadcast
                    rights, net of current portion
                
                
                -
                
                
                
                310,384Intangible
                    assets - net of accumulated amortization of $95,881 and
                    $14,725
                
                
                217,911
                
                
                
                250,317Other
                
                
                36,111
                
                
                
                102,261**Total
                    Other Assets**
                
                ****
                **254,022**
                
                
                ****
                **662,962****Total
                    Assets**
                
                **$**
                **2,196,756**
                
                
                **$**
                **6,691,645****Liabilities
                    and Stockholders' Deficit****Current
                    Liabilities**Accounts
                    payable and accrued expenses
                
                $
                3,744,381
                
                
                $
                2,048,129Contracts
                    payable - broadcast rights
                
                
                225,000
                
                
                
                2,454,725Capital
                    lease obligations - current
                
                
                -
                
                
                
                33,255Deferred
                    current liabilities
                
                
                6,389
                
                
                
                20,248Due
                    to related parties
                
                
                203,300
                
                
                
                -Accrued
                    settlement expenses
                
                
                335,000
                
                
                
                5,022,000Loan
                    payable and related accrued interest
                
                
                235,729
                
                
                
                63,042**Total
                    Current Liabilities**
                
                ****
                **4,749,799**
                
                
                ****
                **9,641,399****Long-term
                    Liabilities**Contracts
                    payable - broadcast rights - net of current portion
                
                
                -
                
                
                
                979,851Capital
                    lease obligations - net of current portion
                
                
                -
                
                
                
                161,089**Total
                    Long-Term Liabilities**
                
                ****
                **-**
                
                
                ****
                **1,140,940****Total
                    Liabilities**
                
                ****
                **4,749,799**
                
                
                ****
                **10,782,339****Commitments
                    and Contingencies****Stockholders'
                    Deficit**Preferred
                    stock, Series A-1, Convertible, $.001 par value, 50,000,000 shares
                    authorized, 11,666,666 shares issued and 266,666 outstanding
                    as of
                    September 30, 2007,11,666,666 shares issued and 2,633,333 outstanding
                    as
                    of December 31, 2006
                
                
                267
                
                
                
                2,634Common
                    stock, $.001 par value, 150,000,000 shares authorized, 67,211,966
                    shares
                    issued and outstanding as of September 30, 2007, 47,292,284 shares
                    issued
                    and outstanding as of December 31, 2006
                
                
                67,212
                
                
                
                47,288Additional
                     paid-in capital
                
                
                70,168,012
                
                
                
                61,179,644Less:
                    Deferred consulting fees
                
                
                (7,192
                )
                
                
                (877,628
                )Accumulated
                    deficit
                
                
                (72,781,342
                )
                
                
                (64,442,632
                )**Total
                    Stockholders' Deficit**
                
                ****
                **(2,553,043**
                **)**
                
                ****
                **(4,090,694**
                **)****Total
                    Liabilities and Stockholders' Deficit**
                
                **$**
                **2,196,756**
                
                
                **$**
                **6,691,645**
 
 **See
          accompanying notes to consolidated financial
          statements**




-1-
 *Index*




**uVuMobile,
        Inc.**
 **Consolidated
        Statements of Operations**
 **(Unaudited)**
 
 **For
                  the Three Months Ended**
              
              
              **For
                  the Nine Months Ended****September
                  30,**
              
              
              **September
                  30,****2007**
              
              
              **2006**
              
              
              **2007**
              
              
              **2006****Revenues**Revenue
              
              $
              202,886
              
              
              $
              197,302
              
              
              $
              815,787
              
              
              $
              476,700**Total
                  Revenues**
              
              ****
              **202,886**
              
              
              ****
              **197,302**
              
              
              ****
              **815,787**
              
              
              ****
              **476,700****Cost
                  of Goods Sold**Cost
                  of goods sold
              
              ****
              **122,750**
              
              
              ****
              **-**
              
              
              ****
              **381,473**
              
              
              ****
              **-****Total
                  Cost of Goods Sold**
              
              ****
              **122,750**
              
              
              ****
              **-**
              
              
              ****
              **381,473**
              
              
              ****
              **-****Gross
                  Profit**
              
              ****
              **80,136**
              
              
              ****
              **197,302**
              
              
              ****
              **434,314**
              
              
              ****
              **476,700****Operating
                  Expenses**Broadcast
                  rights
              
              
              22,547
              
              
              
              616,756
              
              
              
              177,388
              
              
              
              1,774,781Impairment
                  of broadcast rights
              
              
              (742,951
              )
              
              
              -
              
              
              
              (1,475,316
              )
              
              
              -Compensation
                  and benefits
              
              
              393,216
              
              
              
              727,324
              
              
              
              1,709,920
              
              
              
              2,029,062Consulting
                  and professional fees
              
              
              281,752
              
              
              
              522,931
              
              
              
              1,210,499
              
              
              
              2,790,547Data
                  center
              
              
              195,384
              
              
              
              200,163
              
              
              
              666,325
              
              
              
              705,375Depreciation
              
              
              241,536
              
              
              
              156,757
              
              
              
              723,077
              
              
              
              407,858Settlement
                  expense
              
              
              142,927
              
              
              
              57,000
              
              
              
              1,431,427
              
              
              
              705,000Stock-based
                  compensation
              
              
              612,813
              
              
              
              1,658,705
              
              
              
              2,965,519
              
              
              
              3,833,498Selling,
                  general and administrative
              
              
              334,126
              
              
              
              541,689
              
              
              
              1,374,057
              
              
              
              2,187,770**Total
                  Operating Expenses**
              
              ****
              **1,481,350**
              
              
              ****
              **4,481,325**
              
              
              ****
              **8,782,896**
              
              
              ****
              **14,433,891****Loss
                  from Operations**
              
              ****
              **(1,401,214**
              **)**
              
              ****
              **(4,284,023**
              **)**
              
              ****
              **(8,348,582**
              **)**
              
              ****
              **(13,957,191**
              **)****Other
                  Income (Expense)**Interest
                  income
              
              
              4,293
              
              
              
              140,960
              
              
              
              36,612
              
              
              
              161,210Interest
                  expense
              
              
              (17,118
              )
              
              
              (4,831
              )
              
              
              (26,741
              )
              
              
              50,986**Total
                  Other Income (Expense), Net**
              
              ****
              **(12,825**
              **)**
              
              ****
              **136,129**
              
              
              ****
              **9,871**
              
              
              ****
              **212,196****Net
                  Loss**
              
              **$**
              **(1,414,039**
              **)**
              
              **$**
              **(4,147,894**
              **)**
              
              **$**
              **(8,338,711**
              **)**
              
              **$**
              **(13,744,995**
              **)**Net
                  Loss per Share - Basic and Diluted
              
              $
              (0.02
              )
              
              $
              (0.09
              )
              
              $
              (0.14
              )
              
              $
              (0.36
              )Weighted
                  Average Common Shares Outstanding
                  during the Period
              
              
              **64,381,733**
              
              
              
              **45,260,203**
              
              
              
              **58,659,916**
              
              
              
              **37,959,443**
  **See
        accompanying notes to unaudited consolidated financial
        statements**
  -2-
 *Index*
  **uVuMobile,Inc.**
 **Consolidated
          Statements of Cash Flows**
 **(Unaudited)**
 
 **For
                    the Nine Months Ended****September
                    30,****2007**
                
                
                **2006****Cash
                    Flows from Operating Activities**Net
                    loss
                
                $
                (8,338,711
                )
                
                $
                (13,744,995
                )Adjustments
                    to reconcile net loss to net cash used
                    in operating activities:Amortization
                    of stock options pursuant to SFAS No. 123R
                
                
                -
                
                
                
                2,119,252Amortization
                    of stock based compensation
                
                
                870,436
                
                
                
                1,557,690Amortization
                    of broadcast rights
                
                
                149,975
                
                
                
                1,824,024Impairment
                    of Broadcast rights
                
                
                (1,475,316
                )
                
                
                -Bad
                    debt
                
                
                11,000
                
                
                
                (77,889
                )Depreciation
                
                
                723,080
                
                
                
                407,858Issuance
                    of common stock for legal settlement
                
                
                1,228,500
                
                
                
                705,000Non-cash,
                    stock-based compensation
                
                
                2,204,454
                
                
                
                1,852,369Changes
                    in operating assets and liabilities:(Increase)
                    Decrease in:Accounts
                    receivable
                
                
                (239,276
                )
                
                
                77,889Prepaid
                    expenses
                
                
                87,901
                
                
                
                (106,640
                )Restricted
                    cash
                
                
                (66,037
                )
                
                
                -Intangible
                    assets
                
                
                113
                
                
                
                -Marketable
                    securities
                
                
                (48,750
                )
                
                
                -Other
                    Current assets
                
                
                611,665
                
                
                
                (224,162
                )Other
                    assets
                
                
                201,447
                
                
                
                97,082Increase
                    (Decrease) in:Accounts
                    payable and accrued expenses
                
                
                1,814,531
                
                
                
                (624,742
                )Accrued
                    interest payable
                
                
                2,385
                
                
                
                (62,104
                )Deferred
                    revenues
                
                
                (13,859
                )
                
                
                -Escrow
                    payable / Deposit liability
                
                
                -
                
                
                
                -Contracts
                    rights payable
                
                
                (1,734,260
                )
                
                
                -Repayments
                    on acquired broadcast rights
                
                
                -
                
                
                
                (1,695,000
                )**Net
                    Cash Used in Operating Activities**
                
                ****
                **(4,010,722**
                **)**
                
                ****
                **(7,894,368**
                **)****Cash
                    Flows from Investing Activities**Purchase
                    of equipment
                
                
                (305,402
                )
                
                
                (1,048,676
                )**Net
                    Cash Used in Investing Activities**
                
                ****
                **(305,402**
                **)**
                
                ****
                **(1,048,676**
                **)****Cash
                    Flows from Financing Activities**Redemption
                    of warrants
                
                
                (2,888
                )
                
                
                (70,667
                )Issuance
                    of common stock for cash
                
                
                738,221
                
                
                
                9,000,000Proceeds
                    from warrant exercises
                
                
                -
                
                
                
                943,975Bridge
                    Loans
                
                
                370,302
                
                
                
                -Capital
                    lease obligations
                
                
                (127,834
                )
                
                
                -**Net
                    Cash Provided by Financing Activities**
                
                ****
                **977,801**
                
                
                ****
                **9,873,308**Net
                    (Decrease), Increase in cash and cash equivalents
                
                
                (3,338,323
                )
                
                
                930,264Cash
                    - Beginning of year
                
                
                3,696,581
                
                
                
                5,792,566**Cash
                    - End of Period**
                
                **$**
                **358,258**
                
                
                **$**
                **6,722,830****Supplemental
                    Disclosure of Cash Flow Information**Cash
                    paid for:Income
                    taxes
                
                $
                -
                
                
                $
                -Interest
                
                $
                -
                
                
                $
                -**Supplemental
                    Disclosure of Non-Cash Investing and Financing
                    Activities**Acquisition
                    of broadcast rights
                
                $
                -
                
                
                $
                84,000Issuance
                    of common stock to acquire software
                
                $
                -
                
                
                $
                208,000Issuance
                    of common stock for settlement of accounts payable
                
                $
                -
                
                
                $
                149,637Issuance
                    of common stock for settlement of litigation
                
                $
                -
                
                
                $
                -Issuance
                    of convertible preferred stock to settle accrued
                    litigation
                
                $
                -
                
                
                $
                4,750,000Issuance
                    of common stock pursuant to anti-dilution agreement
                
                $
                -
                
                
                $
                1,122Conversion
                    of convertible preferred stock to common stock
                
                $
                -
                
                
                $
                8,497Forfeiture
                    of stock based compensation
                
                $
                -
                
                
                $
                271,563Options
                    granted for future services
                
                $
                -
                
                
                $
                1,775,727Non-cash
                    financing activities
                
                $
                350,638
                
                
                $
                -
  **See
          accompanying notes to unaudited consolidated financial
          statements**
  -3-
 *Index*
  **uVuMobile,
        Inc**
 **Notes
        to Consolidated Financial
        Statements**
 **(Unaudited)**
  **Note
          1 - Organization**
  uVuMobile,
          Inc. (“uVuMobileTM” or “the Company”), formerly known as smarTVideo Technologies,
          Inc., was incorporated in Florida on August 17, 1984, and on December 19,
          2000,
          changed its corporate domicile to Delaware. Its wholly-owned subsidiary,
          OVT,
          Inc., (“OVT”) was incorporated in the state of Georgia on August 31, 2000.
          uVuMobile is a media distribution services company in the business of obtaining
          the rights to video and television content for the mobile handset market
          and
          delivering the video content for a fee or a portion of the associated
          advertising revenue. The Company specializes in the distribution of high-quality
          video and programming through devices connected to the public Internet
          and is
          currently focused on distribution to mobile display devices, cell phones
          and
          PDAs connected to the public Internet via wireless data networks and
          Wi-Fi.
 
 In
          January 2007, the Company announced its intent to seek stockholder approval
          to
          change the name of the Company to uVuMobile, Inc. to better reflect the
          corporate brand and new products. More specifically, the Company is developing
          a
          new suite of products and platforms, which are expected to include backend
          media
          hosting, application development, mobile marketing, messaging, content
          aggregation, billing, advertising and other services directed towards the
          mobile
          business-to-business market. On February 14, 2007, the Company initiated
          this
          process by distributing a consent solicitation statement to its stockholders
          seeking consent to amend its Certificate of Incorporation to effect the
          name
          change. On May 3, 2007, the Company announced that as of April 9, 2007
          it had
          received the consent of the holders of approximately 58% of its stock
          to change its corporate name to uVuMobile, Inc.  On June 1,
          2007 the Company changed its name to uVuMobile, Inc.
 
