**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**




**FORM
      10-KSB**




(Mark
      One)




**x**
            **ANNUAL
                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                1934**




**For
      the fiscal year ended December 31, 2006**




**o**
            **TRANSITION
                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                1934**




**For
      the transition period from ___________ to ___________**




**Commission
      file number** **333-127329**




**ETWINE
      HOLDINGS, INC.**


(Exact
      name of registrant as specified in its charter)




**1375
      Broadway, 3** **rd** **Floor**


**New
      York, NY 10018**


**(646)
      467-7365**


(Address
      and Telephone Number of Registrant’s Principal


Executive
      Offices and Principal Place of Business)





**Clifford
      Lerner**


**1375
      Broadway, 3** **rd** **Floor**


**New
      York, NY 10018**


**(646)
      467-7365**





**Delaware**
            **20-3191847**(State
                or other jurisdiction of incorporation or organization)
            (I.R.S.
                Employer Identification No.)**1375
                Broadway, Floor 3, New York, New York**
            **10018**(Address
                of principal executive offices)
            (Zip
                Code)





Registrant’s
                telephone number, including area code
            **(646)
                467-7365**




Securities
                registered under Section 12(b) of the Exchange Act:Title
                of each class
            Name
                of each exchange on which registered**None**
            **None**Securities
                registered under Section 12(g) of the Exchange Act:**Common
                Stock, par value $.001**(Title
                of class)




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




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




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





State
      issuer’s revenues for its most recent fiscal year. $92





Aggregate
        market
        value of the common stock held by non-affiliates of the Company as of March
        16,
        2007: $400.000


Number
        of shares of
        the registrant’s common stock outstanding as of March 16, 2007:  9,028,780
        shares of Common Stock.







**TABLE
      OF CONTENTS**








**Part
                I**Item
                1.
            Description
                of Business.Item
                2.
            Description
                of Property.Item
                3.
            Legal
                Proceedings.Item
                4.
            Submission
                of Matters to a Vote of Security Holders.**Part
                II**Item
                5.
            Market
                for Common Equity and Related Stockholder Matters.Item
                6.
            Management’s
                Discussion and Analysis or Plan of Operations.Item
                7.
            Financial
                Statements.Item
                8.
            Changes
                in and Disagreements With Accountants on Accounting and Financial
                Disclosure.Item
                8A.
            Controls
                and Procedures.Item
                8B.
            Other
                Information.**Part
                III**Item
                9.
            Directors,
                Executive Officers, Promoters and Control Persons; Compliance with
                Section
                16(a) of the Exchange Act.Item
                10.
            Executive
                Compensation.Item
                11.
            Security
                Ownership of Certain Beneficial Owners and Management and Related
                Stockholder Matters.Item
                12.
            Certain
                Relationships and Related Transactions.Item
                13.
            Exhibits.Item
                14.
            Principal
                Accountant Fees and Services.**Signatures**








*Except
        as otherwise
        required by the context, all references in this prospectus to "we", "us”, "our",
“eTwine”, or "Company" refer to the consolidated operations of eTwine Holdings,
        Inc.., a Delaware corporation, and its wholly owned
        subsidiaries.*




**Forward-Looking
      Statements and Associated Risks**






*The
      Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for
      certain forward-looking statements. Some of the statements contained in this
      annual report of *eTwine* discuss
      future expectations, contain projections of our operations or financial
      condition or state other forward-looking information. Some statements contained
      in this annual report on Form 10-K that are not historical facts (including
      without limitation statements to the effect that we "believe," "expect,"
      "anticipate," "plan," "intend," "foresee," or other similar expressions) and
      are
      forward-looking statements. These forward-looking statements are based on our
      current expectations and beliefs concerning future developments and their
      potential effects on us. There can be no assurance that future developments
      affecting us will be those anticipated by us. All comments concerning our
      expectations for future revenue and operating results are based on our forecasts
      of our plan of operation and do not include the potential impact of any future
      acquisitions or operations. These forward-looking statements involve significant
      risks and uncertainties (some of which are beyond our control) and assumptions.
      Should one or more of these risks or uncertainties materialize, or should any
      of
      our assumptions prove incorrect, actual results may vary in material respects
      from those projected in the forward-looking statements.*




**PART
      I**




**Item
        1. Description
        of Business.**




**General**




We
      were
      incorporated under the laws of the State of Delaware on July 19, 2005. Clifford
      Lerner is our sole officer and director, as well as our controlling stockholder.
      We currently have one other employee, as well as one full-time programmer and
      several programmers who are employed on a part-time basis. On December 30,
      2005,
      we obtained all of the shares of eTwine, Inc., a New York Corporation pursuant
      to a Stock Purchase Agreement and Share Exchange between eTwine, Inc. and us
      in
      consideration for the issuance of 8,227,000 shares to the eTwine, Inc.
      shareholders. Clifford Lerner remained our sole officer and director after
      the
      agreement and pursuant to the agreement eTwine, Inc. became our wholly owned
      subsidiary. Now we own and operate two online dating websites. The purpose
      of
      this merger was to create a holding company in the event we decide to acquire
      other entities in this industry in the future. In addition, the purpose was
      for
      the public entity to be a Delaware corporation which has provisions of its
      laws
      that are more favorable to our shareholders than New York laws.


****


We
      launched our primary online dating website IamFreeTonight.com
      (http://www.IamFreeTonight.com) in November 2006. Our subsidiary, eTwine, Inc.
      was incorporated in the State of New York on May 7, 2004, and launched its
      website in May 2004.





In
      November 2006, we launched an online dating website located at
      http://www.IamFreeTonight.com. IamFreeTonight.com offers several unique features
      for singles and utilizes the latest technologies to give singles an enhanced
      user experience compared to other online dating sites currently on the
      market.




In
        December 2006, IamFreeTonight.com introduced the popular concept of the
        'Wingman' into its dating application. By bringing the real-world wingman
        concept online, IamFreeTonight.com differentiates itself from traditional
        dating sites by creating new and exciting ways for singles to meet both online
        and in-person. Additionally, the ‘wingman’ concept enables the site to grow
        internally as members must invite friends to register in order to utilize
        the
‘wingman’ feature.





In
      January 2007, IamFreeTonight.com launched its unique ‘Date Now!’ concept. The
‘Date Now!’ concept offers singles a new way to meet online by enabling them to
      find and schedule dates in a matter of seconds. IamFreeTonight.com's
      Date Now! feature gives users the ability to post when they're actually free
      to
      go out on a date as well as what they'd like to do on their date.


I-1


Members
      can search the Date Now! listings to see which members are free and looking
      to
      date on a given night, and the listings are posted prominently throughout the
      IamFreeTonight.com website. Date
      Now !
      is
      designed to fit the needs of busy single professionals who may not have large
      amounts of time to spend online emailing back and forth. We believe that this
      feature differentiates IamFreeTonight.com from other online dating sites by
      making it easier to arrange dates and reducing the amount of time it takes
      to
      transition from initial contact to actually meeting in person.





Over
      the
      next six months we will continue to upgrade the IamFreeTonight.com website
      and
      add new features which we believe will be unique to the online dating industry.
      IamFreeTonight.com currently offers most standard online dating features
      including email, flirts, ‘stats’, advanced searches, and privacy options.
      Additional features will be rolled out on a continuing basis. Several of these
      features will be targeted specifically toward college students.




eTwine.com
      is a social community website that offers online dating, blogs, and event
      planning & management tools.   We integrate all of these
      applications into one easy to use platform to create an overall product offering
      - while additionally presenting several unique features within each
      application.




Revenue
      Streams:




We
      anticipate generating revenue from two primary revenue streams:




Subscription
      Fees - We hope to convert our website(s) to a subscription-based pay model
      in
      late 2007, or at such time as our member base has grown to the point where
      it
      can support the implementation of a pay model. Our decision to convert to a
      pay
      model is dependent upon a variety of factors within the overall member total.
      Such factors include how much activity there is on the site, as well as the
      success and popularity of new features we add in the coming months. We will
      begin to carefully consider imposing subscription fees for our services when
      our
      active member base reaches the 100,000 member range.




Advertising/Sponsorship
      - Once approximately 100,000 users have joined IamFreeTonight.com, we will
      begin
      to consider employing a standard model in charging for advertising and
      sponsorships. The demographic that social networking and online dating sites
      typically attract is especially desirable to advertisers so this revenue stream
      has the potential to be substantial as membership grows.




We
      presently maintain our principal offices at 1375 Broadway, Floor 3, New York,
      NY
      10018. Our telephone number is (646) 467-7365.





**Marketing**




We
        expect to spend
        approximately $100,000 on marketing in the first and second quarters of 2007
        through both online & offline mediums. In order to further increase our
        member base, we also plan to offer online contests that reward members for
        inviting their friends to join the site. Additionally, several of the unique
        features on our new website IamFreeTonight.com, such as our recently launched
        'wingman concept', have been built with the goal of generating internal growth.
        We believe that these features will generate significant membership growth
        via
        word-of-mouth.





We
      also
      intend to actively pursue partnership opportunities with other online dating
      and
      social networking companies to increase our member base. In addition, we will
      consider acquiring other established online dating sites in order to grow our
      member base. We expect to use a combination of stock and cash to purchase other
      online dating sites. We believe that our sites offer unique features for singles
      that will be very appealing to current online dating site users once an active
      member base has been established on our sites.





