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[X] Quarterly
Report under Section 13 or 15(d) of the Securities Exchange Act of
1934.
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[ ] Transition
Report under Section 13 or 15(d) of the Securities Exchange Act of
1934.
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NEVADA
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87-0564472
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(State
or other jurisdiction of
incorporation or organization)
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(I.R.S.
Employer I.D.
Number)
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Page
No.
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|
PART
1. FINANCIAL INFORMATION
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|
Item
1. Financial
Statements
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3
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Consolidated
Balance Sheet, June
30, 2007 (unaudited) and
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|
December
31, 2006
(audited)
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3
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Consolidated
Statement of
Operations, for the three months ended June 30, 2007
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|
and
2006, and cumulative from
inception to June 30, 2007 (unaudited)
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4
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Consolidated
Statement of
Stockholders’ Equity (Deficit) for the period from
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|
January
7, 1982 (inception)
through June 30, 2007 (unaudited)
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5
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Consolidated
Statements of Cash
Flows, for the three months ended
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|
June
30, 2007 and 2006, and
cumulative from inception (Jan. 7, 1982)
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|
to
June 30, 2007
(unaudited)
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6
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Notes
to Condensed Financial
Statements (unaudited)
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7
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Item
2. Management’s
Discussion and Analysis or Plan of Operation
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12
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Item
3. Controls
and Procedures
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16
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PART
II. OTHER INFORMATION
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|
Item
1. Legal
Proceedings
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17
|
Item
2. Unregistered
Sales of Equity Securities and Use of Proceeds
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17
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Item
3. Defaults
Upon Senior Securities
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17
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Item
4. Submission
of Matters to a Vote of Security Holders
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17
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Item
5. Other
Information
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18
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Item
6. Exhibits
and Reports on Form 8-K
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18
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VICTORY
ENERGY CORPORATION AND SUBSIDIARIES
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||||||||
(A
Development Stage Company)
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||||||||
Consolidated
Balance Sheets
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||||||||
ASSETS
|
||||||||
June
30,
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December
31,
|
|||||||
2007
|
2006
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|||||||
Unaudited
|
||||||||
CURRENT
ASSETS
|
||||||||
Cash
and Cash Equivalents
|
$ |
-
|
$ |
-
|
||||
Subscriptions
Receivable
|
735,000
|
-
|
||||||
Total
Curent Assets
|
735,000
|
-
|
||||||
FIXED
ASSETS, NET
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-
|
-
|
||||||
OTHER
ASSETS
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||||||||
Investment
in Joint Venture
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50,000
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50,000
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||||||
TOTAL
ASSETS
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$ |
785,000
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$ |
50,000
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||||
LIABILITIES
& STOCKHOLDERS' DEFICIT
|
||||||||
CURRENT
LIABILITES
|
||||||||
Bank
Overdraft
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$ |
11,760
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$ |
79
|
||||
Accounts
Payable
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40,440
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19,142
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||||||
Credit
Line - WFB Business Line
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80,622
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56,961
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||||||
Prepaid
Subscriptions
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203,500
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203,500
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||||||
Total
Current Liabilities
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336,322
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279,682
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||||||
OTHER
LIABILITIES
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||||||||
Loan
from Officer
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988,565
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690,085
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||||||
Total
Other Liabilities
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988,565
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690,085
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||||||
Total
Liabilities
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1,324,887
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969,767
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||||||
Commitments
and contingencies (Note 6)
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||||||||
STOCKHOLDERS'
DEFICIT
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||||||||
Preferred
Stock, $0.001 par value, 10,000,000 shares
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||||||||
authorized,
630,517 issued and outstanding
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631
|
716
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||||||
Common
Stock, $0.001 par value, 200,000,000 shares
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||||||||
authorized, 31,285,366 issued
and outstanding
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31,286
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4,518
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||||||
Additional