 On
          June
          21, 2007 the Company announced it has shifted its business model to allow
          uVuMobile to focus engineering and new business efforts on its business
          to
          business mobile platform.  In connection with this shift in the
          business model, the Company has transitioned out of its branded direct
          to
          consumer mobile television subscription business.
 
 **Note
          2 - Going Concern, SignificantAccountingPolicies and Risks and
          Uncertainties**
  ***(A)
          Going Concern***
  As
          reflected in the accompanying unaudited consolidated financial statements,
          the
          Company has a net loss of $8,338,711 and net cash used in operations of
          $4,010,722, respectively for the nine month period ended September 30,
          2007. The
          Company also has an accumulated deficit of $72,781,342 at September 30,
          2007.
 
 Based
          on
          information currently available regarding our proposed plans and assumptions
          relating to operations we anticipate that the net proceeds from the closing
          of
          our financings in 2007, together with revenues generated from operations,
          will
          not be sufficient to meet our cash requirements for working capital and
          capital
          expenditures beyond the fourth quarter of 2007. There can be no assurance
          that
          the Company will be able to secure additional financing on acceptable terms
          at
          or prior to the depletion of existing funds, or at all. If adequate funds
          are
          not available or not available on acceptable terms, the Company will be
          unable
          to continue as a going concern. The Company has no firm commitment for
          any
          additional capital.
 
 ***(B)
          Basis of Presentation***
 
 The
          accompanying unaudited condensed consolidated financial statements have
          been
          prepared in accordance with accounting principles generally accepted in
          the
          United States (“GAAP”) and with the instructions to Form 10-Q for interim
          financial information. Accordingly, these unaudited condensed consolidated
          financial statements do not include all of the information and notes required
          for complete financial statements. In the Company's opinion, all adjustments
          (consisting of normal recurring adjustments) considered necessary for a
          fair
          presentation have been included. Certain prior year amounts have been
          reclassified to conform to the current year presentation. Operating results
          for
          the three months ended September 30, 2007 are not necessarily indicative
          of the
          results that may be expected for the year ending December 31, 2007. For
          further information, refer to the consolidated financial statements and
          notes
          thereto included in the Company's Annual Report on Form 10-K for the year
          ended December 31, 2006.
 
 ***(C)
          Use of Estimates***
 
 In
          preparing financial statements, management is required to make estimates
          and
          assumptions that affect the reported amounts of assets and liabilities,
          disclosure of contingent assets and liabilities at the date of the financial
          statements, and revenues and expenses during the periods presented. Actual
          results may differ from these estimates.
  Significant
          estimates during 2007 and 2006 include depreciable lives on property and
          equipment, the valuation of stock options/warrants granted for services,
          the
          value of warrants issued in connection with debt and equity related financings,
          valuation and related amortization of intangible broadcast rights pursuant
          to
          Statement of Financial Accounting Standards (“SFAS”) No. 63 and the valuation
          allowance for deferred tax assets since the Company had continuing operating
          losses.
  -4-
 *Index*
 **uVuMobile,
            Inc**
 **Notes
            to Consolidated Financial
            Statements**
 **(Unaudited)**
 **Note
          2 - Going Concern, Significant Accounting Policies and Risks and Uncertainties
–
Continued**
 
 ***(D)
          Cash and Cash Equivalents***
  For
          the
          purpose of the cash flow statements, the Company considers all highly liquid
          investments with original maturities of three months or less at the time
          of
          purchase to be cash equivalents.
 
 The
          Company minimizes its credit risk associated with cash by periodically
          evaluating the credit quality of its primary financial institution. The
          balance
          at times may exceed federally insured limits. At September 30, 2007, the
          balance
          exceeded the federally insured limit by $243,258. Additionally, at
          September 30, 2007, the Company had $15,000 maintained under a compensating
          balance agreement. The $15,000 is retained due to potential credit card
          charge
          backs that are unforeseen.
 
 ***(E)
          Equipment***
  Equipment
          consisting primarily of computer equipment is stated at cost. Depreciation
          is
          computed using the straight-line method over the estimated useful lives
          of the
          assets, which is generally three years. Depreciation expense for the three
          and
          nine month periods are detailed as follows:
  **For
                    the Three Months Ended**
                
                
                **For
                    the Nine Months Ended****September
                    30,**
                
                
                **September
                    30,****2007**
                
                
                **2006**
                
                
                **2007**
                
                
                **2006**Depreciation
                
                $
                241,536
                
                
                $
                156,757
                
                
                $
                723,077
                
                
                $
                407,858Equipment
                    consists of the following:**September 30,**
                
                
                **December 31,****2007**
                
                
                **2006**Computer
                    Equipment
                
                $
                2,655,155
                
                
                $
                2,398,504Proprietary
                    softwaredevelopment
                
                
                79,500
                
                
                
                79,5002,734,655
                
                
                
                2,478,004Less
                    accumulated depreciation
                
                
                (1,578,538
                )
                
                
                (936,614
                )Property
                    and equipment, net
                
                $
                1,156,117
                
                
                $
                1,541,390
   ***(F)
          Broadcast Rights***
  The
          Company acquires rights to programming so that it may deliver this programming
          to its subscribers. The costs incurred in acquiring programs are capitalized
          and
          amortized over the license period or projected useful life of the programming.
          The broadcast rights are accounted for according to SFAS No. 63 “Financial
          Reporting by Broadcasters”. Program rights and the related liabilities are
          recorded at the gross amount of the liabilities when the license period
          has
          begun, the cost of the program is determinable, and the program is accepted
          and
          available for airing.
 
 ***(G)
          Accounts Receivable***
  Substantially
          all of the Company's accounts receivable are due from end-users. Collateral
          is
          not required. Credit losses are provided for in the consolidated financial
          statements. The Company has a limited history in evaluating such credit
          losses.
 
 ***(H)
          Allowance for Doubtful Accounts***
  Management
          estimates the amount of required allowances for potential non-collectibility
          of
          accounts receivable based upon past collection experience and consideration
          of
          other relevant factors. However, past experience may not be indicative
          of future
          collections and therefore additional charges could be incurred in the future
          to
          reflect differences between estimated and actual collections.  The
          allowance for doubtful accounts at September 30, 2007 as $11,000 and at
          December
          31, 2006 was $0.
 
 ***(I)
          Earnings (Loss) Per Share***
  In
          accordance with SFAS No. 128, “Earnings per Share” (“EPS”), basic earnings per
          share is computed by dividing the net income (loss) less preferred dividends
          for
          the period by the weighted average number of shares outstanding. Diluted
          earnings per share is computed by dividing net income (loss) less preferred
          dividends by the weighted average number of shares outstanding including
          the
          effect of share equivalents. Common share equivalents consist of shares
          issuable
          upon the exercise of certain common stock purchase warrants, stock options,
          and
          Convertible Preferred Stock. The Company has excluded these common share
          equivalents from its computation of earnings per share due to their antidilutive
          effect as the Company has reflected a net loss at September 30, 2007 and
          2006,
          respectively. Accordingly, the basic and diluted EPS are the same.
  -5-
 *Index*
  **uVuMobile,
            Inc**
 **Notes
            to Consolidated Financial
            Statements**
 **(Unaudited)**
 **Note
          2 - Going Concern, Significant Accounting Policies and Risks and Uncertainties
–
(continued)**
 
 The
          following table is a summary of common stock equivalents outstanding at
          September 30, 2007 and 2006, respectively.
  **September
                      30,****2007**
                  
                  
                  **2006**Common
                      Stock Options
                  
                  
                  9,260,000
                  
                  
                  
                  8,035,000Common
                      Stock Warrants
                  
                  
                  8,173,837
                  
                  
                  
                  35,010,149Total
                      Common Stock Options and Warrants
                  
                  
                  17,433,837
                  
                  
                  
                  43,045,149
 
 ***(J)
            Stock-based Compensation***
  Effective
            January 1, 2006, we adopted SFAS No. 123(R),*Share-Based Payment*
            utilizing the prospective method. SFAS No. 123(R) requires the measurement
            of
            stock-based compensation expense based on the fair value of the award
            on the
            date of grant. Under the prospective method, the provisions of SFAS No.
            123(R)
            apply to all awards granted or modified after the date of adoption.
 
 ***(K)
            Revenue Recognition***
  The
            Company follows the guidance of the SEC's Staff Accounting Bulletin No.
            104 for
            revenue recognition.  In general, the Company records revenue when
            persuasive evidence of an arrangement exists, services have been rendered
            or
            product delivery has occurred, the sales price to the customer is fixed
            or
            determinable, and collectability is reasonably assured.
  The
            Company provides services to our business-to-business customers under
            volume-based usage arrangements of our digital media and multimedia broadcast
            products and services. Under certain arrangements, the customers are
            subject to
            a base monthly fee or minimum monthly usage requirement in order to maintain
            a
            customer's preferential negotiated rates. From time-to-time, the Company
            may
            also lease hardware to its customers enabling them to facilitate a live
            broadcast. In certain situations, the Company may sell hardware to its
            resellers
            under the specific terms of the agreements with them.
  Revenue
            is also recognized as earned upon the delivery of services to the Company's
            subscription-based customers. This is typically when a digital media
            or
            multimedia broadcast is viewed. Many of the Company's subscription-based
            customers access its programming through the purchase of a monthly, semi-annual,
            or annual subscription fee for SmartVideo's mobile entertainment services.
            Revenue received on annual subscriptions is deferred and therefore is
            recognized
            ratably over the term of the contract.
  ***(L)
            Income Taxes***
  The
            Company accounts for income taxes under the Financial Accounting Standards
            (“FAS”) No. 109 “Accounting for Income Taxes” (“Statement 109”). Under Statement
            109, deferred tax assets and liabilities are recognized for the future
            tax
            consequences attributable to differences between the financial statement
            carrying amounts of existing assets and liabilities and their respective
            tax
            bases. Deferred tax assets and liabilities are measured using enacted
            tax rates
            expected to apply to taxable income in the years in which those temporary
            differences are expected to be recovered or settled. Under Statement
            109, the
            effect on deferred tax assets and liabilities of a change in tax rates
            is
            recognized in income in the period, which includes the enactment
            date.
 
 ***(M)
            Derivative Liabilities***
  In
            June
            2005, the Emerging Issues Task Force ("EITF") issued EITF 05-2, “The Meaning of
            Conventional Convertible Debt Instrument in Issue No. 00-19". EITF 05-2
            retained
            the definition of a conventional convertible debt instrument as set forth
            in
            EITF 00-19, and which is used in determining certain exemptions to the
            accounting treatments prescribed under SFAS 133, "Accounting for Derivative
            Instruments and Hedging Activities". EITF 05-2 also clarified that certain
            contingencies related to the exercise of a conversion option would not
            be
            outside the definition of "conventional" and determined that Convertible
            Preferred Stock with a mandatory redemption date would also qualify for
            similar
            exemptions if the economic characteristics of the preferred stock are
            more akin
            to debt than equity. EITF 05-2 is effective for new instruments entered
            into and
            instruments modified in periods beginning after June 29, 2005. We adopted
            the
            provisions of EITF 05-2 on July 1, 2005, which did not have a material
            effect on
            our unaudited consolidated financial position, results of operations
            and cash
            flows.
 
 In
            July
            2005, the FASB issued FASB Staff Position ("FSP") 150-5, "Accounting
            Under SFAS
            150 for Freestanding Warrants and Other Similar Instruments on Redeemable
            Shares". FSP 150-5 clarifies that warrants on shares that are redeemable
            or
            puttable immediately upon exercise and warrants on shares that are redeemable
            or
            puttable in the future qualify as liabilities under SFAS 150, regardless
            of the
            redemption feature or redemption price. The FSP is effective for the
            first
            reporting period beginning after June 30, 2005, with resulting changes
            to prior
            period statements reported as the cumulative effect of an accounting
            change in
            accordance with the transition provisions of SFAS 150. We adopted the
            provisions
            of FSP 150-5 on July 1, 2005, which did not have a material effect on
            our
            unaudited consolidated financial position, results of operations and
            cash
            flows.
  -6-
 *Index*
  **uVuMobile,
              Inc**
 **Notes
              to Consolidated Financial
              Statements**
 **(Unaudited)**
 **Note
            2 - Going Concern, Significant Accounting Policies and Risks and Uncertainties
–
(continued)**
 
 ***(N)
            Product Concentration***
  The
            Company derives a substantial portion of its revenues from five types
            of
            products: business-to-business, direct-to-consumer mobile video service,
            hosting
            services, and custom applications.
   **For
                      the Three Months Ended**
                  
                  
                  **For
                      the Nine Months Ended****September
                      30,**
                  
                  
                  **September
                      30,****2007**
                  
                  
                  **2006**
                  
                  
                  **2007**
                  
                  
                  **2006**Business-to-business
                  
                  $
                  10,014
                  
                  
                  
                  5
                  %
                  
                  $
                  20,409
                  
                  
                  
                  10
                  %
                  
                  $
                  19,682
                  
                  
                  
                  2
                  %
                  
                  $
                  69,380
                  
                  
                  
                  15
                  %Direct-to-consumer
                  
                  
                  36,872
                  
                  
                  
                  18
                  %
                  
                  
                  153,863
                  
                  
                  
                  78
                  %
                  
                  
                  235,449
                  
                  
                  
                  29
                  %
                  
                  
                  384,290
                  
                  
                  
                  81
                  %Hosting
                      services
                  
                  
                  -
                  
                  
                  
                  0
                  %
                  
                  
                  -
                  
                  
                  
                  0
                  %
                  
                  
                  37,500
                  
                  
                  
                  5
                  %
                  
                  
                  -
                  
                  
                  
                  0
                  %Mobile
                      Advertising
                  
                  
                  -
                  
                  
                  
                  0
                  %
                  
                  
                  23,030
                  
                  
                  
                  12
                  %
                  
                  
                  -
                  
                  
                  
                  0
                  %
                  
                  
                  23,030
                  
                  
                  
                  5
                  %Custom
                      applications
                  
                  
                  156,000
                  
                  
                  
                  77
                  %
                  
                  
                  -
                  
                  
                  
                  0
                  %
                  
                  
                  523,156
                  
                  
                  
                  64
                  %
                  
                  
                  -
                  
                  
                  
                  0
                  %Total
                      Revenue
                  
                  $
                  202,886
                  
                  
                  
                  100
                  %
                  
                  $
                  197,302
                  
                  
                  
                  100
                  %
                  
                  $
                  815,787
                  
                  
                  
                  100
                  %
                  
                  $
                  476,700
                  
                  
                  
                  100
                  %
 
 The
            Company could experience declines in demand for products, whether as
            a result of
            general economic conditions, new competitive product releases, price
            competition, lack of market acceptance, technological change or other
            factors.
 
