As filed with the Securities and Exchange Commission on June 6,October 16, 2008

Registration Statement No. 333-150494

U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM S-1/A

Amendment No. 12

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

DISABOOM, INC.
(Exact name of registrant as specified in its charter)

Colorado737320-5973352
(State or jurisdiction of
incorporation or organization)
(Primary Standard Industrial
Classification Code Number)
(I.R.S. Employer
Identification No.)

7730 E. Belleview Avenue
Suite A-306
Greenwood Village, CO 80111
(720) 407-6530
 
J. W. Roth, Chairman
7730 E. Belleview Avenue
Suite A-306
Greenwood Village, CO 80111
(720) 407-6530
 
(Address and telephone number of
principal executive offices and
address of principal place of
business)
(Name, address and telephone number
of agent for service)

With a Copy to:

Theresa M. Mehringer, Esq.
Burns Figa & Will, P.C.
6400 S. Fiddlers Green Circle
Suite 1000
Greenwood Village, Colorado 80111
(303) 796-2626

Approximate date of proposed sale to the public:

As soon as practicable following the date on which the Registration Statement becomes effective.

        If any of the Securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. |X|

        If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.


        If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.

        If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.

        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer    [   ]
 
Accelerated filer   [   ]
Non-accelerated filer    [   ]
 
Smaller reporting company   [X]

        If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [_]

CALCULATION OF REGISTRATION FEE

Title of each class of securities to
be registered

Amount to be
registered(1)

Proposed
maximum
offering price
per share(2)

Proposed
maximum
aggregate
offering
price(2)

Amount of
registration
fee(2)

Amount to be
registered(1)

Proposed
maximum
offering price
per share(2)

Proposed
maximum
aggregate
offering
price(2)

Amount of
registration
fee(2)

Common Stock Outstanding   9,345,166  $1.22  $11,401,102  $448    9,345,166  $1.22  $11,401,102  $448 
Common Stock Underlying Warrants  7,982,521  $1.22  $9,738,676  $383   7,972,521  $1.22  $9,738,676  $383 
Total Common Stock (3)  17,327,687  $1.22  $21,139,778  $831   17,317,687  $1.22  $21,139,778  $831 

 (1)In the event of a stock split, stock dividend or similar transaction involving our common stock, in order to prevent dilution, the number of shares registered shall be automatically increased to cover the additional shares in accordance with Rule 416(a).

 (2)Proposed maximum offering price and registration fee pursuant to Rule 457(c) is based on the average bid and asked price of our common stock on April 23, 2008, which was within five business days of the initial filing of this registration statement. A registration fee of $830 was previously paid.

 (3)All shares offered pursuant to this Registration Statement relate only to resales by Selling Shareholders.

The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said section 8(a), may determine.


PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JUNEOCTOBER ___, 2008
DISABOOM, INC.
SHARES OF COMMON STOCK

        Disaboom, Inc. (“we”, “us”, or the “Company”) incorporated under the laws of the State of Colorado on September 5, 2006. On October 1, 2007, we launched the general availability version of our website, www.disaboom.com, and on January 24, 2008 released an updated version of the website. On October 9, 2007, the Company acquired an online dating and social networking website with the domain name Lovebyrd.com, and began re-branding Lovebyrd.com in February 2008 as a related website of Disaboom.com. On February 1, 2008 the Company launched a website with the domain name DisaboomJobs.com, which is dedicated to providing employment-related resources and services to the disability community and their employers. We are continuing to develop the siteour main website and related micro sites as a comprehensive, interactive online resourceresources not only for persons living with disabilities or functional limitations, but also their immediate families and friends, caregivers, recreation and rehabilitation providers and employers.

        This prospectus relates to the resale by the selling stockholders of up to 17,327,68717,317,687 shares (the “Shares”) of our common stock that may be offered by certain shareholders (the “Selling Shareholders”) from time to time in the public market. The Selling Shareholders purchased the Shares in private offerings conducted in 2007. The Shares offered hereby include: (i) 9,345,166 shares of our common stock outstanding; and (ii) 7,982,5217,972,521 shares of our common stock issuable upon exercise of outstanding warrants.

        The Selling Shareholders may sell common stock from time to time in the principal market on which the stock is traded at the prevailing market price or in negotiated transactions. The Selling Shareholders may be deemed underwriters of the Shares which they are offering. The Selling Shareholders will receive all of the proceeds from any sales of the Shares made pursuant to this prospectus, and we will receive nothing. However, we will pay the expenses of registering the Shares.

        Our common stock is traded on the NASD Over-the-Counter Bulletin Board under the symbol “DSBO.OB.” On June 2,October 13, 2008, the closing bid price of our common stock as reported by the Over-the-Counter Bulletin Board was $1.33.$0.15.

        INVESTING IN THESE SECURITIES INVOLVES SIGNIFICANT RISKS. SEE "RISK FACTORS" BEGINNING ON PAGE 1.

        THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

        The date of this prospectus is JuneOctober ___, 2008.

        The information in this Prospectus is not complete and may be changed. This Prospectus is included in the Registration Statement that was filed by Disaboom, Inc. with the Securities and Exchange Commission. The Selling Shareholders may not sell these securities until the registration statement becomes effective. This Prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the sale is not permitted.


TABLE OF CONTENTS

Summary Information and Risk Factors   1 
Use of Proceeds   10 
Selling Security Holders   10 
Plan of Distribution   19 
Description of Securities   20 
Experts   21 
Description of the Business   21 
Legal Proceedings   3638 
Market for Common Equity and Related Shareholders Matters   3638 
Plan of Operations   3840 
Directors, Executive Officers, Promoters and Control Persons   4246 
Executive Compensation   4448 
Security Ownership of Beneficial Owners and Management   4953 
Certain Relationships and Transactions and Corporate Governance   5155 
Commission Position of Indemnification for Securities Act Liabilty   5256 
Financial Statements   F-1 
Part II - Information not Required I Prospectus   II-1 



CAUTIONARY STATEMENT ABOUT FORWARD-LOOKING STATEMENTS

This Prospectus contains forward-looking statements regarding future events and the Company’s future results that are subject to the safe harbors created under the Securities Act of 1933 (the “Securities Act”) and the Securities Exchange Act of 1934 (the “Exchange Act”). These statements are based on current expectations, estimates, forecasts, and projections about the industry in which the Company operates and the beliefs and assumptions of the Company’s management. Words such as “expects,” “anticipates,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “continues,” “may,” variations of such words, and similar expressions are intended to identify such forward-looking statements. In addition, any statements that refer to projections of the Company’s future financial performance, the continuing development of the Company’s website, the prospects for selling advertising on the website and new visitors and visitor page views related to advertising agreements, the Company’s anticipated growth and potentials in its business, and other characterizations of future events or circumstances are forward-looking statements. Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties, and assumptions that are difficult to predict, including those identified elsewhere herein, including under “Risk Factors.” Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements.

        The Company is under no duty to update any of these forward-looking statements after the date of this prospectus. You should not place undue reliance on these forward-looking statements.


SUMMARY INFORMATION AND RISK FACTORS

Prospectus Summary

        The following summary highlights selected information contained in this prospectus. This summary does not contain all the information you should consider before investing in the securities. Before making an investment decision, you should read the entire prospectus carefully.

Disaboom, Inc.

        Disaboom, Inc. (“we”, “us”, or the “Company”) incorporated under the laws of the State of Colorado on September 5, 2006. On October 1, 2007, we launched the first general availability version of our website disaboom.com, and on January 24, 2008 released an updated version of our website. On October 9, 2007, the Company acquired an online dating and social networking website with the domain name Lovebyrd.com, and began re-branding Lovebyrd.com in February 2008 as a related website of Disaboom.com. On February 1, 2008 the Company launched a website with the domain name DisaboomJobs.com, which is dedicated to providing employment-related resources and services to the disability community and their employers. We are continuing to develop theour main web site as a comprehensive, interactive online resourceresources not only for persons living with disabilities or functional limitations, but also their immediate families and friends, caregivers, recreation and rehabilitation providers and employers.

The Offering

         Common stock offered by selling stockholders includes up to 17,327,68717,317,687 shares of common stock, consisting of (i) 9,345,166 shares of our common stock outstanding, and (ii) 7,982,5217,972,521 shares of our common stock issuable upon exercise of outstanding warrants.

The 17,327,68717,317,687 common shares represent approximately 32%33% of our outstanding common stock (calculated on a post-exercise basis with respect to the warrants).

Use of proceeds. We will not receive any proceeds from the sale of the common stock.

         The above information regarding common stock to be outstanding after the offering is based on 43,334,27143,435,207 shares of common stock outstanding as of June 2,October 14, 2008, of which 116,66791,667 shares were issued in error but remain outstanding.

        Our principal offices are located at 7730 E. Belleview Avenue, Suite A-306, Greenwood Village, CO 80111 and our telephone number is (720) 407-6532. We are a Colorado corporation. Our website address is www.disaboom.com.

RISK FACTORS

Our securities are highly speculative and involve a high degree of risk, including among other items the risk factors described below.

RISKS RELATED TO OUR BUSINESS

We have a lack of operating history and lack of revenues from operations.

To date we have only realized nominal revenues and have limited operating history. Our only significant asset is the business plan andassets are our websites. Our ability to successfully generate revenues from our websitewebsites is dependent on a number of factors, including availability of funds to continue to add content to the site, to adequately develop and maintain the website as outlined in our business plan, to commercialize our website through advertising, sponsorships and strategic alliances, and to attract and retain visitors to our site. There can be no assurance that we will not encounter setbacks with our website. Wewebsites. With our projected operations and expenditures we expect that our current financial resources are sufficient to be sufficient until we project being cash flow positive; however, unexpected capital needs may arise orfund our operations into at least our third quarter of fiscal 2009. However, we may deem that it is appropriate to raise additional funds for general corporate and working capital purposes. If an unexpected capital need arises weWe cannot assure you that capital will be available on reasonable terms, if at all. Therefore, the inability to raise additional funds, either through equity or debt financing, could materially impair our ability to generate revenues.


There are many risks associated with forward-looking information.

Much of the information presented in our business plan contains forward-looking statements. Although we believe the forward-looking statements have reasonable bases, we cannot offer any assurance that we will be able to conduct our operations as contemplated.

The business of providing services over the internet is difficult to evaluate and our business model is unproven.

Because we recently began operations, it is difficult to evaluate our business and prospects. Our revenue and income potential is unproven and our business model is emerging. We may never achieve favorable operating results or profitability.

We may be unable to generate significant advertising or sponsorship revenues.

We expect to derive a significant portion of our revenues from advertising and sponsorship on the Disaboom.com website.through our main website and our related micro sites. We may not, however, be able to generate adequate advertising or sponsorship revenues. There are no widely accepted standards that measure the effectiveness of web advertising. Advertisers and sponsors that have traditionally relied on other advertising media may be reluctant to advertise on the web. Advertisers that already have invested substantial resources in other advertising or sponsor methods may be reluctant to adopt a new strategy and our business would be adversely affected.

Different pricing models are used to sell advertising on the internet. It is difficult to predict which, if any, will emerge as the industry standard. The proliferation of websites across the internet may cause advertising and sponsor pricing levels to exist or evolve which are below levels originally anticipated in the Company’s business plan. This makes it difficult to project future advertising and sponsor revenues. Moreover, certain security, filtering and proprietary software programs that limit or prevent certain types of advertising from being delivered to a web user’s computer are available. Widespread adoption of this software could adversely affect the commercial viability of web advertising.

There is no assurance that we will be successful in expanding our operations and, if successful, managing our future growth.

Although we launched the first general availability version of our website on October 1, 2007, and an updated version of the site on January 24, 2008, we are continuing to develop portions or our website and our business operations. Payments for website development and expansion of our operations have and will result in significant operating costs. If we are unable to generate revenues that are sufficient to cover our significant operating costs, our results of operations will be materially and adversely affected. In addition, we may experience periods of rapid growth, including increased staffing levels. Such growth will place a substantial strain on our management, operational, financial and other resources. Moreover, we will need to train, motivate and manage employees and partners, as well as attract sales, technical and other professionals. Any failure to expand these areas and implement such procedures and controls in an efficient manner and at a pace consistent with our business objectives would have a material adverse affect on our business, financial condition and results of operations.


We are dependent on our key personnel, and the loss of any could adversely affect our business.

We depend on the continued performance of the members of our management team, particularly Dr. Glen House, J.W. Roth and John Walpuck. Dr. House, Mr. Roth and Mr. Walpuck have each contributed significantly to the expertise of our team and the position of our business. Dr. House and Mr. Roth each entered into three-year employment agreements with the Company, and Mr. Walpuck entered into a two-year employment agreement with the Company. If we lose the services of any of the foregoing individuals, and are unable to locate suitable replacements for such persons in a timely manner, it could have a material adverse effect on our business. We do not have, and we do not expect to obtain, key man life insurance for any members of management in the foreseeable future.

We face significant competition; and, our competitors may have greater resources or research and development capabilities than we have, and we may not have the resources necessary to successfully compete with them.

Our business has been to create an interactive online resource for people living with or directly affected by disabilities or functional limitations. We are currently not aware of any significant competitors commercially selling this resource; however, the online marketplace for general healthcare information, resources, products and services is intensely competitive, rapidly evolving and subject to rapid technological change. As we continue to develop and launch modifications and updated releases of our website, we have found the internet and advertising business is highly competitive, and we may face increasing competition. Additionally, we are aware that many of our potential competitors operating in the online marketplace for general healthcare information, resources and services have greater financial and technical resources, more experience in research and development, and more established marketing and distribution capabilities than we have. Some of our large customers may also complete with us. These organizations are also better known and have more customers. We may be unable to compete successfully against these organizations if they expand their focus and operations to directly target our marketplace serving people living with or directly affected by disabilities or functional limitations.

We also compete for visitors, members, consumers, content and service providers, advertisers, sponsors, partners and acquisition candidates with a range of companies, including the following categories of companies:

online services or websites targeted to the healthcare industry and healthcare consumers generally, including webmd.com, medscape.com, pol.net, ivillage.com, medcareonline.com, mediconsult.com, betterhealth.com, drkoop.com, onhealth.com, healthcentral.com and thriveonline.com;
publishers and distributors of traditional offline media, including those targeted to healthcare professionals, many of which have established or may establish websites;
general purpose consumer online services and portals which provide access to healthcare-related content and services;
public sector and non-profit websites that provide healthcare information without advertising or commercial sponsorships;
vendors of healthcare information, products and services distributed through other means, including direct sales, mail and fax messaging; and
web search and retrieval services and other high-traffic websites.


We face significant competition from traditional media companies which could adversely affect our future operating results.

We also compete with traditional media companies for advertising. Most advertisers currently spend only a portion of their advertising budgets on internet advertising. If we fail to persuade advertisers to spend a portion of their budget on advertising with us, our revenues could decline and our future operating results could be adversely affected.

Performance or security problems with our website could negatively impact our business.

Our success depends greatly on (i) the successful and ongoing development of our website and related micro sites, and (ii) maintaining the siteour sites to minimize delays and systems problems. Our customer satisfaction and our business could be harmed if we or our customers experience system delays, failures or loss of data. The occurrence of a major catastrophic event or other system failure at any of our or our vendor facilities could interrupt data processing or result in the loss of stored data. In addition, we depend on the efficient operation of internet connections from customers to our systems and vendors. These connections, in turn, depend on the efficient operation of Web browsers, internet service providers and internet backbone service providers, all of which have had periodic operational problems or experienced outages.

A material security breach could damage our reputation or result in liability. We may be required to spend significant capital and other resources to protect against security breaches or to alleviate problems caused by breaches. Any well-publicized compromise of internet security could deter people from using the internet or from conducting transactions that involve transmitting confidential information, including confidential healthcare information. Therefore, it is critical that these facilities and infrastructure remain secure and are perceived by the marketplace to be secure.

Despite the implementation of security measures, this infrastructure may be vulnerable to physical break-ins, computer viruses, programming errors, attacks by third parties or similar disruptive problems.

Technology may change faster than we can update our applications and services.

Medical information exchange is a relatively new and evolving market. The pace of change in this market is rapid and there are frequent new product introductions and evolving industry standards. We may be unsuccessful in responding to technological developments and changing customer needs. In addition, our applications and services offerings may become obsolete due to the adoption of new technologies or standards.

We depend on service and content providers to provide information and data feeds on a timely basis. Our website could experience disruptions or interruptions in service due to the failure or delay in the transmission or receipt of this information. In addition, our members and consumers depend on internet service providers, online service providers and other website operators for access to our websites. All of them have experienced significant outages in the past and could experience outages, delays and other difficulties in the future due to system failures unrelated to our systems. Any significant interruptions in our services or increases in response time could result in a loss of potential or existing members, consumers, strategic partners, advertisers or sponsors and, if sustained or repeated, could reduce the attractiveness of our services.


If we are unable to provide services which generate significant traffic to our websites, or we are unable to enter into distribution relationships which drive significant traffic to our websites, our business could be harmed, hampering our ability to increase our revenues.

TheOur success of our business plan is largely dependent on the number of visitors to our website,websites, the number of page views and in turn, advertising and sponsorship revenue. Our marketing plan is measured by the number of page views or website hits we receive. Although management has based its estimates on what it believes to be reasonable assumptions, there can be no assurance that the number of page views can be accurately predicted, which in turn will substantially impact the ability to attract the requisite purchasers with spending power as well as advertisers and sponsors to our site, who advertise based on website traffic numbers. A material reduction in our website hits will substantially affect our business plan, projected revenues and net income.

The majority of our revenues will be derived from advertising and sponsorships, and the reduction in spending by or loss of current or potential advertisers or sponsors would cause our revenues and operating results to decline.

The majority of our total revenues will come from advertising and sponsorships. Our ability to grow advertising and sponsorship revenue depends upon:

growing and retaining our user base;
attracting new and broadening our relationships with existing advertisers and sponsors;
attracting advertisers and sponsors to our user base;
increasing demand for our advertising and sponsorships;
deriving better demographic and other information from our users; and
driving continued and increased acceptance of the web by advertisers and sponsors as an effective advertising medium.

Advertising agreements often have payments contingent upon guaranteed minimum usage, impressions, or click-through levels. Accordingly, it is difficult to forecast certain advertising revenues accurately. Any reduction in spending by or loss of existing or potential future advertisers or sponsors would cause our revenues to decline. Further, we may be unable to adjust spending quickly enough to compensate for any unexpected revenue shortfall.

Decreases or delays in advertising spending by our advertisers or sponsors due to general economic conditions could harm our ability to generate advertising revenue.

Expenditures by advertisers and sponsors tend to be cyclical, reflecting overall economic conditions and budgeting and buying patterns. Since we expect to derive the majority of our revenues from advertising, any decreases in or delays in advertising or sponsorship spending due to general economic conditions could reduce our revenues or negatively impact our ability to grow our revenues.


If we are unable to acquire compelling content at reasonable costs or if we do not develop compelling content, the number of users of our services may not grow as anticipated, or may decline, which could harm our operating results.

Our success depends in part upon our ability to create, license and aggregate compelling content from third parties, and deliver that content through our website.websites. We provide audio and video content to our users, and we believe that users will increasingly demand high-quality audio and video content, including user-generated content, such as music, film, speeches, news footage, concerts and other special events. Such content may require us to make substantial payments to third parties from whom we license or acquire such content. Our ability to maintain and build relationships with third-party content providers is critical to our success. In addition, as new methods for accessing the internet become available, including through alternative devices, we may need to enter into amended content agreements with existing third-party content providers to cover these new devices. Also, to the extent that Disaboom.com developswe develop content of itsour own, Disaboom.com’sour current and potential third-party content providers may view our services as competitive with their own, and this may adversely affect their willingness to contract with us. We may be unable to enter into new, or preserve existing, relationships with the third parties whose content we seek to obtain. In addition, as competition for compelling content increases both domestically and internationally, our content providers may increase the prices at which they offer their content to us, and potential content providers may not offer their content on terms agreeable to us. An increase in the prices charged to us by third-party content providers could harm our operating results and financial condition. Further, many of our content licenses with third parties are non-exclusive. Accordingly, other webcasters and other media such as radio or television may be able to offer similar or identical content. This increases the importance of our ability to deliver compelling editorial content and personalization of this content for users in order to differentiate Disaboom.comthe Company from other businesses. If we are unable to license or acquire compelling content at reasonable prices, if other companies broadcast content that is similar to or the same as that provided by Disaboom.com,we provide, or if we do not develop compelling editorial content or personalization services, the number of users of our services may not grow as anticipated, or may decline, which could harm our operating results.

Our intellectual property rights are valuable, and any inability to protect them could reduce the value of our brand image and harm our business and our operating results.

We create, own and maintain a wide array of intellectual property assets, including copyrights, trademarks, trade dress, trade secrets and rights to certain domain names, which we believe are among our most valuable assets. We seek to protect our intellectual property assets through copyright, trade secret, trademark and other laws of the United States, and through contractual provisions. The efforts we have taken to protect our intellectual property and proprietary rights may not be sufficient or effective at stopping unauthorized use of those rights. In addition, effective trademark, copyright and trade secret protection may not be available or cost-effective in every country in which our website and media properties are distributed or made available through the internet. There may be instances where we are not able to fully protect or utilize our intellectual property assets in a manner to maximize competitive advantages. Further, while we attempt to ensure that the quality of our brand is maintained by our licensees, our licensees may take actions that could impair the value of our brand, our proprietary rights or the reputation of our products and media properties. We realize that third parties may, from time to time, copy significant content available on Disaboom.com for use in competitive internet services. Protection of the distinctive elements of Disaboom.com may not be available under copyright law. If we are unable to protect our proprietary rights from unauthorized use, the value of our brand image may be reduced. Any impairment of our brand could negatively impact our business. In addition, protecting our intellectual property and other proprietary rights is expensive and time consuming. Any increase in the unauthorized use of our intellectual property could make it more expensive to do business and consequently harm our operating results.


We may in the future be subject to intellectual property infringement claims, which are costly to defend, could result in significant damage awards, and could limit our ability to provide certain content or use certain technologies in the future.