Another
        area that we
        will continue to vigorously pursue as part of our marketing and branding
        program
        is search engine placement. We have made efforts to optimize our websites
        for
        priority search engine placement, which we feel can improve search results,
        which in turn directs more traffic to the websites




I-2





**Competition**


We
        believe that our
        primary competition is from other online dating services. There are
        approximately 30 to 50 major online dating websites, and several hundred
        recognized sites overall. Based on membership totals, we are currently a
        small
        site in the industry. Presently the market is quite segmented with Yahoo!
        Personals & Match.Com widely considered the industry leaders. Match.com’s
        personals claim nearly 1.3 million paying subscribers and more than 15 million
        members with profiles posted or who are active users. Other large sites in
        the
        industry include True.com, SinglesNet.com, & several sites that comprise
        Spark Networks. Achieving critical mass with respect to market share is critical
        for our business. Competitors who already have an established market share
        will,
        therefore, be in a better competitive position than us. We hope to offset
        any
        such competitive advantages by offering products and services which are unique
        to the industry, superior in quality to and more appealing than those of
        our
        competitors, and by launching an effective marketing campaign. We also believe
        that the industry offers substantial room for growth as the internet continues
        to become more of an accepted tool for finding a mate.




**Patent
      and Trademarks**




We
      currently do not own any patents, trademarks or licenses of any kind and
      therefore we have no protected rights with respect to our consulting
      services.




**Governmental
      Regulations**




There
      are
      no governmental approvals necessary to conduct our current business and the
      consulting industry is not generally subject to any governmental regulation.
      Although this permits us to provide our services without the time and expense
      of
      governmental supervision it also allows competitors to more easily enter this
      business market.




**Employees**




We
      currently have one full-time employee. We also have one part-time employee
      as
      well as several programmers and a consultant that we employ on a part-time
      basis.




**Item
        2. Description
        of Property.**




We
      presently maintain our principal offices at 1375 Broadway, Floor 3, New York,
      NY, 10018. We lease office space at this location on an annual basis. Our lease
      began on February 1, 2007 and contains a clause which gives us the right to
      terminate after three months or convert to a monthly basis at that time. We
      believe that this location is sufficient and adequate to operate our current
      business.





Item
        3. Legal
        Proceedings.
 Neither
        the Company nor any of its subsidiaries is a party to any pending or threatened
        legal proceedings.




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




None.




I-3


**PART
      II**




**Item
        5. Market
        for Common Equity and Related Stockholder
        Matters.**




**Market
      Information**





Our
      common stock has traded on the OTC Bulletin Board system under the symbol “ETWI”
since October 6, 2006. There
      is
      a limited trading market for our Common Stock. The following table sets forth
      the range of high and low bid quotations for each quarter within the last fiscal
      year. These quotations as reported by the OTCBB reflect inter-dealer prices
      without retail mark-up, mark-down, or commissions and may not necessarily
      represent actual transactions.




2006High
            LowOctober
                6, 2006 to current
            $0.57
            $0.15





The
      source of these high and low prices was the OTC Bulletin Board. These quotations
      reflect inter-dealer prices, without retail mark-up, markdown or commissions
      and
      may not represent actual transactions. The high and low prices listed have
      been
      rounded up to the next highest two decimal places.





The
      market price of our common stock is subject to significant fluctuations in
      response to variations in our quarterly operating results, general trends in
      the
      market, and other factors, over many of which we have little or no control.
      In
      addition, broad market fluctuations, as well as general economic, business
      and
      political conditions, may adversely affect the market for our common stock,
      regardless of our actual or projected performance.





**Holders**





As
      of
      March 16, 2007 in accordance with our transfer agent records, we had 50
      recordholders of our Common Stock.





**Dividends**





Holders
      of our common stock are entitled to receive dividends if, as and when declared
      by the Board of Directors out of funds legally available therefore. We have
      never declared or paid any dividends on our common stock. We intend to retain
      any future earnings for use in the operation and expansion of our business.
      Consequently, we do not anticipate paying any cash dividends on our common
      stock
      to our stockholders for the foreseeable future.





**Recent
      Sales of Unregistered Securities**




On
      November 15, 2006, we issued 60,000 shares to Richard I. Anslow and 40,000
      shares to Gregg E. Jaclin for legal services rendered by Anslow & Jaclin,
      LLP. Such shares were valued at $0.30 per share for a total of $30,000 and
      such
      shares were issued pursuant to an exemption from registration at Section 4(2)
      of
      the Securities Act of 1933 and are restricted in accordance with Rule 144 of
      the
      Securities Act of 1933. The offering was not a "public offering" as defined
      in
      Section 4(2) due to the insubstantial number of persons involved in the deal,
      the size of the offering, and the manner of the offering. We did not undertake
      an offering in which we sold a high number of shares to a high number of
      investors. In addition, the investors had the necessary investment intent as
      required by Section 4(2) since they agreed to and received share certificates
      bearing a legend stating that such shares are restricted pursuant to Rule 144
      of
      the 1933 Securities Act. This restriction ensures that these shares would not
      be
      immediately redistributed into the market, and therefore not be part of a
      "public offering." Based on an analysis of the above factors, we have met the
      requirements to qualify for exemption under Section 4(2) of the Securities
      Act
      of 1933 for this transaction.


I-4





On
      November 15, 2006, we issued 20,000 shares to Eric Tjaden pursuant to his
      consulting agreement with us to assist us with marketing and promotional
      activates including various internet campaigns on a part-time basis. Such shares
      were valued at $0.30 per share for a total of $6,000 and such shares were issued
      pursuant to an exemption from registration at Section 4(2) of the Securities
      Act
      of 1933 and are restricted in accordance with Rule 144 of the Securities Act
      of
      1933. The offering was not a "public offering" as defined in Section 4(2) due
      to
      the insubstantial number of persons involved in the deal, the size of the
      offering, and the manner of the offering. We did not undertake an offering
      in
      which we sold a high number of shares to a high number of investors. In
      addition, the investor had the necessary investment intent as required by
      Section 4(2) since he agreed to and received a share certificate bearing a
      legend stating that such shares are restricted pursuant to Rule 144 of the
      1933
      Securities Act. This restriction ensures that these shares would not be
      immediately redistributed into the market, and therefore not be part of a
      "public offering." Based on an analysis of the above factors, we have met the
      requirements to qualify for exemption under Section 4(2) of the Securities
      Act
      of 1933 for this transaction.




On
      November 15, 2006, we issued 21,780 shares to Matt Levin for website design.
      Such shares were valued at $0.30 per share for a total of $6,534 and such shares
      were issued pursuant to an exemption from registration at Section 4(2) of the
      Securities Act of 1933 and are restricted in accordance with Rule 144 of the
      Securities Act of 1933. The offering was not a "public offering" as defined
      in
      Section 4(2) due to the insubstantial number of persons involved in the deal,
      the size of the offering, and the manner of the offering.  We
      did
      not undertake an offering in which we sold a high number of shares to a high
      number of investors. In addition, the investor had the necessary investment
      intent as required by Section 4(2) since he agreed to and received a share
      certificate bearing a legend stating that such shares are restricted pursuant
      to
      Rule 144 of the 1933 Securities Act. This restriction ensures that these shares
      would not be immediately redistributed into the market, and therefore not be
      part of a "public offering." Based on an analysis of the above factors, we
      have
      met the requirements to qualify for exemption under Section 4(2) of the
      Securities Act of 1933 for this transaction.





In
      December 2006, we completed an offering in which we sold a total of 500,000
      shares of our common stock at $0.30 per share for a total of $150,000 to twelve
      investors. Such shares were issued in reliance on the exemption under Section
      4(2) of the Securities Act of 1933, as amended (the “Act”). The following sets
      forth a list of such investors:




Eric
                Tjaden
            16,667Melvin
                Bernstein
            40,000Willy
                Ky
            66,667Harold
                Sussman
            80,000Michael
                Hartman
            33,333Robert
                Abramowitz
            40,000Angelo
                Cipriano
            33,333Roberta
                Riesenberg
            33,333Jack
                Shapiro
            33,333Philip
                J. Cardillo
            16,667Ronald
                Rothchild
            40,000Alan
                Tepper
            40,000Andrew
                Gavrin
            26,667




These
      shares of our common stock qualified for exemption under Section 4(2) of the
      Securities Act of 1933 since the issuance shares by us did not involve a public
      offering. The offering was not a “public offering” as defined in Section 4(2)
      due to the insubstantial number of persons involved in the deal, size of the
      offering, manner of the offering and number of shares offered. We did not
      undertake an offering in which we sold a high number of shares to a high number
      of investors. In addition, these shareholders had the necessary investment
      intent as required by Section 4(2) since they agreed to and received share
      certificates bearing a legend stating that such shares are restricted pursuant
      to Rule 144 of the 1933 Securities Act. This restriction ensures that these
      shares would not be immediately redistributed into the market and therefore
      not
      be part of a “public offering.” Based on an analysis of the above factors, we
      have met the requirements to qualify for exemption under Section 4(2) of the
      Securities Act of 1933 for this transaction.







I-5




On
      December 20, 2006, we issued 125,000 shares to Intralogic Solutions Inc. for
      programming services rendered. Such shares were valued at $0.30 per share for
      a
      total of $37,500 and such shares were issued pursuant to an exemption from
      registration at Section 4(2) of the Securities Act of 1933 and are restricted
      in
      accordance with Rule 144 of the Securities Act of 1933. The offering was not
      a
      "public offering" as defined in Section 4(2) due to the insubstantial number
      of
      persons involved in the deal, the size of the offering, and the manner of the
      offering. We did not undertake an offering in which we sold a high number of
      shares to a high number of investors. In addition, the investor had the
      necessary investment intent as required by Section 4(2) since they agreed to
      and
      received a share certificate bearing a legend stating that such shares are
      restricted pursuant to Rule 144 of the 1933 Securities Act. This restriction
      ensures that these shares would not be immediately redistributed into the
      market, and therefore not be part of a "public offering." Based on an analysis
      of the above factors, we have met the requirements to qualify for exemption
      under Section 4(2) of the Securities Act of 1933 for this
      transaction.




