Balance Sheet top

September 30,     December 31,   ASSETS   2009     2008       (Unaudited)     (1)   Current Assets:               Cash   $ 156,465     $ 252,921   Accounts receivable, net of allowance for bad debt of $11,780 and $6,857 at           September 30, 2009 and December 31, 2008, respectively     139,758       177,752   Prepaid expenses and other assets     27,147       30,224   Domain name rights     1,712       20,411   Deferred tax asset     38,549       56,030   Total current assets     363,631       537,338                     Website development costs, net of accumulated amortization of $250,477 and           $206,410 at September 30, 2009 and December 31, 2008, respectively     96,373       140,075                     Fixed assets, net of accumulated depreciation of $35,465 and $24,436 at                 September 30, 2009 and December 31, 2008, respectively     9,649       17,527                     Deferred financing fees     52,412       -   Goodwill     90,000       685,547   Total assets   $ 612,065     $ 1,380,487                     LIABILITIES AND STOCKHOLDERS' DEFICIT                                   Current Liabilities:                 Accounts payable and accrued expenses   $ 343,586     $ 442,565   Deferred revenues- short-term     403,493       580,920   Deferred tax liability     38,549       56,030   Total current liabilities     785,628       1,079,515                     Convertible notes payable and accrued interest, net of debt discount of $347,439           and $156,852 at September 30, 2009 and December 31, 2008, respectively     830,348       375,787   Deferred revenue- long-term     118,172       86,110   Total liabilities     1,734,148       1,541,412                     Stockholders' Deficit:                 Preferred stock, $0.001 par value, 2,000,000 shares authorized:                 Series A,  54,000 issued and outstanding at September 30, 2009 and December 31, 2008, respectively     728,567       728,567   Series B, 112,125 issued and outstanding at September 30, 2009 and December 31, 2008, respectively     3,565,813       3,644,563   Common stock; $.001 par value; 100,000,000 shares authorized;                 28,737,607 and 27,184,854 shares issued and outstanding                 at September 30, 2009 and December 31, 2008, respectively     29,238       27,185   Additional paid-in capital     7,573,578       6,552,272   Treasury stock     (50,000 )     -   Accumulated deficit     (12,969,279 )     (11,113,512 )                   Total stockholders’ deficit     (1,122,083 )     (160,925 )                   Total liabilities and stockholders’ deficit   $ 612,065     $ 1,380,487

Cash Flow Statement top

Nine-month periods ended       September 30,       2009     2008       (Unaudited)     (Unaudited)   Cash flows from operating activities:             Net loss   $ (1,546,563 )   $ (4,243,828 ) Adjustments to reconcile net loss to net cash used in                 operating activities:                 Depreciation and amortization     112,930       283,103   Amortization of deferred compensation     -       71,400   Impairment of goodwill     595,547       -   Fair value of shares issued for services     50,000       -   Change in terms of warrants issued     97,414       -   Fair value of warrants issued for services     139,080       644,000   Fair value of options issued     -       1,239,204   Fair value of options granted     68,329       199,261   Fair value of shares issued for interest payment     25,660       -   Changes in operating assets and liabilities:                 Accounts receivable     37,994       (69,943 ) Prepaid expenses     5,577       (38,863 ) Deferred tax asset     30,110       4,503   Other assets     (2,500 )     (17,460 ) Accrued interest     8,148       4,850   Accounts payable and accrued expenses     (98,979 )     119,181   Deferred tax liability     (30,110 )     (4,503 ) Deferred revenues     (145,365 )     114,650                     Net cash used in operating activities     (652,728 )     (1,694,445 )                   Cash flows used in investing activities:                 Capital expenditures     (3,151 )     (12,130 ) Website development costs     (365 )     (47,680 )                   Net cash used in investing activities     (3,516 )     (59,810 )                   Cash flows from financing activities:                 Proceeds from notes payable     584,588       530,000   Payment to former member     -       (21,736 ) Proceeds from exercise of warrants     25,200       822,500   Repurchase of shares of common stock     (50,000 )     -                     Net cash provided by financing activities     559,788       1,330,764                     Net decrease in cash     (96,456 )     (423,491 )                   Cash, beginning of period     252,921       951,317                     Cash, end of period   $ 156,465     $ 527,826                     Supplemental disclosures of cash flow information:                 Cash paid for interest   $ 77,480     $ 23,028                     Cash paid for income taxes   $ -     $ -                     Non-cash investing and financing activities:                                   Beneficial conversion feature associated with convertible notes payable   $ 194,703     $ 179,450   Revaluation of beneficial conversion feature associated with           convertible notes payable   $ 35,019     $ -   Conversion of preferred stock Series B to common stock   $ 78,750     $ -   Cashless exercise of warrants   $ 171     $ -   Preferred stock dividends   $ 309,204     $ 311,804   Fair value of shares issued for future services   $ 50,000     $ -   Goodwill resulting from acquisition and corresponding           increase (decrease) in:   $ -     $ 105,000   Assets   $ -     $ -   Common stock and additional paid-in capital   $ -     $ 105,000