Third parties may in the future assert claims against us alleging infringement of copyrights, trademark rights, trade secret rights or other proprietary rights, or alleging unfair competition or violations of privacy rights or failure to maintain confidentiality of user data. In addition, third parties may make trademark infringement and related claims against us. As we expand our business and develop new technologies, products and services, we may become increasingly subject to intellectual property infringement claims. In the event that there is a determination that we have infringed third-party proprietary rights such as copyrights, trademark rights, trade secret rights or other third party rights such as publicity and privacy rights, we could incur substantial monetary liability, be required to enter into costly royalty or licensing agreements or be prevented from using the rights, which could require us to change our business practices in the future and limit our ability to compete effectively. We may also incur substantial expenses in defending against third-party infringement claims regardless of the merit of such claims. In addition, many of our agreements with our customers or affiliates require us to indemnify them for certain third-party intellectual property infringement claims, which could increase our costs in defending such claims and our damages. The occurrence of any of these results could harm our brand and negatively impact our operating results.

We are subject to United States and foreign government regulation on internet services which could subject us to claims and remedies including monetary liabilities and limitations on our business practices.

We are subject to regulations and laws directly applicable to providers of internet services both domestically and internationally. The application of existing domestic and international laws and regulations to Disaboom.com relating to issues such as user privacy and data protection, defamation, pricing, advertising, taxation, gambling, sweepstakes, promotions, financial market regulation, consumer protection, content regulation, quality of services, telecommunications and intellectual property ownership and infringement in many instances is unclear or unsettled. In addition, we will also be subject to any new laws and regulations directly applicable to our domestic and international activities. Further, the application of existing laws to Disaboom.com regulating or requiring licenses for certain businesses of our advertisers including, for example, distribution of pharmaceuticals, alcohol, adult content, tobacco or firearms, as well as insurance and securities brokerage and legal services, can be unclear. We may incur substantial liabilities for expenses necessary to comply with these laws and regulations or penalties for any failure to comply. Compliance with these laws and regulations may also cause us to change or limit our business practices in a manner adverse to our business. A number of federal laws, including those referenced below, impact our business. The Digital Millennium Copyright Act (“DMCA”) is intended, in part, to limit the liability of eligible online service providers for listing or linking to third-party websites that include materials that infringe copyrights or other rights of others. Portions of the Communications Decency Act (“CDA”) are intended to provide statutory protections to online service providers who distribute third party content. Disaboom.com relies on the protections provided by both the DMCA and CDA in conducting its business. Any changes in these laws or judicial interpretations narrowing their protections will subject us to greater risk of liability and may increase our costs of compliance with these regulations or limit our ability to operate certain lines of business. The Children’s Online Protection Act and the Children’s Online Privacy Protection Act are intended to restrict the distribution of certain materials deemed harmful to children and impose additional restrictions on the ability of online services to collect user information from minors. In addition, the Protection of Children From Sexual Predators Act of 1998 requires online service providers to report evidence of violations of federal child pornography laws under certain circumstances. The costs of compliance with these regulations may increase in the future as a result of changes in the regulations or the interpretation of them. Further, any failures on our part to comply with these regulations may subject us to significant liabilities.


Changes in regulations or user concerns regarding privacy and protection of user data could adversely affect our business.

Federal, state and international laws and regulations may govern the collection, use, sharing and security of data that we receive from our users and partners. In addition, we have, and post on our website our own privacy policies and practices concerning the collection, use and disclosure of user data. Any failure, or perceived failure, by us to comply with our posted privacy policies or with any data-related consent orders, Federal Trade Commission requirements or other federal, state or international privacy-related laws and regulations could result in proceedings or actions against us by governmental entities or others, which could potentially have an adverse effect on our business.

Further, the failure or perceived failure to comply with our policies or applicable requirements related to the collection, use, sharing or security of personal information or other privacy-related matters could result in a loss of user confidence in us and ultimately in a loss of users, partners or advertisers, which could adversely affect our business. In addition, the interpretation and application of user data protection laws are in a state of flux. Complying with these varying requirements could cause us to incur substantial costs or require us to change our business practices in a manner adverse to our business.

Compliance with Section 404 of the Sarbanes-Oxley Act.

Section 404 of the Sarbanes-Oxley Act requires management to assess our internal controls over financial reporting and requires auditors to attest to that assessment. Current regulations of the Securities and Exchange Commission, or SEC, will require us to include our management assessment in our annual report commencing with the annual report we file with the SEC for our fiscal year ending December 31, 2008. If on June 30, 2008 we are deemed to be an “Accelerated Filer” as defined by U.S. securities laws we will also be required to include our auditor’s assessment in our annual report.

We will incur significant increased costs in implementing and responding to these requirements. In particular, the rules governing the standards that must be met for management to assess its internal controls over financial reporting under Section 404 are complex, and require significant documentation, testing and possible remediation. We may have to invest in additional accounting and software systems. We may be required to hire additional personnel and to use outside legal, accounting and advisory services. In addition, we will incur additional fees from our auditors as they perform the additional services necessary for them to provide their attestation. If we are unable to favorably assess the effectiveness of our internal control over financial reporting when we are required to, or if our independent auditors are unable to provide an unqualified attestation report on such assessment, we may be required to change our internal control over financial reporting to remediate deficiencies. In addition, investors may lose confidence in the reliability of our financial statements causing our stock price to decline.

RISKS RELATED TO OUR SECURITIES

We maylikely will require additional capital in the future and we cannot assure you that capital will be available on reasonable terms, if at all, or on terms that would not cause substantial dilution to your stock holdings.

WeWith our projected operations and expenditures we expect that our current financial resources are sufficient to be sufficient forfund our corporate needs until we project being cash flow positive.operations into at least our third quarter of fiscal 2009. However, estimates for expenses, as well as our market approach and timing may change and we may decide to attempt to obtain additional debt or equity financing during 2008. Further, we may determinedeem that it is appropriate to raise additional capitalfunds for general corporate and working capital and general corporate purposes. There can be no assuranceWe cannot assure you that such capital will be available in sufficient amounts or on reasonable terms, acceptable to us, if at all. Therefore, the inability to raise additional funds, either through equity or debt financing, could materially impair our ability to generate revenues. Any sale of a substantial number of additional shares, or convertible securities, may cause dilution to your investment and could also cause the market price of our common stock to decline.


We do not plan to pay dividends on our common stock.

We do not anticipate paying cash dividends to the holders of our common stock in the foreseeable future. Accordingly, investors in our common stock must rely upon subsequent sales after price appreciation as the sole method to realize a gain on an investment in our common stock. There are no assurances that the price of our common stock will ever appreciate in value particularly if we continue to sustain operating losses. Investors seeking cash dividends should not buy our common stock.

We currently have a limited trading market as there is limited liquidity on the OTC Bulletin Board which may impact your ability to sell your shares.

Currently our shares of our Common Stock are traded on the NASD — OTC Bulletin Board. However, there is limited trading volume in our shares. When fewer shares of a security are traded on the OTC Bulletin Board, price volatility may increase and price movement may outpace the ability of the OTC Bulletin Board to deliver accurate quote information. If low trading volumes in our common stock continue, there may be a lower likelihood of orders for shares of our common stock being executed, and current prices may differ significantly from prices quoted by the OTC Bulletin Board at the time of order entry.

Our common stock is subject to the penny stock rules which limits the market for our common stock.

Because our stock is traded on the NASD-OTC Bulletin Board, if the market price of the common stock is less than $5.00 per share, the common stock is classified as a “penny stock.” SEC Rule 15g-9 under the Exchange Act imposes additional sales practice requirements on broker-dealers that recommend the purchase or sale of penny stocks to persons other than those who qualify as an “established customer” or an “accredited investor.” This includes the requirement that a broker-dealer must make a determination that investments in penny stocks are suitable for the customer and must make special disclosures to the customers concerning the risk of penny stocks. Many broker-dealers decline to participate in penny stock transactions because of the extra requirements imposed on penny stock transactions. Application of the penny stock rules to our common stock reduces the market liquidity of our shares, which in turn affects the ability of holders of our common stock to resell the shares they purchase, and they may not be able to resell at prices at or above the prices they paid.

There may be a greater risk of fraud on the NASD-OTC Bulletin Board.

NASD-OTC Bulletin Board securities are more frequently targets for fraud or market manipulation because they are not regulated as closely as securities listed on exchanges. Dealers may dominate the market and set prices that are not based on competitive forces. Individuals or groups may create fraudulent markets and control the sudden, sharp increase of price and trading volume and the equally sudden collapse of market prices. While there is regulation of the NASD-OTC Bulletin Board, it is not as comprehensive as the regulation of the listed exchange. If this should occur, the value of an investment in our common stock could decline significantly.


USE OF PROCEEDS

        This prospectus relates to shares of our common stock that may be offered and sold from time to time by the Selling Shareholders. We will not receive any proceeds from the sale of shares in this offering. However, if the warrants are exercised we will receive the exercise price paid upon exercise of those warrants. If we receive any proceeds upon the exercise of the outstanding warrants we intend to use the proceeds for working capital and other general corporate purposes. All proceeds received from the sale of the shares offered by the Selling Shareholders will accrue to the benefit of the Selling Shareholders and not to the Company.

SELLING SECURITY HOLDERS

        The tables below set forth information concerning the resale of the Shares by the Selling Shareholders. We are registering for resale an aggregate of 17,327,68717,317,687 shares of our common stock which includes 9,345,166 shares currently outstanding and 7,982,5217,972,521 shares underlying warrants. Except for 55,000 of the shares issued in October 2007, 86,32576,325 shares underlying warrants that were issued in December 2007, and May 2008, the shares and warrants were purchased by the selling shareholders in two private placements, the first closed in September and October 2007 (“Offering No. 1”) and the second offering closed in December 2007 (“Offering No. 2”). The resale of the shares purchased in Offering No. 1 and shares underlying the warrants purchased in Offering No. 1 were originally registered in a registration statement we filed on Form SB-2, SEC File No. 333-148122. We are registering the resale of these shares of our common stock to permit each of the selling stockholders and their donees, pledgees, transferees or other successors-in-interest that receive their shares after the date of this prospectus to resell or otherwise dispose of the shares and shares underlying warrants, or interests therein, as well as any stock that we may issue or may be issuable by reason of any stock split, stock dividend or similar transaction involving these shares, in the manner contemplated under “Plan of Distribution.” We will not receive any proceeds from the resale of the common stock by the Selling Shareholders.

Offering No. 2

        The following table sets forth the name of each person who is offering the resale of shares of common stock by this prospectus that were purchased in Offering No. 2. The number of shares of common stock beneficially owned by each person, the number of shares of common stock that may be sold in the offering and the number of shares of common stock each person will own after the offering, assuming they sell all of the shares offered.



A

B

C

D

E
 
     Name

Outstanding
Shares Owned


Shares
Underlying
Warrants


Total Shares
(Based on
Columns A and B)
Beneficially
Owned Prior to
Offering (1)


Shares Offered
Hereby
(1)


Shares Owned
After Offering
(1) (2)


Vanita Aggarwal   7,928  5,946  13,874  13,874  0 

Harlan Arita   19,818  14,862  34,680  34,680  0 

Richard S. Baright and  
Carleen S. Baright JT WROS   33,333  25,000  58,333  58,333  0 





A

B

C

D

E
 
Jerry O. Barney   11,891  8,919  20,810  20,810  0 

John R. Bartos   33,333  25,000  58,333  58,333  0 

Margaret M. Bathgate (6)   23,781  17,835  41,616  41,616  0 

Emmanuel Baud   33,333  25,000  58,333  58,333  0 

Axel Bauer   53,333  40,000  93,333  93,333  0 

Richard John Baxter   68,000  51,000  119,000  119,000  0 

John W. Beckley   39,636  29,727  69,363  69,363  0 

Eric N. Billingsley   66,667  50,000  116,667  116,667  0 

Michael Bilotta   69,363    69,363  69,363  0 

Albert Terry Bourque Jr. &  
Hope Bourque JTTEN   33,333  25,000  58,333  58,333  0 

Andrew MD Bradford   33,333  25,000  58,333  58,333  0 

Bruce & Laura Bray JT WROS   33,333  25,000  58,333  58,333  0 

Jochen Burrichter   133,333  100,000  233,333  233,333  0 

Anthony C.M. Bury   133,333  100,000  233,333  233,333  0 

Curtis Campbell   20,214  15,160  35,374  35,374  0 

Stephen Caragol   66,667  50,000  116,667  116,667  0 

Blue Rhino Investments, Inc.  
Defined Benefit Plan PSP (5)   66,667  50,000  116,667  116,667  0 

Ronald Barrie Clapham   66,667  50,000  116,667  116,667  0 

Ryan D. Clutter   33,333  25,000  58,333  58,333  0 

Kyle Cox (6)   39,636  29,727  69,363  69,363  0 

David Davis   33,333  25,000  58,333  58,333  0 

Mark Davis   66,667  50,000  116,667  116,667  0 

F. Rouault De La Vigne   39,616  29,712  69,328  69,328  0 

Eric Delissy   66,667  50,000  116,667  116,667  0 

Daniel & Gina Derrico JT WROS   66,667  50,000  116,667  116,667  0 

Georgios Doutis   50,000  37,500  87,500  87,500  0 

Mike & Ellen Duffy JT WROS   133,333  100,000  233,333  233,333  0 

Jeremy P. Edwards   66,667  50,000  116,667  116,667  0 

W. Mark Edwards   66,667  50,000  116,667  116,667  0 

David W. Floyd and  
Cheryl W. Floyd JT WROS   33,333  25,000  58,333  58,333  0 

Stephan Gais   333,333  250,000  583,333  583,333  0 

Frank G. Gasztonyi and  
Cynthia Gasztonyi JT WROS   33,333  25,000  58,333  58,333  0 

Anton Gavrailov   33,333  25,000  58,333  58,333  0 

Eyal Giladi   19,818  14,863  34,681  34,681  0 

Patricia Susan Gorrie   100,000  75,000  175,000  175,000  0 

Donald G. Hamilton   66,667  50,000  116,667  116,667  0 

Howard H. Harriman &  
Eunice S. Harriman JT WROS   133,333  100,000  233,333  233,333  0 




A

B

C

D

E
 
Michael T. Heffner   133,333  100,000  233,333  233,333  0 

Jay A. Hintze   33,333  25,000  58,333  58,333  0 

H. Lee Hornbeck &  
Carolyn Sue Hornbeck JT WROS   200,000  150,000  350,000  350,000  0 

Brian Hunter   100,000  75,000  175,000  175,000  0 

Gregory F. Hurley   166,667  125,000  291,667  291,667  0 

Oren Inbar   39,818  14,863  54,681  34,681  20,000 

Michael Ishida   59,453  44,589  104,042  104,042  0 

Deepak Jain   7,928  5,946  13,874  13,874  0 

Varon Jain   7,927  5,946  13,873  13,873  0 

Matthew Keller (6)   33,333  25,000  58,333  58,333  0 

James G. Kennedy IRA Charles  
Schwab & Co., Inc. Custodian   100,000  59,454  159,454  138,725  20,729 

Nancy H. Kennedy IRA Charles  
Schwab & Co., Inc. Custodian   50,000  29,727  79,727  69,363  10,364 

John Klopp   33,333  25,000  58,333  58,333  0 

Steve Krietemeyer and  
Rose Krietemeyer JT WROS   33,333  25,000  58,333  58,333  0 

Rachel P. Kruger   19,818  14,863  34,681  34,681  0 

Ralph E. Kruger Jr.   19,818  14,863  34,681  34,681  0 

George Kryzaniwsky   133,333  100,000  233,333  233,333  0 

Delaware Charter Guarantee &  
Trust CO TTEE FBO John David  
Kucera IRA #44647683   11,891  8,917  20,808  20,808  0 

Swiatoslaw Kuziw   133,333  100,000  233,333  233,333  0 

The Larsen 2000 Revocable  
Trust (5)   66,667  50,000  116,667  116,667  0 

Ronald E. Lehman &  
Sharon V. Lehman COMM PROP WROS   66,667  50,000  116,667  116,667  0 

Risa Levin   56,000  42,000  98,000  98,000  0 

Brian E. Lewis   33,333  25,000  58,333  58,333  0 

Geoffrey Charles Maddock   133,333  100,000  233,333  233,333  0 

Sterling McGregor &  
Pamela McGregor   33,333  25,000  58,333  58,333  0 

Medimiles BV (5)   33,333  25,000  58,333  58,333  0 

Theresa Mehringer and  
Paul Cadorette JTTEN   69,818  14,863  84,681  34,681  50,000 

Kenneth Montgomery   33,333  25,000  58,333  58,333  0 

Moreland Crosby Industries (5)   33,333  25,000  58,333  58,333  0 





A

B

C

D

E
 
Irvin S. Naylor   39,636  29,727  69,363  69,363  0 

Newport Capital Partners Inc. (5)   33,333  25,000  58,333  58,333  0 

Norton Delware & CO (5)   33,333  25,000  58,333  58,333  0 

Jeremy Oates   66,667  50,000  116,667  116,667  0 

Michael Ferghal O'Regan   120,000  90,000  210,000  210,000  0 

Micheal Norman Oughtred   133,333  100,000  233,333  233,333  0 

Nitin Patil   7,911  5,934  13,845  13,845  0 

J.J. Peirce   66,667  50,000  116,667  116,667  0 

Cynthia Peragallo and  
Dario Peragallo JT WROS   33,333  25,000  58,333  58,333  0 

Richard J. Petso (6)   11,891  8,917  20,808  20,808  0 

Paul M. Ponte   66,667  50,000  116,667  116,667  0 

Michael J.M. Quinlan   80,000  60,000  140,000  140,000  0 

Janice Rager   39,636  29,727  69,363  69,363  0 

Adam Raynor   166,667  125,000  291,667  291,667  0 

Barry Romich   33,333  25,000  58,333  58,333  0 

Michael Sandford   33,333  25,000  58,333  58,333  0 

Joseph A. Santoro   33,333  25,000  58,333  58,333  0 

Samuel Scheller   33,333  25,000  58,333  58,333  0 

Hans Seger   133,333  100,000  233,333  233,333  0 

B.W. Skinner   66,667  50,000  116,667  116,667  0 

Slade, Inc. (5)   39,636  29,727  69,363  69,363  0 

Richard Anthony Smee   333,333  250,000  583,333  583,333  0 

Stephen C. Smith   7,928  5,946  13,874  13,874  0 

Lori Sunshine (7)   31,709  33,781  65,490  65,490  0 

Hubertus J.H. Sweering   66,667  50,000  116,667  116,667  0 

S.M. Weiler Appointment Trust  
f/b/o Ellen W. Halle (5)   39,636  29,727  69,363  69,363  0 

Patrick A. Templeton (3)   27,745  20,808  48,553  48,553  0 

Tisu Investment Ltd (5)   66,667  50,000  116,667  116,667  0 

Kenneth D. Wasserman   39,636  29,727  69,363  69,363  0 

Yossi Weinberger   33,333  25,000  58,333  58,333  0 

Sean Westervelt   66,667  50,000  116,667  116,667  0 

WestMountain Prime LLC (5)   178,360  133,770  312,130  312,130  0 

W-3 Ventures, Inc.(5),(7)   0  66,325  66,325  66,325  0 

Mark Wheeler   39,636  29,727  69,363  69,363  0 

Rob Yarbrough   47,563  35,673  83,236  83,236  0 

Robert Zelin   33,333  25,000  58,333  58,333  0 

Bathgate Capital Partners(4)   0  33,011  33,011  33,011  0 

James Halle(4)   0  17,835  17,835  17,835  0 




A

B

C

D

E
 

A

B

C

D

E
 
GunnAllen Financial Inc.(4) (5)  0  404,550  404,550  404,550  0   0  404,550  404,550  404,550  0 

Lovebyrd.com, LLC (5), (6), (8)  55,000  0  55,000  55,000  0   55,000  0  55,000  55,000  0 


Abshier Webb & Donnelly (5), (9)  0  10,000  10,000  10,000  0 

TOTALS  6,648,361  5,410,921  12,059,282  11,958,189  101,093   6,648,361  5,400,921  12,049,282  11,948,189  101,093 


    (1)        The beneficial ownership of the common stock by the selling stockholder set forth in the table is determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rule, beneficial ownership includes any shares as to which the selling stockholders has sole or shared voting power or investment power and also any shares, which the selling stockholders has the right to acquire within 60 days.

    (2)        Assumes that all securities registered will be sold.

    (3)        Relationships between selling security holders and the Company are as follows: Mr. Templeton currently serves on the Company’s Board of Directors.

    (4)         GunnAllen Financial, Inc., Bathgate Financial Partners and Chapin Davis served as placement agents for the Company for the private placement completed in December 2007 and are registered broker dealers. The warrants issued to James Halle, who is a registered representative of Chapin Davis, were issued to Mr. Halle as part of the commission owed to Chapin Davis.

     (5)        The natural person(s) who exercise voting and/or dispositive and investing powers are the following individuals: David L. Larsen and Kristen B. Larsen, Trustees have voting and dispositive power over the shares held by The Larsen 2000 Revocable Trust; Marielle DeHaas has voting and dispositive power over the shares held by Medmiles BV; Gerald W. Moreland and Barbara A. Moreland have voting and dispositive power over the shares held by Moreland Crosby Industries, Inc.; Walter Stresemenn has voting and dispositive power over the shares held by Norton Delaware & Co.; Rephael Inbar has voting and dispositve power over the shares held by W3 Ventures, Inc.; Pat Stryker and Joseph C. Zimlich have voting and dispositive power over the shares held by WestMountain Prime LLC; Richard D. Lovely has voting and dispositive power over the shares held by Lovebyrd, LLC; Stephen Caragol has voting and dispositive power over the shares held by Blue Rhino Investments, Inc. Defined Benefit Plan PSP; RW Schaum has voting and dispositive power over the shares held by Newport Capital Partners Inc; Richard A. Frueh has voting and dispositive power over the shares held by GunnAllen Financial Inc; Edward A. Halle Jr. has voting and dispositive power over the shares held by Slade Inc. and the shares held by the SM Weiler Trust; Art Donnelly has voting and dispositive power over the shares held by Abshier Webb & Donnelly; and Tis Prager has voting and dispositive power over the shares held by Tisu Investment Ltd.

    (6)        Kyle Cox, Matthew Keller, James Halle, Richard J. Petso, and Margaret Bathgate have all identified themselves as affiliates of Broker/Dealers. These shareholders have represented to the Company that they purchased the Securities on their own behalf in the ordinary course of business, and at the time of the purchase of the Securities, they had no agreements or understandings, directly or indirectly, with any party to distribute the Securities. All other selling shareholders (except as provided in footnotes 4 and 9) have represented that they are not registered broker-dealers or an affiliate of a registered broker-dealer.