**Item
        6. Management’s
        Discussion and Analysis or Plan of
        Operations.**


*The
      following discussion contains forward-looking statements within the meaning
      of
      Section 27A of the Securities Act of 1933 and Section 21E of the Securities
      Exchange Act of 1934 relating to future events or our future performance. Actual
      results may materially differ from those projected in the forward-looking
      statements as a result of certain risks and uncertainties set forth in this
      prospectus. Although management believes that the assumptions made and
      expectations reflected in the forward-looking statements are reasonable, there
      is no assurance that the underlying assumptions will, in fact, prove to be
      correct or that actual results will not be different from expectations expressed
      in this report.*




**Plan
      of Operations**





During
      the next twelve months, we expect to take the following steps in connection
      with
      the further development of our business and the implementation of our plan
      of
      operations:




·
            We
                recently launched a new online dating website located at
                www.IamFreeTonight.com. Over the next six months we will continue
                to
                upgrade the IamFreeTonight.com website and add new features which
                we
                believe will be unique to the online dating industry. Additional
                features
                will be rolled out on a continuing basis. Several of these features
                will
                be targeted specifically toward college students. We expect to spend
                approximately $10,000 per month for overall programming costs during
                this
                timeframe.·
            Continue
                to implement a marketing plan to increase our member base.  The
                majority of our member base has been obtained from three sources:
                search
                engine results, online advertisements, and
                word-of-mouth.·
            We
                  expect to spend approximately $100,000 on marketing in the first
                  and
                  second quarters of 2007, through both online and offline advertising
                  mediums. In order to further increase our member base, we plan
                  to offer
                  online contests that reward members for inviting their friends
                  to join the
                  site. Additionally, several of the unique features on our new website,
                  as
                  well as features currently being developed, have been built with
                  the goal
                  of generating viral growth. We believe that these features will
                  generate significant membership growth via
                  word-of-mouth.·
            We
                will also actively pursue partnership opportunities with other online
                dating and social networking companies to increase our member base.
                In
                addition, we will consider acquiring other established online dating
                sites
                in order to grow our member base. We expect to use a combination
                of stock
                and cash to purchase other online dating sites. We believe that our
                sites
                offer unique features for singles that will be very appealing to
                current
                online dating site users once an active member base has been established
                on our sites.·
            Another
                  area that we will continue to vigorously pursue as part of our
                  marketing
                  and branding program is search engine placement. We have made efforts
                  to
                  optimize our websites for priority search engine placement, which
                  we feel
                  can improve search results, which in turn directs more traffic
                  to the
                  websites.·
            We
                hope to convert our website(s) to a subscription-based pay model
                in late
                2007, or at such time as our member base has grown to the point where
                it
                can support the implementation of a pay model. Our decision to convert
                to
                a pay model is dependent upon a variety of factors within the overall
                member total.
              Such
                factors include how much activity there is on the site, as well as
                the
                success and popularity of new features we add in the coming months.
                We
                will begin to carefully consider imposing subscription fees for our
                services when our member base reaches the 100,000 member
                range.






I-6






**Results
      of Operations for the Twelve Months Ended December 31, 2006 Compared to the
      Twelve Months Ended December 31, 2005**




Revenue
          decreased from $169 for the twelve months ended December 31, 2005 to $92
          for the
          twelve months ended December 31, 2006 a decrease of $77. These revenues
          are
          solely based on the advertising revenues we received from our Google AdSense
          program in effect in 2005 and 2006. The decrease was due to the limited
          advertising on our eTwine.com website due to the shift in emphasis from
          eTwine.com to IamFreeTonight.com. We have not yet begun to accept advertising
          on
          IamFreeTonight.com.


Research
        and development expenses for the twelve months ended December 31, 2006 increased
        to $126,590 from $56,199 for the twelve months ended December 31, 2005,
        representing an increase of $70,391. The increase in research and development
        is
        primarily attributable to the increase in spending on the continued development
        of our IamFreeTonight.com website.





**Liquidity
      and Capital Resources**




The
      Company is currently financing its operations primarily through cash generated
      by its previous financing activities **.** At
      December 31, 2006, the Company had cash of $215,792. In December 2006, we
      completed an
      offering in which we sold a total of 500,000 shares of our common stock at
      $.30
      per share for a total of $150,000 to twelve investors.




In
      December 2006 the Company filed a registration statement with the SEC which
      was
      declared effective in January 2007 registering a $10 million Investment
      Agreement with Dutchess Private Equities Fund, Ltd. of Boston along with the
      shares of Common Stock issued to investors in connection with the private
      placement in December 2006. Under the terms of the Investment Agreement, the
      Company may elect to receive as much as $10 million from Dutchess through common
      stock purchases by Dutchess over the next three years. The Company will account
      for amounts received under the agreement in accordance with
      EITF-00-19.




We
      believe we can not currently satisfy our cash requirements for the next twelve
      months with our current cash and expected revenues from our operations. However,
      management plans to increase revenue and obtain additional financing in order
      to
      sustain operations for at least the next twelve months. We have already obtained
      some financing and sold shares to support our continued operations. However,
      completion of our plan of operation is subject to attaining adequate revenue.
      We
      cannot assure investors that adequate revenues will be generated. In the absence
      of our projected revenues, we may be unable to proceed with our plan of
      operations. Even without significant revenues within the next twelve months,
      we
      still anticipate being able to continue with our present activities, but we
      may
      require financing to potentially achieve our goal of profit, revenue and
      growth.




On
        March
        5, 2007, we entered into an agreement with a public relations firm for a
        period
        of 90 days. The agreement calls for us to pay cash consideration of $15,000
        and
        60,000 shares of common stock.




In
      the
      event we are not successful in reaching our initial revenue targets, additional
      funds may be required, and we would then not be able to proceed with our
      business plan for the development and marketing of our core services. Should
      this occur, we would likely seek additional financing to support the continued
      operation of our business. We anticipate that depending on market conditions
      and
      our plan of operations, we would incur operating losses in the foreseeable
      future. We base this expectation, in part, on the fact that we may not be able
      to generate enough gross profit from our consulting services to cover our
      operating expenses. Consequently, there is substantial doubt about the Company’s
      ability to continue to operate as a going concern.




As
        reflected in the
        accompanying audited financial statements, we are in the development stage
        and
        have a negative cash flow from operations of $194,795 from inception and
        an
        accumulated deficit of $ $704,544. This raises substantial doubt about its
        ability to continue as a going concern. The ability of the Company to continue
        as a going concern is dependent on the Company's ability to raise additional
        capital and implement its business plan. The financial statements do not
        include
        any adjustments that might be necessary if the Company is unable to continue
        as
        a going concern.






I-7




Management
      believes that actions presently being taken to obtain additional funding and
      implement its strategic plans provide the opportunity for the Company to
      continue as a going concern




**Transaction
      with Dutchess Private Equities Fund II, LLP**




On
      November 22, 2006, we entered into an Investment Agreement (the “Agreement”)
      with Dutchess Private Equities Fund, Ltd. (“Dutchess”) to provide us with an
      equity line of credit. Pursuant to this Agreement, upon effectiveness of this
      registration statement, Dutchess is contractually obligated to
      purchase up to $10,000,000 of the Company’s Stock over the course of 36
      months (“Line Period”), after a  registration statement has been declared
      effective (“Effective Date”). The amount that the Company shall be entitled to
      request from each of the purchase “Puts”, shall be equal to either 1) $100,000
      or 2) 200% of the average daily volume (U.S market only) (“ADV”), multiplied by
      the average of the three (3) daily closing prices immediately preceding the
      Put
      Date.  The ADV shall be computed using the ten (10) trading days prior to
      the Put Date. The Purchase Price for the common stock identified in the Put
      Notice shall be set at ninety-five percent (95%) of the lowest closing bid
      price
      of the common stock during the Pricing Period. The Pricing Period is equal
      to
      the period beginning on the Put Notice Date and ending on and including the
      date
      that is five (5) trading days after such Put Notice Date. There are put
      restrictions applied on days between the Put Date and the Closing Date with
      respect to that Put.  During this time, the Company shall not be entitled
      to deliver another Put Notice.





The
      Company shall automatically withdraw that portion of the put notice amount,
      if
      the Market Price with respect to that Put does not meet the Minimum Acceptable
      Price.  The Minimum Acceptable Price is defined as seventy-five (75%) of
      the closing bid price of the common stock for the three (3) trading days prior
      to the Put **** Date.





In
      connection with the Agreement, we entered into a Registration Rights Agreement
      with Dutchess (“Registration Agreement”). Pursuant to the Registration
      Agreement, we were obligated to file a registration statement with the
      Securities and Exchange Commission covering the shares of common stock
      underlying the Investment Agreement within thirty (30) days after the closing
      date. In addition, we were obligated to use all commercially reasonable efforts
      to have the registration statement declared effective by the SEC within ninety
      (90) days after the closing date.




**Critical
        Accounting Pronouncements**
 
 Our
          significant accounting policies are summarized in Note 1 of our financial
          statements.
 