 ***(O)
            Long-Lived Assets***
  The
            Company accounts for long-lived assets in accordance with the provisions
            of SFAS
            No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets.” SFAS
            No. 144 requires that long-lived assets be reviewed for impairment whenever
            events or changes in circumstances indicate that the carrying amount
            of an asset
            may not be recoverable. Recoverability of assets to be held and used
            is measured
            by a comparison of the carrying amount of an asset to future undiscounted
            net
            cash flows expected to be generated by the asset. If such assets are
            considered
            to be impaired, the impairment to be recognized is measured by the amount
            by
            which the carrying amount of the assets exceeds the fair value of the
            assets.
            Assets to be disposed of are reported at the lower of the carrying amount
            or
            fair value less costs to sell the asset.
 
 ***(P)
            Intangible Assets***
  The
            Company accounts for intangible assets in accordance with the
            provisions of Statement of Financial Accounting Standards No. 142, “Goodwill and
            Other Intangible Assets” (“SFAS 142”), which requires goodwill and intangible
            assets with indefinite useful lives not be amortized, but be tested for
            impairment annually or whenever indicators or impairments arise. Intangible
            assets that have finite lives continue to be amortized over their estimated
            useful lives. Our intangible assets consist of contract based
            intangibles.
 
 During
            November 2006, we entered into an agreement with Diggit Entertainment
            Group
            (“Diggit”) for the distribution arrangements to provide for the management of
            the mobile platform, assets and carrier relationships for both Vibe and
            Spin
            magazines for an aggregate price of $301,750, plus transactions
            costs.
 
 As
            of
            September 30, 2007 and December 31, 2006, our identifiable intangible
            assets
            subject to amortization consisted of the following:
  **As
                        of****September
                        30, 2007**
                    
                    
                    **December
                        31, 2006****Intangible
                        Assets**
                    
                    
                    **Accumulated
                        Amortization**
                    
                    
                    **Intangible
                        Assets**
                    
                    
                    **Accumulated
                        Amortization**Contract
                        based
                    
                    
                    313,792
                    
                    
                    
                    95,881
                    
                    
                    $
                    265,042
                    
                    
                    $
                    14,725**Total**
                    
                    **$**
                    **313,792**
                    
                    
                    **$**
                    **95,881**
                    
                    
                    **$**
                    **265,042**
                    
                    
                    **$**
                    **14,725**
  Amortization
            of these intangible assets, recorded on a straight line basis over an
            average
            finite useful life of 3 years was $14,725 for the year ended December
            31, 2006.
            The aggregate amortization expense is estimated to be approximately $104,597
            for
            2007, $104,597 for 2008, and $87,164 for 2009.
  -7-
 *Index*
  **uVuMobile,
              Inc**
 **Notes
              to Consolidated Financial
              Statements**
 **(Unaudited)**
 **Note
            2 - Going Concern, Significant Accounting Policies and Risks and Uncertainties
–
(continued)**
  ***(Q)
            Capital Lease Obligations***
  Capital
            lease obligations consist of the following:
  **As
                      of****September
                      30,**
                  
                  
                  **December
                      31,****2007**
                  
                  
                  **2006**Equipment
                      financed under capital lease obligations
                  
                  $
                  -
                  
                  
                  $
                  194,344Total
                  
                  $
                  -
                  
                  
                  $
                  194,344Less
                      current portion
                  
                  
                  -
                  
                  
                  
                  (33,255
                  )Capital
                      lease obligations, net of current portion
                  
                  $
                  -
                  
                  
                  $
                  161,089
 
 In
            December 2006, the Company financed the purchase of equipment for our
            data
            center from Banc of America Capital Lease.  On September 11,
            2007 the Company paid off the remaining balance of the Capital Lease
            obligation.
  **Note
            3 - Broadcast Rights**
  **(A)                     Asset**
  For
            the
            nine months ended September 30, 2007, amortization expense of broadcast
            rights
            accounted for $149,975 of the total broadcast rights expense of $177,388.
            Included in the total expense of $154,842 is approximately $0 in credits
            that were reflected in the nine months ended September 30, 2007. For
            the quarter
            ended September 30, 2007, amortization expense of broadcast rights accounted
            for
            $0.00 of the total broadcast rights expense of $22,547.
  For
            the
            nine months ended September 30, 2007 the Broadcast Rights Assets - net
            of
            accumulated amortization was $0. Broadcast Rights Assets - net of current
            portion was $0. At December 31, 2006 the Broadcast Rights Assets - net
            of
            accumulated amortization were $301,281. Broadcast Rights Assets - net
            of current
            portion was $310,384.
  **(B)                     Liability**
 At
            September 30, 2007 and 2006, the Company paid $120,810 and $1,695,000,
            respectively to content providers pursuant to the terms of the related
            contracts.
  Contracts
            payable - short term at September 30, 2007 were $225,000. Contracts payable
            -
            long-term at September 30, 2007 were $0. Contracts payable - short term
            at
            December 31, 2006 were $2,454,725. Contracts payable - long-term at December
            31,
            2006 were $979,851.
  **Note
            4 - Shareholders' Equity**
  **(A)                     Preferred
            Stock**
  ***(1)
            Capital Structure***
  As
            of
            September 30, 2007 the authorized Preferred Stock of the Company consists
            of
            50,000,000 shares of $.001 par value Series A-1 Preferred Stock of which
            11,666,666 shares are issued and 266,666 shares are outstanding and are
            designated as convertible.
  **(B)                     Common
            Stock Issuances**
  ***(1)*** ***Capital
            Structure***
  As
            of
            September 30, 2007, the authorized common stock of the Company consists
            of
            150,000,000 shares of $.001 par value.
  ***(2)*** ***Preferred
            Stock Conversions***
  During
            the nine months ended September 30, 2007, the Company converted 2,366,666
            shares
            of Series A-1 Convertible Preferred Stock to shares of common stock on
            a
            one-to-one basis.
  -8-
 *Index*
  **uVuMobile,
              Inc**
 **Notes
              to Consolidated Financial
              Statements**
 **(Unaudited)**
 **Note
            4 – Shareholders’ Equity – (continued)**
  ***(3)*** ***Settlements***
  During
            the nine months ended September 30, 2007, the Company settled five outstanding
            legal matters with unrelated third parties by issuing an aggregate of
            9,425,000
            shares of common stock having an aggregate fair value of $5,715,500.
            Fair value
            was determined based on the quoted closing trading price on the dates
            of
            settlement. The share prices on the dates of issuance ranged from $0.185
            - $0.80
            per share.
 
 ***(4)*** ***Warrant
            Conversions***
  During
            the nine months ended September 30, 2007, the Company redeemed 28,875
            callable
            warrants at a price of $0.10 per warrant for a total payment of $2,888
            which
            also reduced additional paid-in capital by $2,888.
 
 On
            March
            9, 2007, we commenced an Offer to Amend and Exchange certain of our outstanding
            warrants. The offer provided holders of certain warrants the opportunity
            to
            amend and immediately exercise any or all of their warrants for a significantly
            reduced exercise price by either paying the exercise price in cash or
            by
            tendering a specified number of warrants for each share of common stock
            being
            purchased. The offer expired at 5:00 p.m., Eastern Time, on April 20,
            2007. As
            of that time, approximately 80% of warrants subject to the offer had
            been
            tendered. Upon waiver by our Board of Directors of a specified closing
            condition
            that had not been met as of the time our offer expired, we accepted all
            warrants
            validly tendered pursuant to the terms of the offer on April 20, 2007.
            Through
            the offer, we generated approximately $738,000 in gross proceeds available
            for
            our use to fund our operations.
 
 ***(5)*** ***Non-Cash
            Financing Activities***
  During
            the nine months ended September 30, 2007, as a result of the forgiveness
            of
            three Bridge Loans from former directors Messrs. Abdo, Oros and Stanley,
            the
            Company increased paid in capital by $300,000.  In addition, the
            Company recorded $50,638 in additional paid in capital for the allocation
            of the
            relative fair value of warrants issued to the holders of the six Bridge
            Loans:
            Jerry Bratton, Roy Jones, Drew Arnold, Chris Carson, Joseph Fitzpatrick
            and KLC
            Ventures, Inc. (the “Lenders”).
 
 The
            following is a summary of all common stock issued during the nine months
            ended
            September 30, 2007:
  **QUANTITY****ACTIVITY**
                  
                  **OF
                      SHARES**
                  
                  
                  **VALUATION**Preferred
                      Stock Conversions
                  
                  
                  2,366,666
                  
                  
                  
                  -Settlements
                  
                  
                  9,425,000
                  
                  
                  
                  5,715,500Warrant
                      Tender Offer
                  
                  
                  8,128,016
                  
                  
                  
                  738,221Non-Cash
                      Financing Activities
                  
                  
                  -
                  
                  
                  
                  350,638Totals
                  
                  
                  19,919,682
                  
                  
                  
                  6,804,359
 
  **(C)**
                  **Other
                      Grants of Common Stock Options and
                      Warrants**
  ***(1)*** ***2004
            Equity Incentive Plan***
  The
            Board
            of Directors of the Company adopted the 2004 Stock Incentive Plan (“2004 Plan”)
            effective January 1, 2004, to provide incentives to attract and retain
            officers,
            directors, and key employees. The 2004 Plan allows for the issuance of
            up to
            5,000,000 shares of common stock and was approved by the shareholders
            at the
            annual meeting held on August 31, 2004.
 
 ***(2)*** ***2005
            Equity Incentive Plan***
  The
            Board
            of Directors of the Company adopted the 2005 Equity Incentive Plan (“2005 Plan”)
            on January 3, 2006 to provide incentives to attract and retain participating
            officers, directors, employees, consultants and advisors. The 2005 Plan
            allows
            for the issuance of 10,000,000 shares of common stock in the form of
            incentive
            awards, including, without limitation, stock options and restricted stock
            and
            was approved by the shareholders on February 23, 2006.
  -9-
 *Index*
  **uVuMobile,
              Inc**
 **Notes
              to Consolidated Financial
              Statements**
 **(Unaudited)**
 **Note
            4 – Shareholders’ Equity – (continued)**
  The
            following tables summarize all stock option grants to employees and
            non-employees as of September 30, 2007:
  **Number
                      of Options**
                  
                  
                  **Weighted
                      Average Exercise Price****Stock
                      Options**Balance
                      at December 31, 2006
                  
                  
                  9,030,000
                  
                  
                  $
                  1.80Granted
                  
                  
                  1,305,000
                  
                  
                  
                  0.24Exercised
                  
                  
                  -
                  
                  
                  
                  -Forfeited
                  
                  
                  575,000
                  
                  
                  
                  1.86Balance
                      at September 30, 2007
                  
                  
                  9,760,000
                  
                  
                  $
                  1.83Options
                      exercisable at September 30, 2007
                  
                  
                  6,960,938
                  
                  
                  $
                  1.79Weighted
                      average fair value of options granted during the six months
                      ended
                      September 30, 2007
                  
                  
                  
                  
                  
                  $
                  0.24
 
 **Options
                      Outstanding**
                  
                  
                  **Options
                      Exercisable****Weighted****Average**
                  
                  
                  **Weighted**
                  
                  
                  
                  
                  
                  **Weighted****Range
                      of**
                  
                  
                  **Number**
                  
                  
                  **Remaining**
                  
                  
                  **Average**
                  
                  
                  **Number**
                  
                  
                  **Average****Exercise**
                  
                  
                  **Outstanding
                      at**
                  
                  
                  **Contractual**
                  
                  
                  **Exercise**
                  
                  
                  **Exercisable
                      at**
                  
                  
                  **Exercise****Price**
                  
                  
                  **September
                      30, 2007**
                  
                  
                  **Years**
                  
                  
                  **Price**
                  
                  
                  **September
                      30, 2007**
                  
                  
                  **Price**$
                  0.15
                  
                  
                  
                  500,000
                  
                  
                  
                  9.77
                  
                  
                  $
                  0.15
                  
                  
                  
                  -
                  
                  
                  $
                  0.15$
                  0.30
                  
                  
                  
                  755,000
                  
                  
                  
                  9.44
                  
                  
                  $
                  0.30
                  
                  
                  
                  94,375
                  
                  
                  $
                  0.30$
                  0.35
                  
                  
                  
                  50,000
                  
                  
                  
                  9.40
                  
                  
                  $
                  0.35
                  
                  
                  
                  6,250
                  
                  
                  $
                  0.35$
                  0.90
                  
                  
                  