    (7)         The 66,325 warrants issued to W3 Ventures and 10,000 warrants issued to Lori Sunshine were issued in consideration for business consulting services.

    (8)        The 55,000 shares held by Lovebyrd, LLC were issued in October 2007 pursuant to an asset purchase agreement between the Company and Lovebyrd, LLC.

    (9)        The 10,000 warrants issued to Abshier Webb & Donnelly were issued as partial commission for serving as a placement agent for the private placement the Company completed in March and April 2008. Abshier Webb & Donnelly is a registered broker–dealer.

Offering No. 1

        The following table sets forth the name of each person who is offering the resale of shares of common stock by this prospectus that were purchased in Offering No. 1. The number of shares of common stock beneficially owned by each person, the number of shares of common stock that may be sold in the offering and the number of shares of common stock each person will own after the offering, assuming they sell all of the shares offered.




A

B

C

D

E
 

A

B

C

D

E
 
Name

Outstanding
Shares Owned


Shares
Underlying
Warrants


Total Shares
(Based on
Columns A and B)
Beneficially
Owned Prior to
Offering (1)


Shares Offered
Hereby
(1)


Shares Owned
After Offering
(1) (2)



Outstanding
Shares Owned


Shares
Underlying
Warrants


Total Shares
(Based on
Columns A and B)
Beneficially
Owned Prior to
Offering (1)


Shares Offered
Hereby
(1)


Shares Owned
After Offering
(1) (2)


Anderieck Holdings, LLC(5)  66,667  16,667  83,334  16,667  66,667   66,667  16,667  83,334  16,667  66,667 

Mark A. Araki  166,667  41,667  208,334  41,667  166,667   166,667  41,667  208,334  41,667  166,667 

Rodney D. Baber (6)  600,000  100,000  700,000  300,000  400,000   600,000  100,000  700,000  300,000  400,000 

Angelo Barr (6)  23,333  0  23,333  10,000  13,333   23,333  0  23,333  10,000  13,333 

Richard A. Becher  26,667  6,667  33,334  6,667  26,667   26,667  6,667  33,334  6,667  26,667 

James Richard Belk  26,667  6,667  33,334  6,667  26,667   26,667  6,667  33,334  6,667  26,667 

Jay D. Belk (3)  119,333  8,333  127,666  8,333  119,333   119,333  8,333  127,666  8,333  119,333 

John N. Boyle III &  
Cynthia M. Boyle (6)  40,000  10,000  50,000  10,000  40,000   40,000  10,000  50,000  10,000  40,000 

Scott Brownholtz  66,667  16,667  83,334  16,667  66,667   66,667  16,667  83,334  16,667  66,667 

Charles H. Bruce  66,667  16,667  83,334  16,667  66,667   66,667  16,667  83,334  16,667  66,667 

Lori S. Bruce  53,333  13,333  66,666  13,333  53,333   53,333  13,333  66,666  13,333  53,333 

Warren G. Buettner  70,000  8,333  78,333  25,000  53,333   70,000  8,333  78,333  25,000  53,333 

Daniel L. Carnahan  79,000  2,500  81,500  7,500  74,000   79,000  2,500  81,500  7,500  74,000 

Lawrence Chimerine  50,000  8,333  58,333  25,000  33,333   50,000  8,333  58,333  25,000  33,333 

Todd J. & Colleen K.  
Chwialkowski  20,000  3,333  23,333  10,000  13,333   20,000  3,333  23,333  10,000  13,333 

Jove Partners, LP on behalf of  900,000  150,000  1,050,000  450,000  600,000   900,000  150,000  1,050,000  450,000  600,000 
Jove Master Fund, Ltd.(5)  

Clayton Cole  50,000  8,333  58,333  25,000  33,333   50,000  8,333  58,333  25,000  33,333 

Kevin M. Cox  266,667  16,667  283,334  16,667  266,667   266,667  16,667  283,334  16,667  266,667 

James A. Deleeuw & Julie M.  66,667  16,667  83,334  16,667  66,667   66,667  16,667  83,334  16,667  66,667 
Deleeuw as Joint Tenants (JTWROS)  

Douglas A. Dennis  73,333  13,333  86,666  13,333  73,333   73,333  13,333  86,666  13,333  73,333 

J. Doug Dunn  200,000  33,333  233,333  100,000  133,333   200,000  33,333  233,333  100,000  133,333 

R. Kent Erickson  13,333  3,333  16,666  3,333  13,333   13,333  3,333  16,666  3,333  13,333 

Richard T. Glass and Anne Marie  
Glass Trustees for the R.T. Glass  
& Associates Defined Benefit  
Pension Plan  66,667  16,667  83,334  16,667  66,667   66,667  16,667  83,334  16,667  66,667 

Joe M. Goldenstern  10,000  1,667  11,667  5,000  6,667   10,000  1,667  11,667  5,000  6,667 

Kevin Hall(3)  100,000  16,667  116,667  50,000  66,667   100,000  16,667  116,667  50,000  66,667 

Lowell Hansen  40,000  6,667  46,667  20,000  26,667   40,000  6,667  46,667  20,000  26,667 

Donald L. Hartmann (6)  19,333  2,333  21,666  2,333  19,333   19,333  2,333  21,666  2,333  19,333 

Hallmark Consulting  
Group, Inc. (5)(6)  26,667  6,667  33,334  6,667  26,667   26,667  6,667  33,334  6,667  26,667 





A

B

C

D

E
 
Chris L. Heitman   10,000  1,667  11,667  5,000  6,667 

Jon D. Hellhake   91,666  16,666  108,332  41,666  66,666 

Larry J. Hellhake and  
Diane K. Hellhake   114,000  19,000  133,000  57,000  76,000 

Edward Hitchcock   33,333  8,333  41,666  8,333  33,333 

Revocable Living Trust of Dean  
Edmund Hittle and Ann Elizabeth  
Hittle dated March 31, 1994   66,667  16,667  83,334  16,667  66,667 

Mark A. Hogan   23,333  3,333  26,666  3,333  23,333 

Charles J. Horak III and Ann M.   200,000  50,000  250,000  50,000  200,000 
Branan Horak  

James B. House, JR   50,000  5,000  55,000  5,000  50,000 

Jean E. Hunter Trust dtd 6/8/89   20,000  3,333  23,333  10,000  13,333 

Robert Jacobsen   40,000  6,667  46,667  20,000  26,667 

Philip W. Johnson   20,000  3,333  23,333  10,000  13,333 

Dan Kenneth Johnstone and Sherry   153,333  13,333  166,666  13,333  153,333 
Lynn Johnstone  

E. Carl Krausnick, JR.(6)   33,333  8,333  41,666  8,333  33,333 

George L. Learned (6)   59,333  12,333  71,666  12,333  59,333 

LAM Waiting Game Fund, Ltd.(5)   66,667  16,667  83,334  16,667  66,667 

Tim R. Mathes and Sharon Mathes   76,667  16,667  93,334  26,667  66,667 

Kenneth A. May   600,000  100,000  700,000  300,000  400,000 

Gary McGill (6)   20,000  5,000  25,000  5,000  20,000 

Michael McGill   10,667  2,667  13,334  2,667  10,667 

David Mellman / Philippa Hambidge   26,667  6,667  33,334  6,667  26,667 

David P. Messinger   20,000  3,333  23,333  10,000  13,333 

Todd Michael   20,000  5,000  25,000  5,000  20,000 

David J. Myers and  
Ann A. Myers Joint Tenancy   20,000  3,333  23,333  10,000  13,333 

Gordon Neill   116,667  16,667  133,334  16,667  116,667 

Gordon Neill Profit Sharing  
Plan & Trust (5)   133,333  33,333  166,666  33,333  133,333 

Nanine A. Odell (3) (6)   113,333  3,333  116,666  3,333  113,333 

Joseph M. O'Donnell   200,000  33,333  233,333  100,000  133,333 

Carolyn F. Overgaard (3)   200,000  16,667  216,667  50,000  166,667 

John P. Overgaard   13,333  3,333  16,666  3,333  13,333 

John E. Peppercorn   100,000  16,667  116,667  50,000  66,667 

Frank F. Pitts JR   45,000  7,500  52,500  22,500  30,000 

Wesley A. Pomeroy   50,000  12,500  62,500  12,500  50,000 

Daniel I. Raviv   60,000  10,000  70,000  30,000  40,000 

Nora Kathleen Shannon-Yano   200,000  16,667  216,667  50,000  166,667 





A

B

C

D

E
 
Judith A. Shine   33,333  3,333  36,666  3,333  33,333 

Richard S. Simms   50,000  5,000  55,000  5,000  50,000 

Dennis E. Simonich   66,667  16,667  83,334  16,667  66,667 

Eric D. Sipf   200,000  16,667  216,667  50,000  166,667 

Graham R. Smith   600,000  100,000  700,000  300,000  400,000 

Waverly Limited Partnership (5)   600,000  100,000  700,000  300,000  400,000 

Gary Smookler   65,000  0  65,000  15,000  50,000 

Jonathan Brit Stephens   250,000  50,000  300,000  100,000  200,000 

Donald K. Stritzke   720,000  33,333  753,333  100,000  653,333 

Richard J. Thompson   96,667  16,667  113,334  46,667  66,667 

J.L. Wagner   2,500  500  3,000  1,000  2,000 

Janet H. White   16,667  1,667  18,334  1,667  16,667 

William J. White (6)   76,667  6,667  83,334  6,667  76,667 

John F. Wolz dba Euphotics   20,000  3,333  23,333  10,000  13,333 

HC Schmieding Produce CO INC  
Employee Stock Ownership Plan  
and Trust (5)   800,000  133,333  933,333  400,000  533,333 

Schmieding Enterprises, Inc. (5)   400,000  66,667  466,667  200,000  266,667 

The Schmieding Foundation INC (5)   800,000  133,333  933,333  400,000  533,333 

Merlin Bingham   40,000  6,667  46,667  20,000  26,667 

Jeff McGonegal   30,000  5,000  35,000  15,000  20,000 

David Nahmias   40,000  10,000  50,000  10,000  40,000 

David Petso (3) (6)   620,000  16,667  636,667  50,000  586,667 

Eric H. Pettit   20,000  5,000  25,000  5,000  20,000 

Mark X Energy Company (5)   200,000  33,333  233,333  100,000  133,333 

Pusey, Greg   13,333  3,333  16,666  3,333  13,333 

Morgan Keegan & Company Inc.(4)   0  544,300  544,300  544,300  0 

Jay Goldman(4)   0  3,250  3,250  3,250  0 

Jesup & Lamont Securities Corp.(4)   0  5,750  5,750  5,750  0 

Veronica McCarthy(4) (6)   0  1,500  1,500  1,500  0 

    12,075,834  2,370,800  14,446,634  4,969,301  9,477,333 


        (1)     The beneficial ownership of the common stock by the selling stockholder set forth in the table is determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rule, beneficial ownership includes any shares as to which the selling stockholders has sole or shared voting power or investment power and also any shares, which the selling stockholders has the right to acquire within 60 days.

        (2)     Assumes that all securities registered will be sold.


        (3)     Relationships between selling security holders and the Company are as follows: Jay D. Belk served as a director of Disaboom until August 21, 2007; Nanine Odell is the spouse of Victor Lazarro Jr., a director of the Company; Carolyn Overgaard is the spouse of R. Jerry Overgaard, a director of the Company; David Petso serves as a director of the Company.Company; and Kevin Hall currently serves as a director of the Company although he is not standing for reelection to our board of directors at our November 5, 2008 annual meeting of shareholders.

        (4)     Morgan Keegan & Company, Inc. and Jesup & Lamont Securities Corporation served as placement agents for the Company for the private placement completed in September and October 2007, and are registered broker dealers. The warrants issued to Jay Goldman and Veronica McCarthy were issued as part of the commission paid to Jesup & Lamont Securities Corporation.

        (5)     The natural person(s) who exercise voting and/or dispositive and investing powers are the following individuals: A.C. Garland has voting and dispositive power over the shares held by Anderick Holdings, LLC; Donald L. Hartmann has voting and dispositive power over the shares held by Hallmark Consulting Group, Inc.; W. Austin Lewis has voting and dispositive power over the shares held by the LAM Waiting Game Fund, Ltd.; Graham R. Smith, Jennifer T. Smith, and George Pappas have voting and dispositive power over the shares held by Waverly Limited Partnership; Charles L. Barney has voting and dispositive power over the shares held by Mark X Energy Company; Robby J. Zink has voting and dispositive power over the shares held by HC Schmieding Produce CO INC Employee Stock Ownership Plan and Trust and The Schmieding Foundation Inc.; Robby J. Zink and Lawrence H. Schmieding have voting and dispositive power over the shares held by Schmieding Enterprises, Inc.; and Joel Citron holds voting and dispositive power over the shares held by Jove Partners, LP on behalf of Jove Master Fund, Ltd.

        (6)     Rodney D. Baber, Angelo Barr, John N. Boyle, Donald L. Hartmann, E. Carl Krausnick, JR., Michael McGill, William J. White, David Petso, Veronica McCarthy, Nanine A Odell, and George L. Learned have all identified themselves as affiliates of Broker/Dealers. These shareholders have represented to the Company that they purchased the Securities on their own behalf in the ordinary course of business, and at the time of the purchase of the Securities, they had no agreements or understandings, directly or indirectly, with any party to distribute the Securities. All other selling shareholders (except as provided in footnote 4) have represented that they are not registered broker-dealers or an affiliate of a registered broker-dealer.

Selling Shareholders Participating in Both Offering No. 1 and Offering No. 2

        The following table sets forth the names of the persons offering shares of common stock by this prospectus who participated in both Offering No. 1 and Offering No. 2. The number of shares of common stock beneficially owned by each person, the number of shares of common stock that may be sold in the offering and the number of shares of common stock each person will own after the offering, assuming they sell all of the shares offered.



A

B

C

D

E
 
Name

Outstanding
Shares Owned


Shares
Underlying
Warrants


Total Shares
(Based on
Columns A and B)
Beneficially
Owned Prior to
Offering (1)


Shares Offered
Hereby
(1)


Shares Owned
After Offering
(1) (2)


Sean Chawla (3)   159,271  79,454  238,725  158,725  80,000 

Harold G. Goble (4)   36,260  9,279  45,539  22,206  23,333 

Rephael Inbar (5)   176,303  46,394  222,697  106,030  116,667 

Deborah Ku (6)   167,563  65,673  233,236  113,236  120,000 

TOTALS   539,397  200,800  740,197  400,197  340,000 



        (1)         The beneficial ownership of the common stock by the selling stockholder set forth in the table is determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rule, beneficial ownership includes any shares as to which the selling stockholders has sole or shared voting power or investment power and also any shares, which the selling stockholders has the right to acquire within 60 days.

        (2)         Assumes that all securities registered will be sold.

        (3)         Consists of 80,000 shares and 20,000 shares underlying non-redeemable warrants purchased in Offering No. 1 as well as 79,271 shares with 59,454 warrants purchased in Offering No. 2.

        (4)         Consists of 13,333 shares plus 5,000 shares acquired upon the exercise of warrants purchased in Offering No. 1, as well as 3,333 shares underlying non-redeemable warrants purchased in that offering. Also includes 7,927 shares and 5,946 shares underlying warrants purchased in Offering No. 2. Outstanding shares owned also includes 10,000 shares not purchased in either Offering No. 1 or Offering No. 2, which are not being offered for resale pursuant to this prospectus.

        (5)         Consists of 66,667 shares plus 20,000 shares acquired the exercise of warrants purchased in Offering No. 1, as well as 16,667 shares underlying non-redeemable warrants purchased in that offering. Also includes 39,636 shares plus 29,727 shares underlying warrants purchased in Offering No. 2. Outstanding shares owned also includes 50,000 shares that were not purchased in Offering No. 1 or Offering No. 2, which are not being offered for resale pursuant to this prospectus.

        (6)         Consists of 120,000 shares and 30,000 shares underlying non-redeemable warrants purchased in Offering No. 1 and 47,563 shares and 35,673 shares underlying warrants purchased in Offering No. 2.

PLAN OF DISTRIBUTION

        Each Selling Shareholder and any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their shares of common stock on the trading market or any other stock exchange, market or trading facility on which the shares are traded or in private transactions. These sales may be at fixed or negotiated prices. A Selling Shareholder may use any one or more of the following methods when selling shares:

ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;
purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
an exchange distribution in accordance with the rules of the applicable exchange;
privately negotiated transactions;
settlement of short sales entered into after the date of this prospectus;
broker-dealers may agree with the Selling Stockholders to sell a specified number of such shares at a stipulated price per share;
a combination of any such methods of sale;
through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; or
any other method permitted pursuant to applicable law.


        The Selling Shareholders may also sell shares under Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), if available, rather than under this prospectus.

        Broker-dealers engaged by the Selling Shareholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the Selling Shareholders (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated. Each Selling Shareholder does not expect these commissions and discounts relating to its sales of shares to exceed what is customary in the types of transactions involved.

        The Selling Shareholders and any broker-dealers or agents that are involved in selling the Shares may be deemed to be “underwriters” within the meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the Shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act. Each Selling Shareholder has informed us that it does not have any agreement or understanding, directly or indirectly, with any person to distribute the Common Stock.

        The Shares will be sold only through registered or licensed brokers or dealers if required under applicable state or provincial securities laws. In addition, in certain states or provinces, the Shares may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.

        Under applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the Shares may not simultaneously engage in market making activities with respect to our common stock for a period of two business days prior to the commencement of the distribution. In addition, the Selling Shareholders will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of shares of our common stock by the Selling Shareholders or any other person.

DESCRIPTION OF SECURITIES TO BE REGISTERED

Capital Stock

        The authorized capital of the Company currently consists of 75,000,000 shares, of which 10,000,000 shares are preferred stock, par value of $.0001 per share (“Preferred Stock”), and 65,000,000 shares are common stock, par value of $.0001 per share (“Common Stock”). At our annual meeting of shareholders to be held on November 5, 2008 we are seeking shareholder approval to amend our articles of incorporation and increase the number of authorized common shares to 100,000,000. We currently have 43,334,27143,435,270 shares of common stock outstanding, and no shares of preferred stock outstanding. The number of outstanding common shares includes 116,66791,667 shares issued in error but remains outstanding.

        Each share of common stock is entitled to share pro rata in dividends and distributions, if any, with respect to the common stock when, as and if declared by the Board of Directors from funds legally available for such purpose. No holder of any shares of common stock has any preemptive rights to subscribe for any securities of the Company. Upon liquidation, dissolution or winding up of the Company, each share of the common stock is entitled to share ratably in the amount available for distribution to holders of common stock. All shares of common stock presently outstanding are fully paid and non-assessable.

        Each shareholder is entitled to one vote for each share of common stock held. There is no right to cumulate votes for the election of directors. This means that holders of more than 50% of the shares voting for the election of directors can elect all of the directors if they choose to do so, and in such event, the holders of the remaining less than 50% of the shares voting for the election of directors will not be able to elect any person or persons to the Board of Directors.


Dividends

        We have never declared or paid any dividends or distributions on our common stock. We anticipate that for the foreseeable future all earnings will be retained for use in our business and no cash dividends will be paid to stockholders. Any payment of cash dividends in the future on our common stock will be dependent upon our financial condition, results of operations, current and anticipated cash requirements, plans for expansion, as well as other factors that the Board of Directors deems relevant.

INTERESTS OF NAMED EXPERTS AND COUNSEL

        The audited financial statements of Disaboom, Inc. included herein and elsewhere in the Registration Statement have been audited by GHP Horwath, P.C., independent registered public accounting firm, for the periods and to the extent set forth in their report appearing herein and elsewhere in the Registration Statement. Such financial statements have been so included in reliance upon the report of such firm given upon the firm’s authority as an expert in auditing and accounting.

DESCRIPTION OF THE BUSINESS

Overview

        We were incorporated under the laws of the State of Colorado on September 5, 2006. We are in the business of developing, operating, and marketing an interactive online community dedicated to constantly improving the way people with disabilities or functional limitations live their lives. This interactive community is intended to serve as a comprehensive online resource not only for people living with such conditions, but their immediate families and friends, caregivers, recreation and rehabilitation providers, and employers. The Company released an initial version of the website on August 15, 2007, released a limited availability version on September 1, 2007, released the general availability version of the website on October 1, 2007, and released an updated and enhanced version of the site on January 24, 2008. On October 9, 2007, the Company acquired an online dating and social networking website with the domain name Lovebyrd.com, and began rebranding Lovebyrd.com in February 2008 as a related website of Disaboom.com. On February 1, 2008 the Company launched a website with the domain name DisaboomJobs.com, which is dedicated to providing employment-related resources and services to the disability community and their employers. The Company's main website and related microsites for dating and employment-related resources and services are collectively referred to herein as the Disaboom Network. Our headquarters are located at 7730 E. Belleview Ave., Suite A-306, Greenwood Village, CO 80111. Our company website is www.disaboom.com.

        There are more than 54 million American adults living with disabilities or functional limitations today in the United States alone, and over 650 million worldwide. We believe Disaboom offers a new solution to the difficulties faced by this previously untapped market. Persons living with disabilities or functional limitations have unique needs, as do the people in their lives who are directly affected by such disabilities or functional limitations. Founded by a doctor, and himself a member of the disability community, built by internet industry veterans, and regularly incorporating the feedback of tens of thousands of users, we believe Disaboom.com brings together content and tools ranging from specialized health information to social networking to daily living resources in a single interactive community.

        We promote the trademarked name of our website, Disaboom.com, and related microsites DisaboomJobs.com and Lovebyrd.com, by primarily implementing a combination of national and regional advertising campaigns, both online and offline, as well as organic and direct response marketing intended to encourage people to visit our site. We believe that with the present absence of a comprehensive, community-oriented website specifically for people living with or directly affected by disabilities or functional limitations, this untapped target audience will visit and participate in our community, and contribute to its growth and success.


Our Target Market

        Approximately 16% of the American adult population lives with a disability that makes it difficult to perform functional activities such as walking, climbing stairs, reaching, or lifting and carrying objects. About 7.6 million adults experience difficulty dressing, bathing, or simply getting around their home, while 18.2 million Americans are unable to even leave their homes without help. We believe that not only do the millions of persons living with disabilities or functional limitations have a need and desire for a comprehensive resource aimed at their unique needs, but their immediate family, friends, caregivers, recreation and rehabilitation providers, and employers can also utilize such a comprehensive resource. An estimated one in three Americans is either living with or directly affected by a disability or functional limitation.