 We
          have
          adopted the following accounting standards. While all of these significant
          accounting policies impact our financial condition, our views of these
          policies
          are critical. Policies determined to be critical are those policies that
          have
          the most significant impact on our financial statements and require management
          to use a greater degree of judgment and estimates. Actual results may differ
          from those estimates. Our management believes that given current facts
          and
          circumstances, it is unlikely that applying any other reasonable judgments
          or
          estimate methodologies would cause effect on our consolidated results of
          operations, financial position or liquidity for the periods presented in
          this
          report:
 
 We
          recognize revenue on arrangements in accordance with Securities and Exchange
          Commission Staff Accounting Bulletin No. 101, “Revenue Recognition in Financial
          Statements” and No. 104, “Revenue Recognition”. In all cases, revenue is
          recognized only when the price is fixed or determinable, persuasive evidence
          of
          an arrangement exists, the service is performed and collectability is reasonably
          assured.
 
 We
          recognize revenue
          as earned on a click through basis. As the traffic moves through the websites
          per click, the contract amount is recognized as revenue. “Click-throughs” are
          defined as the number of times a user clicks on an advertisement or search
          result.
  We
          have adopted the
          provisions of Emerging Issues Task Force 00-2, “Accounting for Web Site
          Development Costs.” Costs incurred in the planning stage of a website are
          expensed as research and development while costs incurred in the development
          stage are capitalized and amortized over the life of the asset, estimated
          to be
          five years. Expenses subsequent to the launch have been expensed as research
          and
          development expenses.




**Recent
      Accounting Pronouncements**




In
      May
      2005, the FASB issued SFAS 154, Accounting Changes and Error Corrections. This
      Statement replaces APB Opinion No. 20, Accounting Changes, and FASB Statement
      No. 3, Reporting Accounting Changes in Interim Financial Statements, and changes
      the requirements for the accounting for and reporting of a change in accounting
      principle. This Statement applies to all voluntary changes in accounting
      principle. It also applies to changes required by an accounting pronouncement
      in
      the unusual instance that the pronouncement does not include specific transition
      provisions. SFAS 154 also requires that a change in depreciation, amortization
      or depletion method for long-lived, nonfinancial assets be accounted for as
      a
      change in accounting estimate affected by a change in accounting principle.
      This
      Statement is effective in fiscal years beginning after December 15, 2005. The
      Company has not yet determined the effect of implementing this
      standard.




SFAS
      155,
      Accounting for Certain Hybrid Financial Instruments and SFAS 156, Accounting
      for
      Servicing of Financial Assets were recently issued. SFAS 155 and 156 have no
      current applicability to the Company and have no effect on the financial
      statements.





**Off-Balance
      Sheet Arrangements**





We
      do not
      have any off-balance sheet arrangements, financings, or other relationships
      with
      unconsolidated entities or other persons, also known as “special purpose
      entities” (SPEs).




**Item
        7. Financial
        Statements.**






I-8




**eTWINE
        HOLDINGS, INC.  **AND
        SUBSIDIARY****
 **(A
        DEVELOPMENT STAGE COMPANY)**
 
 
 
 **CONTENTS**
 
 
 PAGE
              F-1
              REPORT
                  OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMPAGE
              F-2
              CONSOLIDATED
                  BALANCE SHEET AS OF DECEMBER 31, 2006PAGE
              F-3
              CONSOLIDATED
                  STATEMENTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2006
                  AND 2005
                  AND FOR THE PERIOD FROM MAY 7, 2004 (INCEPTION) TO DECEMBER 31,
                  2006PAGE
              F-4
              CONSOLIDATEDSTATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIENCY) FOR THE
                    YEARS ENDED DECEMBER 31, 2006 AND 2005 AND FOR THE PERIOD FROM
                    MAY 7, 2004
                    (INCEPTION) TO DECEMBER 31, 2006PAGE
              F-5
              CONSOLIDATEDSTATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER
                    31, 2006 AND
                    2005 AND FOR THE PERIOD FROM MAY 7, 2004 (INCEPTION) TO DECEMBER
                    31,
                    2006PAGES
              F-6
                  - F-14
              NOTES
                  TO CONSOLIDATED FINANCIAL STATEMENTS
 
 
 
  **REPORT
        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
 
 To
        the
        Board of Directors of:
 eTwine
        Holdings, Inc.
 (A
        Development Stage Company)
 
 We
        have
        audited the accompanying consolidated balance sheet of eTwine Holdings, Inc.
        and
        subsidiary (a development stage company) as of December 31, 2006 and the
        related consolidated statements of operations, changes in stockholders’ equity
        (deficiency) and cash flows for the years ended December 31, 2006 and 2005
        and
        for the period from May 7, 2004 (inception) to December 31, 2006. These
        financial statements are the responsibility of the Company’s management. Our
        responsibility is to express an opinion on these financial statements based
        on
        our audit.
 
 We
        conducted our audit in accordance with the standards of the Public Company
        Accounting Oversight Board (United States). Those standards require that
        we plan
        and perform the audit to obtain reasonable assurance about whether the financial
        statements are free of material misstatement. An audit includes examining,
        on a
        test basis, evidence supporting the amounts and disclosures in the financial
        statements. An audit also includes assessing the accounting principles used
        and
        significant estimates made by management, as well as evaluating the overall
        financial statement presentation. We believe that our audit provide a reasonable
        basis for our opinion.
 
 In
        our
        opinion, the financial statements referred to above present fairly in all
        material respects, the consolidated financial position of eTwine Holdings,
        Inc.
        and subsidiary (a development stage company) as of December 31, 2006 and
        the
        consolidated results of its operations and its cash flows for the years ended
        December 31, 2006 and 2005, and for the period from May 7, 2004 (inception)
        to
        December 31, 2006 in conformity with accounting principles generally
        accepted in the United States of America.
 
 The
        accompanying consolidated financial statements have been prepared assuming
        that
        the Company will continue as a going concern. As discussed in Note 8 to the
        consolidated financial statements, the Company is in the development stage
        with
        no operations, an accumulated deficit during development stage of $704,544
        and
        has a negative cash flow from operations of $194,795 since inception. These
        factors raise substantial doubt about its ability to continue as a going
        concern. Management’s plans concerning this matter are also described in Note 8.
        The accompanying consolidated financial statements do not include any
        adjustments that might result from the outcome of this uncertainty.
 
 
 
 WEBB
        & COMPANY, P.A.
 
 Boynton
        Beach, Florida
 January
            30, 2007, except for Note 9(c), to which the date is March 5,
            2007.










F-1


**eTwine
                  Holdings, Inc. and Subsidiary****(A
                  Development Stage Company)****Consolidated
                  Balance Sheet****As
                  of December 31, 2006****ASSETS****2006****Current
                  Assets**Cash
              
              **$**
              215,792Accounts
                  receivable
              
              
              52Total
                  Current Assets
              
              
              215,844Website
                  development costs, net
              
              
              21,437**Total
                  Assets**
              
              **$**
              **237,281****LIABILITIES
                  AND STOCKHOLDERS' EQUITY****Current
                  Liabilities**Accounts payable
              
              **$**
              856Accrued interest
              
              
              12,649Advances from stockholder
              
              
              10,138Total
                  Current Liabilities
              
              
              23,643Convertible
                  note payable - stockholder
              
              
              85,348**Total
                  Liabilities**
              
              
              108,991**Commitments
                  and Contingencies****Stockholders'
                  Equity**Preferred stock, $0.001 par value, 10,000,000 shares authorized,
                  noneissued and outstanding
              
              
              -Common stock, $0.001 par value; 100,000,000 shares authorized,9,008,780 shares issued and outstanding
              
              
              9,009Additional paid-in capital
              
              
              829,075Accumulated deficit during development stage
              
              
              (704,544
              )Deferred
                  Compensation
              
              
              (5,250
              )**Total
                  Stockholders' Equity**
              
              
              128,290**Total
                  Liabilities and Stockholders' Equity**
              
              **$**
              **237,281**












F-2






**eTwine
                  Holdings, Inc. and Subsidiary****(A
                  Development Stage Company)****Consolidated
                  Statements of Operations****For
                  the Year Ended December 31**
              
              **May
                  7, 2004 (Inception) to****2006**
              
              **2005**
              
              **December
                  31, 2006****Revenue**
              
              $
              92
              
              $
              169
              
              $
              362**Operating
                  Expenses**Professional
                  fees
              
              
              69,375
              
              
              24,088
              
              $
              100,538Research
                  and Development
              
              
              126,590
              
              
              56,199
              
              $
              195,129Depreciation
              
              
              8,100
              
              
              8,100
              
              $
              20,012General
                  and administrative
              
              
              380,767
              
              
              -
              
              $
              380,797**Total
                  Operating Expenses**
              
              
              584,832
              
              
              88,387
              
              
              696,476**Loss
                  from Operations**
              
              
              (584,740
              )
              
              (88,218
              )
              
              (696,114**Other
                  Income (Expense)**Interest
                  Expense
              
              
              (5,954
              )
              
              (4,868
              )
              $
              (12,648Interest
                  Income
              
              
              3,910
              
              
              307
              
              $
              4,218**Total
                  Other Expense, net**
              
              
              (2,044
              )
              
              (4,561
              )
              
              (8,430**Loss
                  Before Provision For Income Taxes**
              
              
              (586,784
              )
              
              (92,779
              )
              
              **(704,544****Provision
                  for Income Taxes**
              
              
              **-**
              
              
              **-**
              
              
              **-****Net
                  Loss**
              
              **$**
              (586,784
              )
              **$**
              (92,779
              )
              **$**
              **(704,544****Net
                  Loss Per Share - Basic and Diluted**
              
              
              (0.07
              )
              
              (0.01
              )
              
              **(0.09****Weighted
                  average number of shares outstanding****during
                  the period - basic and diluted**
              