                  250,000
                  
                  
                  
                  8.03
                  
                  
                  $
                  0.90
                  
                  
                  
                  250,000
                  
                  
                  $
                  0.90$
                  0.97
                  
                  
                  
                  200,000
                  
                  
                  
                  9.16
                  
                  
                  $
                  0.97
                  
                  
                  
                  187,500
                  
                  
                  $
                  0.97$
                  1.00
                  
                  
                  
                  385,000
                  
                  
                  
                  7.36
                  
                  
                  $
                  1.00
                  
                  
                  
                  347,500
                  
                  
                  $
                  1.00$
                  1.02
                  
                  
                  
                  265,000
                  
                  
                  
                  9.09
                  
                  
                  $
                  1.02
                  
                  
                  
                  198,750
                  
                  
                  $
                  1.02$
                  1.31
                  
                  
                  
                  940,000
                  
                  
                  
                  9.11
                  
                  
                  $
                  1.31
                  
                  
                  
                  536,250
                  
                  
                  $
                  1.31$
                  1.36
                  
                  
                  
                  275,000
                  
                  
                  
                  8.91
                  
                  
                  $
                  1.36
                  
                  
                  
                  265,625
                  
                  
                  $
                  1.36$
                  1.40
                  
                  
                  
                  300,000
                  
                  
                  
                  9.02
                  
                  
                  $
                  1.40
                  
                  
                  
                  162,500
                  
                  
                  $
                  1.40$
                  1.44
                  
                  
                  
                  75,000
                  
                  
                  
                  9.95
                  
                  
                  $
                  1.44
                  
                  
                  
                  46,875
                  
                  
                  $
                  1.44$
                  1.48
                  
                  
                  
                  250,000
                  
                  
                  
                  8.65
                  
                  
                  $
                  1.48
                  
                  
                  
                  193,750
                  
                  
                  $
                  1.48$
                  1.50
                  
                  
                  
                  250,000
                  
                  
                  
                  8.47
                  
                  
                  $
                  1.50
                  
                  
                  
                  125,000
                  
                  
                  $
                  1.50$
                  1.55
                  
                  
                  
                  1,700,000
                  
                  
                  
                  7.87
                  
                  
                  $
                  1.55
                  
                  
                  
                  1,700,000
                  
                  
                  $
                  1.55$
                  1.58
                  
                  
                  
                  25,000
                  
                  
                  
                  7.91
                  
                  
                  $
                  1.58
                  
                  
                  
                  10,938
                  
                  
                  $
                  1.58$
                  1.90
                  
                  
                  
                  500,000
                  
                  
                  
                  8.35
                  
                  
                  $
                  1.90
                  
                  
                  
                  500,000
                  
                  
                  $
                  1.90$
                  1.91
                  
                  
                  
                  280,000
                  
                  
                  
                  8.78
                  
                  
                  $
                  1.91
                  
                  
                  
                  280,000
                  
                  
                  $
                  1.91$
                  1.95
                  
                  
                  
                  100,000
                  
                  
                  
                  8.73
                  
                  
                  $
                  1.95
                  
                  
                  
                  100,000
                  
                  
                  $
                  1.95$
                  2.10
                  
                  
                  
                  1,200,000
                  
                  
                  
                  8.67
                  
                  
                  $
                  2.10
                  
                  
                  
                  697,500
                  
                  
                  $
                  2.10$
                  2.20
                  
                  
                  
                  150,000
                  
                  
                  
                  8.77
                  
                  
                  $
                  2.20
                  
                  
                  
                  150,000
                  
                  
                  $
                  2.20$
                  2.25
                  
                  
                  
                  170,000
                  
                  
                  
                  5.54
                  
                  
                  $
                  2.25
                  
                  
                  
                  108,125
                  
                  
                  $
                  2.25$
                  2.30
                  
                  
                  
                  150,000
                  
                  
                  
                  7.43
                  
                  
                  $
                  2.30
                  
                  
                  
                  135,000
                  
                  
                  $
                  2.30$
                  2.77
                  
                  
                  
                  25,000
                  
                  
                  
                  8.68
                  
                  
                  $
                  2.77
                  
                  
                  
                  18,750
                  
                  
                  $
                  2.77$
                  2.90
                  
                  
                  
                  20,000
                  
                  
                  
                  7.78
                  
                  
                  $
                  2.90
                  
                  
                  
                  8,750
                  
                  
                  $
                  2.90$
                  2.91
                  
                  
                  
                  30,000
                  
                  
                  
                  7.80
                  
                  
                  $
                  2.91
                  
                  
                  
                  13,125
                  
                  
                  $
                  2.91$
                  2.95
                  
                  
                  
                  15,000
                  
                  
                  
                  7.26
                  
                  
                  $
                  2.95
                  
                  
                  
                  9,375
                  
                  
                  $
                  2.95$
                  3.27
                  
                  
                  
                  150,000
                  
                  
                  
                  8.65
                  
                  
                  $
                  3.27
                  
                  
                  
                  65,000
                  
                  
                  $
                  3.27$
                  3.50
                  
                  
                  
                  750,000
                  
                  
                  
                  7.02
                  
                  
                  $
                  3.50
                  
                  
                  
                  750,000
                  
                  
                  $
                  3.50****
                  **9,760,000**
                  
                  
                  ****
                  **8.41**
                  
                  
                  **$**
                  **1.60**
                  
                  
                  ****
                  **6,960,938**
                  
                  
                  **$**
                  **1.79**
  -10-
 *Index*
  **uVuMobile,
              Inc**
 **Notes
              to Consolidated Financial
              Statements**
 **(Unaudited)**
 **Note
            4 – Shareholders’ Equity – (continued)**
 
 At
            September 30, 2007, the Company had a total of 8,173,837 warrants outstanding.
            All of these warrants are exercisable. The life of the warrants range
            from zero
            to five years. The exercise price of these warrants range from $0.10
            to $6.50.
            See additional disclosure above regarding warrant activity.
  ***(3)*** ***Stock Plans***
 
 In
            2006,
            the Company adopted SFAS No. 123(R). Under SFAS No. 123(R), companies
            are
            required to measure the compensation costs of share-based compensation
            arrangements based on the grant-date fair value and recognize the costs
            in the
            financial statements over the period during which employees are required
            to
            provide services. Share-based compensation arrangements include stock
            options,
            restricted share plans, performance-based awards, share appreciation
            rights and
            employee share purchase plans.
 
 **Note
            5 - Office Space**
 
 In
            August
            2007, the Company assumed a sublease for approximately 4,541 square feet
            of
            office space in Duluth, Georgia. This office space currently serves as
            the
            Company's corporate headquarters. This sublease calls for monthly rental
            payments of approximately $6,528 and terminates on December 30, 2009.
            Rent
            expense for the quarter ended September 30, 2007 and 2006 was $64,110
            and
            $69,500, respectively.  For the nine months ended September 30, 2007
            and 2006, rent expense was $199,872 and $208,498, respectively.
  **Note
            6 - Promissory Notes**
 
 Concurrent
            with the OVT merger on November 26, 2002, the Company agreed to assume
            a $50,000
            loan payable to a third party. The loan bears interest at 5% and is payable
            on
            demand. The accrued interest on the loan payable was approximately $15,427
            as of
            September 30, 2007.
 
 On
            July
            20, 2007 the Company entered into five Bridge Loan Agreements in the
            amount of
            $100,000 each with Glenn Singer, Justin A. Stanley, David Oros, Michael
            Criden,
            and John E. Abdo for total proceeds of $500,000 and issued 8.25% promissory
            notes to all five Directors of the Company.  The loan is evidenced by
            an unsecured promissory note (the “Note”) which accrues interest at a rate of
            8.25% per annum.  Interest and principal on the Note are due in full
            one hundred and twenty (120) days from the date of the Note.  On
            August 23, 2007 Messrs. Abdo, Oros and Stanley resigned their positions
            as
            Directors of the Company.  In connection with their resignations,
            Messrs. Abdo, Oros and Stanley each forgave repayment of the $100,000
            bridge
            loan that each had made to the Company on July 20, 2007, as well as all
            accrued
            interest on the loan.  The accrued interest on the five loans payable
            was approximately $3,330 as of September 30, 2007.  As a result of the
            forgiveness of the three loans by Messrs. Abdo, Oros and Stanley paid-in
            capital
            increased $300,000.
 
 Between
            August 31, 2007 and September 25, 2007, the Company entered into six
            Bridge Loan
            Agreements with Jerry Bratton, Ray Jones, Drew Arnold, Chris Carson,
            Joseph
            Fitzpatrick and KLC Ventures, Inc. (the “Lenders”) for total proceeds of
            $212,500 and issued 12% promissory notes to all six Lenders.  The loan
            is evidenced by a promissory note (the “Note”) which accrues interest at a rate
            of 12% per annum and provides for the repayment of the principal amount
            and all
            accrued interest thirty (30) days from the date of the Note (the “Maturity
            Date”), and Security Agreements between the Company and each of the Lenders
            (a
“Security Agreement”) pursuant to which the Company is granting to the Lenders a
            lien on substantially all of the Company’s assets (up to $282,625 in aggregate
            amount between the six Lenders) to secure the repayment of the
            Note.  As an inducement for the Lenders to make the Bridge Loans, the
            Company agreed in the Note to issue Warrants granting to the Lender the
            right to
            acquire an aggregate of 425,000 shares of the Company’s common stock at an
            exercise price of $0.10 per share (the “First Warrants”).  The First
            Warrants will have a five (5) year term and will have other normal and
            customary
            provisions, including anti-dilution provisions and registration rights
            with
            respect to the underlying shares of common stock.  The reason for the
            short duration of the Bridge Loan is that certain accredited investors
            (the
“Investors”) are currently in negotiations with the Company to make up to a $4
            million strategic equity investment in the Company (the “Strategic Equity
            Transaction”), which investment would be made on or about the Maturity Date to
            enable the Company to pay back the six Bridge Loans.  Subject to the
            parties entering into definitive documentation with respect to the Strategic
            Equity Transaction, the Investors would invest a minimum of $1 million
            and a
            maximum of $4 million in the Company. If the Strategic Equity Transaction
            is consummated, the Company plans to use a portion of the proceeds to
            repay the
            Bridge Loans.  However, in the Note the Lender has been granted the
            right, exercisable once the Company has closed on a qualified strategic
            financing, to convert the principal balance of the Bridge Loan into shares
            of
            the Company’s common stock at a conversion rate of ten shares of common stock
            for each dollar of the Bridge Loan so converted.  If a Lender chooses
            to convert the Bridge Loan to equity, then the Company will have the
            option of
            paying the accrued interest owed to such Lender in cash or in additional
            shares
            of common stock at the same conversion rate.  To induce the Lender to
            convert the Bridge Loan to equity and not seek repayment of the same,
            upon such
            conversion the Company will issue to that Lender a Warrant granting the
            right to
            acquire an aggregate of 212,500 shares of the Company’s common stock at an
            exercise price of $0.10 per share (the “Second Warrant”).  The Second
            Warrant will have a five (5) year term and will have other normal and
            customary
            provisions, including anti-dilution provisions and registration rights
            with
            respect to the underlying shares of common stock. As noted above, the
            Company is in negotiations with respect to entering into a term sheet
            with
            respect to a Strategic Equity Transaction.  There can be no assurance
            that the parties will be able to agree upon definitive documentation
            and
            consummate the Strategic Equity Transaction.  If the parties do not
            close the Strategic Equity Transaction by the Maturity Date, then the
            Lenders
            will grant to the Company an additional ninety (90) days to repay the
            Bridge
            Loans, with the interest rate with respect to the Notes increasing from
            12% to
            14% during that 90-day period until the Notes are repaid in full. Upon the
            signing of a binding term sheet or the consummation of the Strategic
            Equity
            Transaction, the Company will file another Current Report on Form 8-K
            with the
            Securities and Exchange Commission the (“SEC”) describing the Strategic Equity
            Transaction and including the definitive documentation required to be
            filed
            therewith.  The accrued interest on the six loans was approximately
            $856 as of September 30, 2007.
 -11-
 *Index*
  **uVuMobile,
              Inc**
 **Notes
              to Consolidated Financial
              Statements**
 **(Unaudited)**
 **Note
            7 - Commitments and Contingencies**
 
 From
            time-to-time, the Company is a party to claims and legal proceedings
            arising in
            the ordinary course of business. The Company's management evaluates the
            exposure
            to these claims and proceedings individually and in the aggregate and
            allocates
            additional monies for potential losses on such litigation if it is possible
            to
            estimate the amount of loss and determine if the loss is probable.
 