paid-in capital
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7,999,041
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4,566,320
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||||||
Deficit
accumulated in the development stage
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(8,570,845 | ) | (5,491,321 | ) | ||||
Total
Stockholders' Deficit
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(539,887 | ) | (919,767 | ) | ||||
TOTAL
LIABILITIES AND STOCKHOLDERS' DEFICIT
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$ |
785,000
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$ |
50,000
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VICTORY
ENERGY CORPORATION AND SUBSIDIARIES
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||||||||||||||||||||
(A
Development Stage Company)
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||||||||||||||||||||
Consolidated
Statement of Operations
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||||||||||||||||||||
Unaudited
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||||||||||||||||||||
For
the period
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||||||||||||||||||||
of
Inception,
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||||||||||||||||||||
For
the
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For
the
|
from
January 2,
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||||||||||||||||||
Three
Months Ended
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Six
Months Ended
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1982
through
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||||||||||||||||||
June
30,
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June
30,
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June
30
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||||||||||||||||||
2007
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2006
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2007
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2006
|
2007
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||||||||||||||||
Revenues
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$ |
-
|
$ |
-
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$ |
-
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$ |
-
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$ |
20,207
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||||||||||
Costs
and Expenses
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||||||||||||||||||||
Consulting
Expense
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680,494
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142,575
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2,912,501
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742,835
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6,901,855
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|||||||||||||||
Land
Leases
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4,500
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(960 | ) |
6,180
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24,040
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6,180
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||||||||||||||
Wages
and Salaries
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-
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22,500
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270,500
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|||||||||||||||||
General
& Administrative
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36,535
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239,360
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160,843
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367,497
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1,315,350
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|||||||||||||||
Total
Expenses
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721,529
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380,975
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3,079,524
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1,156,872
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8,493,885
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|||||||||||||||
Operating
Loss
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(721,529 | ) | (380,975 | ) | (3,079,524 | ) | (1,156,872 | ) | (8,473,678 | ) | ||||||||||
Other
Income and (expenses)
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||||||||||||||||||||
Loss
on abandonment of subsidiary
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(50,900 | ) | ||||||||||||||||||
Loss
from reduction in debt
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(48,363 | ) | ||||||||||||||||||
Interest
Expense
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0
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|||||||||||||||||||
Other
Income
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2,096
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|||||||||||||||||||
Total
Other Income and (expenses)
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0
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0
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0
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0
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(97,167 | ) | ||||||||||||||
Net
Loss
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$ | (721,529 | ) | $ | (380,975 | ) | $ | (3,079,524 | ) | $ | (1,156,872 | ) | $ | (8,570,845 | ) | |||||
Basic
and Dilutive net loss per share
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$ | (0.036 | ) | $ | (0.150 | ) | $ | (0.187 | ) | $ | (0.534 | ) | ||||||||
Weighted
average number of shares
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||||||||||||||||||||
outstanding,
basic and diluted
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19,973,370
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2,535,590
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16,467,912
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2,167,655
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||||||||||||||||
(Restated)
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(Restated)
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|||||||||||||||||||
Note
2
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Note
2
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|||||||||||||||||||
Dilutive
effect of preferred stock,
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0
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0
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||||||||||||||||||
(Note
2)
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VICTORY
ENERGY CORPORATION AND SUBSIDIARIES
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||||||||||||||||||||
(A
Development Stage Company)
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||||||||||||||||||||
Consolidated
Statements of Cash Flows
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||||||||||||||||||||
Unaudited
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||||||||||||||||||||
For
the
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For
the
|
Inception
from
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||||||||||||||||||