              
              **8,314,211**
              
              
              **7,495,216**
              
              
              **7,756,034**













F-3




**eTwine
                  Holdings, Inc. and Subsidiary**
              ******(A
                  Development Stage Company)**
              ******Consolidated
                  Statement of Changes in Stockholders'
                  Equity(Deficiency)**
              ******For
                  the period from May 7, 2004 (inception) to December 31,
                  2006**Preferred
                  Stock
              
              Common
                  stock
              
              
              
              Deficit$.001
                  Par Value
              
              $.001
                  Par Value
              
              Additional
              
              accumulated
                  during
              
              
              
              
              
              TotalNumber
                  of
              
              
              
              
              
              
              
              paid-in
              
              development
              
              Deferred
              
              Subscription
              
              Stockholder'sShares
              
              Amount
              
              Shares
              
              Amount
              
              capital
              
              stage
              
              Compensation
              
              Receivable
              
              EquityStock
                  issued to founders on May 7, 2004
              
              
              -
              
              
              -
              
              
              7,300,000
              
              $
              7,300
              
              $
              -
              
              $
              (600
              )
              $
              -
              
              $
              (7,300
              )
              $
              (600
              )Net
                  loss, 2004
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (24,381
              )
              
              -
              
              
              -
              
              
              (24,381
              )-Balance,
                  December 31, 2004
              
              
              -
              
              
              -
              
              
              7,300,000
              
              
              7,300
              
              
              -
              
              
              (24,981
              )
              
              -
              
              
              (7,300
              )
              
              (24,981
              )-Stock
                  issued for cash
              
              
              -
              
              
              -
              
              
              797,000
              
              
              797
              
              
              198,453
              
              
              -
              
              
              -
              
              
              (93,500
              )
              
              105,750Deferred
                  compensation
              
              
              
              
              
              
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (22,656
              )
              
              
              
              
              (22,656
              )(shares
                  issued for service)Stock
                  issued for services
              
              
              -
              
              
              -
              
              
              130,000
              
              
              130
              
              
              32,370
              
              
              -
              
              
              
              
              
              
              
              
              32,500Net
                  loss, 2005
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (92,779
              )
              
              -
              
              
              -
              
              
              (92,779
              )Balance,
                  December 31, 2005
              
              
              -
              
              
              -
              
              
              8,227,000
              
              
              8,227
              
              
              230,823
              
              
              (117,760
              )
              
              (22,656
              )
              
              (100,800
              )
              
              (2,166
              )Cash
                  received on subscription receivable
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              100,800
              
              
              100,800Deferred
                  Compensation Realized
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              22,656
              
              
              
              
              
              22,656Shares
                  issued for services
              
              
              -
              
              
              -
              
              
              281,780
              
              
              282
              
              
              83,502
              
              
              -
              
              
              -
              
              
              -
              
              
              83,784Stock
                  options granted for services
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              365,250
              
              
              
              
              
              
              
              
              
              
              
              365,250Stock
                  issued for cash
              
              
              
              
              
              
              
              
              500,000
              
              
              500
              
              
              149,500
              
              
              
              
              
              
              
              
              
              
              
              150,000Stock
                  based compensation
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              -
              
              
              -
              
              
              (5,250
              )
              
              -
              
              
              (5,250
              )Net
                  loss, December 31, 2006
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (586,784
              )
              
              -
              
              
              -
              
              
              (586,784
              )**Balance,
                  for the year ended December 31, 2006**
              
              
              **-**
              
              
              **-**
              
              
              **9,008,780**
              
              
              **9,009**
              
              
              **829,075**
              
              
              **(704,544**
              **)**
              
              **(5,250**
              **)**
              
              **-**
              
              
              **128,290**







F-4






**eTwine
                  Holdings, Inc. and Subsidiary****(A
                  Development Stage Company)****Consolidated
                  Statements of Cash Flows****May
                  7, 2004****For
                  the year ended December 31,**
              
              **(Inception)
                  to****2006**
              
              **2005**
              
              **December
                  31, 2006****Cash
                  Flows From Operating Activities:**Net
                  Loss
              
              $
              (586,784
              )
              $
              (92,779
              )
              $
              (704,544
              )Adjustments to reconcile net loss to net cash used in
                  operationsDepreciation
              
              
              8,100
              
              
              8,100
              
              
              20,012Stock
                  issued for services
              
              
              101,190
              
              
              9,843
              
              
              111,034Stock
                  option
              
              
              365,250
              
              
              
              
              
              365,250Changes in operating assets and liabilities:(Increase)
                  Decrease in:Accounts
                  Receivable
              
              
              9
              
              
              (61
              )
              
              (52
              )Increase
                  (Decrease) in:Accounts
                  payable
              
              
              (2,145
              )
              
              861
              
              
              856Accrued
                  interest payable
              
              
              5,955
              
              
              4,869
              
              
              12,649**Net
                  Cash Used In Operating Activities**
              
              
              **(108,425**
              **)**
              
              **(69,167**
              **)**
              
              **(194,795**
              **)****Cash
                  Flows From Investing Activities:**Website
                  development Costs
              
              
              **(949**
              **)**
              
              -
              
              
              (41,449
              )**Net
                  Cash Used in Investing Activities**
              
              
              **(949**
              **)**
              
              **-**
              
              
              **(41,449**
              **)****Cash
                  Flows From Financing Activities:**Proceeds
                  from collection of stock subscription
              
              
              93,500
              
              
              -
              
              
              93,500Proceeds
                  from issuance of stock for cash
              
              
              150,000
              
              
              105,750
              
              
              255,750Proceeds
                  from related party loan
              
              
              -
              
              
              41,936
              
              
              102,786**Net
                  Cash Provided By Financing Activities**
              
              
              **243,500**
              
              
              **147,686**
              
              
              **452,036****Net
                  Increase in Cash**
              
              
              134,126
              
              
              78,519
              
              
              215,792Cash
                  at Beginning of Period
              
              
              81,666
              
              
              3,147
              
              
              -**Cash
                  at End of Period**
              
              **$**
              **215,792**
              
              **$**
              **81,666**
              
              **$**
              **215,792****Supplemental
                  disclosure of cash flow information:**Cash
                  paid for interest
              
              $
              -
              
              $
              -
              
              $
              -Cash
                  paid for taxes
              
              $
              -
              
              $
              -
              
              $
              -**Non-Cash
                  Financing Activities:**During
                  2006, a stockholder exchanged $7,300 of his note payablebalance
                  for full payment of the subscription receivable of $7,300.
















F-5




**eTWINE
        HOLDINGS, INC. AND SUBSIDIARY**
 **(A
        DEVELOPMENT STAGE COMPANY)**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS**
 **AS
        OF DECEMBER 31, 2006**


**NOTE
        1**  **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION**
 
 ***(A)
        Organization***
 
 eTwine
        Holdings, Inc. (a development stage company) was incorporated under the laws
        of
        the State of Delaware on July 19, 2005.
 
 eTwine,
        Inc. was incorporated under the laws of the State of New York on May 7,
        2004.
 
 eTwine
        Holdings, Inc. and its wholly owned subsidiary eTwine, Inc. are hereafter
        referred to as (the “Company”).
 
 The
        Company was organized to operate an online dating and social community website
        that is proactive in understanding the singles environment. Activities during
        the development stage include developing the business plan and raising
        capital.
 
 ***(B)
        Principles of Consolidation***
 
 The
        accompanying 2006 consolidated financial statements include the accounts
        of
        eTwine Holdings, Inc. and it’s 100% owned subsidiary eTwine, Inc. The
        accompanying 2005 consolidated financial statements include the accounts
        of
        eTwine Holdings, Inc. from July 19, 2005 (inception) and its 100% owned
        subsidiary eTwine, Inc. All inter-company accounts have been eliminated in
        the
        consolidation.
 
 ***(C)
        Use of Estimates***
 
 In
        preparing financial statements in conformity with generally accepted accounting
        principles, management is required to make estimates and assumptions that
        affect
        the reported amounts of assets and liabilities and the disclosure of contingent
        assets and liabilities at the date of the financial statements and revenues
        and
        expenses during the reported period. Actual results could differ from those
        estimates.
 
 ***(D)
        Cash and Cash Equivalents***
 
 For
        purposes 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.
 
 ***(E)
        Income Taxes***
 
 The
        Company accounts for income taxes under the Statement of Financial Accounting
        Standards 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.
   F-6
  **eTWINE
          HOLDINGS, INC. AND SUBSIDIARY**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **AS
          OF DECEMBER 31, 2006**
  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 that includes the enactment date. As of December 31, 2006, the
        Company has a net operating loss carryforward of $339,294 available to offset
        future taxable income through 2026. The valuation allowance at December 31,
        2005
        was $239,545. The net change in the valuation allowance for the year ended
        December 31, 2006 was an increase of $199,507.
 
 ***(F)
        Property and Equipment***
 
 The
        Company values property and equipment at cost and depreciates these assets
        using
        the straight-line method over their expected useful life. The Company uses
        a
        three year life for software.
 
 ***(G)
        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
        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 123. Effective January
        1,
        2006, the Company has fully adopted the provisions of SFAS No. 123R and related
        interpretations as provided by SAB 107. As such, compensation cost is measured
        on the date of grant at their fair value. Such compensation amounts, if any,
        are
        amortized over the respective vesting periods of the option grant. The Company
        applies this statement prospectively.
 
 
 
 F-7
 **eTWINE
          HOLDINGS, INC. AND SUBSIDIARY**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **AS
          OF DECEMBER 31, 2006**
 
 ***(H)
        Business Segments***
 
 The
        Company operates in one segment and therefore segment information is not
        presented.
 