 On
            or
            about April 6, 2004, Rene Hamouth filed a Writ of Summons in the Supreme
            Court
            of British Columbia (Case No. SO41955) against us, our former chief executive
            officer and director, Richard E. Bennett, Jr. and our former securities
            counsel,
            Edwards & Angell, LLP, a predecessor to Edwards Angell Palmer & Dodge
            LLP, seeking an unspecified amount of damages and costs for alleged libel
            of Mr.
            Hamouth resulting from two letters to his stockbroker, First Associates
            Investments, Inc. We and the other defendants have made an appearance
            in the
            court through respective legal counsel. On June 29, 2004, Mr. Hamouth
            filed an
            Amended Statement of Claim with the court. On November 19, 2004, the
            Court of
            Appeal for British Columbia granted Edwards Angell Palmer & Dodge LLP the
            right to appeal a chambers judge's decision that the alleged libelous
            correspondence in question is covered by absolute privilege and granted
            a stay
            of the proceeding pending the outcome of the appeal. The appeal was heard
            in
            February 2005. On March 30, 2005, the court granted the appeal and dismissed
            the
            claim against Edwards Angell Palmer & Dodge LLP. Since the court's entry of
            judgment in the appeal and to our knowledge, Mr. Hamouth has taken no
            further
            steps to pursue his claims against us or Mr. Bennett.  On July 16,
            2007, the Company entered into a General Release and Settlement Agreement
            with
            the Hamouth Family Trust and Rene Hamouth.  (*See* October 20,
            2006 Hamouth litigation paragraph below describing the settlement
            agreement.)
  On
            or about April 22, 2004, we filed a complaint in the United States District
            Court, North District of Georgia (Case No. 1:04-CV-1123) against Rene
            Hamouth,
            seeking the recovery of all profits realized by Mr. Hamouth resulting
            from his
            alleged violations of Section 16(b) of the Securities Exchange Act of
            1934 (the
“Exchange Act”) relating to his purchases and sales of our common stock since
            approximately January 1, 2003. We are seeking damages in the amount of
            at least
            $151,428, interest on the amount of profits recovered and all other general
            and
            equitable relief to which we may be entitled. Since filing the complaint
            and
            serving Mr. Hamouth, Mr. Hamouth has filed an answer. The court has entered
            a
            scheduling order, approving the Joint Preliminary Planning Report and
            Discovery
            Plan. On March 16, 2005, we received notice that Mr. Hamouth's attorney
            in this
            matter has withdrawn from the case. On April 15, 2005, we filed a motion
            for
            summary judgment on this matter. The motion was unopposed. On October
            5, 2005,
            the Court granted our motion and executed a judgment for us in the amount
            of
            $172,342.  On July 16, 2007, the Company entered into a General
            Release and Settlement Agreement with the Hamouth Family Trust and Rene
            Hamouth. (*See* October 20, 2006 Hamouth litigation paragraph below
            describing the settlement agreement.)
 
 On
            March
            9, 2005, SmartVideo Europe, Ltd., or SVEL, which is not an affiliate
            of ours,
            announced its intention to bring legal action in the form of a
            mediation/arbitration against us in regard to our alleged repudiation
            and breach
            of a distribution agreement between the parties, dated April 2, 2004,
            which
            involved certain rights to distribute certain of our products. The dispute
            includes claims of SVEL that we had anticipatorily breached our agreement
            with
            SVEL, thus allegedly inhibiting the development of SVEL's business utilizing
            our
            technology on an exclusive basis in 25 countries throughout the European
            Union.
            We contend that we had the right to terminate the agreement because of
            breaches
            by SVEL. On or about December 13, 2006, SVEL filed its Statement of Claim
            with
            the American Arbitration Association. The Company filed its response
            to the
            Statement of Claim on or about January 22, 2007. The parties have now
            agreed to
            mediate the matter prior to proceeding with arbitration. The mediation,
            which
            was set for October 23, 2007, has been postponed indefinitely.  We
            intend to defend against the claim vigorously, although there can be
            no
            assurances that we will be successful.
 
 On
            November 29, 2005, ProNetworkTV, Inc. filed a Complaint for Equitable
            Relief in
            the Superior County Court of Gwinnett County, State of Georgia, (Civil
            Action
            Number 05-A-13684-2) against OVT, Inc. seeking the recovery of late fees
            in the
            amount of $100,615 alleged to be owed pursuant to a Promissory Note executed
            by
            OVT, Inc. in favor of ProNetworkTV, Inc. in the principal amount of $325,000.
            ProNetworkTV, Inc. alleges that OVT, Inc. failed to make payments when
            due under
            the Promissory Note. As a result of the alleged failure to makes such
            payments,
            ProNetworkTV, Inc. alleges that late fees accrued under the Promissory
            Note. On
            March 26, 2006, the Company filed a Motion to Dismiss with the Court.
            On May 8,
            2006, the Company's Motion to Dismiss was granted. On September 11, 2006,
            ProNetworkTV, Inc. filed a Complaint against the Company and OVT, Inc.
            in
            the Superior Court of Gwinnett County, State of Georgia (Civil Action
            Number
            06A-08430-5) seeking recovery of the same late fees referenced above,
            but this
            time in the amount of $105,262, which is alleged to be owed pursuant
            to the same
            Promissory Note referenced above. Further, the Complaint seeks a declaratory
            judgment that ProNetworkTV, Inc. is the owner of certain technology belonging
            to
            the Company, which is the subject of a services agreement between the
            parties.
            The Complaint also alleges that ProNetworkTV, Inc. is entitled to monetary
            damages arising out of the Company's alleged breach of the services agreement.
            On September 15, 2006, the Company reached a settlement agreement with
            ProNetworkTV, Inc. relating to this and certain other unrelated matters.
            Pursuant to the terms of the settlement agreement, both parties agreed,
            among
            other things, to provide mutual general releases of any existing alleged
            claims
            either party may have had as of the date of the settlement agreement,
            including,
            but not limited to, any claims relating to the promissory note that was
            the
            subject of this lawsuit. After reaching the September 15, 2006 agreement
            referenced above, ProNetworkTV, Inc. took the position that a “final” agreement
            had not, in fact, been reached. Currently, the parties are proceeding
            as they
            were prior to reaching the September 15, 2006 settlement agreement. A
            hearing on
            ProNetwork TV, Inc.'s Motion for Declaratory Judgment was set for May
            24,
            2007.  Prior to May 24, 2007, ProNetworkTV, Inc. withdrew its request
            for a hearing on its Motion for Declaratory Judgment and did not ask
            for a
            hearing re-set date.  On or about September 26, 2007, The Company
            filed a Motion to Dismiss with the Court.  A hearing on the motion has
            been set for October 14, 2007.  Should the Motion be denied and if
            ProNetworkTV, Inc. decides to pursue its claims, the Company intends
            to defend
            against them vigorously, although there can be no assurances that the
            Company
            will be successful.
  -12-
 *Index*
  Note 7 – Commitments and Contingencies –
(continued)
  On
            January 19, 2006, the Company received a letter on behalf of Mantra Films,
            Inc.
            demanding that the Company pay cash damages of $791,244 as a result of
            the
            Company's alleged breach of certain guarantee obligations under an agreement
            between Cell Phone Entertainment, LLC, Mantra Films, Inc. and the Company
            (as
            Guarantor), dated September 30, 2004. Mantra Films, Inc. alleges that
            Cell Phone
            Entertainment, LLC and the Company failed to make certain guaranteed
            minimum
            license payments due under the agreement. As a result of the alleged
            failure to
            make such minimum payments, Mantra Films, Inc. terminated the agreement.
            The
            $791,244 demand represents the entire contract amount, including both
            past due
            payments and future guaranteed license fees, totaling minimum payments
            due
            pursuant to the agreement of $900,000, which amount has been reduced
            by payments
            made and certain prepaid insurance premiums in the amount of $108,756.
            On June
            12, 2006, Mantra Films, Inc. filed suit against Cell Phone Entertainment,
            LLC
            and the Company in the Superior Court for the State of California, County
            of Los
            Angeles (Civil Action File NO. SC090022). Mantra Films, Inc.'s Complaint
            sets
            forth the same basic facts discussed above, as well as certain additional
            facts
            regarding the alleged failure of the Company to return certain property
            to
            Mantra Films, Inc. In its Complaint, Mantra Films, Inc. has asserted
            claims for
            breach of contract, conversion, unjust enrichment, specific recovery
            of personal
            property accounting and interference with prospective economic advantage.
            The
            Complaint seeks damages in the amount discussed above, in addition to
            certain
            unspecified damages to be proven at trial. On October 5, 2006, the Company
            filed
            a Motion to Compel Arbitration. A hearing on the Motion took place on
            December
            27, 2006 and at the hearing the Court ordered the case to arbitration.
            The
            parties agreed to mediate the case prior to commencing arbitration proceedings.
            On January 12, 2007, the mediation took place, but the parties were unable
            to
            come to a successful resolution of the matter. Thereafter, on February
            15, 2007,
            the Company and Cell Phone Entertainment, LLC entered into a settlement
            agreement with Mantra Films, Inc. and ROAR Productions (as a signatory
            to the
            contract at issue in the lawsuit filed by Mantra Films, Inc.). Pursuant
            to the
            terms of the settlement agreement, the Company agreed to pay Mantra Films,
            Inc.
            the total sum of one hundred and fifty thousand dollars ($150,000), which
            sum
            was to be paid in eight (8) equal installments of $18,750, to be allocated
            between Mantra Films, Inc. and ROAR Productions as solely agreed to by
            and
            between Mantra Films, Inc. and ROAR Productions.  All required
            payments have now been made, and Mantra Films, Inc. and ROAR Productions
            have
            filed a dismissal with prejudice of the lawsuit.
 
 On
            or
            about January 18, 2006, Wilson W. Hendricks, III filed a Complaint in
            the County
            Court, Seventh Judicial Circuit, in and for St. John's County, Florida
            against
            the Company. Mr. Hendricks claimed damages in excess of $600,000 relating
            to
            lost wages and unreimbursed business expenses. In addition, he claimed
            the
            Company failed to issue 500,000 non-qualified stock options, to which
            he alleges
            he was entitled. Mr. Hendrick's main claims are that the he was wrongfully
            discharged from the Company and that the Company failed to grant him
            promised
            stock options. On June 22, 2006, the Court entered an Order requiring
            the
            parties mediate the case on or before October 31, 2006. The parties began
            the
            mediation process on August 29, 2006. On February 22, 2007, the Company
            and Mr.
            Hendricks agreed to the basic terms of a settlement which was memorialized
            in a
            settlement agreement dated March 7, 2007. Pursuant to the terms of the
            settlement agreement, the Company issued Mr. Hendricks 175,000 shares
            of the
            Company's common stock, and paid $10,000 for attorney's fees and expenses
            (payable in two monthly installments), in exchange for, among other things,
            a
            dismissal with prejudice of the lawsuit. Among other items, the settlement
            agreement also includes mutual general releases, mutual non-disparagement
            clauses, a confidentiality clause and a “non-cooperation” clause on behalf of
            Mr. Hendricks.
 
 On
            or
            about July 18, 2006, Manhattan Investments, Inc. (“Manhattan”) filed a Complaint
            against the Company in the United States District Court, Northern District
            of
            California (Case No. C-06-4379), alleging that the Company has wrongfully
            refused to remove the restrictive legend on a stock certificate representing
            49,795 shares. The Complaint includes claims for breach of fiduciary
            and
            statutory duties, conversion and fraud, and seeks injunctive relief,
            as well as
            monetary damages. On October 2, 2006, the Company filed a Motion to Transfer
            for
            Improper Venue. The Motion was granted by the Court on November 13,
            2006.  On July 23, 2007 (the “Effective Date”) the Company entered
            into a Settlement Agreement and Mutual Release (the “Agreement”) with
            Manhattan.  Pursuant to the Agreement, the parties agreed, among other
            things, that the Company will issue 850,000
            shares of the Company’s common stock, par value $0.001 to Manhattan within seven
            business days following a determination by the Court that the issuance
            of such
            common stock is fair, reasonable, and adequate to Manhattan.  The
            850,000 shares of the Company’s common stock will be issued in reliance on the
            exemption from the registration requirements of the Securities Act of
            1933, as
            amended (the “Act”), provided by Section 3(a)(10) of the Act.  The
            Agreement also requires the Company to pay $35,000 to Manhattan within
            15 days
            after the closing of an equity financing transaction, provided that the
            Company
            completes such transaction.  In addition, the agreement requires the
            Company to cause 49,795 shares of the Company’s common stock currently owned by
            Manhattan to be re-issued without restrictive legends within seven business
            days
            of the Effective Date.  In exchange for the payments and actions
            described above, the Agreement provides for a release of the Company
            and each of
            the owners, stockholders, predecessors, successors, directors, officers,
            employees, representatives, attorneys, subsidiaries, and affiliates of
            the
            Company from all charges, claims, liabilities, agreements, damages, causes
            of
            action, suits, costs, losses, debts and expenses of any nature by
            Manhattan.  The Agreement further provides for a release of Manhattan
            and each of the trustees, representatives, attorneys and affiliates of
            Manhattan, and all persons acting by, through, under or in concert with
            them
            from any and all charges, claims, liabilities, agreements, damages, causes
            of
            action, suits, costs, losses, debts and expenses of any nature by the
            Company.  At September 30, 2007, based on the settlement date of July
            23, 2007, the Company accrued a settlement liability and related expense
            of
            $332,500 based on the quoted closing trading price of $0.30 per share
            for the
            underlying 850,000 common shares in addition to the $35,000 in cash
            payments.
  -13-
 *Index*
  **uVuMobile,
              Inc**
 **Notes
              to Consolidated Financial
              Statements**
 **(Unaudited)**
 Note
            7 – Commitments and
            Contingencies – (continued)
  On
            or
            about October 20, 2006, Hamouth Family Trust (“Hamouth”) filed a Complaint
            against the Company in the Court of Chancery of the State of Delaware,
            in which
            Hamouth seeks declaratory and injunctive relief, as well as damages in
            an
            unspecified amount, related to the Company's alleged wrongful refusal
            to issue
            new stock certificates without restrictive legends for 800,000 shares
            of stock
            owned by Hamouth.  On July 16, 2007 (the “Effective Date”), the
            Company entered into a General Release and Settlement Agreement (the
            “Agreement”) with the Hamouth Family Trust and Rene Hamouth (the “Claimant
            Parties”) related to the Company's alleged wrongful refusal to issue new stock
            certificates without restrictive legends for 800,000 shares of stock
            owned by
            the Hamouth Family Trust and a judgment against Rene Hamouth in favor
            of the
            Company in the amount of $172,325.32.  Pursuant to the Agreement, the
            parties agreed, among other things, that the Company will issue 3,000,000
            shares
            of the Company’s common stock, par value $0.001 (the “Settlement Shares”) to the
            Hamouth Family Trust within six business days following a determination
            by the
            Chancery Court that the issuance of such common stock is fair, reasonable,
            and
            adequate to the Hamouth Family Trust (the “Judicial
            Determination”).  The 3,000,000 shares of the Company’s common stock
            will be issued in reliance on the exemption from the registration requirements
            of the Securities Act of 1933, as amended (the “Act”), provided by Section
            3(a)(10) of the Act.  In the event the Chancery Court declines to make
            the Judicial Determination, the Hamouth Family Trust has certain specified
            registration rights relating to the Settlement Shares.  The Agreement
            also requires (i) the Company to pay $50,000 to the Hamouth Family Trust
            on the
            Effective Date, (ii) the Company to pay $50,000 to the Hamouth Family
            Trust on
            the 30th day following the Effective Date, (iii) the Company to pay $300,000
            to
            the Hamouth Family Trust within 30 days after the closing of an equity
            financing
            transaction, provided that the Company completes such transaction within
            120
            days of the Effective Date.  In addition, the agreement requires the
            Company to (a) cause 800,000 shares of the Company’s common stock currently
            owned by the Hamouth Family Trust to be re-issued without restrictive
            legends
            within six business days of receipt of the certificates representing
            such shares
            of common stock and (b) release a judgment in the amount of $172,325.32
            it holds
            against Rene Hamouth.  In exchange for the payments and actions
            described above, the Agreement provides for a release of the Company
            and each of
            the owners, stockholders, predecessors, successors, directors, officers,
            employees, representatives, attorneys, subsidiaries, and affiliates of
            the
            Company from all charges, claims, liabilities, agreements, damages, causes
            of
            action, suits, costs, losses, debts and expenses of any nature by the
            Claimant
            Parties.  The Agreement further provides for a release of the Claimant
            Parties and each of the trustees, representatives, attorneys and affiliates
            of
            the Claimant Parties, and all persons acting by, through, under or in
            concert
            with them from any and all charges, claims, liabilities, agreements,
            damages,
            causes of action, suits, costs, losses, debts and expenses of any nature
            by the
            Company.  The Agreement also provides that neither the Company nor the
            Claimant Parties will file or pursue certain specified claims, grievances,
            complaints, lawsuits, or arbitrations.  On July 18, 2007, the Chancery
            Court entered an Order making the above-referenced Judicial Determination.
            At
            September 30, 2007, based on the settlement date of July 16, 2007, the
            Company
            accrued a settlement liability and related expense of $955,000 based
            on the
            quoted trading price of $0.185 per share for the 3,000,000 underlying
            common
            shares in addition to the $400,000 in cash payments.
 