Our Product

        We believe that we areDisaboom.com currently is the only comprehensive, interactive online community dedicated to serving the specific needs of persons living with or directly affected by a disability or functional limitation. Disaboom.com is not solely a medical information website providing healthcare content about a particular condition or diagnosis, but a community based website and comprehensive resource addressing a broad range of topics and issues related to “living with” a disability or functional limitation. The primary components of our website are content, community, and microsites, each of which serve as a gateway and complementary resource to the other.

        Content

        Disaboom.com provides a broad spectrum of authoritative, frequently updated, and useful information designed to help people understand how to live most effectively with their specific disability related condition. Visitors have the option of starting with an in depth initial diagnosis and condition overview (the “Core Knowledge” content), including the most recent medical developments, or going directly to information that answers questions about their daily living needs. All articles are archived permanently on the site, and are searchable by title, author, most recently published, and “most comments”. The content component of the site is organized into two broad sections – Living and Health.

        The Livingsection of our website focuses on providing people living with a disability or functional limitation the information and resources they need to engage in the daily challenges, opportunities, and activities of their lives. It provides people directly affected by a disability or functional limitation (e.g., caregivers, immediate family or friends, rehabilitation providers, etc.) the information and resources they need to understand, support and engage in the daily activities of the life of the person living with the disability or functional limitation, and their own lives. The Living section is currently composed of the following channel categories:

Entertainment
Lifestyle
In The News
Support & Services
Media Room


The types of information included in each of these channel categories are:

        Entertainment.    The entertainment category provides up-to-date articles, reviews, interviews, and insider commentary in the areas of Television, Movies, Books, and Music – from both disability and mainstream perspectives.

        Lifestyle    Topics in the Lifestyle area currently include Accessible Home, Aging with a Disability, Assistive Technology, Caregiving, Dating and Relationships, Military Life, Parenting and Family, Sports and Recreation, and Travel and Transportation. Lifestyle includes feature articles, how-to pieces, personal narratives, individual profiles, and short, actionable “info briefs.” Examples of these types of articles are “Functional Kitchens Have Universal Appeal,” “Tired of Typing? Try Talking to Your PC,” “I’m an Ironman,” (a profile of Trish Downing, the first female paraplegic to compete in an Ironman-length triathlon), and “How to Talk to Your Doctor about Pain.”

        In The News.   The news category features current health-related news articles.

        Support & Services.  The resource center provides basic but information we believe is important to our site visitors such as Disability-Related Benefits, Disability-Related Laws, Emergency Preparedness, Organizations, and Disability-Related Information Resources.

        Media Room.    The Media Room is the video component of the website, where various Disaboom-produced videos are available for viewing by site visitors. These may include promotional videos, event-related videos, or professionally-produced videos that Disaboom partners have created to share with the Disaboom community (user generated videos are viewable through member blogs and are not included with the videos featured in the Media Room).

        The Health section of our website is intended to provide comprehensive medical information and education on disability-related conditions. It is designed to enable people living with, or directly affected by a disability or functional limitation, including the newly-diagnosed, to better understand their conditions, their treatment options, and what they need to know from a health perspective for their day-to-day lives. The Health section is not a series of simple medical briefs or summaries about a particular condition, instead we believe it is a comprehensive medical resource providing authoritative information written by medical experts on:

Amyotrophic lateral sclerosis (ALS, or Lou Gehrig's Disease)
Brain and traumatic brain injuries
Fibromyalgia
Multiple sclerosis
Muscular dystrophy
Amputations (upper and lower extremities of adult and pediatric)
Orthopedics (hip replacements, knee replacements, back surgery)

Arthritis Center (includes osteoarthritis, rheumatoid arthritis, gout, pseudogout, ankylosing spondylitis, reactive arthritis and reiter's arthritis, psoriatic arthritis, enteropathic arthritis, Lyme disease and other infectious arthritis)


Depression
Pain Center (includes Pain - overview, fibromyalgia, back pain, neck pain, shoulder pain, sciatica, herniated disc, myofascial pain, phantom pain, reflex sympathetic dystrophy as well as complex regional pain syndrome, depression and pain (one topic)
Parkinson's disease
Pediatrics (spina bifida, cerebral palsy, brachial plexus palsy)
Spinal cord injuries (includes sexuality and fertility)
Sports concussion
Stroke and stroke prevention
Vertigo (dizziness)
Visual deficits & rehabilitation
Women's health (includes osteoporosis, pelvic pain, and urinary incontinence)

        The foregoing conditions were selected for Disaboom.com’s initial focus based on the number of people currently living with the particular condition, recent growth rates in particular conditions, associated chronic conditions, and other considerations:

        Multiple sclerosis is newly diagnosed in an estimated 10,400 people every year, or about 200 new cases per week. People with multiple sclerosis experience fatigue, heat sensitivity, muscle weakness, decreased coordination, blurred vision, and cognitive impairments such as memory problems, slowed thinking, and decreased concentration.

        Orthopedic patients, those suffering musculoskeletal impairments such as arthritis, back pain, hip replacements, knee replacements and back surgery, represent one in seven Americans. Arthritis, in fact, is the leading chronic condition reported by the elderly. Back and knee problems account for a large portion of orthopedic patients and resulted in 31 million and 19 million physician visits respectively in 2003. Those who suffer from musculoskeletal impairments live with pain, fatigue, and sleep disturbances, and often complain that their bodies ache.

        Pediatric conditions, including cerebral palsy and spina bifida, impact the lives of both children and adults, with an estimated 764,000 children and adults in the United States having at least one symptom of cerebral palsy. Additionally, about 8,000 babies and infants are diagnosed with this condition each year, a diagnosis that often signals a life spent dealing with seizures, mental retardation, and problems with movement, posture, limping, jaw control, chewing, sucking, and swallowing. Another roughly 70,000 Americans live with spina bifida. The illness affects an average of eight babies per day, and causes numbness, bladder control issues, paralysis, coordination problems and latex allergies, among other challenging difficulties.


        Spinal cord injuries are experienced by nearly 11,000 individuals in the United States annually, and more than 190,000 Americans currently live with paralysis caused by spinal cord injuries.

        Stroke is the leading cause of serious, long-term disability in the U.S., and on average, someone in this country has a stroke every 45 seconds. According to the American Heart Association, in 1999, more than one million Americans reported difficulties with daily living activities resulting from a stroke.

        Traumatic brain injuries are sustained by roughly 1.5 million people in the United States every year. As a result, approximately 80,000 of those people experience the onset of long-term disabilities. The Centers for Disease Control and Prevention estimates that at least 5.3 million Americans have a long-term need for help performing daily living activities as a result of traumatic brain injuries.

        In addition to the Core Knowledge content that addresses each of the disability-related conditions, Disaboom.com also provides current updates of recent research findings through brief summaries of research reports, written in lay language, as well as condition-specific medical advice, and a glossary of disability-related medical terms. Disaboom has entered into independent contractor agreements with individuals (the “Content Providers”) in several specialties to provide current medical journal reviews and summaries as well as other written materials to be used by the Company on the website.

        The Health section also offers a “Fitness and Nutrition” area that includes consumer-oriented articles that will lead people from the basic medical information in the Core Knowledge entries to the next step: i.e., how do I live as well as possible with this condition? Fitness and Nutrition content is a mix of contributed, licensed, and commissioned content.

        The Company anticipates adding a variety of types of licensed content (e.g., comprehensive topics, articles, targeted medical and health information) to the Company’s Health section from The Cleveland Clinic Foundation, Harvard Health Publications, and the Mayo Foundation for Medical Education and Research. The Company also anticipates adding several conditions to the Health section, including stroke prevention, neck pain, sciatica, shoulder pain, depression, reflex sympathetic dystrophy, and hearing loss.

        Community

        Disaboom.com provides a Community section designed to give users an opportunity to share their stories and challenges, respond to others’ stories, and develop friendships and connections based on shared interests and experiences. The Community section is also designed to engage visitors in such a way that they visit and participate interactively on the site at a high frequency, thereby increasing site visits, repeat visitors, and amount of time visitors spend on the site.

        Through the Community section, Disaboom.com members can start ablog, participate in conversations in thediscussion area, and engage in real-timechat.

        Blogs.  A blog serves as a personal publishing platform on any topic of interest. For example, bloggers post pictures, videos, their personal stories (challenges, opportunities, triumphs, losses), poems, political commentary, and reactions to current events. Blogs empower members to share their ideas on subjects of personal importance and then gain community feedback through comments.

        Discussions.  Discussion forums are intended to cultivate conversation in the community. Forums provide an easy vehicle for members to ask questions of each other, engage in debate, and give back to the community by sharing experiences and expertise. We included and established forums as part of the general availability release of our website on October 1, 2007, and the community has taken over. Discussions cover a multitude of topics ranging from medical topics such as ‘Living with Fibromyalgia’ to personal questions such as ‘Do you want attention (for your disability)?’ We currently have over 5,000 forum topics within our community.


        Chat.   Members can connect with each other in real time through the chat section of community. Chat enables instant live connections between users and facilitates meaningful, immediate interaction and conversation.

        Groups.   Groups were launched in January 2008 and provide a way for site members to connect with each other based on common interests and/or experiences. For example, several bloggers who write regularly about their roles as caregivers may decide to start a caregiver group. Members of the group will be able to post topic-related blogs, pictures, and videos directly to the group’s online location. Instead of having to keep track of multiple blogs and blog authors, individuals interested in reading caregiver-themed content will be able to simply subscribe to the Caregiver Group. All members will have the ability to start a group and gather like-minded members to their cause. There are currently more than 15 active groups within our community and growing.

        Microsites

         Disaboom.com also provides additional features designed for members and non-members to develop personal relationships, professional opportunities, and support our community – through microsites. A microsite is a separate website which addresses a specific market, business or community need, and is integrated with the Company’s core Content and Community product platform, and partner websites as applicable.

        Dating.     On October 9, 2007, we acquired the rights to the internet domain and website of Lovebyrd.com, an online dating and social networking service for individuals living with disabilities and other conditions that make it difficult to meet and connect with other people. Over the next six months the Company plans to continue to enhance its offering and the current functionalityIn February 2008 we began re-branding Lovebyrd.com as a related website of its dating microsite via a site redesign, improved customer service, additional advertising and sponsor capabilities, and migrating the site to an in house hosting environment.Disaboom.com

        DisaboomJobs.    The Company’s internet domain DisaboomJobs.com currently provides services to both our community as well as employers. Approximately 15 years after the enactment of the Americans with Disabilities Act, the unemployment rate of people living with disabilities is between 65% — 70%. Through DisaboomJobs, members of the community can currently search for job openings from a database of over 500,000 open positions. DisaboomJobs also provides information about employment related consulting and other services, directly related to our community, which the Company can provide to corporations who employ people living with a disability. For example, employers are eligible for certain federal and state tax credits and incentives for hiring eligible employees with a disability, and corporations contracting with the Federal Government are responsible for compliance with disability-related physical accommodations, website accessibility, and other requirements. Over the next six months, the Company plans to further enhance the functionality of DisaboomJobs to include providing the capability for job-seekers to post their resumes via a resume builder, enhancing the capabilities of job seekers to search for job openings which may be a better fit given their unique needs, and continuing to increase content and “how to” information for users regarding their careers, employment and job search, and for employers on both Disaboom.com and DisaboomJobs.com.


Accessibility Reviews.   We anticipate re-introducingBusiness Changes and launching an Accessibility Review microsite. Accessibility ReviewsProduct Launches

        The Company has begun to respond aggressively to changing internet advertising industry conditions. While the growth of traditional static banner and display advertising has generally slowed due to pricing declines, advertising agency commitments and other factors, the growth of search related, landing page and microsite related, social network related, rich media, and other forms of online advertising are accelerating. During the quarter ended June 30, 2008 and subsequently, the Company begun to reduce its investment in media related expenditures in response to the changing market conditions, reduced the number of employees primarily dedicated to the sale and support of cost per mille (“CPM”) advertising, and launched new products which we believe will enhance the Company’s growth in future quarters.

        The Company’s media related expenditures were reduced by approximately 25% from the quarter ended June 30, 2008 versus the prior quarter, and were reduced approximately 50% from the month of May 2008 to the month of June 2008. The Company has already reduced its actual and planned media related expenditures for the quarter ending September 30, 2008, and anticipates its media related expenditures will be written$0 in the quarter ending December 31, 2008. In response to changing market conditions, as well as changes in the Company’s planned media related expenditures and sales focus, the Company reduced its workforce by approximately 20% in July 2008, which primarily included employees dedicated to the sale and support of traditional CPM advertising.

        On July 7, 2008, the Company launched a marketplace business directory on its main disability related website www.disaboom.com. The marketplace enables local and national business owners and managers a cost-effective channel to reach our targeted community. Business owners and managers are able to display a searchable business listing that provides certain required contact details and optional information about their business, a photo/image, a link to their own website or landing page, and the opportunity to offer a discounted product, service or other incentive (e.g., coupon) to members of our community. National and Local Business Listings are grouped in a growing number of major categories and subcategories and searchable based on various criteria. Advertisers select the Disaboomsubcategory for their Listing, and have the option to purchase additional categories. Business listings were developed in response to user feedback from our community to enable members of our community to locate, in their desired local geographic market, numerous resources relevant to their day-to-day lives. It also enables registered users access to our Member’s Club where business owners have the opportunity to make discounted offers on products, services or other incentives available to our community. A key element

        Additionally, on July 7, 2008, the Company launched two text advertising packages linked to its Business Listing product offerings, and available on its main disability related website www.disaboom.com. Text advertising packages enable local and national business owners the opportunity to reach the widest audience of potential customers within our community. National and Local Packages each include a text advertisement containing the company logo, contact information, and a link back to their website, include a certain level of guaranteed advertising impressions depending upon whether a National or Local Package, and include a National or Local Business Listing. Text advertisements may be targeted by zip codes, in a specific section of the review, uniquewebsite, or be run of site. National and Local packages enable the Company to bundle its products, sell available CPM inventory in a non-traditional way, charge premium pricing for CPM advertising inventory versus current banner or display advertising market prices, and minimize CPM advertising support costs. Advertisers who are interested in or purchase National or Local Packages also represent a cost-effective database of leads for the potential upsell of sponsorship and CPM advertising opportunities.

        Finally, also on July 7, 2008, the Company launched a directory service for business owners and managers to build and upload a company profile on Disaboom’s disability employment related website www.disaboomjobs.com. Company Profiles enable local and national business owners and managers to become a featured company interested in and committed to the Company’s community, is the physical accessibility and accommodations within restaurants, hotels, resorts, cruises, airlines, rental cars, attractions, etc. foremployment of people living with a disability or functional limitation. ReviewsA Company Profile includes company contact information, a link to the company’s website or a specific landing page, a photo/image, access to the Company’s database of disability related equipmentresumes posted by members of our community, and equipment providers aresearchable disability-friendly or demographic-specific job postings the company may wish to advertise specifically to our community (in addition to all of its existing job openings). It also a part of this microsite. Reviews provide another way for community members to shareincludes optional information and interact with the site more frequently, increasing site visits, page views, and time on site.

eCommerce.  We anticipate offering a Disaboom branded online catalog, or “white labeled” ecommerce capability, for disability related products. We expect that products will be purchased directly through a secure e-commerce microsite, or indirectly via insurance carrier reimbursement. We expect to enter revenue sharing and/or lead generation agreementslinks to content promoting or featuring specific employees, career growth for, and/or special benefits related to living with online partners, as well as manufacturers and/or distributors to provide the productsa disability and working for the online catalog. We willcompany, or any company initiatives for hiring veterans with disabilities. Company Profiles also enable advertisers to demonstrate their commitment to and enhance their compliance with various disability-related federal contract requirements. Company Profiles were developed in response to corporate feedback for employment-related advertising and recruitment opportunities, enhanced compliance, and access to the Company’s database of resumes.

        Business owners and managers who purchase Business Listings, Packages, and Company Profiles Advertiser must pay in full during the sign up process. The term for Listings and Company Profiles is 12 months. Advertisers may not terminate or cancel the purchase inventory, but rather will receiveof a percent of each sale fromListing or Company Profile at any time during the suppliers. We plan to use a third party credit card verification service to verify all credit card transactions if we do not have a partner relationship which already addresses this capability.12 month term. Payments are non-refundable and non-cancellable.


Website Development Agreement with DATA, Inc.

        On January 10, 2007 we entered an Acceptance Agreement for Website Development with DATA, Inc. (“DATA”). Under the agreement DATA agreed to design and build a fully operational interactive website for the Company. A new master agreement was executed in August 2007 to encompass site changes going forward in the form of individual work-for-hire agreements, as well as a hosting agreement that utilizes the DATA hosting facility located in Denver. Collectively the January 10, 2007 agreement and the August 2007 master agreement are referred to as the “Agreement”. Other than the independent contractor relationship created between the Company and DATA, Inc. by the Agreement, there is no material relationship between us and DATA.

        The Agreement provides that all works created for us under the Agreement are works made for hire giving us all copyright ownership in the work. Furthermore, DATA has agreed to assign and/or license all rights in works not covered by the work made for hire doctrine to us. The Agreement also includes standard confidentiality and indemnification provisions.

        We also operate under a collocation and hosting agreement with DataUSA, Inc to provide redundancy in the event our primary hosting environment experiences a lack of connectivity for functionality. The agreement is month-to-month beginning January 31, 2008 for a fee of $650 per month plus any variable bandwidth overages.

        Agreement with Cowboy International, Inc.

        On July 5, 2007 we entered into a services agreement with Cowboy International, Inc. (“Cowboy”), which was subsequently amended on August 3, 2007 and September 28, 2007. Cowboy was helping us create a comprehensive and integrated marketing, advertising, and branding campaign for our website. On January 31, 2008, the Company terminated the agreement with Cowboy.

        Website Advertising & Sponsorships

        We expect our largest source of revenue to be from website advertisement and sponsorship sales. Advertising and sponsorship fees and rates vary depending on page, placement, and size of the advertisement on the website. Premium fees are charged for home page and section sponsorships while a lesser fee will apply to run of schedule advertisements which continuously rotate throughout the website. We anticipate that manufacturers of disability-specific pharmaceuticals, products, and services will make up a large percentage of advertisement and sponsorship sales. However, we are promoting our advertising to a broad base of industries, including to companies in the consumer products, travel and tourism industries.


        Potential Market

            The following article which is posted on the U.S. Department of Health and Human Services Center for Disease Control and Prevention’s website provides evidence of the potential size of our market.

        Prevalence of Disabilities and Associated Health Conditions Among Adults – United States, 1999(1)

        In the United States, the number of persons reporting disabling conditions increased from 49 million during1991-1992 to 54 million during 1994-19952. During 1996, direct medical costs for persons with disabilities were$260 billion3.

        For this analysis, disability was defined as self-reported or proxy-reported difficulty with or reportingone or more of eight measures: 1) difficulty with one or more specified functional activities4; 2) difficultywith one or more activities of daily living (IADLS)*; 3) difficulty with one or more instrumental activities ofdaily living (IADLs); 4) reporting one or more selected impairments*; 5) use of assistive aids (e.g., wheelchair,crutches, cane or walker) for >6 months; 6) limitation in the ability to work around the house; 7) limitation in theability to work at a job or business (data for persons aged 16-67 years); and 8) receiving federal benefits on thebasis of an inability to work. A subset of persons with disability also reported the main cause of their disabilityfrom a list of 30 associated health conditions. This subset, defined before the survey was conducted, comprisedpersons reporting difficulty with ADLs IADLs, selected functional activities (excluding seeing, hearing, and havingtheir speech understood by others), or limitation in the ability to work around the house or at a job or business.National estimates were calculated using sample weights representing the inverse of the probability for selectionand complex adjustments for no response and subsampling4.


1    Prevalence of Disabilities and Associated Health Care Conditions Among Adults – 1999 (Feb. 23, 2001) available at http://www.cdc.gov/mmwR/preview/mmwrhtml/mm5007a3.htm

2    CDC. Prevalence of disabilities and associated health conditions — United States, 1991 — 1992. MMWR 1994;43:730 — 9; Kaye H, LaPlante M, Carlson D, et al. Trends in disability rates in the United States, 1970 — 1994. San Francisco, California: University of California, Disability Statistics Center, 1996. available athttp://dsc.ucsf.edu/UCSF/pub. Accessed February 2001; McNeil JM. Americans with disabilities, 1994 — 95. Washington, DC: US Department of Commerce, Economics and Statistics Administration, Bureau of the Census, 1997. (Current population reports; series P70, no. 61); McNeil JM. Americans with disabilities: 1991 — 92. Washington, DC: US Department of Commerce, Economics and Statistics Administration, Bureau of the Census, 1993. (Current population reports; series P70, no. 33).

3     Hough J. Estimating the health care utilization costs associated with people with disabilities: data from the 1996 Medical Expenditure Panel Survey (MEPS). Annual meeting of the Association for Health Services Research, Los Angeles, California, 2000

4     Income Surveys Branch, Bureau of the Census, Overview of the Survey of Income and Program Participation (SIPP). Washington, DC: US Department of Commerce, Economics and Statistics Administration, Bureau of the Census, 1999. Available athttp://www.census.gov. Accessed December 1, 2000.


        The analysis focused on 53,636 adults >18 years (consistent with standard age categories used in othernational surveys).

        In 1999, 44 million (22%) adults reported having a disability (see Table 1 below). The prevalence rate ofdisability was 24% among women and 20% among men. Approximately 32 million adults had difficulty with one or morefunctional activities such as climbing a flight of stairs (19.4 million), walking three city blocks (19 million), orlifting/carrying 10 lbs (14.2 million); approximately 16.7 million adults had a limitation in the ability to workaround the house; 11 million had either selected impairments or difficulty with IADLs. Two million adults used awheelchair, and seven million used a cane, crutches, or a walker. Of the total percentage of disabilities, 63%occurred among working adults (aged 8-64 years); of these, 27.8 million (16.5%) had a disability and 17.7 million(10.5%) had a limitation in the ability to work at a job or business. Of those adults >65 years, 16.3 million (50%)had a disability. The age-specific prevalence rate of disability was the highest among respondents aged >65 for allfunctional activities, ADLs and IADLs.