 ***(I)
        Loss Per Share***
 
 Basic
        and
        diluted net loss per common share is computed based upon the weighted average
        common shares outstanding as defined by Financial Accounting Standards No.
        128,
“Earnings per Share.” The 370,592 shares issuable upon conversion of the note
        payable were not included in the computation of loss per share for December
        31,
        2006 and 2005, and for the period from May 7, 2004 (inception) to December
        31,
        2006, because their inclusion is anti-dilutive. The 1,500,000 shares issuable
        upon the exercise of stock options were not included in the computation of
        loss
        per share for December 31, 2006 or the period from May 7, 2004 (inception)
        to
        December 31, 2006 because their inclusion is anti-dilutive.
 
 
 ***(J)
        Fair Value of Financial Instruments***
 
 The
        carrying amounts reported in the balance sheet for accounts receivable, accounts
        payable, advances from stockholder and notes payable approximate fair value
        based on the short-term maturity of these instruments.
 
 ***(******K)
        Research and Development***
 
 The
        Company has adopted the provisions of Emerging Issues Task Force 00-2,
“Accounting for Web Site Development Costs.” Costs incurred in the planning
        stage of a website are expensed as research and development while costs incurred
        in the development stage are capitalized and amortized over the life of the
        asset, estimated to be five years. Expenses subsequent to the launch have
        been
        expensed as research and development expenses.
 
 ***(L)
        Concentration of Credit Risk***
 
 The
        Company at times has cash in banks in excess of FDIC insurance limits. At
        December 31, 2006, the Company had approximately $126,601 in excess of FDIC
        insurance limits.
 
 At
        December 31, 2006, 100% of the accounts receivable was due from one
        customer.
 
 During
        2006 and 2005, 100% of revenues were derived from one customer.
 
 
 F-8
 **eTWINE
          HOLDINGS, INC. AND SUBSIDIARY**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **AS
          OF DECEMBER 31, 2006**
 ***(M)
        Revenue Recognition***
 
 The
        Company recognizes revenue on arrangements in accordance with Securities
        and
        Exchange Commission Staff Accounting Bulletin No. 101, “Revenue Recognition in
        Financial Statements” and No. 104, “Revenue Recognition”. In all cases, revenue
        is recognized only when the price is fixed or determinable, persuasive evidence
        of an arrangement exists, the service is performed and collectability is
        reasonably assured.
 
 The
        Company recognizes revenue as earned on a click through basis. As the traffic
        moves through the websites per click, the contract amount is recognized as
        revenue. “Click-throughs” are defined as the number of times a user clicks on an
        advertisement or search result.
 
 ***(N)
        Intangible Assets***
 
 The
        Company adopted SFAS No. 142, Goodwill and Other Intangible Assets and, as
        required, the Company does not amortize indefinite lived intangible assets.
        Intangible assets that do not have indefinite lives are amortized over the
        useful lives and reviewed for impairment in accordance with SFAS no.
        144.
 
 ***(O)
        Recent Accounting Pronouncements***
 
 SFAS
        155,
“Accounting for Certain Hybrid Financial Instruments” and SFAS 156, “Accounting
        for Servicing of Financial Assets” were recently issued. SFAS 155 and 156 have
        no current applicability to the Company and have no effect on the financial
        statements.
  **NOTE
        2**  **WEBSITE**
 
 At
        December 31, 2006 website costs were as follows:
 
 2006Software
              
              949Website
                  costs
              
              $
              40,500Less
                  accumulated amortization
              
              
              (20,012
              )$
              21,437
 
 Amortization
        expense for the years ended December 31, 2006, 2005 and for the period from
        May
        7, 2004 to December 31, 2006 was $8,100, $8,100 and $20,012,
        respectively.
    F-9
 **eTWINE
          HOLDINGS, INC. AND SUBSIDIARY**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **AS
          OF DECEMBER 31, 2006**
 Estimated
        future amortization of intangible assets is as follows:
 
 Year
              
              Amount2007
              
              8,4162008
              
              8,4162009
              
              4,60521,437
 
  **NOTE
        3**  **STOCKHOLDERS’
        EQUITY**
 
 ***(A)
        Common Stock Issued for Services***
 
 On
        November 15, 2006, the Company executed an agreement with an unrelated third
        party to provide business consulting services in exchange for 20,000 shares
        of
        common stock. The stock has a fair value of $0.30 per share based upon recent
        cash offerings aggregating $6,000. The Company has recorded the entire amount
        as
        deferred compensation at issuance, and amortized $750 for the year ended
        December 31, 2006. The remaining deferred compensation at December 31, 2006
        was
        $5,250.
 
 On
        November 15, 2006, the Company issued 100,000 shares of common stock at an
        offering price of $0.30 per share in exchange for legal services rendered
        having
        a fair value at the grant date of $30,000.
 
 On
        November 15, 2006, the Company issued 21,780 shares of common stock at an
        offering price of $0.30 per share in exchange for consulting services rendered
        having a fair value at the grant date of $6,534.
 
 On
        December 20, 2006, the Company issued 125,000 shares of common stock at an
        offering price of $0.30 per share in exchange for consulting services rendered
        having a fair value at the grant date of $37,500.
 
 On
        July
        1, 2006, the Company issued 15,000 shares of common stock at a recent cash
        offering price of $.25 per share in exchange for consulting services rendered
        having a fair value at the grant date of $3,750.
 
 During
        2005, the Company issued 130,000 shares of common stock at a recent cash
        offering price of $.25 per share in exchange for services rendered having
        a fair
        value at the grant date of $32,500. The Company will recognize the value
        of the
        shares over the life of the agreements. As of December 31, 2006, the Company
        recognized $22,656 of consulting expense.
    F-10
 **eTWINE
          HOLDINGS, INC. AND SUBSIDIARY**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **AS
          OF DECEMBER 31, 2006**
 During
        2005, the Company issued 797,000 shares of common stock at an offering price
        of
        $.25 per share for a value of $199,250, in exchange for cash totaling $105,750
        and a charge to subscription receivable of $93,500. Of the total stock
        subscription, $93,500 was collected during 2006.
 
 During
        2004, the Company issued 7,300,000 shares of common stock to its founder
        for
        services valued at the fair value on the grant date of $7,300 ($0.001 per
        share). The $7,300 has been recorded as a component of subscriptions receivable.
        During 2006, a stockholder exchanged $7,300 of a note payable balance in
        full
        payment of a subscription receivable of $7,300.
 
 
 ***(B)
        Stock Issued for Cash***
 
 During
        November 2006, the Company sold 500,000 shares of common stock pursuant to
        the
        terms of a private placement offering. The shares were sold for $0.30 each.
        Total proceeds from the sale of stock aggregated $150,000.
 
 ***(C)
        Stock Options Issued for Services***
 
 On
        December 13, 2006, the Company executed an employment agreement with its
        President and CEO. The term ceases December 1, 2007, but there is an automatic
        option to extend the agreement for a period of three additional years. Pursuant
        to the terms of the agreement, the individual will receive 1,500,000 options
        of
        the Company having an exercise price of $0.40 per share. The options vest
        immediately and the Company recorded compensation expense of $365,250, with
        an
        offsetting credit is to additional paid in capital. The Company has valued
        these
        options at their fair value using the Black-Scholes option pricing method.
        The
        assumptions used were as follows:
 
 Expected
        life   2
        years
 Expected
        volatility  71.86%
 Risk
        free interest
        rate  4.86%
 Expected
        dividends  0%
  The
        following tables summarize all stock option grants to employees as of December
        31, 2006 and 2005 and the related changes during these periods are presented
        below.
   F-11
  **eTWINE
          HOLDINGS, INC. AND SUBSIDIARY**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **AS
          OF DECEMBER 31, 2006**
 Number
                    of
                  Options
                
                Weighted
                    Average Exercise Price**Stock
                    Options**Balance
                    at December 31, 2004
                
                
                -
                
                $
                -Granted
                
                
                -
                
                $
                -Exercised
                
                
                -
                
                $
                -Forfeited
                
                
                -
                
                $
                -Balance
                    at December 31, 2005
                
                
                -
                
                $
                -Granted
                
                
                1,500,000
                
                $
                0.40Exercised
                
                
                -
                
                $
                -Forfeited
                
                
                -
                
                $
                -Balance
                    at December 31, 2006
                
                
                1,500,000
                
                $
                0.40Options
                    exercisable at December 31, 2006
                
                
                1,500,000
                
                $
                0.40Weighted
                    average fair value of options
                  granted during 2006
                
                
                
                
                $
                0.40
  Of
        the
        total options granted, all 1,500,000 are fully vested, exercisable and
        non-forfeitable.
  The
        following table summarizes information about stock options for the Company
        at December 31, 2006:
  Options
                  Outstanding
              
              Options
                  ExercisableRange
                  of Exercise Price
              
              Number
                Outstanding
                  at December 31, 2006
              
              Weighted
                  Average Remaining Contractual Life
              
              Weighted
                  Average Exercise Price
              
              Number
                Exercisable
                  at December
                31,
                  2006
              
              Weighted
                  Average Exercise Price$
              0.40
              
              1,500,000
              
              1.84
                  Years
              $
              0.40
              
              1,500,000
              $
              0.40
 
 **NOTE
        4**  **ADVANCES
        FROM STOCKHOLDER**
 
 During
        2004, a stockholder paid $60,850 for operating expenses on behalf of the
        Company. The advances are due on demand, non-interest bearing and unsecured
        (See
        Note 7).
 
 During
        2005, a stockholder paid $41,936 for operating expenses on behalf of the
        Company
        (See Note 7).
 