 On
            November 13, 2006, James A. Jones filed a Complaint in the U.S. District
            Court
            for the Northern District of Georgia against the Company and Richard
            E. Bennett,
            Jr., the Company's former President and Chief Executive Officer. Mr.
            Jones
            alleges a violation of Section 806 of the Corporate Criminal and Fraud
            Accountability Act of 2002, 18 U.S.C. § 1514 et. seq. (“Sarbanes Oxley”), and is
            seeking compensatory damages, back pay and reimbursement for lost wages,
            pension, insurance, and other employment benefits, front pay and reimbursement
            for lost wages, pension, insurance, and other employment benefits, and
            attorneys
            fees. Mr. Jones claims that he was unlawfully terminated in retaliation
            for
            investigating and opposing allegedly improper conduct by the Company
            and Mr.
            Bennett. The Company and Mr. Bennett filed their Answers to the Complaint
            on
            December 21, 2006.  On  May 31, 2007, Mr. Jones filed a
            motion to dismiss his case without prejudice with the Court, which the
            Company
            vigorously opposed.  On June 4th, 2007, the Court issued an order
            on Mr. Jones' motion to dismiss his case.  The Court granted Mr.
            Jones' motion to dismiss without prejudice, but attached conditions to
            it. 
Those conditions are:  (1) he must refile the case, if at all, within the
            statutory timeframe; and (2) he must pay the fees that the Company
            incurred in preparing for Mr. Jones’ deposition.  The Court also gave Mr.
            Jones ten days to change his mind about dismissing the case in light
            of the
            conditions imposed.  Mr. Jones allowed the ten day period to expire
            without event.  Should Mr. Jones choose to re-file his case within the
            statutorily allowed timeframe, the Company will vigorously defend against
            his
            claims.
  The
            Company was named as a defendant in four lawsuits brought by a total
            of eighteen
            investors in the United States District Court, Northern District of Georgia
            (Case No. 1:06- CV-0850-MHS filed on or about April 10, 2006, and Case
            Nos.
            1:06-CV-2388, 1:06-CV-2390, and 1:06-CV-2391 filed on or about October
            6, 2006).
            The investors alleged, among other things, that the Company breached
            certain
            Registration Rights Agreements. The investors also claimed, among other
            things,
            that as a result of the Company's breach of the registration rights agreements
            they were denied certain rights they were allegedly owed under the agreements,
            and were inappropriately prevented from exercising warrants and selling
            shares
            during a specific period of time. In the aggregate, the investors claimed
            that
            as a result of the Company's actions they suffered damages in excess
            of $13
            million dollars. On January 11, 2007 the Company entered into a Settlement
            Agreement with these investors and certain other interested parties (the
            “Claimants”). Pursuant to the terms of the Settlement Agreement, the Company
            issued 6,000,000 shares of the Company's common stock to the Claimants
            in
            exchange for the Claimants agreeing to release the Company and its owners,
            predecessors, successors, directors, officers, stockholders, employees,
            representatives, attorneys, subsidiaries and affiliates from all suits,
            claims,
            charges, liabilities and causes of action of any nature whatsoever which
            the
            Claimants had, have or may in the future have, arising out of any acts
            or events
            occurring up to and including the effective date of the Settlement Agreement.
            Among other items, the Claimants further agreed not to use confidential
            information against the Company in the future. The Settlement Agreement
            also
            contains mutual non-disparagement clauses.
  -14-
 *Index*
  **uVuMobile,
              Inc**
 **Notes
              to Consolidated Financial
              Statements**
 **(Unaudited)**
 Note 7 – Commitments and Contingencies –
(continued)
  On
            September 9, 2006 and February 14, 2007, respectively, the Company received
            correspondence from Epsom Investment Services, N.V. (“Epsom”) demanding
            repayment of an alleged outstanding Demand Loan made in 2002 from Epsom
            to
            Sharps Eliminations Technologies, Inc. (“Sharps”) in the amount of $50,000
            bearing interest at 5%. Epsom claims that the Company agreed to repay
            this loan
            on behalf of Sharps. The Company currently does not believe any such
            amounts are
            due and owing to Epsom.
 
 On
            February 28, 2007, the Company filed a Complaint in the United States
            District
            Court, North District of Georgia (Case No. 1:07-CV-0503) against Leslie
            L.
            Croland, Esq., and Edwards Angell Palmer & Dodge, LLP (“Croland”) the
            Company's former securities counsel, seeking the recovery of damages
            as a result
            of Mr. Croland's professional negligence and breach of fiduciary duties
            to the
            Company.  More specifically, the Company seeks to recover compensatory
            damages for, among other things, losses sustained and attorneys' fees,
            costs,
            and expenses and liabilities incurred due to claims asserted by certain
            investors against the Company, as well as punitive damages, attorneys
            fees,
            costs of suit and any other relief the Court deems equitable and just.
 On
            September 26, 2007, the Company and Croland entered into a settlement
            agreement
            (the “Agreement”).  Pursuant to the terms of the Agreement, Croland
            paid the Company $110,000 and agreed to forebear from seeking payment
            of any and
            all outstanding legal fees due and owing to Croland from the Company
            in exchange
            for, among other things, a dismissal with prejudice of the lawsuit against
            Croland.  Among other items, the settlement agreement also includes
            mutual general releases.
  On
            April
            18, 2007, MobiTV, Inc. (“MobiTV”) filed a lawsuit in the United States District
            Court, District of Massachusetts (Case No. 1:07-cv-10755-RGS) against
            Jeremy De
            Bonet (“De Bonet”), Skyward Mobile LLC (“Skyward”), and the Company in which
            MobiTV alleges that the Defendants have (a) infringed MobiTV's United
            States
            Patent No. 7,073,178 (“the `178 patent”) entitled “Method and System of
            Performing Transactions Using Shared Resources and Different Applications”; (b)
            infringed MobiTV's copyright in software programs entitled “Mobi Radio Encoder”,
“Mobi Radio 1 Client” and “Far Reach”; (c) misappropriated trade secrets; and
            (d) unfairly competed.  MobiTV makes further claims against De Bonet
            individually for Breach of Contract and Breach of Fiduciary
            Duty.  MobiTV's claims relate to, among other things, the departure of
            De Bonet from MobiTV in January 2006; his subsequent formation of Skyward
            in
            March 2006; and the joint development of software by Skyward and the
            Company
            known as uVuRadioTM and MobilecastingTM.  The Company has now filed an
            Answer to the Complaint.  The Company intends to vigorously defend
            against these claims, although there can be no assurances that the Company
            will
            be successful.  On November 2, 2007, the Company and MobiTV entered
            into a settlement agreement.  In exchange for a dismissal without
            prejudice of the lawsuit, the Company, among other things, represented
            that it
            is not currently, directly or indirectly, licensing, selling, deploying
            or
            generating any income, revenue or subscribers (“Exploited”) from any technology,
            design, method, process, plan, software, program, application, component,
            product or service that was created, conceived, invented, designed, developed,
            marketed, licensed or offered for sale or license by or in connection
            with
            DeBonet and/or Skyward (“Skyward Material”).  The Company has agreed
            that to the extent it intends to Exploit any of the Skyward Materials
            in the
            future, it will notify MobiTV of such intended use in writing no later
            than
            thirty (30) days prior to such Exploitation.  If after receiving such
            a notice from the Company, MobiTV believes the Company’s intended Exploitation
            of the Skyward Material may infringe MobiTV’s intellectual property, then MobiTV
            and the Company have agreed to work cooperatively to resolve such concerns
            for a
            period of no less than twenty (20) days before MobiTV may initiate any
            formal
            legal proceedings against the Company.
 
 On
            April
            27, 2007, the Company entered into a General Release and Settlement Agreement
            effective April 30, 2007 (the “Agreement”) with Richard E. Bennett, Jr., the
            ex-chief executive officer of the Company (“Bennett”). Pursuant to the
            Agreement, the parties agreed that 600,000 of the 3,510,000 shares of
            the
            Company's common stock held in trust by RB Family Holdings, Ltd. (the
“RB
            Trust”) for the benefit of Bennett would be cancelled and returned to the
            Company and the remaining 2,910,000 of such shares of the Company's common
            stock
            (the “Remaining Shares”) would be reissued to Bennett without restrictive
            legend.  The Agreement further provides that 291,000 of the Remaining
            Shares will be transferred by Bennett to Bennett's legal counsel and
            such shares
            will be subject
            to certain specified sale volume restrictions until December 31,
            2007.  Except for 150,000 of the Remaining Shares and the 291,000
            Remaining Shares transferred to Bennett's legal counsel, the Remaining
            Shares
            will also be subject to certain specified sales volume restrictions until
            December 31, 2007.  The Agreement provides that Bennett shall
            cooperate with and assist the Company in connection with certain legal
            proceedings involving the Company and that Bennett shall be entitled
            to be
            indemnified in the same manner as set forth in the Company's
            Bylaws.  The Agreement also provides for a release of the Company and
            other specified parties by Bennett from any and all claims of any nature
            whatsoever, whether known or unknown which Bennett now has, or claims
            to have,
            or which Bennett at any time may have or claim to have, against the Company
            and
            such persons occurring up to and including the effective date of the
            Agreement.  The Agreement also provides for a release of Bennett and
            the RB Trust by the Company from any and all claims which the Company
            now has,
            or claims to have, or which the Company at any time may have or claim
            to have,
            against Bennett occurring up to and including the effective date of the
            Agreement.
  -15-
 *Index*
  **uVuMobile,
              Inc**
 **Notes
              to Consolidated Financial
              Statements**
 **(Unaudited)**
 Note 7 – Commitments and Contingencies –
(continued)
  On
            November 6, 2007, the Company filed a demand for arbitration against
            Jeremy
            DeBonet (“DeBonet”) and Skyward Mobile, LLC\ (“Skyward”) alleging breach of
            contract, misappropriation of trade secrets, conversion and deceptive
            trade
            practices and unfair competition under the statutory and common law of
            the State
            of Delaware arising, in part, out of DeBonet/Skyward’s failure to perform their
            obligations under a technology development agreement between the Company
            and
            DeBonet/Skyward.  More specifically, despite repeated demands by the
            Company that DeBonet/Skyward turn over intellectual property for which
            the
            Company has paid over a half million dollars, DeBonet/Skyward have refused
            to do
            so.  Furthermore, the Company believes that DeBonet/Skyward have converted
            the intellectual property at issue through the wrongful exercise of dominion
            or
            right of ownership over the Company’s intellectual property in denial of, or
            inconsistent with the Company’s right as owner.  The Company is asking
            for:  (a) judgment that DeBonet/Skyward have materially breached the
            technology development agreement; (b) an order requiring DeBonet/Skyward
            to
            perform their obligations under the technology development agreement,
            and to
            produce all technology developed under the agreement, or in the alternative,
            a
            judgment that the Company is entitled to an award of monetary damages;
            (c)
            certain other monetary and declaratory relief.
 