        Of all adults with disabilities, 41.2 million (93.4%) reported their main health condition associated withtheir disability (see Table 2 below); 7.2 million (17.5%) had arthritis and rheumatism, 6.8 million (16.5%) had backor spine problems, and 3.2 million (7.8%) had heart trouble/hardening of the arteries. Women had higher rates ofarthritis or rheumatism and “other” associated health conditions categories than men. Men had higher rates of harttrouble/hardening for the arteries and deafness or hearing problems than women.

        Editorial Note

        Disability affects more than one in five adults. Rates of disability are higher among older adults whoalso have higher rates of chronic diseases. However, most disability occurs during the working years, whichcontributes to the high cost estimates of disability. Arthritis or rheumatism, back or spine problems, and hearttrouble/hardening of the arteries continue to be the leading causes of disability. This report differs from asimilar 1994 report by focusing on adults only and using a broader definition of disability5.

        The strengths of SIPP include a survey design that allows nationally representative population estimates ofdisability. The broad definition of disability used in SIPP also provides a sensitive estimate of disabilityprevalence that is less likely to overlook persons with disability than other definitions (e.g., clinical or federalbenefit program-based definitions). SIPP links disability with associated health conditions, providing informationthat usually is not available from other data sources. This information is important because many programs addressdisability prevention by disease or condition.


5     McNeil JM. Americans with disabilities: 1991 — 92. Washington, DC: US Department of Commerce, Economics and Statistics Administration, Bureau of the Census, 1993. (Current population reports; series P70, no. 33).


        The findings in this report are subject to at least five limitations. First, despite complex statisticaladjustment procedures used to address nonresponse over time, these procedures may not have completely eliminatedbias that resulted from nonresponse errors, especially in subgroup analyses. Second, this report excluded personsin institutions, in the military, and aged <18 years. Third, persons with multiple disabilities may attribute themain disability to the one most disabling at the time of the interview, which may result in inconsistent surveyresponses. Fourth, because of questionnaire design, the main associated health condition was determined for mostbut not all adults with disability; 2.9 million (6.4%) persons whose only disabilities were difficulty with vision,hearing, or speech, who had selected impairments, used assistive aids, or received federal disability benefits werenot asked about a main condition. Finally, the definition of disability used did not assess environmental andsocial barriers, discrimination as the result of disability, and effects on the workforce. These issues areaddressed in the International Classification of Functioning, Disability, and Health (ICIDH-2), a unified andstandard framework that describes the dimensions of disability6. ICIDH-2 complements the InternationalClassification of Diseases by organizing information around three dimensions: body level (body systems andstructure), person and society level (activities and participation), and the environment. Because of the dynamicquality of disability, a limitation in one dimension does not predict a limitation in another.

        These estimates demonstrate the large impact of disability in working age and older adults and the relativecontributions of associated health conditions, and provide information for public health policy makers and healthsystems. More detailed analyses relating the eight measures of disability and associated health conditions canassist disease-specific efforts in planning, health promotion and disease prevention, and surveillance ofdisability-related national health objectives7. With increasing life expectancy and the aging of the population,health issues related to disability are likely to increase in importance.


6     World Health Organization. ICIDH-2: international classification of functioning, disability and health: pre-final draft, full version. Geneva, Switzerland: World Health Organization, 2000.

7     Arthritis Foundation, Association of State and Territorial Health Officials, and CDC. National Arthritis Action Plan: a public health strategy. Atlanta, Georgia: Arthritis Foundation, 1999.


TABLE 1

Survey of Income Program and Participation, United States, 1999

Number and prevalence rates of civilian non-institutionalized persons aged =18 Years with disability by age group

 

> 18 Years

18-64 Years

> 65 Years

Measure of Disability

No.*

Rate

(95% CI<> )

No.*

Rate

(95% CI<> )

No.*

Rate

(95% CI<> )

Difficulty with specified functional activities

32,191

16.0

(±0.5)

17,110

10.2

(±0.4)

15,081

46.3

(±1.6)

Having speech understood

1,982

1.0

(±0.1)

1,326

0.8

(±0.1)

656

2.0

(±0.4)

Lifting/Carrying 10 lbs

14,224

7.1

(±0.3)

7,033

4.2

(±0.3)

7,191

22.1

(±1.3)

Climbing a flight of stairs

19,363

9.6

(±0.4)

9,465

5.6

(±0.3)

9,898

30.4

(±1.5)

Walking three city blocks

19,031

9.5

(±0.4)

9,087

5.4

(±0.3)

9,944

30.5

(±1.5)

Difficulty with activities of Daily living

7,690

3.8

(±0.2)

3,514

2.1

(±0.2)

4,176

12.8

(±1.1)

Getting around inside home

3,471

1.7

(±0.2)

1,477

0.9

(±0.1)

1,994

6.1

(±0.8)

Getting in/out of bed/chair

5,340

2.7

(±0.2)

2,618

1.6

(±0.2)

2,722

8.4

(±0.9)

Bathing

4,371

2.2

(±0.2)

1,727

1.0

(±0.1)

2,644

8.1

(±0.9)

Dressing

3,130

1.6

(±0.2)

1,387

0.8

(±0.1)

1,743

5.4

(±0.7)

Eating

1,226

0.6

(±0.31

566

0.3

(±0.1)

661

2.0

(±0.7)

Toileting

2,064

1.0

(±0.1)

922

0.5

(±0.1)

1,143

3.5

(±0.6)

Difficulty with instrumental activities of living

11,795

5.9

(±0.3)

5,370

3.2

(±0.2)

6,425

19.7

(±1.3)

Getting around outside home

8,113

4.0

(±0.3)

3,202

1.9

(±0.2)

4,910

15.1

(±1.1)

Taking care of money and bills

4,492

2.2

(±0.2)

2,205

1.3

(±0.2)

2,286

7.0

(±0.8)

Preparing meals

4,430

2.2

(±0.2)

1,919

1.1

(±0.1)

2,511

7.7

(±0.8)

Doing light housework

6,042

3.0

(±0.2)

2,723

1.6

(±0.2)

3,319

10.2

(±1.0)

Using the telephone

2,597

1.3

(±0.1)

1,001

0.6

(±0.1)

1,597

4.9

(±0.7)

Use of Assistive Aid‡

9,180

4.6

(±0.3)

3,415

2.0

(±0.2)

5,765

17.7

(±1.2)

Limitation in ability to work around house

16,755

8.3

(±0.4)

9,649

5.7

(±0.3)

7,106

21.8

(±1.3)

Limitation in ability to work at job/business

N/A

N/A

N/A

17,689

10.5

(±0.4)

N/A

N/A

N/A

Received federal

work disability benefits

N/A

N/A

N/A

7,611

4.5

(±0.3)

N/A

N/A

N/A

Total Surveyed:

200,668

100.0

 

168,105

100.0

 

32,563

100.0

 

Total with a disability:

44,088

22.0

(±0.5)

27,781

16.5

(±0.5)

16,307

50.1

(±1.6)



* In thousands.
Per 100 persons calculated using the civilian, institutional US population on July 1, 1999
<>Confidence Interval
¶ Number of persons reporting any subcomponent of this category; subcomponents are note mutually exclusive
‡ Wheelchair

TABLE 2

Survey of Income Program and Participation, United States, 1999
Number and percentage of civilian non-institutionalized persons aged > 18 Years with disabilities reporting selected conditions as the main † cause of disability by sex.

 

All Persons

Men

Women

Main Condition

No.*

(%)

(95% CI<> )

No.*

(%)

(95% CI <>)

No.*

(%)

(95% CI <> )

Arthritis or rheumatism

7,207

17.5`

(±1.1)

1,955

11.0

(±1.3)

5,235

22.4

(±1.6)

Back or spine problem

6,780

16.5

(±1.0)

2,903

16.3

(±1.6)

3,877

16.6

(±1.4)

Limb or extremity stiffness

1,747

4.2

(±0.6)

842

4.7

(±0.9)

905

3.9

(±0.7)

Stroke

1,160

2.8

(±0.5)

592

3.3

(±0.8)

567

2.4

(±0.6)

Broken bone or fracture

885

2.1

(±0.4)

373

2.1

(±1.5)

512

2.2

(±0.6)

Head or spinal cord injury

452

1.1

(±0.3)

280

1.6

(±1.1)

172

0.7

(±0.3)

Paralysis

310

0.8

(±0.3)

175

1.0

(±0.4)

135

0.6

(±0.3)

Missing Limbs

299

0.7

(±0.2)

211

1.2

(±0.5)

----

----

----

Cerebral Palsy

141

0.3

(±0.2)

----

----

----

----

----

----

Other

6,188

15.0

(±1.0)

2,375

13.4

(±1.5)

3,813

16.3

(±1.4)

Total:

41,168

100.0

 

17,767

100.0

 

23,401

100.0

 


* In thousands.
† Persons who reported difficulty with functional limitations, daily living activities, instrumental activities of daily living, the inability to
Do housework or the inability to work a job identified the “main” cause and up to two other causes of the disability from a list of 30 conditions
<> Confidence Interval


Competition

        We compete in the market for internet services and information which is a highly competitive and volatile market. We compete with other both for profit and nonprofit medical information websites such as WebMD.com, RevolutionHealth.com and Healthcommunities.com for our medical information services. However, our community is targeted and dedicated to persons living with or directly affected by disabilities or functional limitations which we believe provides us a competitive advantage versus general medical information or diagnosis-oriented websites.

        We compete with other social networking websites for social networking services such as MySpace.com, Friendster.com, Facebook.com, Bebo.com, Xanga.com, Ning.com, eHarmony.com, and Match.com. We hope to develop a loyal base of site visitor and participants through the social networking aspect of the website, which in-turn will help generate advertising and sponsorship sales specifically targeted to consumers of disability related products and services. We believe we have a competitive advantage over general social networking sites because we are targeting, through a broad array of content, community, and other services, a specific group of persons with specific consumer and information needs.

        We compete with large general internet service companies such as Google, Inc., Yahoo!, Inc., Microsoft, Inc., and America Online for online marketing and advertising. However, because our website content is specifically targeted to persons living with, or directly affected by disabilities or functional limitations, the Company believes there will be little competition for advertisement and sponsorship sales targeting that specific market. We compete with other e-commerce internet sites such as Disabilityproducts.com, Sportaid.com, 180medical.com, and ActiveForever.com for the sale of disability related products. We compete with full service information, product, and networking sites for the disabled community such as Disabled-World.com. We compete with Craig's List and eBay for online sales of consumer goods from consumer to consumer through our classifieds section. However, our classifieds will be specifically targeted to consumers of disability related products. We believe that through our marketing and branding efforts, ongoing product development, the depth and breadth of our content, quality customer service, and partnerships and relationships with advertisers, sponsors, medical professionals, and other leaders in the health industry we will be able to develop a loyal client base in order to compete effectively in the very competitive online marketplace.

        Patents and trademarks

        We own and maintain a portfolio of intellectual property assets which we hope to continue to build. We believe that our intellectual property assets create great value to the Company and therefore we are taking steps to protect those assets through trademark, copyright, trade secret, and trademark laws of the United States and through contractual agreements.

        We are applying for federal registration with the U.S. Patent and Trademark Office of several trade or service marks on an intent to use basis in order to develop a trademark portfolio and protect the Company's brand. An application for registration of the word mark DISABOOM was filed on October 20, 2006. An application for registration of the word plus design mark for Disaboom was filed on April 2, 2007. An application for registration of the word mark DISABOOM.COM was filed on April 3, 2007. As of October 3, 2008, certain of the services for word mark DISABOOM and the word plus design mark for Disaboom have been registered and registration is pending for the remaining services. We continue to prosecute these marks, to the extent not already registered, and hope to have them registered on the principal register in 2008.


        Effect of existing or probable government regulations on the business.

        -FTC and FDA regulation of drug and medical device advertising and promotion

        The FDA and the FTC regulate the form, content and dissemination of labeling, advertising and promotional materials of pharmaceutical or medical device companies, including direct-to-consumer prescription drug and medical device advertising. The FTC regulates over-the-counter drug advertising and, in some cases, medical device advertising. Generally, based on FDA requirements, companies must limit advertising materials to discussions of FDA-approved uses and claims.

        Information that promotes the use of pharmaceutical products or medical devices that is put on our website is subject to the full array of the FDA and FTC requirements and enforcement actions. The FDA and FTC would most likely be focused on the advertisements placed on our pages, any other pharmaceutical information found in our education pages, and the products sold through our e-commerce site. The FTC and FDA look for editorial independence from advertisers and sponsors in informational or educational discussions of regulated pharmaceuticals or medical devices. The FDA and the FTC place the principal burden of compliance with advertising and promotional regulations on advertisers and sponsors to make truthful, substantiated claims. If the FDA or the FTC finds that any information on our website violates FDA or FTC regulations, they may take regulatory or judicial action against us or the advertiser or sponsor of that information. State attorneys general may also take similar action based on their state's consumer protection statutes.

        -Drug Advertising.

        The Federal Food, Drug, and Cosmetic Act, or FDC Act, requires that prescription drugs be approved for a specific medical indication by the FDA prior to marketing. Marketing, advertising or otherwise commercializing products prior to approval is prohibited. Upon approval, the FDA's regulatory authority extends to the labeling and advertising of prescription drugs sold throughout the United States which may only be promoted and advertised for their approved indications. The labeling and advertising must not be false or misleading, and must present all material information, including risk information. Labeling and advertising that violate these legal standards are subject to FDA enforcement action.

        The FDA regulates the safety, effectiveness, and labeling of over-the-counter drugs. Together, the FDA and FTC require that OTC drug formulation and labeling comply with FDA approvals or regulations and the promotion of OTC drugs must be truthful, adequately substantiated, and consistent with the labeled uses. OTC drugs that do not meet these requirements are subject to FDA or FTC enforcement action depending on the nature of the violation. In addition, state attorneys general can also bring enforcement actions for alleged unfair or deceptive advertising.

        Any increase in FDA regulation of the online advertisements of prescription drugs could make it more difficult for us to obtain advertising and sponsorship revenue. Only recently has the FDA relaxed its formerly restrictive policies on direct to consumer advertising of prescription drugs. If the FDA changes its policies to make them more restrictive, this could also make it more difficult for us to obtain advertising and sponsorship revenue.


        -FTC regulation of general internet advertising and marketing

        The FTC regulates internet advertising under the Federal Trade Commission Act which allows the FTC to act in the interest of all consumers to prevent deceptive and unfair acts or practices. The FTC requires that advertisements be true and not misleading to consumers and that they be substantiated. The FTC also requires clear and conspicuous disclosures.

        Failure to comply with the FTC's prohibition of false or misleading claims in advertisements could result in enforcement actions or civil lawsuits for fines and civil penalties. We believe that we have taken steps to protect our company from liability for displaying or disseminating ads in violation of these regulations through our advertising agreements and Company advertising policy. However, a regulatory authority may find that the Company has violated the advertising regulations and may bring an enforcement action against the Company.

        -Medical Professional Regulation

        Most states regulate the practice of medicine requiring professional licensing. Some states prohibit business entities from practicing medicine. We do not believe that we are engaged in the practice of medicine, but rather we provide information to the general public. The Company has agreements with licensed medical professionals who provide educational information in the form of content for the Company's website. We do not, and do not intend to, provide professional medical advice, diagnosis or treatment through our website. A state may determine that some aspect of our business violates that state's licensing laws and may seek to have us discontinue those portions or subject us to penalties or licensure requirements. Any determination that we are a healthcare provider and acted improperly as a healthcare provider may result in liability to us.

        Many states regulate the ability of medical professionals to advertise or maintain referral services. We do not represent that a physician's use of the Company's online directory will comply with these or other state laws regulating professional practice. It is possible a state or a court may determine we are responsible for any non-compliance with these laws, which could affect our ability to offer this service to our customers.

        -Consumer Protection Regulation

        Advertising viewed by visitors on our website and consumer sales from our e-commerce website are subject to federal and state consumer protection laws which regulate unfair and deceptive practices. We are also subject to various other federal and state consumer protection laws, including the ones described below. Most state consumer protection laws are enforced by the Attorneys General of each state.

        -COPPA

        The Children's Online Privacy Protection Act ("COPPA") protects personal information of children under the age of 13 disclosed online by prohibiting unfair or deceptive acts or practices in connection with the collection, use, and/or disclosure of personal information from and about children. Our website does not target children under 13, nor do we plan to allow anyone under the age of 18 to register as a Disaboomer. Therefore, the Company will not knowingly be collecting the personal information of children under the age of 13.

        -CAN-SPAM

        The Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 ("CAN-SPAM") regulates commercial emails and provides recipients the right to request the sender to stop sending messages. CAN-SPAM establishes penalties for sending commercial email which are intended to deceive the recipient as to source or content. At this time, we periodically send commercial emails to Disaboomers or other users of our site. Many states have also enacted anti-spam laws. The CAN-SPAM Act preempts many of these statutes.


        Employees

         As of June 2,October 3, 2008 we had 3738 employees, 3035 of which are full time and 73 which are part time.

DESCRIPTION OF PROPERTY

        In June 2007 we entered into a Sublease Agreement for the lease of office space at 7730 E. Belleview Avenue, Suite A-306, Greenwood Village, CO 80111, which we utilize as our corporate offices. The sublease commenced June 15, 2007 and terminates on July 31, 2009. We pay $7,667 per month under the terms of the sublease.

        On July 8, 2008 we entered into a lease agreement for the lease of additional office space. The lease commenced July 11, 2008 and terminates on July 31, 2009. We pay $3,249 per month under the terms of the lease.

LEGAL PROCEEDINGS

         On February 29, 2008, the Company filed a complaint against Cowboy International, Inc. ("Cowboy"(“Cowboy”) in the ColoradoDistrict Court for the County of Arapahoe, Colorado. On March 20, 2008, Cowboy removed the case from state court to the United States District Court for the District of Arapahoe County. The complaint alleges that Cowboy: 1) breached the services agreement entered into between the Company and Cowboy; 2) breached its obligations to hold certain Company information confidential; and 3) failed to comply with its contractual obligations regarding Company intellectual property. The complaint seeks both monetary relief and a declaratory judgment.Colorado. On April 2, 2008, Cowboy filed counterclaims seeking amounts allegedly due under the services agreement and seeking monetary damages. In its counterclaim Cowboy has alleged specific damagesOn September 11, 2008, the United States District Court dismissed the case upon the parties’ submission of at least $142,000a joint stipulation for settlement and mutual releases. On that date the Company’s alleged breach of the servicesparties enter into a mutual settlement agreement and has also alleged specific damages of uprelease, with neither party admitting liability, and pursuant to $710,000 for Cowboy’s expectancy under the agreement. We believe Cowboy’s position with respect to its counterclaims is unfounded and without merit. The Company intends to vigorously prosecute its claims and defend against Cowboy’s counterclaims.which Disaboom paid Cowboy $90,000.

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

        Shares of our common stock began trading on the NASD - OTC Bulletin Board on May 30, 2007. As of June 2,October 3, 2008, there were approximately 296274 holders of record of our common stock. This does not include persons who hold our common stock in brokerage accounts and otherwise in `street“street name.'

        Our transfer agent is Corporate Stock Transfer, Inc., 3200 Cherry Creek South Drive, Suite 430, Denver, Colorado 80209.

        The table below sets forth the high and low closing prices of the Company's Common Stock during the periods indicated as reported on Yahoo Finance (http://finance.yahoo.com). The quotations reflect inter-dealer prices without retail mark-up, mark-down or commission and may not reflect actual transactions.

Quarter ended
High
Low
High
Low
June 30, 2007   $1.87  $1.15    $1.87  $1.15 
September 30, 2007  $1.60  $1.20   $1.60  $1.20 
December 31, 2007  $1.70  $1.30   $1.70  $1.30 
March 31, 2008  $1.60  $0.94   $1.60  $0.94 
June 30, 2008  $1.42  $1.06 
September 30, 2008  $1.01  $0.25 

The closing sales price of the Common Stock as reported on June 2,October 13, 2008, was $1.33$0.15 per share.


        Dividends

        Since its inception the Company has not declared or paid cash or other dividends on its Common Stock. The Company has no plans to pay any dividends, although it may do so if it’s financial position changes.

        Securities Authorized Under Equity Compensation Plans Information

         The Company currently has onetwo equity compensation plan.plans. The 2006 Stock Option Plan (the “2006 Plan”) was approved by the Board of Directors and adopted by the shareholders on November 13, 2006. Our Board of Directors has approved three amendments to the 2006 Plan which have increased the number of shares reserved under the 2006 Plan from 1,750,000 to 7,000,000. These amendments were adopted on April 2, 2007, June 26, 2007 and October 1, 2007. At our annual meeting of shareholders held on August 21, 2007 our shareholders approved amendments to the 2006 Plan that had been approved by our Board of Directors on April 2, 2007 and June 26, 2007 that increased the number of shares reserved under the 2006 Plan to 5,000,000 shares. At our next annual meetingOn September 16, 2008 the Company adopted the 2008 Stock Option Plan, however as of shareholders we expect to seek shareholder approval of the October 1, 2007 amendment increasing the3, 2008 no options or shares reservedhave been issued under the 2006 Plan to 7,000,000.this plan.

        The following table gives information about the Company’s Common Stock that may be issued upon the exercise of options, warrants and rights under the Company’s compensation plans as of January 3, 2008.

Plan Category
Number of securities to be issued upon exercise of outstanding options, warrants and rights
Weighted average exercise price of outstanding options, warrants, and rights
Number of securities remaining available for future issuance
Equity compensation plans        
approved by security holders1   6,158,500  $ 0.85  841,500 
   
Equity compensation plans not  
approved by security holders 2   794,519  $ 1.31  N/A 
   
                             Total   6,953,019  $ 0.90  N/A 

1     Includes: (i) options to acquire 6,158,500 shares of common stock under the 2006 Plan.

2     Includes: (i) warrants to purchase 450,000 shares of Common Stock as compensation for services to Memphis Consulting, (ii) warrants to purchase 66,325 shares of Common Stock as compensation for services to W3 Ventures, Inc.; (iii) warrants to purchase 10,000 shares of Common Stock as compensation for services to Lori Sunshine; (iv) performance warrants, granted January 3, 2008, to purchase 125,000 shares of Common Stock as compensation for services to The Geek Factory, Inc.; (v) performance warrants, granted January 3, 2008, to purchase 100,000 shares of Common Stock as compensations for services to Thunderbolt; (vi) 18,000 shares of Restricted Stock as compensation for services to Memphis Consulting; (vii) 1,000 shares of Restricted Stock as compensation for services to Kurt Palisi; (viii) 24,194 shares of Restricted Stock as compensation for services to Nicholas Buoniconti.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

        See Financial Statements and Supplementary Data following the signature page of this Form S-1.


MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Plan of Operation

        We were incorporated under the laws of the State of Colorado on September 5, 2006 with the primary purpose of developing, operating and marketing the first interactive online community dedicated to constantly improving the way Americans with disabilities or functional limitations live their lives. It also serves as a comprehensive online resource not only for people living with such conditions, but their immediate families and friends, caregivers, recreation and rehabilitation providers, and employers. The Company released an initial version of the website on August 15, 2007, released a limited availability version on September 1, 2007, released the general availability version of the website on October 1, 2007, and released an updated and version of the website on January 24, 2008. On October 9, 2007, the Company acquired an online dating and social networking website with the domain name Lovebyrd.com, and began re-branding Lovebyrd.com in February 2008 as a related website of Disaboom.com. On February 1, 2008 the Company launched a website with the domain name DisaboomJobs.com, which is dedicated to providing employment-related resources and services to the disability community and their employers. The Company’s main website and related microsites for dating and employment-related resources and services are collectively referred to herein as the Disaboom Network. Our headquarters are located in the metropolitan area of Denver, Colorado.

        The activities of the Company in 2007 were primarily organizational in nature, including the planning, ongoing development and integration of our main website (www.disaboom.com), planning and beginning to implement our marketing and business development initiatives, the start up of our sales operations, and continuing to build our management team and staff. During the quarter ended December 31, 2007 and through the quarterquarters ended March 31, 2008 and June 30, 2008, our focus began to switch from organizational matters and the initial launch of our main website, to operational matters related to expanding the resources and services of our main website, launching additional resources and services through related microsites, integrating our main website and related microsites into the Disaboom Network, driving Internet traffic and registered users into our community, and beginning to generate advertising and sponsorship revenues.

        During the quarter ended December 31, 2007 and through the quarter ended March 31, 2008, we have received over 2,475,000 visits, delivered over 9,250,000 page views and served over 23,000,000 ads. We currently have over 50,00075,000 registered and engaged users. The Company hasSince March 31, 2008, the Company’s registered users have increased approximately 45%, from approximately 43,000 to approximately 62,000. From the quarter ended March 31, 2008 through the quarter ended June 30, 2008, the Company’s revenue increased 184%, from $49,860 to $141,355. Organic traffic represented 24% of the Company’s total traffic in January 2008, and represented 58% of total traffic in June 2008. Average page views per visit increased approximately 20% from the quarter ended March 31, 2008 to the quarter ended June 30, 2008, from 3.8 page views per visit to 4.5 page views per visit. Absolute and relative increases in organic traffic and page views per visit not only reduce the need for online and offline advertising campaigns to promote the Disaboom Network via media related expenditures, but also now signed over $975,000 in contract value to be earned as revenue overincrease the individual contract terms.Company’s available inventory for internet advertising and directory services.

        OurWe expect our focus duringthroughout the remainder of 2008 has and will continue to be: (i) the ongoing development and evolution of resources and services related to the Disaboom Network, our main website (www.disaboom.com)social networking platform, our community, and networkour customers,,; (ii) the sale of related microsites (currently www.disaboomjobs.com, www.lovebyrd.com, www.disaboom-inc.com), operational platform,various types of marketplace directory services, including national and product strategy; (ii)local business listings, national and local packages, and company profiles, thereby generating revenue and cash flow; (iii) to negotiate and to enter into advertising sponsorship and otherCPM related agreements, thereby generating revenue and cash flow; (iv) to identify and (iii)pursue targeted traffic and growth opportunities via acquisitions or other business relationships which are related to the Disaboom Network and the Company’s social networking platform, and; (v) to increase brand awareness and drive internet traffic and registered users to and within our online community through various online and organic media campaigns, business development and partnership initiatives, sponsorships, events and other activities. Theactivities We believe the greater the awareness of our main website and network of related microsites, community and brand in the marketplace, the greater the number of page views we will experience. The more page views our online community experiences, the greater the inventory of advertising impressions, sponsorship opportunities, and billable revenue under the standard terms of our advertising and sponsorship agreements.

        Our financial statements for our fiscal year 2007 and the period from September 5, 2006 (inception) through December 31, 2006 reflect minimal business activities. During this time period we worked primarily on the planning, development and integration of our main website, the planning and initial implementation of our marketing and business development initiatives, the start up of our sales operations, and the development of our management team and staff.


        Liquidity and Capital Resources

         During our fiscal year ended December 31, 2007 and through the quarter ended March 31,June 30, 2008 we generated limited amounts of revenues through the sale of advertising and sponsorship products from its main website Disaboom.com, and related microsites DisaboomJobs.com and Lovebyrd.com. While

         During our fiscal year ended December 31, 2007 and in the numberquarters ended March 31, 2008 and June 30, 2008, we generated limited amounts of contractsadvertising revenues. Although our revenues generated increased 184% in the Company has closed has grown because,quarter ended June 30, 2008 versus the quarter ended March 31, 2008, we believe it is unlikely we will generate significant revenues from advertising and sponsorships until at least the second calendar quarter of 2008, if not later.

         We currently fund our operations primarily through funds raised through private placements completed in March, September, October and December 2007 and March and April 2008. Additionally, in March and April 2008 we received gross proceeds of $2,623,501 upon the exercise of certain warrants the Company issued in September and October 2007. On March 9, 2007 we completed a private placement of our common stock, issuing 6,296,000 shares for aggregate gross proceeds of $3,148,000. The shares were issued at $0.50 per share.


        On September 26, 2007 we had a closing of $5,346,000 under a private placement of unregistered securities. A total of 7,128,000 common shares were issued on September 26, 2007 and 5,346,000 warrants to purchase the same number of common shares. On October 9, 2007 we had a final closing of $349,500. A total of 449,333 common shares and 337,000 warrants to purchase the same number of common shares were issued in this final closing. For both the September and October 2007 closings for each $0.75 invested, each purchaser received one common share plus warrants to acquire three-fourths of a share. The warrants are exercisable at $1.00 per share.

        On December 10, 2007, we closed a $5,000,000 private placement under the same terms as those of the private placement closed in September and October 2007. On December 10, 2007 we issued a total of 6,666,665 common shares and 5,000,000 warrants to purchase the same number of common shares.


        On March 12, 2008 we closed $1,552,000 in gross proceeds under a private placement, and issued 1,552,000 shares of common stock. The shares were issued at $1.00 per share. On April 4, 2008 we closed $800,000 in gross proceeds under a private placement, and issued 800,000 shares of common stock. These shares were issued at $1.00 per share.

        On March 10, 2008 and April 2, 2008 we issued an aggregate of 2,623,501 shares of common stock at $1.00 upon the exercise of warrants that the Company issued in September and October 2007.

         WeWith our projected operations and expenditures we expect the proceeds from these offerings, including proceeds collected from the exercise of the warrants, to bethat our current financial resources are sufficient to cover our costs and expenses until the date at which we projectfund our operations will be cash flow positive. However, estimates for expensesinto at least our third quarter of fiscal 2009. We may change in which case our capital would not be sufficient for this time period. Further, we may determinedeem that it is appropriate to raise additional capitalfunds for general corporate and working capital and general corporate purposes. If we need, or elect, to obtain additional debt or equity financing, but there can be no assuranceWe cannot assure you that additional financingcapital will be available on reasonable terms, if at all. Therefore, the inability to raise additional funds, either through equity or debt financing, could materially impair our ability to generate revenues.

        Events Taking Place Subsequent to December 31, 2007

        As outlined above in March and April 2008 we closed an aggregate of $2,352,000 in gross proceeds under a private placement, and issued 2,352,000 shares of common stock. In connection with the private placement closed in September and October 2007, we issued investors warrants that consisted of two series, Redeemable and Non-Redeemable. For every four shares of Common Stock purchased, each investor received Redeemable warrants to purchase two shares of Common Stock and Non-Redeemable warrants to purchase one share of Common Stock, exercisable at a price of $1.00 per share. In March and April 2008 2,623,501 of the warrants were exercised and 1,173,499 warrants were redeemed by the Company. Accordingly, we received gross proceeds of $2,623,501 upon the exercise of the warrants.

        On March 13, 2008, J. Glen House, a co-founder, director and officer of the Company voluntarily surrendered 3,750,000 shares of common stock back to the Company for no consideration, reducing his total share ownership to 7,500,000 shares. Dr. House surrendered the shares to make additional capital stock available for other corporate purposes.

        Results of Operations:

        Our financial statements for the fiscal year ended December 31, 2007 and the period from September 5, 2006 (inception) through December 31, 2006, and for the three months ended March 31, 2008 reflect minimal business activities. We incorporated in September 2006, and since that time we worked primarily on the planning, development and integration of our main website, the planning and initial implementation our marketing and business development initiatives, the start up of our sales operations, and the initial development of our management team and staff.


        In January 2007 we entered into the Website Development Agreement with DATA, Inc. (“Data”), which was our first material financial commitment, totaling $280,000 with payments to be made through July 2007. Upon the completion of our original contract with DATA in July 2007, a new master agreement was negotiated to encompass site changes through December 2007 in the form of individual work-for-hire agreements. We also continued to work with DATA to complete outstanding change orders and final site modifications in advance of the general availability release of our website which occurred on October 1, 2007. These changes resulted from additional creative and execution input from Disaboom over the initial months of the project, and Cowboy International, Inc. (“Cowboy”). During 2007, the Company paid a total of approximately $482,000 to Data for services rendered.

        On July 5, 2007 we entered into a services agreement with Cowboy was retained to help the Company create a comprehensive and integrated marketing, advertising, and branding campaign for our main website. During 2007, the Company paid a total of approximately $904,000 to Cowboy for services rendered. On January 31, 2008, the Company terminated its agreement with Cowboy.

        On October 9, 2007, we acquired the rights to the internet domain and website of Lovebyrd.com which is an online dating and social networking service for individuals living with conditions that make it difficult to meet and connect with other people. Although we previously announced that these services would be available free of charge, we anticipate that as we integrate the online and dating and social networking services into our online community that we will charge users for the dating service.

        As described above, we currently fund our operations primarily through funds raised in private placements of our common stock completed in March, September, October, December 2007 and March and April 2008. We expect the proceeds from these offerings, including proceeds collected from the exercise of certain of our outstanding warrants, to be sufficient to cover our costs and expenses for at least the next twelve months. However, estimates for expenses, as well as our market approach and timing may change, or we may determine it is appropriate to raise additional capital for working capital and general corporate purposes, and decide to obtain additional debt or equity financing during 2008, but there can be no assurance that additional financing will be available on reasonable terms, if at all.

 A.Results of Operations for our 2007 Fiscal Year

        During the fiscal year ended December 31, 2007, and from inception our operating expenses totaled $8,069,311 and $8,086,298 respectively. Approximately 83% of the expenditures we incurred related to payroll and stock compensation costs ($2,814,915 for the year ended December 31, 2007 and from inception), website development costs ($475,462 and $485,462 for the year ended December 31, 2007 and from inception, respectively), marketing and advertising costs ($2,851,819 for the year ended December 31, 2007 and from inception) and legal and consulting fees ($591,982 and $596,219 for the year ended December 31, 2007 and from inception, respectively).

        During the quarter ended December 31, 2007, the Company launched the general availability version of our website and began receiving limited amounts of revenue from its website through the sale of advertising and sponsorship products. During the quarter (and fiscal year) ended December 31, 2007 we billed $106,748 in accordance with our executed insertion orders, and recognized $83,682 in advertising and sponsorship revenue. We recognize advertising and sponsorship revenue ratably over the period in which it is delivered and earned.


        At December 31, 2007, the Company’s cash, cash equivalents and short-term investments (primarily mutual funds) were $6,645,193. As reflected in our statement of operations during the 2007 fiscal year the Company realized a gain of $86,969 from interest related to cash accounts and dividends on marketable securities held by the Company. The Company also recorded an unrealized loss as a result of a decrease in value of mutual funds.

 B.Results of Operations for the QuarterThree and Six Months Ended March 31,June 30, 2008

        AsOur financial statements for the three and six months ended June 30, 2008, and for the period from September 5, 2006 (inception) through June 30, 2008 reflect minimal business activities. During 2007 the activities of March 31, 2008 we had current assets of $7,362,458 including $5,773,252the Company were primarily organizational in cash and cash equivalents, and $1,355,795 in short-term investments. The Company’s increase in current assets is primarily attributable to the private placements and upon the exercise of warrants summarized below and more fully described in the financial statement footnotes fornature. During the quarter ended MarchDecember 31, 2007 and through the six months ended June 30, 2008, our focus began to switch from organizational matters and the footnotes thereto.initial launch of our main website, to operational matters related to our main website and related microsites, driving Internet traffic and registered users, and beginning to generate advertising and sponsorship revenues.

        For the quarter ended March 31,June 30, 2008, the Company experienced a net loss of $3,648,082$3,317,819 or ($0.09).08) per share, compared to a net loss of $328,067,$812,045, or ($0.01).03) per share during the comparable period in the previous year. The $3,320,015$2,505,774 increase in net loss is primarily due to payroll related, as well as media and market related expenditures. During the quarter ended March 31,June 30, 2007 we had one14 full time and one0 part time employee. At March 31,employees whereas at June 30, 2008, we had 3335 full time and 56 part time employees. During the quarter ended March 31,June 30, 2007, we did not incur any expenses related to the promotion of our website as it was still in the planning and early development stage. During the quarter ended March 31,June 30, 2008, we launched and begancontinued promoting the version 2.0 of our main website Disaboom.com, launched and began promoting the microsite DisaboomJobs.com, and began re-branding Lovebyrd.com. Since our inception in September 2006 our cumulative net losses are $11,614,419.$14,932,238.

        During the quarter ended December 31, 2007 and through the quartersix months ended March 31,June 30, 2008, the Company began receiving limited amounts of revenue through the sale of advertising and sponsorship products from its main website Disaboom.com, and related microsites DisaboomJobs.com and Lovebyrd.com. The Company released an updated and enhanced version 2.0 of its main website on January 24, 2008, began re-branding Lovebyrd.com in February 2008, and released DisaboomJobs.com on February 1, 2008. However, the Company has now signed over $975,000 in contract value to be earned as revenue over the individual contract terms. Existing sales agreements range in term from one month test agreements to twelve month advertising and sponsorship agreements over which the contract value is earned and recognized as revenue.

Disaboom Network. During the quarter ended March 31,June 30, 2007, the Company had no sales or earned revenue from its website as we were still in the planning and early development stage of our website. DuringFrom the quarter ended March 31, 2008 through the Company signedquarter ended June 30, 2008, the Company’s revenue increased 184%, from $49,860 to $141,355. Existing sales agreements range in term from one month test agreements to twelve month agreements over $675,000 inwhich the contract value is earned and earned $49,860 inrecognized as revenue. Our larger customers today initially advertised with the Company on a short term test basis before expanding the nature, scope and term of their advertising and sponsorship agreements. Advertising and sponsorship revenue is recognized ratably over the period in which it is earned through the development of sponsor landing pages, microsites and channels, publishing business listings or company profiles, or the delivery of advertising impressions by recognized and independent third party vendors. At March 31, 2008, other current liabilities include approximately $95,260 of deferred revenue that generally represent advance billings or collections under contracts for which the advertisements and/or sponsorship contract deliverables have not yet been presented or launched.

        During the quarter ended March 31,June 30, 2008, our operating expenses totaled $3,616,933$3,528,975 as compared to $337,717$833,793 for the comparable quarter in 2007 when the Company had one14 full time and one part time employee.employees. This increase is primarily attributable to: (i) payroll related expenses for our current management and staff, (ii) media and marketing related expenses for the initial promotion online and offline market testing, and launchescreation of advertising inventory related to our main website and related microsites,the Disaboom Network, (iii) licensed and purchased content, site development and operations, and (iv) various general and administrative expenses related to our expanding business operations.

        Critical Accounting Policies

        The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make a variety of estimates and assumptions that affect (i) the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and (ii) the reported amounts of revenues and expenses during the reporting periods covered by the financial statements.

        Our management routinely makes judgments and estimates about the effect of matters that are inherently uncertain. As the number of variables and assumptions affecting the future resolution of the uncertainties increase, these judgments become even more subjective and complex. Although we believe that our estimates and assumptions are reasonable, actual results may differ significantly from these estimates. Changes in estimates and assumptions based upon actual results may have a material impact on our results of operation and/or financial condition. Our significant accounting policies are disclosed in Note 2 to the Financial Statements included in this prospectus.

        While all of the significant accounting policies are important to the Company’s financial statements, the following accounting policies and the estimates derived therefrom, have been identified as being critical:


        Website development costs:

        The Company adopted the Financial Accounting Standards Board (“FASB”) Emerging Issues Task Force (“EITF”) 00-2, “Accounting for Website Development Costs,” which specifies the appropriate accounting for costs incurred in connection with the development and maintenance of websites. Under the EITF 00-2, costs related to certain website development activities are expensed as incurred (such as planning and operating stage activities). Costs relating to certain website application and infrastructure development are generally capitalized, and are amortized over their estimated useful life.

        Revenue Recognition:

         During the year ended December 31, 2007, and in the threesix months ended March 31,June 30, 2008 the Company began receiving limited amounts of revenue from its website through the sale of advertising and sponsorship revenue. Advertising and sponsorship revenue is recognized ratably over the period in which it is delivered and earned.

        Short-term investments:

        The Company accounts for short-term marketable securities in accordance with the Financial Accounting Standards Board (“FASB”), Statement of Financial Accounting Standard (“SFAS”) No. 115, “Accounting for Certain Investments in Debt and Equity Securities”. At December 31, 2007, marketable securities are classified as trading securities as the Company expects to use these funds for operating purposes within the next year. Trading securities are reported at fair value and unrealized gains and losses are included in earnings.


        Stock-based Compensation:

        The Company accounts for stock options and similar equity instruments in accordance with SFAS No. 123(R), “Share-Based Payment”. SFAS 123(R) requires the recognition of the cost of employee services received in exchange for an award of equity instruments in the financial statements and is measured based on the grant date fair value of the award. SFAS 123(R) also requires the stock option compensation expense to be recognized over the period during which an employee is required to provide service in exchange for the award (usually the vesting period).


DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 

         The persons below served as directors and executive officers of the Company as of June 2, 2008.October 3, 2008, or were a nominee for director on such date. Executive officers of the Company are elected by the Board of Directors, and serve for a term of one year and until their successors have been elected and qualified or until their earlier resignation or removal by the Board of Directors. There are no family relationships among any of the directors and executive officers of the Company.Company

Name
Age
Position
J.W. Roth   4344 Chief Executive Officer, Director and Chairman of the Board  
Dr. J. Glen House(1)   3738 Chief Medical Officer, Director  
John Walpuck   46 Chief Financial Officer, President, Secretary, Treasurer and Director  
Victor Lazzaro, Jr.   6162 Director  
David Petso   4546 Director  
R. Jerry Overgaard   6667 Director  
Patrick Templeton   65 Director  
Kevin Hall(1)   53 Director  
Howard LieberScott Chandler   4847 Senior Vice President of SalesNominee for director  

Kenneth Klispie(1)42Dr. House is not standing for reelection to the Company’s board of directors at the November 5, 2008 annual meeting of shareholders but will continue to serve as the Company’s Chief Operating OfficerMedical Officer. Mr. Hall is not standing for reelection to the Company’s board of directors at the November 5, 2008 annual meeting of shareholders.

J.W. Roth is a co-founder of Disaboom and was appointed to serve on our Board of Directors in November 2006. Additionally, Mr. Roth currently serves as our Chief Executive Officer and as the Chairman of the Board. He is also a co-founder of Colorado Catheter Company, Inc, a private company engaged in the design and development of catheters. Since 1997 Mr. Roth has served as the as the President of JW Roth & Company, Inc., a consulting company. Prior to founding JW Roth & Company, Mr. Roth worked in the financial sales industry for American National Insurance Company and the Prudential Insurance Company. Additionally, Mr. Roth has worked for, and been associated with, the business development of several companies such as Fear Creek Ranches, IMI Global, Inc., CattleNetwork, Inc., Front Porch Direct, the CTURN Corp, and Aspen BioPharma, Inc.

Dr. J. Glen House is a co-founder of Disaboom. He was appointed to serve on our Board of Directors in November 2006. Currently Dr. House serves as our Chief Medical Officer. He also served as President from the Company’s inception until August 21, 2007. Additionally, Dr. House currently serves as the Medical Director of Penrose Hospital’s Center for Neuro & Trauma Rehabilitation. He is also a co-founder, director and the Chief Medical Officer of Colorado Catheter Company, Inc. Since November 2003 he has served as President of Colorado Rehabilitation Physicians, P.C., a private medical rehabilitation company. From August 2001 to November 2003, he served as a Staff Physician at Penrose Hospital. Additionally he has served as the President of Flexlife, a medical device company since 1993. Dr. House holds U.S. Patents on the Colorado Catheter and continues to invent technology to help people that suffer from Spinal Cord related injuries. Dr. House completed his Spinal Cord Medicine Fellowship at the University of Medicine and Dentistry of New Jersey in July 2001. He attended medical school at the University of Washington, performed an internship in Internal Medicine at the LDS Hospital in Salt Lake City and completed a residency in Physical Medicine and Rehabilitation at Baylor College of Medicine.


John Walpuck was appointed to our Board of Directors in April 2007 and also serves as our Chief Financial Officer, President, Secretary and Treasurer. He also served as Chief Operating Officer from April 2007 until his appointment as President on August 21, 2007. Mr. Walpuck has over 20 years’ experience working in corporate development, corporate finance and general financial management. From 2005 through 2007 Mr. Walpuck was the Chief Financial Officer of Nine Systems, a streaming media software services company acquired by Akamai in November 2006. From 2002 through 2005 Mr. Walpuck served as the sole partner for Palmyra Consulting, a consulting firm where he advised clients on issues and projects including merger and acquisitions, corporate finance, real estate finance, and government contracts. From 2000 through 2002 Mr. Walpuck served as the Chief Financial Officer for TecSec, Inc., a private security software company. Mr. Walpuck is a CPA and CMA, and also holds an MBA from the University of Chicago and a Bachelor’s degree from Edinboro State College.