 On
        December 29, 2005, $92,648 of the stockholder advances were converted into
        a
        convertible note payable (See Note 5 and 7). At December 31, 2006, $85,348
        remains outstanding.
 
 At
        December 31, 2006, $10,138 of advances to stockholder remains outstanding.
        The
        balance accrues interest at a rate of 6% per annum, is unsecured and due
        on
        demand.
 
 The
        Company has accrued $12,649 of related interest on these advances and
        convertible note payable at December 31, 2006.
   F-12
 **eTWINE
          HOLDINGS, INC. AND SUBSIDIARY**
 **(A
          DEVELOPMENT STAGE COMPANY)**
 **NOTES
          TO CONSOLIDATED FINANCIAL STATEMENTS**
 **AS
          OF DECEMBER 31, 2006**
  **NOTE
        5**  **CONVERTIBLE
        NOTE PAYABLE - STOCKHOLDER**
  On
          December 29, 2005, $92,648 of the stockholder advances were converted into
          a
          convertible note payable, due December 31, 2008 and bearing interest at
          a rate
          of 6% per annum. The Company and the note holder, by mutual consent have
          the
          right to convert, in part or in total, the amount due and payable under
          the
          note, into common stock at a conversion rate of $0.25 per share resulting
          in the
          issuance of a maximum 370,592 shares of common stock not including the
          accrued
          interest. The cash offering price at that time was $0.25 and therefore
          there was
          no beneficial conversion feature on the note. During 2006, the stockholder
          exchanged $7,300 of the note payable in full payment of a subscription
          receivable.
 
 **NOTE
        6**  **COMMITMENTS
        AND CONTINGENCIES**
 
 During
        November 2005, the Company entered into a two year consulting agreement for
        the
        continued improvement and monthly maintenance of the eTwine website. The
        terms
        of the agreement call for a monthly maintenance fee of $1,500 and the issuance
        of 200,000 shares. The consultants are entitled to an additional 25,000 shares
        at the completion of the agreement. As of December 31, 2006, the Company
        has
        issued 100,000 shares.
 
 During
        2005, the Company issued 30,000 shares of common stock to a law firm for
        services. The agreement requires the Company to guarantee the minimum value
        of
        the shares of $7,500 upon trading of the securities or issue additional shares
        to compensate the law firm for the shortfall. In addition, the Company has
        the
        right to repurchase the shares any time prior to receiving approval to
        trade.
 
 In
        June
        2006, the Company entered into a six-month consulting agreement with a web
        site
        development company. Pursuant to the terms of the agreement, the consultant
        will
        receive payments of common stock based upon the achievement of certain
        milestones. The Company is required to pay the consultant $1,400 per week
        plus
        4,000 shares of common stock having a fair value of $1,000 per week if certain
        milestones were met. The shares were valued at the Company’s then cash offering
        price of $0.25. Aggregate cash and non cash compensation on a weekly basis,
        exclusive of any milestones is $1,400.
 
 **NOTE
        7**  **RELATED
        PARTY TRANSACTIONS**
 
 The
        stockholder of the Company received 7,300,000 shares of common stock with
        a fair
        value of $7,300 (See Note 3(A)).
 
 Since
        inception, the Company received $102,786 of advances from a stockholder.
        On
        December 29, 2005, $92,648 was converted into a convertible note payable,
        due
        December 31, 2008 and bearing interest at a rate of 6% per annum. During
        2006, the subscription receivable was settled by an exchange of $7,300 in
        a
        convertible note - stockholder.
   F-13
 
 **eTWINE
        HOLDINGS, INC. AND SUBSIDIARY**
 **(A
        DEVELOPMENT STAGE COMPANY)**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS**
 **AS
        OF DECEMBER 31, 2006**


**NOTE
        8**  **GOING
        CONCERN**
 
 As
        reflected in the accompanying consolidated financial statements, the Company
        is
        in the development stage with limited operations, an accumulated deficit
        from
        inception of $704,544 and a negative cash flow from operations of $194,795
        from
        inception. This raises substantial doubt about its ability to continue as
        a
        going concern. The ability of the Company to continue as a going concern
        is
        dependent on the Company’s ability to raise additional capital and implement its
        business plan. The financial statements do not include any adjustments that
        might be necessary if the Company is unable to continue as a going
        concern.
 
 Management
        believes that actions presently being taken to obtain additional equity funding
        and implement its strategic plans provide the opportunity for the Company
        to
        continue as a going concern.
 
 **NOTE
        9**  **SUBSEQUENT
        EVENTS**
  **(A)** **Website
        Development Agreement**
 
 On
        December 20, 2006, the Company entered into a service agreement with an
        unrelated third party to provide web development and programming related
        services. The term of the agreement is from January 1, 2007 to December 31,
        2007. As compensation for services received the Company is required to pay
        $2,300 per week for programmers. The company will also issue an additional
        100,000 shares of common stock, fair value will be determined on issuance
        date
        provided the required services have been performed. In addition, based on
        Company’s discretion it will grant up to 150,000 stock options as
        follows:
  June
                    30
                2007
                    - exercise price $0.50June
                    30
                2007
                    - exercise price $1.00December
                    31
                2007
                    - exercise price $0.50December
                    31
                2007
                    - exercise price $1.00
 
 **(B) Consulting
        Agreement**
 
 On
        January 10, 2007, the Company entered into a service agreement with an unrelated
        third party to provide marketing and advertising services. The term of the
        services to be provided is from March 1, 2007 to April 30, 2007. As
        compensation for services received the Company will be required to pay shares
        of
        common stock having a fair value of $0.30 per share based on recent cash
        offerings. The Company is not required to pay any stock based compensation
        until
        the end of the service period and unless the service provider has surpassed
        certain predetermined milestones.
  **C) Public
          Relations
          Agreement**
  On
          March
          5, 2007, the Company entered into an agreement with a public relations
          firm for
          a period of 90 days. The agreement calls for the Company to pay cash
          consideration of $15,000 and 60,000 shares of common stock.








F-14


Item
        8.  Changes
        In and Disagreements With Accountants on Accounting and Financial
        Disclosure.





None.




**Item
        8A. Controls
        and Procedures.**




**Evaluation
      of Disclosure Controls and Procedures**





Under
      the
      supervision and with the participation of our management, including our
      principal executive officer and principal financial officer, we conducted an
      evaluation of our disclosure controls and procedures, as such term is defined
      under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities
      Exchange Act of 1934, as amended (Exchange Act), as of December 31, 2006. Based
      on this evaluation, our principal executive officer and principal financial
      officer have concluded that our disclosure controls and procedures are effective
      to ensure that information required to be disclosed by us in the reports we
      file
      or submit under the Exchange Act is recorded, processed, summarized, and
      reported within the time periods specified in the Securities and Exchange
      Commission's rules and forms and that our disclosure and controls are designed
      to ensure that information required to be disclosed by us in the reports that
      we
      file or submit under the Exchange Act is accumulated and communicated to our
      management, including our principal executive officer and principal financial
      officer, or persons performing similar functions, as appropriate to allow timely
      decisions regarding required disclosure.





**Changes
      in Internal Controls**





There
      were no changes (including corrective actions with regard to significant
      deficiencies or material weaknesses) in our internal controls over financial
      reporting that occurred during the fourth quarter of fiscal 2006 that has
      materially affected, or is reasonably likely to materially affect, our internal
      control over financial reporting.


**Item
        8B. Other
        Information.**




None.





II-1


**PART
      III**




**Item
        9. Directors,
        Executive Officers, Promoters and Control Persons; Compliance with Section
        16(a)
        of the Exchange Act.**




The
      following table sets forth the name and age of our sole executive officer and
      director.





**Name**
            
            **Age**
            
            **Position**
            
            **Date
                of Appointment**Clifford
                Lerner
            
            29
            
            President,
                Chief Executive Officer, Chief Financial Officer, Chairman
            
            Inception





Set
      forth below is a brief description of the background and business experience
      of
      our sole executive officer and director for the past five years.





**CLIFFORD
      LERNER** is our
      President and Chief Executive Officer as well as Chairman of our Board of
      Directors. Prior to joining eTwine in July 2005, Clifford spent his professional
      career from July 2000 to May 2005 at Lehman Brothers Inc. as an Analyst in
      its
      Equities division. Clifford worked as an Analyst in the Product Management
      Group
      where his duties involved helping to coordinate the morning and afternoon equity
      research calls. He received his undergraduate degree from Cornell University
      in
      2000 where he majored in Applied Economics & Business
      Management.




**Term
      of Office**




Our
      directors are appointed for a one-year term to hold office until the next annual
      general meeting of our shareholders or until removed from office in accordance
      with our bylaws. Our officers are appointed by our board of directors and hold
      office until removed by the board.





**Significant
      Employees**





None.





**Family
      Relationships**





No
      family
      relationships exist among our directors or executive officers.





**Involvement
      in Certain Legal Proceedings**




To
      our
      knowledge, during
      the past five years, none of our directors, executive officers, promoters,
      control persons, or nominees has been:




•
            the
                subject of any bankruptcy petition filed by or against any business
                of
                which such person was a general partner or executive officer either
                at the
                time of the bankruptcy or within two years prior to that time;





•
            convicted
                in a criminal proceeding or is subject to a pending criminal proceeding
                (excluding traffic violations and other minor offenses);





•
            subject
                to any order, judgment, or decree, not subsequently reversed, suspended
                or
                vacated, of any court of competent jurisdiction, permanently or
                temporarily enjoining, barring, suspending or otherwise limiting
                his
                involvement in any type of business, securities or banking activities;
                or





•
            found
                by a court of competent jurisdiction (in a civil action), the Commission
                or the Commodity Futures Trading Commission to have violated a federal
                or
                state securities or commodities law.