 Except
            as
            set forth above, we believe that there are no material litigation matters
            at the
            current time. The results of such litigation matters and claims cannot
            be
            predicted with certainty, and an adverse outcome in one or more of such
            matters
            and claims could have a material adverse impact on our financial position,
            liquidity, or results of operations.
 
 **Note
            8 – Related Party Transactions**
 
 On
            July
            20, 2007, the Company entered into five Bridge Loan Agreements in the
            amount of
            $100,000 each with Glenn Singer, Justin A. Stanley, David Oros, Michael
            Criden,
            and John E. Abdo for total proceeds of $500,000 and issued 8.25% promissory
            notes to all five Directors of the Company.  The loan is evidenced by
            an unsecured promissory note (the “Note”) which accrues interest at a rate of
            8.25% per annum.  Interest and principal on the Note are due in full
            one hundred and twenty (120) days from the date of the Note.
 
 On
            August
            23, 2007, three former Directors of the Company; Messrs. Abdo, Oros,
            and
            Stanley; forgave repayment of their loans to the Company totaling $300,000,
            as
            well as all accrued interest on the loans.  For the nine months ended
            September 30, 2007, the loans to Messrs. Singer and Criden, plus accrued
            interest, remained outstanding in the amount of $203,300.
 
 **Note
            9 - Subsequent Events**
  None
 
 -16-
 *Index*
  **Item
            2. Management'sDiscussion and Analysis of Financial
            Condition and Results of Operation**s
 
 *The
            discussion in this report contains forward-looking statements that involve
            risks
            and uncertainties.  uVuMobile’s actual results could differ materially
            from those discussed below. Factors that could cause or contribute to
            such
            differences include, but are not limited to, those identified in “Forward
            Looking Statements.” You should also carefully review the risk factors set forth
            in other reports or documents that uVuMobile files from time to time
            with the
            United States Securities and Exchange Commission, particularly our Annual
            Reports on Form 10-K, other Quarterly Reports on Form 10-Q and any Current
            Reports on Form 8-K. You should also read the following discussion and
            analysis in conjunction with our condensed consolidated financial statements
            and
            related notes to condensed consolidated financial statements included
            in this
            report.*
 
 ***Overview***
  uVuMobile,
            Inc. (hereinafter sometimes referred to as “uVuMobileTM,” “SmartVideo,” the
“Company,” “we,” “us,” or “our”) is a provider of video content distribution
            services and technology.
 
 Incorporated
            in 1984, the Company acquired OVT, Inc. in November 2002 and subsequently
            changed its name to SmartVideo Technologies, Inc.  In January
            2007, the Company announced its intent to see shareholder approval to
            change the
            name of the Company to uVuMobile to better reflect the corporate brand
            and new
            products.  On June 1, 2007 the Company changed its name to uVuMobile,
            Inc.
  Since
            2002, the Company has been a provider of technology engaged in the aggregation
            and distribution of streaming video content to users connected to the
            public
            Internet.  Additionally, the Company also provides managed
            services for Internet network operators (carriers) and for major producers,
            owners and distributors of content.
  In
            January 2005, the Company launched its direct-to-consumer mobile video
            service
            providing its customers with access to high-quality video programming
            that is
            transmitted directly to SmartPhone cellular handsets and to Wi-Fi enabled
            PDA
            devices. In addition, the Company has developed Real Time Streaming
            Protocol (RTSP) and Java 2 Platform, Micro Edition (J2ME)
            compatibility.
 
 During
            the fourth quarter of 2006, the Company expanded its product offerings
            to
            include a new suite of mobile technology and content solutions, bringing
            together a myriad of implementation choices, business models and marketing
            plans. The Company believes these new products will aid our customers
            seeking to
            capitalize on mobile technology opportunities. These new media services
            combine
            TV, radio, and other media platforms with user-friendly personalization,
            interactivity and targeted advertising.
 
 On
            June
            21, 2007 the Company announced it has shifted its business model to allow
            uVuMobile to focus engineering and new business efforts on its business
            to
            business mobile platform.  In connection with this shift in the
            business model the Company has transitioned out of its branded direct
            to
            consumer mobile television subscription business.
 
 **Recent
            Developments**
 None
 -17-
 *Index*
  ***Critical
            Accounting Policies and Estimates***
 
 The
            Company relies on the use of estimates and makes assumptions that impact
            its
            financial condition and results. These estimates and assumptions are
            based on
            historical results and trends as well as the Company's forecasts as to
            how
            results and trends might change in the future. While we believe that
            the
            estimates we use are reasonable, actual results could differ from those
            estimates.
  We
            believe that the accounting policies described below are critical to
            understanding our business, results of operations and financial condition
            because they involve more significant judgments and estimates used in
            the
            preparation of our consolidated financial statements. An accounting policy
            is
            deemed to be critical if it requires an accounting estimate to be made
            based on
            assumptions about matters that are highly uncertain at the time the estimate
            is
            made, and any changes in the different estimates that could have been
            used in
            the accounting estimates that are reasonably likely to occur periodically
            could
            materially impact our consolidated financial statements. We have discussed
            the
            development, selection and application of our critical accounting policies
            with
            the Audit Committee of our Board of Directors, and our Audit Committee
            has
            reviewed our disclosure relating to our critical accounting policies
            in this
“Management's Discussion and Analysis.”
 
 The
            Company's most critical accounting policies and estimates that may materially
            impact the Company's results of operations include:
 
 *Revenue
            Recognition*
  The
            accounting related to revenue recognition in the digital media and multimedia
            broadcast industry is complex and affected by interpretations of the
            rules and
            an understanding of various industry practices, both of which are dynamic
            in
            nature and subject to change. As a result, revenue recognition accounting
            rules
            require us to make significant judgments.
 
 We
            typically provide services to our business-to-business customers under
            volume-based usage arrangements of our digital media and multimedia broadcast
            products and services. Under certain arrangements, our customers are
            subject to
            a base monthly fee or minimum monthly usage requirements in order to
            maintain
            their preferential negotiated rates. Revenue is recognized as earned
            upon the
            delivery of service to our subscription-based customers. This typically
            occurs
            when a digital media or multimedia broadcast is viewed. Many of our
            subscription-based customers access our programming through the purchase
            of a
            monthly, semi-annual, or daily subscription for our mobile entertainment
            services. Revenue from mobile advertising is recognized when the related
            services are performed. See Note 2(K) to the consolidated financial statements
            included elsewhere in this report.
  *Valuation
            and Recoverability of Long-Lived Assets*
  See
            Note
            2(O) to the consolidated financial statements included elsewhere in this
            report
            for a description of the valuation and recoverability of long-lived
            assets.
 
 *Income
            Taxes*
  Income
            taxes are accounted for using the liability method in accordance with
            SFAS No.
            109,*Accounting for Income Taxes* (SFAS 109). Deferred tax assets and
            liabilities are recognized for the future tax consequences attributable
            to
            differences between the financial statement carrying amounts of existing
            assets
            and liabilities and their respective tax bases and operation loss and
            tax credit
            carry forwards. Deferred tax assets and liabilities are measured using
            enacted
            tax rates expected to apply to taxable income in the years in which those
            temporary differences are expected to be recovered or settled. The effect
            on
            deferred tax assets and liabilities of a change in tax rates is recognized
            in
            income in the period that includes the enactment date. We continue to
            record a
            valuation allowance for the full amount of deferred income taxes, which
            would
            otherwise be recorded for tax benefits related to operating loss carry
            forwards,
            as realization of such deferred tax assets cannot be determined to be
            more
            likely than not likely.
 
 *Accounting
            for Stock-Based Compensation*
  In
            December 2004, the FASB issued SFAS No. 123(R), “Share-Based Payment,” which
            replaces SFAS No. 123 and supersedes APB Opinion No. 25. Under SFAS No.
            123(R),
            companies are required to measure the compensation costs of share-based
            compensation arrangements based on the grant-date fair value and recognize
            the
            costs in the financial statements over the period during which employees
            are
            required to provide services. Share-based compensation arrangements include
            stock options, restricted share plans, performance-based awards, share
            appreciation rights and employee share purchase plans. In March 2005,
            the SEC
            issued Staff Accounting Bulletin No. 107, or “SAB 107”. SAB 107 expresses views
            of the staff regarding the interaction between SFAS No. 123(R) and certain
            SEC
            rules and regulations and provides the staff's views regarding the valuation
            of
            share-based payment arrangements for public companies. SFAS No. 123(R)
            permits
            public companies to adopt its requirements using one of two methods.
            On
            April 14, 2005, the SEC adopted a new rule amending the compliance dates
            for SFAS No. 123R. Companies may elect to apply this statement either
            prospectively, or on a modified version of retrospective application
            under which
            financial statements for prior periods are adjusted on a basis consistent
            with
            the pro forma disclosures required for those periods under SFAS No. 123.
            Effective January 1, 2006, we have adopted SFAS No. 123(R) using the
            prospective
            method.
  -18-
 *Index*
 
 ***Results
            of Operations***
  *For
            the Three Months Ended September 30, 2007 compared to the Three Months
            Ended
            September 30, 2006*
 
 *Revenues*
  Revenues
            for the three month period ended September 30, 2007 consisted primarily
            of a
            subscription based service delivering live and on-demand mobile entertainment
            services directly to consumers and revenues attributable to custom applications.
            Our revenues increased by approximately $5,600 for the three months ended
            September 30, 2007 as compared to the same period in 2006. This increase
            is
            primarily attributable to our decision to change our focus to hosting
            services
            and custom applications.
 
 *Broadcast
            rights*
  Broadcast
            rights expense for the three months ended September 30, 2007 were $22,500
            as
            compared to $616,600 for the same period in 2006. This change is attributable
            to
            our decision to change our focus to a subscription based model delivering
            mobile
            entertainment services direct to the consumer. This amount reflects the
            costs
            associated with acquiring the rights to deliver our mobile entertainment
            services.
 
 As
            a
            result of the decision to change our focus to a subscription based model,
            the
            Company incurred an impairment charge in September 2007 against broadcast
            rights
            assets of approximately ($743,000).
 
 *Compensation
            and benefits*
  Our
            compensation and benefits expenses decreased by approximately $334,000 for
            the three months ended September 30, 2007 as compared to the same period
            in
            2006. This decrease is primarily due to the reduction of the staff during
            the
            third quarter of 2007.
 
 *Consulting
            and professional fees*
  Our
            consulting and professional fees decreased by approximately $241,000
            for the
            three months ended September 30, 2007 as compared to the same period
            in 2006.
            This decrease is primarily attributable to legal fees reflected in the
            three
            months ended September 30, 2006 which were not incurred in the three
            months
            ended September 30, 2007.
 
 *Data Center*
  Our
            data
            center expenses consist primarily of those items related to the maintenance
            of
            certain facilities and equipment at a third-party data center. The decrease
            in
            data center expenses of approximately $4,800 for the three months ended
            September 30, 2007 as compared to 2006 is primarily due to reduced costs
            due to
            exiting the direct-to-consumer and offset by additional software
            costs.
 
 *Stock-based
            Compensation*
  For
            the
            three months ended September 30, 2007, we recorded approximately $613,000,
            as
            compared to $1,659,000 for the three months ended September 30, 2006,
            in
            non-cash, stock-based compensation expense. The decrease in stock-based
            compensation expense was primarily attributable to a decrease in the
            number of
            stock options issued. The compensation expense has been determined using
            the
            Black-Scholes fair value method. The remainder of the non-cash, stock-based
            compensation is related to the amortization of the deferred portion of
            previous
            warrant grants.
 
 *Depreciation*
  Depreciation
            expense for the three months ended September 30, 2007 increased by approximately
            $85,000 when compared to the same period in 2006. This increase is primarily
            attributable to the deployment of additional equipment in the process
            of
            increasing the overall capacity and quality of our services.
 
 *Interest
            Expense*
  Interest
            expense for the three months ended September 30, 2007 and 2006 was approximately
            $17,000 and $4,800, respectively.  The increase was due to the bridge
            loans obtained during the third quarter of 2007.
  *Selling,
            General and Administrative Expenses*
  Selling,
            general and administrative expenses consist primarily of travel expenses
            related
            to the marketing of our product and services, lease payments related
            to the use
            of our corporate facilities and space at trade shows, and other general
            and
            administrative expenses. Our selling, general and administrative costs
            decreased
            approximately $208,000 for the three months ended September 30, 2007
            when
            compared to the same period in 2006. This decrease is attributable to
            a
            reduction in travel-related expenses including marketing and advertising
            costs
            as well as a decrease in Directors’ compensation.
 
 -19-
 *Index*
 
 *For
            the Nine Months Ended September 30, 2007 compared to the Nine Months
            Ended
            September 30, 2006*
 
 *Revenues*
  Revenues
            for the nine month period ended September 30, 2007 consisted primarily
            of a
            subscription based service delivering live and on-demand mobile entertainment
            services directly to consumers and revenues attributable to custom applications.
            Our revenues increased by approximately $339,100 for the nine months
            ended
            September 30, 2007 as compared to the same period in 2006. This increase
            is
            primarily attributable to revenues generated from custom
            applications.
 
 *Broadcast
            rights*
  Broadcast
            rights expense for the nine months ended September 30, 2007 were $177,000
            as
            compared to $1,775,000 for the same period in 2006. This change is attributable
            to our decision to change our focus to a subscription based model delivering
            mobile entertainment services direct to the consumer. This amount reflects
            the
            costs associated with acquiring the rights to deliver our mobile entertainment
            services.
 
 As
            a
            result of the decision to change our focus to a subscription based model,
            the
            Company incurred an impairment charge for the nine months ended September
            2007
            against broadcast rights assets of approximately ($1,475,000).
 