Three
Months Ended
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Six Months
Ended
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Jan.
7, 1982
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||||||||||||||||||
June
30,
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June
30,
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through
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||||||||||||||||||
2007
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2006
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2007
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2006
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June
30, 2007
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||||||||||||||||
CASH
FLOWS FROM OPERATING ACTIVITIES:
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||||||||||||||||||||
Net
Loss
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$ | (1,910,549 | ) | $ | (380,974 | ) | $ | (3,079,524 | ) | $ | (1,156,852 | ) | $ | (8,570,845 | ) | |||||
Adjustments
to reconcile net loss to net cash
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||||||||||||||||||||
used
by operating activities:
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||||||||||||||||||||
Depreciation
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599
|
599
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2,294
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|||||||||||||||||
Loss
on extinguishment of debt
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48,363
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|||||||||||||||||||
Loss
on abandonment of subsidiary
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50,900
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|||||||||||||||||||
Issuance
of common stock for services rendered
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400,000
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585,396
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877,500
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6,178,540
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||||||||||||||||
Increase
in Short Term Receivables
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88,300
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(122,684 | ) | |||||||||||||||||
Decrease
(Increase) in Prepaid Expenses
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153,500
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50,000
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||||||||||||||||||
Increase
(Decrease) in Deposits
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153,500
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|||||||||||||||||||
Incrrease
(Decrease) in Prepaid Subscriptions
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(735,000 | ) |
203,500
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|||||||||||||||||
(Incrrease)
Decrease in Subscriptions Receivable
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454,020
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(735,000 | ) | |||||||||||||||||
Increase
(Decrease) in accounts payable
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8,022
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(330,970 | ) |
21,298
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(330,970 | ) |
40,440
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|||||||||||||
Increase
(Decrease) in accrued liabilities
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4,590
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|||||||||||||||||||
Increase
(Decrease ) in Accrued Payroll,P'roll Taxes
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(300,000 | ) |
450,970
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|||||||||||||||||
Increase
(Decrease) in Short Termn Receivables
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(210,984 | ) | ||||||||||||||||||
Repayment
of long term debt
|
(146,431 | ) | ||||||||||||||||||
Increase
(decrease) in Accrued Liabilities-Related
|
690,970
|
(2,500 | ) | |||||||||||||||||
Non-cash
contributed capital
|
(524 | ) | ||||||||||||||||||
Net
Cash provided by (used by)
|
||||||||||||||||||||
Operating
Activities
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(1,448,507 | ) | (35,990 | ) | (3,207,830 | ) | (75,847 | ) | (2,782,332 | ) | ||||||||||
CASH
FLOWS FROM INVESTING ACTIVITIES
|
||||||||||||||||||||
Purchase
of Fixed Assets
|
(2,294 | ) | ||||||||||||||||||
Investment
in Joint Venture
|
(50,000 | ) | (50,000 | ) | (50,000 | ) | ||||||||||||||
Net
Cash (used by) Investing Activities
|
0
|
(50,000 | ) |
0
|
(50,000 | ) | (52,294 | ) | ||||||||||||
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||||||||||||||||||||
Proceeds
of Note Payable
|
3,027
|
|||||||||||||||||||
Proceeds
(Repayment) of Loans
|
||||||||||||||||||||
Increase
(decrease) in Credit Line
|
775
|
23,661
|
80,622
|
|||||||||||||||||
Proceeds
(Repayment) of Loan from Officer
|
114,984
|
58,310
|
298,480
|
116,664
|
988,565
|
|||||||||||||||
Proceeds
(Repayment) of Note Payable-Related Party
|
(2,500 | ) | ||||||||||||||||||
Increase
(Decrease) in Other Loans Payable
|
||||||||||||||||||||
Contributed
capital for rent and officers' compensation
|
2,438
|
|||||||||||||||||||
Proceeds
from the sale of Preferred Stock
|
||||||||||||||||||||
Proceeds
from the sale/conversion of Common Stock
|
14,788
|
23,980
|
342,191
|
|||||||||||||||||
Proceeds
from the sale/conversion of Preferred Stock
|
(85 | ) | (85 | ) |
246,950
|
|||||||||||||||
Contributed
Capital by shareholders
|
1,305,693
|
2,850,113
|
1,162,100
|
|||||||||||||||||
Net
Cash provided by Financing Activities
|
1,436,155
|
55,810
|
3,196,149
|
119,691
|
2,822,866
|
|||||||||||||||
NET
INCREASE IN CASH
|
(12,352 | ) | (30,180 | ) | (11,681 | ) | (6,156 | ) | (11,760 | ) | ||||||||||
CASH
AT BEGINNING OF PERIOD
|
592
|
28,098
|
(79 | ) |
4,074
|
-
|
||||||||||||||
CASH
AT END OF PERIOD
|
$ | (11,760 | ) | $ | (2,082 | ) | $ | (11,760 | ) | $ | (2,082 | ) | $ | (11,760 | ) | |||||
CASH
PAID FOR:
|
||||||||||||||||||||
Interest
|
$ |
-
|
$ |
-
|
$ |
-
|
$ |
-
|
$ |
-
|
||||||||||
Income
Taxes
|
$ |
-
|
$ |
-
|
$ |
-
|
$ |
-
|
$ |
-
|
June
30, 2007
|
|
June
30, 2006
|
||||||
Numerator:
|
||||||||
Basic
and diluted net loss per
share:
|
||||||||
Net
Loss
|
$ | (3,079,524 | ) | $ | (1,156,87 | ) | ||
Denominator
|
||||||||
Basic
and diluted weighted
average
|
||||||||
number
of shares
outstanding
|
16,467,912
|
2,167,655
|
||||||
Basic
and Diluted Net Loss Per Share
|
$ | (0.19 | ) | $ | (0.53 | ) | ||
(Restated)
|
||||||||
Dilutive
effect of Preferred Stock
|
Nil
|
N/A
|
Description
|
Years
|
Furniture
and fixtures
|
7
|
Computer
hardware and software
|
3-5
|
|
|
|
1.
|
Election
of Jon Fullenkamp to serve as CEO, President and Chairman of the
Board of
Directors;
|
|
2.
|
Election
of Rick May as a Director;
|
|
3.
|
Election
of Perry Mansell as a Director;
|
|
4.
|
Ratification
of the Company’s name change effective May 3,
2006;
|
|
5.
|
Ratification
of a 25:1 reverse split of the Corporation’s common stock on November 19,
2006;
|
|
6.
|
Ratification
of the authorization of 10,000,000 shares of Preferred Stock with
rights
and preferences to be determined by the Board of Directors at the
time of
issuance.
|
Exhibit
No.
|
Description
of
Exhibit
|
31
|
|
32
|
|