III-1




**Code
      of Ethics**





We
      have
      adopted a Code of Ethics applicable to our Chief Executive Officer and Chief
      Financial Officer. This Code of Ethics is filed herewith as an
      exhibit.





**Compliance
      with Section 16(a) of the Exchange Act**




Section
      16(a) of the Securities Exchange Act of 1934 requires the Company's officers
      and
      directors, and persons who own more than 10 percent of a registered class of
      the
      Company's equity securities, to file reports of ownership and changes in
      ownership with the Securities and Exchange Commission (SEC). Officers,
      directors, and greater than 10 percent stockholders are required by SEC
      regulation to furnish the Company with copies of all Section 16(a) forms they
      file.





To
      the
      Company's knowledge, based solely on a review of the copies of such reports
      furnished to the Company, all reports under Section 16(a) required to be filed
      by its officers and directors and greater than ten percent beneficial owners
      were timely filed as of the date of this filing.




**Item
        10. Executive
        Compensation.**




**Compensation
      of Executive Officers**




The
      following summary compensation table sets forth all compensation awarded to,
      earned by, or paid to the named executive officers paid by us during the fiscal
      years ended December 31, 2006 and 2005 in all capacities for the accounts of
      our
      executives, including the Chief Executive Officer (CEO) and Chief Financial
      Officer (CFO):





**SUMMARY
      COMPENSATION TABLE**





**Name
                and Principal Position**
            
            
            **Year**
            
            
            **Salary**
              **($)**
            
            
            **Bonus**
              **($)**
            
            
            **Stock
                Awards**
              **($)**
            
            
            **Option
                Awards**
              **($)**
            
            
            **Non-Equity
                Incentive Plan Compensation ($)**
            
            
            **Non-Qualified
                Deferred Compensation Earnings**
              **($)**
            
            
            **All
                Other Compensation**
              **($)**
            
            **Totals**
              **($)**Clifford
                Lerner,(1)
              President,
                Chief
            
            
            2006
            
            $
            0
            
            
            0
            
            
            0
            
            
            0
            
            
            0
            
            
            0
            
            
            0
            $
            0Executive
                Officer,
            
            
            2005
            
            $
            0
            
            
            0
            
            
            0
            
            
            0
            
            
            0
            
            
            0
            
            
            0
            $
            0Chief
                Financial Officer





(1)
            Pursuant
                to his employment agreement with us, Clifford Lerner received options
                to
                purchase one million five hundred thousand shares of the Company’s Common
                Stock at a price of $0.40, such options to expire in
                2012







**Outstanding
      Equity Awards at Fiscal Year-End Table.**  We
      granted to Clifford Lerner options to purchase one million five hundred thousand
      shares of the Company’s Common Stock at a price of $0.40, such options to expire
      in 2012.




**Employment
      Agreements**




Employment
      and Consulting Agreements




We
      entered into an employment agreement with Mr. Clifford Lerner, our Chief
      Executive Officer, President, and Chairman of the Board of Directors, on
      December 14, 2006. Pursuant to such agreement, we granted to Clifford Lerner
      options to purchase one million five hundred thousand shares of the Company’s
      Common Stock at a price of $0.40, such options to expire in 2012.






III-2




**Compensation
      of Directors**




For
      the
      fiscal year ended December 31, 2006, we did not compensate our directors for
      their services.




**Item
        11. Security
        Ownership of Certain Beneficial Owners and Management and Related Stockholder
        Matters.**







The
      following table sets forth certain information regarding the ownership of our
      capital stock, as of March 16, 2007, for: (i) each director; (ii) each person
      who is known to us to be the beneficial owner of more than 5%of our outstanding
      common stock; (iii) each of our executive officers named in the Summary
      Compensation Table; and (iv) all of our current executive officers and directors
      of as a group. Except as otherwise indicated in the footnotes, all information
      with respect to share ownership and voting and investment power has been
      furnished to us by the persons listed. Except as otherwise indicated in the
      footnotes, each person listed has sole voting power with respect to the shares
      shown as beneficially owned.





Title
                of Class
            Name
                and Address of Beneficial Owner
            Amount
                and Nature of Beneficial Owner
            Percent
                of Class (1)Common
                Stock
            Clifford
                Lerner
            7,000,000
                (2)
            77.70%Common
                Stock
            All
                executive officers and directors as a group
            7,000,000
                (2)
            77.70%





(1)The
      percent of class is based on 9,008,780 shares of common stock issued and
      outstanding as of March 16, 2007.


(2)
      In
      addition to the 7,000,000 shares set forth above, Clifford Lerner owns the
      option to purchase an additional 1,500,000 shares of our common stock at $.40
      pursuant to his employment agreement with us.




**Item
        12. Certain
        Relationships and Related Transactions.**




During
      2004, Darrell Lerner, the original founder of our subsidiary eTwine, Inc.,
      paid $60,850 for operating expenses on our behalf and during 2005 he paid
      $41,936 for operating expenses on our behalf. The advances were due on demand,
      non-interest bearing and unsecured. On December 29, 2005, $92,648 of the
      stockholder advances were converted into a convertible note payable due December
      31, 2008 and bearing interest at a rate of 6% per annum.





On
      June
      15, 2005, Mr. Lerner paid a subscription receivable to us in the amount of
      $7,300 through the reduction of his note. Based upon same, the convertible
      note
      is currently for a total of $85,348. This note was for monies paid to eTwine
      by
      Mr. Lerner prior to the merger. By mutual consent, we agreed that
      Mr. Lerner has the right to convert, in part or in total, the amount due
      and payable under the note, into common stock at a conversion rate of $0.25
      per
      share results in the issuance of 341,392 shares of common stock plus any accrued
      interest. The recent cash offering price was $0.25 and therefore there was
      no
      beneficial conversion feature on the note. In addition, Mr. Lerner received
      300,000 shares of our common stock pursuant to the stock purchase agreement
      and
      share exchange with eTwine, Inc., a New York corporation, based on his ownership
      interest in eTwine, Inc., a New York corporation.




On
      December 30, 2005, we obtained all of the shares of eTwine, Inc., a New York
      Corporation, pursuant to a Stock Purchase Agreement and Share Exchange between
      eTwine, Inc. and us in consideration for the issuance of 8,227,000 shares to
      the
      eTwine, Inc. shareholders. Clifford Lerner remained our sole officer and
      director after the agreement and pursuant to the agreement eTwine, Inc. became
      our wholly owned subsidiary. Clifford Lerner was the sole officer and director
      of both entities at the time of the agreement.





III-3


**Item
        13. Exhibits.**




**Exhibit No.**
            
            **Title
                of Document**
            
            **Location**3.1.1
            
            Articles
                of Incorporation
            
            Incorporated
                by reference to Form SB-2 filed on March 14, 20063.2
            
            Bylaws
            
            Incorporated
                by reference to Amendment No. 1 to Form SB-2 filed on September 16,
                200510.1
            
            Investment
                Agreement dated November 22, 2006 and between the Company and Dutchess
                Private Equities Fund, Ltd
            
            Incorporated
                by reference to Form SB-2 filed on December 26, 200610.2
            
            Registration
                Rights Agreement dated June 29, 2006 by and between the Company and
                Dutchess Private Equities Fund, Ltd.
            
            Incorporated
                by reference to Form SB-2 filed on December 26, 200610.3
            
            Stock
                Purchase Agreement and Share Exchange
            
            Incorporated
                by reference to Amendment No. 1 to the Form SB-2 filed on May 12,
                200610.4
            
            Promissory
                Note
            
            Incorporated
                by reference to Amendment No. 1 to Form SB-2 filed on May 12,
                200610.5
            
            Private
                Placement and Subscription Agreement
            
            Incorporated
                by reference to Amendment No. 3 to Form SB-2 filed on June 28,
                200610.6
            
            Employment
                Agreement
            
            Incorporated
                by reference to Form SB-2 filed on August 31, 200631.1
            
            Certification
                of Chief Executive Officer Pursuant to Rule 13a-14(a) of the
                Securities Exchange Act of 1934
            
            Filed
                herewith32.1
            
            Certification
                of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as
                adopted
                pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
            
            Filed
                herewith




**Item
        14. Principal
        Accounting Fees and Services.**




**Audit
      Fees**




For
        our fiscal year
        ended December 31, 2006, we were billed approximately $14,034 for professional
        services rendered for the audit and reviews of our financial statements.
        For our
        fiscal year ended December 31, 2005, we were billed approximately $2,560
        for
        professional services rendered for the audit and reviews of our financial
        statements.




**Tax
      Fees**




For
      our
      fiscal years ended December 31, 2006 and 2005, we were not billed for
      professional services rendered for tax compliance, tax advice, and tax
      planning.




**All
      Other Fees**




The
      Company did not incur any other fees related to services rendered by our
      principal accountant for the fiscal years ended December 31, 2006 and
      2005.


III-4





**SIGNATURES**




In
      accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
      this report to be signed on its behalf by the undersigned, thereunto duly
      authorized.




**ETWINE
                HOLDINGS, INC.**By:
            */s/
                Clifford Lerner*CLIFFORD
                LERNERPresident,
                Chief Executive Officer,
              Chief
                Financial OfficerDate:
            March
                16, 2007





In
      accordance with the Exchange Act, this report has been signed below by the
      following persons on behalf of the registrant and in the capacities and on
      the
      dates indicated.





**Name**
            
            **Title**
            
            **Date***/s/
                Clifford Lerner*
            
            President,
                Chief Executive Officer,
            
            March
                16, 2007CLIFFORD
                LERNER
            
            Chief
                Financial Officer