 *Compensation
            and benefits*
  Our
            compensation and benefits expenses decreased by approximately $319,000
            for the
            nine months ended September 30, 2007 as compared to the same period in
            2006. The
            decrease is attributable to the staff reduction that occurred during
            the third
            quarter of 2007.
 
 *Consulting
            and professional fees*
  Our
            consulting and professional fees decreased by approximately $1,580,000
            for the
            nine months ended September 30, 2007 as compared to the same period in
            2006.
            This decrease is primarily attributable to fees associated with the consulting
            agreement with Growth Consultants LLC that was reflected in the nine
            months
            ended September 30, 2006 which were not incurred in the nine months ended
            September 30, 2007.
 
 *Data Center*
  Our
            data
            center expenses consist primarily of those items related to the maintenance
            of
            certain facilities and equipment at a third-party data center. The decrease
            in
            data center expenses of approximately $39,000 for the nine months ended
            September 30, 2007 as compared to 2006 is primarily due to a decrease
            in the
            costs related to exiting the direct-to-consumer business.
 
 *Stock-based
            Compensation*
  For
            the
            nine months ended September 30, 2007, we recorded approximately $2,966,000,
            as
            compared to $3,833,000 for the nine months ended September 30, 2006,
            in
            non-cash, stock-based compensation expense. The increase in stock-based
            compensation expense was primarily attributable to an increase in the
            number of
            stock options issued. The compensation expense has been determined using
            the
            Black-Scholes fair value method. The remainder of the non-cash, stock-based
            compensation is related to the amortization of the deferred portion of
            previous
            warrant grants.
 
 *Depreciation*
  Depreciation
            expense for the nine months ended September 30, 2007 increased by approximately
            $315,000 when compared to the same period in 2006. This increase is primarily
            attributable to the deployment of additional equipment in the process
            of
            increasing the overall capacity and quality of our services.
 
 *Interest
            Expense*
  Interest
            expense for the nine months ended September 30, 2007 and 2006 was approximately
            $26,700 and ($51,000), respectively.  During the nine months ended
            September 30, 2006, the Company reversed $53,000 of a previously recorded
            interest expense.
  *Selling,
            General and Administrative Expenses*
  Selling,
            general and administrative expenses consist primarily of travel expenses
            related
            to the marketing of our product and services, lease payments related
            to the use
            of our corporate facilities and space at trade shows, and other general
            and
            administrative expenses. Our selling, general and administrative costs
            decreased
            approximately $814,000 for the nine months ended September 30, 2007 when
            compared to the same period in 2006.  This decrease is attributable to
            a reduction in travel-related expenses including marketing and advertising
            costs
            as well as a decrease in Directors’ compensation.
 
 -20-
 *Index*
  **Liquidity
            and Capital Resources and Going Concern**
 
 We
            have
            incurred recurring losses and negative cash flows since inception. As
            of and for
            the nine months ended September 30, 2007, we had an accumulated deficit
            of
            $72,781,342, a consolidated net loss of $8,338,711 and consolidated net
            cash
            flows used in operations of $4,010,722. As a result, our operations are
            not an
            adequate source of cash to fund future operations and these matters raise
            substantial doubt about our ability to continue as a going concern. To
            fund our
            cash requirements, we have relied on private placements of equity and
            loans from
            stockholders and other related entities. Our ability to continue our
            operations
            is contingent upon obtaining additional financing and attaining profitable
            operations.
 
 Cash
            flows generated from operating activities during the year ended December
            31, 2006 were not sufficient to offset our operating expenditures. Based on
            information available regarding our proposed plans and assumptions relating
            to
            operations, we anticipate that the net proceeds from our financings in
            2007,
            together with projected cash flow from operations, will not be sufficient
            to
            meet our cash requirements for working capital and capital expenditures
            beyond
            the fourth quarter of 2007. As a result, it will be necessary for us
            to secure
            additional financing to support our operations. There can be no assurance
            that
            we will be able to obtain such financing on acceptable terms, or at all.
            If
            adequate funds are not available or not available on acceptable terms,
            the
            Company will be unable to continue as a going concern.
 
 On
            February 28, 2007, our Board of Directors determined that it would be
            advisable
            to retain a financial advisor to assist the Company in evaluating various
            strategic alternatives, including recapitalization, sale of stock, merger
            or
            asset disposition possibilities, all with the goal of maximizing stockholder
            value. On March 21, 2007, after reviewing several candidates, the Board
            of
            Directors of the Company unanimously approved the engagement of Daniels
&
Associates as the Company's exclusive investment banker, financial advisor,
            and
            Consultant for these purposes.
 
 On
            March
            9, 2007, we commenced an Offer to Amend and Exchange certain of our outstanding
            warrants. The offer provides holders of certain warrants the opportunity
            to
            amend and exercise any or all of their warrants for a significantly reduced
            exercise price by either paying the exercise price in cash or by tendering
            a
            specified number of warrants for each share of common stock being purchased.
            If
            all of the warrant holders to whom our offer was extended elect to exercise
            their warrants at the reduced cash exercise price set forth in the offer,
            we
            will generate approximately $9 million in gross proceeds available for
            our use
            to fund our operations. The offer expired at 5:00 p.m., Eastern Time,
            on April
            20, 2007. As of that time, approximately 80% of warrants subject to the
            offer
            had been tendered. Upon waiver by our Board of Directors of a specified
            closing
            condition that had not been met as of the time our offer expired, we
            accepted
            all warrants validly tendered pursuant to the terms of the offer on April
            20,
            2007. Through the offer, we generated approximately $738,000 in gross
            proceeds
            available for our use to fund our operations.
 
 On
            July
            20, 2007 the Company entered into five Bridge Loan Agreements in the
            amount of
            $100,000 each with Glenn Singer, Justin A. Stanley, David Oros, Michael
            Criden,
            and John E. Abdo for total proceeds of $500,000 and issued 8.25% promissory
            notes to all five Directors of the Company.  The loan is evidenced by
            an unsecured promissory note (the “Note”) which accrues interest at a rate of
            8.25% per annum.  Interest and principal on the Note are due in full
            one hundred and twenty (120) days from the date of the Note.
 
 ****On
            July 26, 2007, after the evaluation of the ongoing financial prospects
            of the
            Company, including the fact that it has been unable to secure further
            equity or
            debt financing, the Board of Directors of the Company determined to seek
            Chapter
            11 bankruptcy protection for the Company. The Company has engaged bankruptcy
            counsel and is evaluating the alternatives available to it. The Company
            intends
            to file for bankruptcy protection as soon as practicable. The amounts
            borrowed
            under the bridge loans will be available to fund the Company’s operating needs
            during the bankruptcy process. There can be no assurance that any additional
            funding will be available if the existing funds are depleted.
 
 On
            July
            31, 2007, the Company filed with the SEC a Current Report on Form 8-K
            disclosing
            that, after an evaluation of the Company’s ongoing financial prospects, the
            Board of Directors of the Company has now, however, determined not to
            file for
            Chapter 11 bankruptcy protection.
 
 On
            August
            23, 2007, three former Directors of the Company; Messrs. Abdo, Oros,
            and
            Stanley; forgave repayment of their loans to the Company totaling $300,000,
            as
            well as all accrued interest on the loans.  For the nine months ended
            September 30, 2007, the loans to Messrs. Singer and Criden, plus accrued
            interest, remained outstanding in the amount of $203,300.
 
 Between
            August 31, 2007 and September 25, 2007, the Company entered into six
            Bridge Loan
            Agreements with Jerry Bratton, Ray Jones, Drew Arnold, Chris Carson,
            Joseph
            Fitzpatrick and KLC Ventures, Inc. (the “Lenders”) for total proceeds of
            $212,500 and issued 12% promissory notes to all six Lenders.  The loan
            is evidenced by a promissory note (the “Note”) which accrues interest at a rate
            of 12% per annum and Security Agreements between the Company and each
            of the
            Lenders (a “Security Agreement”) pursuant to which the Company is granting to
            the Lenders a lien on substantially all of the Company’s assets (up to $282,625
            in aggregate amount between the six Lenders) to secure the repayment
            of the
            Note.  As an inducement for the Lenders to make the Bridge Loans, the
            Company agreed in the Note to issue Warrants granting to the Lender the
            right to
            acquire an aggregate of 425,000 shares of the Company’s common stock at an
            exercise price of $0.10 per share (the “First Warrants”).  The First
            Warrants will have a five (5) year term and will have other normal and
            customary
            provisions, including anti-dilution provisions and registration rights
            with
            respect to the underlying shares of common stock.
 
 -21-
 *Index*
  **Item4. Controlsand Procedures**
 
 Our
            chief
            executive officer and chief financial officer (the “Certifying Officers”) are
            responsible for establishing and maintaining disclosure controls and
            procedures
            for our Company and our subsidiary. Such officers have concluded (based
            upon
            their evaluation of these controls and procedures as of the end of the
            period
            covered by this report) that our disclosure controls and procedures are
            effective to ensure that information required to be disclosed by us in
            reports
            we file and submit under the Exchange Act is recorded, processed, summarized
            and
            reported as and when required. In addition, the Certifying Officers have
            concluded that our disclosure controls and procedures have been designed
            to
            ensure that information required to be disclosed in reports filed by
            us under
            the Exchange Act is accumulated and communicated to management, including
            our
            principal executive officers as appropriate, in a manner to allow timely
            decisions regarding the required disclosure.
 
 There
            were no significant changes in our internal controls or other factors
            that could
            significantly affect such controls subsequent to the date of his evaluation,
            and
            there were no corrective actions taken with regard to significant deficiencies
            and material weaknesses.
  Our
            management, including the Certifying Officers, do not expect that our
            disclosure
            controls or our internal controls will prevent all error and all fraud.
            A
            control system, no matter how well conceived and operated, can provide
            only
            reasonable, not absolute, assurance that the objectives of the control
            system
            are met. In addition, the design of a control system must reflect the
            fact that
            there are resource constraints, and the benefits of controls must be
            considered
            relative to their costs. Because of the inherent limitations in all control
            systems, no evaluation of controls can provide absolute assurance that
            all
            control issues and instances of fraud, if any, within a company have
            been
            detected. These inherent limitations include the realities that judgments
            in
            decision-making can be faulty, and that breakdowns can occur because
            of simple
            error or mistake. Additionally, controls can be circumvented by the individual
            acts of some persons, by collusion of two or more people or by management
            override of the control. The design of any systems of controls also is
            based in
            part upon certain assumptions about the likelihood of future events,
            and there
            can be no assurance that any design will succeed in achieving its stated
            goals
            under all potential future conditions. Because of these inherent limitations
            in
            a cost-effective control system, misstatements due to error or fraud
            may occur
            and not be detected.
  -22-
 *Index*
  **PART
            II - OTHER INFORMATION**
 
 **Item
            1. LegalProceedings**
  See
            Note
            7 - Commitments and Contingencies to the Financial Statements included
            elsewhere
            in this report which discuss material pending legal proceedings to which
            the
            Company is a party and which are incorporated herein by
            reference.
  **Item
            2.  UnregisteredSales of Equity Securities and Use of
            Proceeds**
 
 As
            is
            described in Note 7 - Commitments and Contingencies to the Financial
            Statements,
            we issued 3,000,000 shares of common stock to the Hamouth Family Trust
            in
            connection with a settlement agreement dated July 16, 2007. In addition,
            we
            issued 850,000 shares of common stock to Manhattan Investments, Inc.
            in
            connection with a settlement agreement dated July 23, 2007.  We did
            not receive any cash proceeds from the issue of shares of our common
            stock to
            Mr. Hamouth and Manhattan Associates.
  In
            each
            of these unregistered issuances of equity securities, the Company relied
            on
            Section 4(2) of the Securities Act of 1933, as amended.
 
 **Item
            3. Submissionof Matters to a Vote of Security
            Holders**
  In
            January 2007, the Company announced its intent to seek stockholder approval
            to
            change the name of the Company to uVumobile, Inc. to better reflect the
            corporate brand and new products. More specifically, the Company is developing
            a
            new suite of products and platforms, which are expected to include backend
            media
            hosting, application development, mobile marketing, messaging, content
            aggregation, billing, advertising and other services directed towards
            the mobile
            business- to- business market. On February 14, 2007, the Company initiated
            this
            process by distributing a consent solicitation statement to its stockholders
            seeking consent to amend its Certificate of Incorporation to effect the
            name
            change. On May 3, 2007, the Company announced that as of April 9, 2007
            it had
            received the consent of the holders of approximately 58% of its stock
            to change its corporate name to uVuMobile, Inc.  The Company
            changed its name to uVuMobile, Inc. on June 1, 2007.
  **Item
            6. Exhibits**
  *Exhibits*31.1
                  Certification
                      of the Chief Executive Officer, President, Chief Financial
                      Officer and
                      Principal Accounting Officer pursuant to Rule 13a-14(a)/15d-14(a)
                      of the
                      Securities and Exchange Act of 1934.32.1
                  Certification
                      of the Chief Executive Officer, President, Chief Financial
                      Officer and
                      Principal Accounting Officer pursuant to 18 U.S.C. Section
                      1350, as
                      adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
                      2003.
 
  -23-
 *Index*
  **SIGNATURES**
  In
              accordance with the requirements of the Exchange Act, the registrant
              caused this
              report to be signed on its behalf by the undersigned, thereunto duly
              authorized.
  **uVuMobile,
                        INC**By:
                    /s/
                        William J. Loughman
                    
                    Date:
                    November 13
                    ,
                        2007William
                        J. LoughmanPresident,
                        Interim Chief Executive Officer and Chief Financial
                        Officer*(Chief
                        Financial Officer and Principal Accounting Officer)*
 -24