Victor Lazzaro was appointed to our Board of Directors in February 2007. Mr. Lazzaro also serves as a director for Colorado Catheter Company, Inc. Before joining Disaboom, Mr. Lazzaro founded, and currently is the President of, International Health Technology Company, a consulting firm providing planning methods, strategies and processes to bring specialty medical clinics to China. Mr. Lazzaro is also currently a managing Director of Tivis Healthcare, a private equity company, focused on acquiring and building healthcare businesses. Prior to founding International Health Technology, Mr. Lazzaro served as the President and Chief Executive Officer of United HealthCare’s Mountain States Division from March 2000 to November 2005. Mr. Lazzaro also served as Chief Financial Officer and Chief Executive Officer for a California HMO and Louisiana insurance company from 1982 to 1990, and Regional Vice President of Health Plan Operations (Gulf South) for Prudential Insurance Company of America from 1990 to 2000.

R. Jerry Overgaard was appointed to our Board of Directors in November 2006. Mr. Overgaard has served as Vice President of Financial Products of MKA Capital Group Advisors, LLC, since August 2004. Mr. Overgaard served as Vice President, Institutional Sales Division, for Dreyfus Services Corporation from 1998 to 2004. Mr. Overgaard began his career in 1962 with IBM Corporation and has spent the last 27 years in the financial services industry.

David Petso was appointed to our Board of Directors in March 2007. Mr. Petso also serves as a director for Colorado Catheter Company, Inc. Since 1980 Mr. Petso has worked for Petso Financial Consultants, LLC. Mr. Petso is currently the president and owner of Petso Financial Consultants and has over twenty-five years of experience in the financial planning industry.

Patrick Templeton was appointed to our Board of Directors in July 2007. Mr. Templeton has over 35 years of experience the fields of government relations and public affairs. Following sixteen years with GE and four years at the National Aeronautics and Space Administration where he was Chief of External Relations, he established his own consulting firm, Templeton and Company. Since 1995, Mr. Templeton has been Senior Consultant to the government relations firm of BKSH & Associates. From 1999 through 2003, Mr. Templeton was also employed by the Coalinga Corporation, a private financial management company, serving as Washington Representative. Additionally, Mr. Templeton is Chairman of the Board of the EdVenture Group, a non-profit corporation that provides technology and related consulting services to educators and businesses. Mr. Templeton is also associated with outreach activities of prominent disabilities organizations.


Kevin Hall was appointed to our Board of Directors on February 29, 2008. Mr. Hall currently operates a private consulting company that provides services to a broad range of businesses. Additionally, in 2007 Mr. Hall was appointed to serve as an independent director of Fuser, a private Web 2.0 technology startup. From 2001 through 2007 Mr. Hall was the Chief Information Officer of ProFlowers. From 1995 through 2001 Mr. Hall served as the Chief Technology and Information Officer of Amherst Technology. Mr. Hall holds a Bachelor of Science degree in Exercise Physiology, graduating Cum Laude from the University of Massachusetts at Amherst, and has taken advanced coursework toward his MBA in Executive Management at Loyola College Baltimore, Maryland.

Howard LieberScott Chandler has served as Senior Vice Presidentwas nominated to serve on our Board of SalesDirectors on September 12, 2008, and Marketing since August 21, 2007, and from May 1, 2007 to August 21, 2007 served as our Vice President of Sales. Mr. Lieber has servedif elected, will begin serving as a consultantdirector on November 5, 2008 at the conclusion of our annual meeting of shareholders. Mr. Chandler has over 15 years of senior and executive level management experience. Mr. Chandler is currently managing partner for HJL Consulting,Franklin Court Partners, LLC, a company that provides a range of business consulting services including advising clients in the following areas: developing business plans to raise initial funding, assisting companies secure additional financing, business restructuring, and litigation support. Currently Mr. Chandler also serves as a director of other companies including Cimetrix Inc. since December 1999. From December 2006 through March 2007, Mr. Lieber served as the president of Lend Again, Inc.,(CMXX.OB) a software company engaged in the residentialdesign, development, marketing, and commercial mortgage business.support of factory automation solutions for the semiconductor and electronics industries. Prior to founding Franklin Court Partners, LLC Mr. Chandler was the Chief Financial Officer and Senior Vice President for RHYTHMS NetConnections, a provider of broadband services utilizing digital subscriber line technology. Additionally, from June 2002 through October 2005 Mr. LieberChandler has worked for Petritech, a companyother companies engaged in the material sciences industrytelecommunications industry. Mr. Chandler’s business career began with Arthur Andersen & Co as a Senior Consultant/Accountant. Mr. Chandler earned an M.B.A. from the Wharton School of the University of Pennsylvania, and focusing on materials useda B.A from Whitworth College.

Along with three other officers of Rhythms NetConnections, in transportation, aerospace and architectural applications. While at Petritech,2002 Mr. Lieber servedChandler was named as a defendant in litigation brought in the company’s Vice President of Sales and later as the chief executive officer.

Kenneth Klispie joined us May 29, 2007, and was appointed to the position of Vice President of Marketing and Sales Operations effective October 1, 2007. Mr. Klispie was appointed as our Chief Operating Officer on March 20, 2008. Mr. Klispie has over 22 years of software and internet experience working with numerous organizations in 15 different industries. Most recently, he served as Executive Vice President, Data Analytics and Business Consultingfederal district court for the Indigio Group, Inc., a Denver based internet Agency. At Indigio Mr. Klispie managedDistrict of Colorado which alleged violations of the development and implementation of a broad array of web tracking, key performance indicator management, behavioral and user segmentation, customer and operational support,federal securities laws and other interactive marketing and web-based solutionscommon law claims against the defendants. The defendants have moved for national account clients.the court to dismiss the claims.

EXECUTIVE COMPENSATION

                The following table sets out the compensation received for each fiscal year since our inception, in respect to each of the individuals who served as the Company’s chief executive officer and chief financial officer at any time during the last fiscal year and the Company’s most highly compensated executive officers whose total salary and bonus exceeded $100,000 (the “Named Executive Officers”).


Name and Principal Position
Fiscal Year
Salary ($)
Bonus ($)
Option Awards ($)
All Other Compensation ($)
Total ($)
Fiscal Year
Salary ($)
Bonus ($)
Option Awards ($)
All Other Compensation ($)
Total ($)
JW Roth                            
Chief Executive Officer 2007 $100,000 $7,692 $0 $12,300 $119,992  2007 $100,000 $7,692 $0 $12,300 $119,992 
 2006 $0 $0 $0 $0 $0  2006 $0 $0 $0 $0 $0 
  
J. Glen House  
Chief Medical Officer 2007 $88,269 $5,769 $0 $6,050 $100,088  2007 $88,269 $5,769 $0 $6,050 $100,088 
 2006 $0 $0 $0 $0 $0  2006 $0 $0 $0 $0 $0 
  
John Walpuck  
President and Chief Financial Officer 2007 $128,750 $7,962 $226,293 $15,650 $378,655  2007 $128,750 $7,962 $226,293 $15,650 $378,655 
 2006 $0 $0 $0 $0 $0  2006 $0 $0 $0 $0 $0 
  
Michael Fay1 2007 $89,583 $5,769 $82,184 $7,518 $185,054  2007 $89,583 $5,769 $82,184 $7,518 $185,054 
Former Chief Operating Officer 2006 $0 $0 $0 $0 $0  2006 $0 $0 $0 $0 $0 
  
Howard Lieber 2007 $100,000 $5,769 $154,662 $52,500 $312,931 
Howard Lieber2 2007 $100,000 $5,769 $154,662 $52,500 $312,931 
Senior Vice President, Sales 2006 $0 $0 $0 $0 $0  2006 $0 $0 $0 $0 $0 


        1      Michael Fay resigned as the Company's Chief Operating Officer effective February 29, 2008.

2      Mr. Lieber resigned as the Company’s Senior Vice President, Sales effective June 13, 2008.

        Compensation Discussion and Analysis

        The following Compensation Discussion and Analysis describes the material elements of compensation for the executive officers identified in the Summary Compensation Table contained above for Messrs. Roth, House, Walpuck, Fay and Lieber.

        The Compensation Committee of our Board of Directors (the “Committee”) reviews and approves the total direct compensation packages for each of our executive officers. Notably the salary and other benefits payable to our named executive officers are set forth in employment agreements which are discussed below. Stock option grants, as applicable to certain of the named executive officers, are approved by the full board of directors.

Cash Compensation Payable To Our Named Executive Officers.

        Our Named Executive Officers receive a base salary payable in accordance with our normal payroll practices and pursuant to agreements between each of these officers and Disaboom (which contracts are described in more detail below). Based on the Committee’s knowledge of the industry and Disaboom’s performance to date the Committee believes that their base salaries are competitive to those that are received by comparable officers with comparable responsibilities in similar companies. Cash compensation in 2007 also included a year-end bonus and other cash benefits or reimbursements which comprised between 5% and 8% of the Named Executive Officers’ annual salary, excluding approximately $50,000 paid to Mr. Lieber as an independent consultant for services he provided the Company prior to May 2007, and excluding board meeting fees for Messrs. Roth, House and Walpuck.

        When the Committee considers total cash compensation for our Named Executive Officers, it does so by evaluating their responsibilities, experience and the competitive marketplace. Specifically, the Committee considers the following factors:

 1.the executive's leadership and operational performance and potential to enhance long-term value to the Company's shareholders;
 2.performance compared to the financial, operational and strategic goals established for the Company;
 3.the nature, scope and level of the executive's responsibilities;
 4.competitive market compensation paid by other companies for similar positions, experience and performance levels; and
 5.the executive's current salary, bonus, cash incentive compensation, and the appropriate balance between incentives for medium-term and short-term performance.


Option Grants To Our Named Executive Officers.

        We have granted stock options to certain of our Named Executive Officers. These option grants are intended to provide incentives to our officers who contribute to the success of Disaboom by offering them the opportunity to acquire an ownership interest in it. We believe that option grants also help to align the interests of our management and employees with the interests of shareholders.

         To date, of our Named Executive Officers, we have granted options to (i) our President and Chief Financial Officer, John Walpuck,Walpuck; (ii) our former Chief Operating Officer Michael Fay; and (iii) our former Senior Vice President of Sales, Howard Lieber. Mr. Walpuck’s options vest over time, with certain options only vesting upon the achievement of certain company events. A portion of Mr. Lieber’s options vestedwere to vest over time, however allbut only upon the achievement of certain defined billed revenues objectives. Certain of the options granted to Mr. Lieber’ currently unvested optionsFay were to vest over a two year periodtime and certain were to vest in accordance with the terms anddefined performance objectives of the Company’s revised Sales Compensation Plan.and Company milestones. We believe that option these option grants serve as additional incentive for our officers and in turn the achievement of these objectives will help our performance. Messrs. Roth and House have not been granted any options to date.

Employment Agreements with our Named Executive Officers.

        We have entered into employment agreements with each of our Named Executive Officers. Each of these officers is paid a salary for their services and certain of our executive officers have also been granted stock options in consideration for their services. When the Compensation Committee considers salaries for our executive officers, it does so by evaluating their responsibilities, experience, the competitive marketplace, and our financial resources and projections. Pursuant to its Charter, our Compensation Committee reviews and approves the terms of the compensation granted to our executive officers.

J.W. Roth:   On October 1, 2007, we entered into an employment agreement with our Chief Executive Officer and Chairman of the Board, J. W. Roth. The agreement is for an initial three year term and may be automatically extended for additional one year terms. Pursuant to the agreement Mr. Roth receives an annual salary of $200,000. Unless the agreement is terminated for cause, or as a result of Mr. Roth’s death or disability preventing him from working, if we terminate the employment agreement Mr. Roth will be entitled to a severance payment equal to his annual salary.

J. Glen House:    On October 1, 2007, we entered into an employment agreement with our Chief Medical Officer. The agreement is for an initial three year term and may be automatically extended for additional one year terms. Pursuant to the agreement, we are currently paying Dr. House receives an annual salary of $150,000 which will be increased to $200,000 when Dr. House works for Disaboom on a full time basis.$75,000. Unless the agreement is terminated for cause, or as a result of Dr. House’s death or disability preventing him from working, if we terminate the employment agreement Dr. House will be entitled to a severance payment equal to his annual salary.

John Walpuck:   On April 2, 2007 we entered into an employment agreement with John Walpuck who currently serves as our President, Chief Financial Officer, Secretary and Treasurer. The employment agreement is for an initial two year term and thereafter may be automatically extended for additional one year terms. Pursuant to the agreement, Mr. Walpuck’s annual salary initially received an annual salary of $150,000 but with the closing of our September and October 2007 private placement now receives an annual salary of $200,000. Mr. Walpuck is eligible for an annual bonus upon the achievement of certain milestones, with the milestones to be mutually agreed upon by Mr. Walpuck and Disaboom. Unless the employment agreement is terminated for cause, or as a result of Mr. Walpuck’s death or disability, if we terminate the agreement Mr. Walpuck will be entitled to a severance payment equal to six months of his annual salary.


        In connection with his employment, Mr. Walpuck was granted 1,750,000 options to purchase our common stock at $0.50 per share, of which 250,000 options vested immediately, 250,000 vested on September 1, 2007, 500,000 vested on January 1, 2008, and 500,000 vest on January 1, 2009 provided Mr. Walpuck is an employee or director of the Company on each vesting date. The final 250,000 options only vest upon the occurrence of certain Company events including a merger, acquisition or consolidation.

Howard Lieber:    Effective Mayas of December 1, 2007 Howard Lieber began serving as our Vice President of Sales at an annual salary of $150,000. Effective October 1, 2007, Mr. Lieber was promoted to Senior Vice President of Sales. Wewe entered into an employment agreement with Mr. Lieber, effective asour former Senior Vice President of December 1, 2007. PursuantSales. Mr. Lieber’s employment agreement was for an initial one year term, pursuant to which at the agreement Mr. Lieber receivestime of his resignation we were paying him an annual salary of $150,000. Unless the agreement is terminated for cause, orMr. Lieber resigned as a result of Mr. Lieber’s death or disability preventing him from working, if we terminate theCompany officer effective June 13, 2008 and terminated his employment agreement Mr. Lieber will be entitled to a severance payment equal to three months of his annual salary. Additionally, we paid Mr. Lieber $50,000 as an independent consultant for services he provided the Company prior to May 2007.agreement.

        On May 1, 2007 the Board of Directors granted Mr. Lieber 500,000 incentive stock options exercisable at $0.50 per share. Mr. Lieber’s option agreement was amended effective April 8, 2008, whereby 200,000 of the 500,000 options were vested as of the date of the amendment, 50,000 were deemed forfeited, and the remainder will vest over a two year period in accordance with the terms and performance objectives of the Company’s revised Sales Compensation Plan. Additionally, Mr. Lieber was granted 250,000 options on October 1, 2007 with the options vesting on April 30, 2008 but only upon the achievement of defined performance objectives. Finally, on April 8, 2008 Mr. Lieber was granted an option to purchase 200,000 shares of our common stock with the options vesting over a two year period in accordance with the terms and performance objectives of the Company’s revised Sales Compensation Plan.

Michael Fay:   On April 23, 2007, we entered into an employment agreement with Michael Fay, our former Chief Operating Officer. Mr. Fay’s employment agreement was for an initial two year term, pursuant to which at the time of his resignation we were paying him an annual salary of $150,000. Mr. Fay resigned as a Company officer effective February 29, 2008 and terminated his employment agreement.

Option Awards
Option Awards
Number of Securities Underlying
Unexercised Options(1) (#)

Option
Exercise
Option
Expiration
Number of Securities Underlying
Unexercised Options(1) (#)

Option
Exercise
Option
Expiration
Name
Exercisable
Unexercisable
Price ($)
Date
Exercisable
Unexercisable
Price ($)
Date
JW Roth   0  0  0 0    0  0  0 0 
  
Glen House  0  0  0 0   0  0  0 0 
  
John Walpuck  500,000  1,250,000  $0.50 1/1/2012   500,000  1,250,000  $0.50 1/1/2012 
  
Michael Fay(2)  325,000  125,000  $0.50 9/1/2011 
Michael Fay (2)  325,000  125,000  $0.50 9/1/2011 
     200,000  $1.50 10/1/2013      200,000  $1.50 10/1/2013 
  
Howard Lieber(3)  200,000  300,000  $0.50 6/1/2014   200,000  300,000  $0.50 6/1/2014 
     250,000  $1.50 10/1/2013      250,000  $1.50 10/1/2013 


(1)The material terms of these option grants are described in the Option Grants To Our Named Executive Officers notes above.

(2)Michael Fay resigned as the Company’s Chief Operating Officer effective February 29, 2008.

(3)Mr. Lieber resigned as the Company’s Vice President of Sales effective June 13, 2008.

Option Exercises and Stock Vested

        None of our executive officers exercised any stock options, SARs or similar instruments during the fiscal year ended December 31, 2007, or subsequently. None of our current executive officers serving were granted restricted common stock that was subject to a vesting schedule during our fiscal year ended December 31, 2007, or subsequently.

Director Compensation

        In January 2007 the Board adopted resolutions whereby each board member receives $550 for participating in Board meetings and is reimbursed for travel and related expenses if the meeting is attended in person.

         On March 9, 2007 our Board of Directors formed an Audit Committee, a Compensation Committee and a Nominating Committee. Mr. Petso serves as the chairman of the Audit and Compensation Committees. As compensation for serving on the Board of Directors and as chairmanserving as the chair of the Audit and Compensation Committees, and for serving on the Nominating Committee,certain committees, Mr. Petso was granted 150,000 stock options. As compensation for serving on the Board of Directors and as chairman of the Nominating Committee, Mr. Lazzaro was granted 100,000 stock options. As compensation for serving on the Audit, Nominating and Compensation committees, Mr. Overgaard was granted 50,000 stock options. Additionally, we granted Mr. Templeton 100,000 options upon his appointment to our Board in July 2007. Upon his appointment to the Board on February 29, 2008, Mr. Hall was granted 50,000 options.

        The following table reflects the compensation of our directors for our fiscal year ended December 31, 2007:

DIRECTOR COMPENSATION

Name
Earned or Paid in Cash
Option Awards
Total
Earned or Paid in Cash
Option Awards
Total
Victor Lazzaro  $3,850 $11,268 $15,118   $3,850 $11,268 $14,633 
Jay Belk(1) $3,300 $ $3,300  $3,300 $ $3,300 
R. Jerry Overgaard $5,500 $5,519 $11,109  $5,500 $5,519 $10,769 
David Petso $5,500 $16,787 $22,287  $5,500 $16,787 $21,552 
Patrick Templeton $2,200 $45,673 $47,873  $2,200 $45,673 $47,873 

(1)Mr. Belk served as a director of the Company from its inception through August 23, 2007.


        During our 2007 fiscal year Messrs. Roth, House, and Walpuck served on our Board of Directors and also served as executive officers of the Company. None of the named executive officers received separate stock option compensation for serving as a director, but did receive the Board meeting fees described herein. Messrs. Roth, House, and Walpuck Board meeting fees are included in the “All Other Compensation” column of the Summary Compensation Table above.

SECURITY OWNERSHIP OF BENEFICIAL OWNERS AND MANAGEMENT

         The number of shares outstanding of the Company’s Common Stock at June 2,October 14, 2008 was 43,334,27143,435,270 of which 116,66791,667 were issued in error but remain outstanding. The following table sets forth the beneficial ownership of the Company’s Common Stock as of June 2,October 14, 2008 by each Director, each nominee for Director, and each Executive Officer of the Company, by all Directors, Director nominees and Executive Officers as a group, and sets forth the number of shares of Common Stock owned by each person who owned of record, or was known to own beneficially, more than 5% of the outstanding shares of Common Stock.

SECURITY OWNERSHIP OF BENEFICIAL OWNERS AND MANAGEMENT



Name and Address of Beneficial Owner

Amount and

Nature of

Beneficial

Ownership

 

Percentage of

Common Stock

Amount and

Nature of

Beneficial

Ownership

 

Percentage of

Common Stock

    

J.W. Roth

7730 E. Belleview Avenue
Suite A-306

Greenwood Village, CO 80111

7,525,000

17.4%

7,525,000

17.3%

    

J. Glen House(1)

7730 E. Belleview Avenue
Suite A-306

Greenwood Village, CO 80111

7,500,000

17.3%

7,500,000

17.3%

    

John Walpuck(2)

7730 E. Belleview Avenue
Suite A-306

Greenwood Village, CO 80111

1,500,000

3.5%

1,500,000

3.5%

    

Victor Lazzaro, Jr. (3)

7730 E. Belleview Avenue
Suite A-306

Greenwood Village, CO 80111

306,666

*

300,666

*

    

R. Jerry Overgaard (4)

7730 E. Belleview Avenue
Suite A-306

Greenwood Village, CO 80111

1,032,667

2.4%

1,032,667

2.4%

    

David Petso (5)

7730 E. Belleview Avenue
Suite A-306

Greenwood Village, CO 80111

686,667

1.6%

686,667

1.6%

    

Patrick Templeton (6)

7730 E. Belleview Avenue
Suite A-306

Greenwood Village, CO 80111

98,553

*

98,553

*

    

Howard Lieber (7)

7730 E. Belleview Avenue
Suite A-306

Greenwood Village, CO 80111

230,000

*

Kevin Hall (7)

7730 E. Belleview Avenue,

Suite A-306

Greenwood Village, CO 80111

116,667

*

    

Kenneth Klispie(8)

7730 E. Belleview Avenue
Suite A-306

Greenwood Village, CO 80111

0

0

Scott Chandler

(Nominee for Director)
7730 E. Belleview Avenue
Suite A-306

Greenwood Village, CO 80111

54,500

*

    

Kevin Hall (9)

7730 E. Belleview Avenue,

Suite A-306

Greenwood Village, CO 80111

116,667

*

  

All Directors and Executives as a Group

19,170,020

44%

All Directors, Nominees and Executives as a Group

18,814,720

42.1%



*Indicates less than one percent.

The number of shares beneficially owned is determined in accordance with Rule 13d-3 of the Securities Exchange Act of 1934, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rule, beneficial ownership includes any shares as to which the selling stockholders has sole or shared voting power or investment power and also any shares, which the selling stockholders has the right to acquire within 60 days. The actual number of shares of common stock outstanding may increase prior to the effectiveness of this registration statement due to penalty shares which may be issued.

(1)Dr. House voluntarily tendered 3,750,000 shares of common stock back to the Company on March 13, 2008.

(2)Includes 500,000 shares purchased on March 23, 2007 and options to purchase 1,000,000 shares of common stock at $0.50 per share granted on April 2, 2007. Does not include options to purchase 750,000 shares of common stock at $0.50 per share that vest on January 1, 2009, or upon the occurrence of certain company events.

(3)Includes 140,000 shares of common stock purchased in the private placement completed on March 9, 2007 held in the Victor Lazzaro, Jr. Trust DTD 10/3/05 and includes options to purchase 34,000 shares of common stock at $0.50 per share. Also includes 123,333 shares and 3,333 shares underlying warrants purchased by Mr. Lazzaro’s wife. Does not include options to purchase 66,000 shares of common stock at $0.50 per share granted on March 9, 2007 that vest on December 31, 2008, and thereafter.

(4)Includes 800,000600,000 shares purchased in November 2006 andheld by Mr. Overgaard’s spouse as well as 400,000 owned directly by Mr. Overgaard. Also includes options to purchase 16,000 shares of common stock. Also includes 200,000 shares and 16,667 shares underlying warrants purchased by Mr. Overgaard’s wife. Does not include options to purchase 34,000 shares of common stock at $0.50 per share granted on March 9, 2007 that vest on December 31, 2008, and thereafter.

(5)Includes 520,000 shares purchased on February 15, 2007, 66,667 shares purchased on October 5, 2007 and 33,333 shares acquired on April 1, 2008 as well as 16,667 shares underlying warrants purchased on October 5, 2007. Also includes options to purchase 50,000 shares of common stock. Does not include options to purchase 100,000 shares of common stock at $0.50 per share granted on March 9, 2007 that vest on December 31, 2008, and thereafter.


(6)Includes 27,745 shares purchased in the private placement completed on December 10, 2007 and 20,808 shares underlying warrants purchased on December 10, 2007. Includes 50,000 options that vest on December 31, 2007, does not include options to purchase 50,000 shares of common stock granted on July 3, 2007 that vest on December 31, 2008.

(7)Includes 30,000 shares purchased on February 19, 2007 and options to purchase 200,000 shares of common stock at $0.50 per share. Does not include options to purchase 250,000 shares of common stock at $0.50 per share granted on May 1, 2007 that only vest upon the achievement of certain defined performance goals. Also, does not include options granted on October 1, 2007 and April 8, 2008 to purchase an aggregate of 450,000 shares of common stock that only vest upon the achievement of certain defined performance objectives.

(8)Does not include options to purchase an aggregate of 200,000 shares of common stock as these options vest on April 30, 2008, but only upon achievement of certain defined performance goals. Also does not include options to purchase 450,000 shares at $1.15 per share vesting on or before October 8, 2008 but only upon the achievement of certain defined performance goals.

(9)Includes 66,667 shares, and 50,000 warrants to purchase shares of common stock acquired in a private placement closed in September, 2007. Does not include options to purchase 50,000 shares of common stock at $1.42 per share granted on February 29, 2008 but vesting in December 2008 and thereafter.

TRANSACTIONS WITH RELATED PERSONS, PROMOTORS AND CERTAIN CONTROL PERSONS

        There have not been any transactions, or proposed transactions, since our inception to which the Company was or is to be a party, in which any Company director or executive officer, any nominee for election as a director, any security holder beneficially owning more than five percent of the common stock of the Company, or any member of the immediate family of the aforementioned persons had or is to have a direct or indirect material interest, except as follows:

        J.W. Roth, an officer and director of the Company advanced approximately $63,000 to the Company to help fund our working capital start up costs. Mr. Roth converted $50,000 into 100,000 shares of our common stock in March 2007, and the remaining $13,000 was subsequently repaid.

        Prior to Patrick Templeton being appointed to our Board of Directors, we engaged BKSH &Associates (BKSH) to provide Disaboom governmental relations consulting services. We paid BKSH a monthly fee of $7,500 for three months for the consulting services. In his capacity as a consultant for BKSH, Mr. Templeton was involved in providing such consulting services to Disaboom, and in that capacity received half of the fees Disaboom paid to BKSH, for an aggregate of approximately $11,250.

        The Company currently maintains a bank account through Petso Financial Advisors, Inc./Cambridge Investment Research Advisors, Inc. Through this account the Company invests a portion of its cash in short term liquid investments. Mr. Petso, who currently serves on our Board of Directors and as the Chairman of our Audit Committee, is the president of Petso Financial Advisors. Mr. Petso has not received any commissions or other remuneration as a result of our maintenance of the account at Petso Financial Advisors.

        On February 29, 2008 Kevin Hall was appointed to our Board of Directors. Further, on March 1, 2008 Mr. Hall began providing the Company consulting services related to the continuing development of our website and technical operations. In consideration we have orally agreed to pay Mr. Hall $10,000 per month through May 31, 2008, and thereafter have agreed to pay Mr. Hall $3,750 per calendar quarter while he is serving as a Company consultant. Mr. Hall is no longer providing consulting services to the Company and we are not currently paying Mr. Hall consulting fees under the oral agreement.


Director Independence

        Our Board of Directors currently consists of Messrs. Roth, Walpuck, House, Petso, Lazzaro, Overgaard, Templeton and Hall. The Company defines “independent” as that term is defined in Rule 4200(a) (15) of the Nasdaq listing standards. Messrs. Petso, Templeton, Lazzaro, and Overgaard qualify as independent and none has any material relationship with the Company that might interfere with his exercise of independent judgment. Messrs. Petso, Lazzaro, Templeton and Overgaard each serve on our audit, nominating, and compensation committees. If elected to the Board of Directors, Mr. Chandler will qualify as independent as that term is defined in Rule 4200(a)(15) of the Nasdaq listing standards and will begin serving on each of the board’s corporate governance committees.

DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR SECURITIES ACT LIABILITY

        Our Articles of Incorporation provide that the Company shall indemnify, to the fullest extent permitted by applicable law, any person, and the estate and personal representative of any such person, against all liability and expense (including attorneys’ fees) incurred by reason of the fact that he is or was a director or officer of the Company or, while serving at the request of the Company as a director, officer, partner, trustee, employee, fiduciary, or agent of, or in any similar managerial or fiduciary position of, another domestic or foreign corporation or other individual or entity or of an employee benefit plan. The Company also shall indemnify any person who is serving or has served the Corporation as director, officer, employee, fiduciary, or agent, and that person’s estate and personal representative, to the extent and in the manner provided in any bylaw, resolution of the shareholders or directors, contract, or otherwise, so long as such provision is legally permissible. Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the “Act”) may be permitted to directors, officers and controlling persons of the small business issuer pursuant to the foregoing provisions, or otherwise, the small business issuer has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.









DISABOOM, INC.
(A DEVELOPMENT STAGE COMPANY)

CONTENTS





PAGE
Report of Independent Registered Public Accounting Firm  F-2  
 
Financial Statements:  
 
   Balance sheets as of December 31, 2007 and 2006  F-3  
 
   Statements of operations for the year ended  
   December 31, 2007, the period from September 5, 2006  
  (inception) through December 31, 2006, and the period  
   from September 5, 2006 (inception) through December 31, 2007  F-4  
 
   Statements of shareholders' equity for the period from  
   September 5, 2006 (inception) through December 31, 2007  F-5  
 
   Statements of cash flows for the year ended December 31, 2007,  
   the period from September 5, 2006 (inception) through  
   December 31, 2006, and the period from September 5, 2006  
    (inception) through December 31, 2007  F-6  
 
   Notes to financial statements  F-7 - F-15  





REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors
Disaboom, Inc.
Denver, Colorado

We have audited the accompanying balance sheets of Disaboom, Inc. (a development stage company) as of December 31, 2007 and 2006, and the related statements of operations, shareholders’ equity and cash flows for the year ended December 31, 2007, the period from September 5, 2006 (inception) through December 31, 2006 and the period from September 5, 2006 (inception) through December 31, 2007. 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 audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the 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 audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Disaboom, Inc. as of December 31, 2007 and 2006, and the results of its operations and its cash flows for the year ended December 31, 2007 and the periods from September 5, 2006 (inception) through December 31, 2006 and September 5, 2006 (inception) through December 31, 2007, in conformity with accounting principles generally accepted in the United States of America.

/s/ GHP HORWATH, P.C.
GHP HORWATH, P.C.

Denver, Colorado
March 20, 2008


DISABOOM, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS

December 31, 2007
December 31, 2006
ASSETS      
Current assets:  
       Cash and cash equivalents  $4,432,751 $ 
       Short-term investments   2,212,442   
       Accounts receivable   77,713   
       Receivable from issuance of common stock     2,125 
       Prepaid expenses   104,319   


 Total current assets   6,827,225  2,125 
    Property and equipment, net   30,133   
    Deposits   7,667   


 Total assets  $6,865,025 $2,125 


LIABILITIES AND SHAREHOLDERS' EQUITY  
 Current liabilities:  
       Accounts payable  $219,064 $916 
       Accrued expenses   185,988   
       Advances, related party     16,071 
       Other current liabilities   14,559 


 Total liabilities (all current)   419,611  16,987 


 Commitments and contingencies  
 Shareholders' equity:  
       Preferred stock, $0.0001 par value; authorized  
       10,000,000 shares; none issued and outstanding      
       Common stock, $0.0001 par value; authorized 65,000,000  
       shares; 41,926,080 and 21,250,000 issued and outstanding, respectively   4,193  2,125 
       Additional paid-in capital   14,407,558   
       Deficit accumulated during the development stage   (7,966,337) (16,987)


                 Total shareholders' equity   6,445,414  (14,862)


                 Total liabilities and shareholders' equity  $6,865,025 $2,125 



The accompanying notes are an integral part of these financial statements.


DISABOOM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS

Year ended
December 31, 2007

September 5, 2006
(inception) through
December 31, 2006

September 5, 2006
(inception) through
December 31, 2007

Revenue  $83,682 $ $83,682 
Expenses:  
Sales and marketing   (2,851,819)   (2,851,819)
General, administrative and other   (5,217,492) (16,987) (5,234,479)



Loss from operations   (7,985,629) (16,987) (8,002,616)
Other income (expense):  
   Interest income   86,969    86,969 
   Loss on short-term investments   (50,690)   (50,690)



Net loss  $(7,949,350)$(16,987)$(7,966,337)



Net loss per share, basic and diluted  $(0.28) * 


Weighted average number of common shares  
   outstanding, basic and diluted   28,697,880  21,250,000 





 * Less than $ (0.01)

The accompanying notes are an integral part of these financial statements.


DISABOOM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

Common stock
Additional Paid-InDeficit accumulated during the development
Shares
Amount
capital
stage
Total
Initial issuance of common stock, November 2006   21,250,000 $2,125       $2,125 
   
Net loss           $(16,987) (16,987)





Balances at December 31, 2006   21,250,000  2,125    (16,987) (14,862)
   
Issuance of common stock in private placement  
   at $0.50 per share, March 2007   5,796,000  580  2,897,420     2,898,000 
   
Issuance of common stock to an employee in  
   exchange for cash at $0.50 per share, April 2007   500,000  50  249,950     250,000 
   
Issuance of common stock and warrants in private  
  placements at $0.75 per share (net of offering costs of  
  $971,867), September, October and December 2007   14,243,998  1,424  9,722,209     9,723,633 
   
Issuance of common stock for acqusition of website   55,000  6  74,244     74,250 
   
Issuance of common stock for services   58,194  6  89,734     89,740 
   
Issuance of common stock for payable   12,888  1  18,749     18,750 
   
Issuance of common stock upon exercise of option   10,000  1  4,999     5,000 
   
Warrants issued for consulting services         290,131     290,131 
   
Compensation expense under stock option plan         1,060,122     1,060,122 
   
Net loss            (7,949,350) (7,949,350)





Balances at December 31, 2007   41,926,080 $4,193 $14,407,558 $(7,966,337)$6,445,414 






The accompanying notes are an integral part of these financial statements.


DISABOOM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS

Year ended
December 31, 2007


September 5, 2006
(inception) through
December 31, 2006


September 5, 2006
(inception) through
December 31, 2007

Cash flows from operating activities:        
   Net loss  $(7,949,350)$(16,987)$(7,966,337)
   Adjustments to reconcile net loss to cash  
       used in operating activities:  
       Stock-based compensation expense   1,350,253    1,350,253 
       Common stock issued for services   89,740    89,740 
       Unrealized loss on short-term investments   50,690    50,690 
       Common stock issued for website   74,250    74,250 
       Depreciation expense   4,557    4,557 
       Changes in operating assets and liabilities:  
           Short-term investments   (2,263,132)   (2,263,132)
           Accounts receivable   (77,713)   (77,713)
           Prepaid expenses and deposits   (111,986)   (111,986)
           Accounts payable   236,898  916  237,814 
           Accrued expenses   185,988    185,988 
           Advances, related party   33,929  16,071  50,000 
           Other current liabilities   14,559    14,559 



                  Net cash used in operating activities   (8,361,317)   (8,361,317)



Cash Flows from investing activities:  
   Purchase of property and equipment   (34,690)   (34,690)



                 Net cash used in investing activities   (34,690)   (34,690)



Cash flows from financing activities:  
   Proceeds from issuance of common stock   12,821,633    12,823,758 
   Proceeds from exercise of options   5,000    5,000 
   Proceeds applied to receivable from issuance of common stock   2,125     



                  Net cash provided by financing activities   12,828,758    12,828,758 



Increase in cash and cash equivalents and ending cash  $4,432,751 $ $4,432,751 



Supplemental disclosure of non-cash investing and financing  
   activities:  
   Conversion of related party advances to common stock  $50,000 $ $50,000 
   Payment of accounts payable with common stock   18,750    18,750 

The accompanying notes are an integral part of these financial statements.


DISABOOM, INC.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2007 AND 2006

1.Organization and basis of presentation:

 Disaboom, Inc. (the “Company”) was incorporated in the State of Colorado on September 5, 2006 with the primary purpose of developing the first interactive online community dedicated to constantly improving the way Americans with disabilities or functional limitations live their lives. It serves as a comprehensive online resource not only for people living with such conditions, but their immediate families and friends, caregivers, recreation and rehabilitation providers, and employers. The Company incorporated in September 2006, and through the period ended December 31, 2007, the Company’s primary activities continued to be organizational in nature. The Company’s activities have consisted primarily of the planning, development and integration of our main website, the planning and initial implementation of our marketing and business development initiatives, the start up of its sales operations, and the initial development of its management team and staff. The Company released a beta version of the website on August 15, 2007, released a limited availability version on September 1, 2007, and released the general availability version of the website on October 1, 2007. The Company’s headquarters are located in the metropolitan area of Denver, Colorado.

2.Summary of significant accounting policies:

 Development stage company:

 The Company complies with Statement of Financial Accounting Standard (“SFAS”) No. 7 for its characterization of the Company as development stage. Furthermore, the Company has adopted Statement of Position (“SOP”) 98-5, “Reporting on the Costs of Start-Up Activities,” which provides guidance on the financial reporting of start-up costs and organizational costs, to be expensed as incurred.

 Revenue recognition:

 During the year ended December 31, 2007, the Company began receiving limited amounts of revenue from its website through the sale of advertising and sponsorship products. Advertising and sponsorship revenue comprised 99% of the Company’s total revenue received. Advertising and sponsorship revenue is recognized ratably over the period in which it is delivered and earned. At December 31, 2007, other current liabilities include approximately $6,000 of deferred revenue that represents amounts received under advertising contracts for which the advertisements have not yet been presented.

 Cash and cash equivalents:

 The Company considers all highly liquid investments with original maturities of three months or less at date of purchase to be cash equivalents.

 Short-term investments:

 Short-term investments consist of a certificate of deposit with an original maturity of six months and mutual funds. The Company accounts for short-term marketable securities in accordance with the Financial Accounting Standards Board (“FASB”), Statement of Financial Accounting Standard (“SFAS”) No. 115, “Accounting for Certain Investments in Debt and Equity Securities”.

 Marketable securities are classified as trading securities, as the Company expects to use these funds for operating purposes within the next year. Trading securities are reported at fair value and unrealized gains and losses are included in earnings.


 Use of estimates in financial statement preparation:

 The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from these estimates.

 Accounts receivable:

 Accounts receivable are recorded at their face amount less an allowance for doubtful accounts. The allowance for doubtful accounts reflects management’s best estimate of probable losses in the accounts receivable balance. Management determines the allowance based on known troubled accounts, historical experience, and other currently available evidence. The allowance for doubtful accounts was zero at December 31, 2007 and 2006. The Company generally does not require collateral from its customers. At December 31, 2007, three customers accounted for 25%, 24% and 14% of accounts receivable, and two customers accounted for 28% and 24% of total revenues.

 Website development costs:

 The Company has adopted the provisions of Financial Accounting Standards Board (“FASB”) Emerging Issues Task Force (“EITF”) 00-2, “Accounting for Web Site Development Costs,” which specifies the appropriate accounting for costs incurred in connection with the development and maintenance of web sites. Under EITF 00-2, costs related to certain web site development activities are expensed as incurred (such as planning and operating stage activities). Costs relating to certain website application and infrastructure development are generally capitalized, and are amortized over their estimated useful life. In January 2007, the Company entered into an agreement to begin its website development. For the year ended December 31, 2007 and the period from September 5, 2006 (inception) to December 31, 2006, website development costs of approximately $475,000 and $10,000, respectively, were expensed.

 Property and equipment:

 Property and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Upon retirement or disposal of assets, the accounts are relieved of cost and accumulated depreciation and the related gain or loss is reflected in earnings. The useful lives are generally as follows:

Furniture and fixtures  3 - 5 years  
Computer software, hardware and office equipment  3 - 5 years  

 Stock-based compensation:

 The Company accounts for stock options and similar equity instruments in accordance with SFAS No. 123(R), “Share-Based Payment”. SFAS 123(R) requires the recognition of the cost of employee services received in exchange for an award of equity instruments in the financial statements and is measured based on the grant date fair value of the award. SFAS 123(R) also requires the stock option compensation expense to be recognized over the period during which an employee is required to provide service in exchange for the award (usually the vesting period).

 The Board of Directors has adopted the 2006 Stock Option Plan (the “2006 Plan”). The 2006 Plan authorizes the Board of Directors to grant stock bonuses or stock options to purchase shares of the Company’s common stock to employees, officers, directors and consultants. Options granted under the 2006 Plan may be either incentive stock options or non-qualified stock options. The aggregate number of shares of common stock as to which options and bonuses may be granted under the 2006 Plan cannot exceed 7,000,000. The number of shares reserved under the 2006 Plan was increased to 7,000,000 on October 1, 2007.

 During the year ended December 31, 2007, the Company granted 6,478,500 stock options to employees and consultants at a weighted average exercise price of $.87 per share. The options are subject to various vesting schedules and are exercisable through 2014. The fair value of stock options at the dates of   grant was $2,928,769. The Company used the following assumptions to determine the fair value of stock option grants during the twelve months ended December 31, 2007:


Expected term  2.5 - 6 years  
Volatility  47% - 91%  
Risk-free interest rate  3.50 - 5.07%  
Dividend yield  0%  

 The expected term of stock options represents the period of time that the stock options granted are expected to be outstanding and was calculated using the simplified method per the guidance of SAB 107 “Share Based Payment” (“SAB 107”) for “plain vanilla” options. The expected volatility is based on the historical price volatility of the common stock of similar companies in the development stage. The risk-free interest rate represents the U.S. Treasury bill rate for the expected term of the related stock options. The dividend yield represents the anticipated cash dividend over the expected term of the stock options.

 Summary of stock option activity for the year ended December 31, 2007 is presented below:

Shares Under Option
Weighted Average Exercise Price
Weighted Average Remaining Contractual Life (Years)
Aggregate Intrinsic Value
Outstanding at January 1, 2007          
Granted   6,478,500 $0.87 
Exercised   (10,000)$0.50 
Forfeited   (310,000)$1.33 


Outstanding at December 31, 2007   6,158,500 $0.85  4.89  $3,784,325 


Vested at December 31, 2007   1,442,500 $0.55 1.52  $1,307,625 



 During the year ended December 31, 2007, compensation expense of $1,060,122 was recorded relative to   the 2006 Plan. Total intrinsic value of the options exercised during the year ended December 31, 2007 was $8,700.

 A summary of the status of the Company’s non-vested shares as of and for the year ended December 31, 2007, is presented below.

Nonvested Shares Under Option
Weighted Average Grant Date Fair Value
Nonvested at January 1, 2007      
Granted   6,478,500 $0.52 
Vested   (1,442,500)$0.29 
Forfeited   (310,000)$0.88 


Nonvested at December 31, 2007   4,726,000 $0.57


 As of December 31, 2007, the Company had $1,868,647 of unrecognized compensation cost related to stock options that will be recognized over a weighted average period of approximately 4 years.

 Loss per share:

 The Company computes net earnings (loss) per share in accordance with SFAS No. 128, “Earnings per Share”, which establishes standards for computing and presenting net earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding and the number of dilutive potential common share equivalents during the period. Stock options and warrants are not considered in the calculation, as the impact of potential common shares (18,377,521 at December 31, 2007) would be to decrease loss per share. Therefore, diluted loss per share is equivalent to basic loss per share.


 Income taxes:

 The Company accounts for income taxes in accordance with Statement of Financial Accounting Standard No. 109,Accounting for Income Taxes (SFAS 109). Under the provisions of SFAS 109, a deferred tax liability or asset (net of a valuation allowance) is provided in the financial statements by applying the provisions of applicable laws to measure the deferred tax consequences of temporary differences that will result in net taxable or deductible amounts in future years as a result of events recognized in the financial statements in the current or preceding years.

 In June 2006, the Financial Accounting Standards Board (“FASB”) issued Interpretation No. 48,Accounting for Uncertainties in Income Taxes, an interpretation of SFAS No. 109, Accounting for IncomeTaxes (“FIN 48”). FIN 48 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under FIN 48, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

 FIN 48 became effective for the Company on January 1, 2007. The cumulative effect of adopting FIN 48 on January 1, 2007 has been recorded net in deferred tax assets, which resulted in no FIN 48 liability on the balance sheet. The total amount of unrecognized tax benefits as of the date of adoption was zero. There are open statutes of limitations for taxing authorities in federal and state jurisdictions to audit the Company’s tax returns from 2006 through the current period. The Company’s policy is to account for income tax related interest and penalties in income tax expense in the statement of operations. There have been no income tax related interest or penalties assessed or recorded. Because the Company has provided a full valuation allowance on all of its deferred tax assets, the adoption of FIN 48 had no impact on the Company’s effective tax rate.

 Fair value of financial instruments:

 The carrying amounts of financial instruments such as cash, marketable securities, accounts receivable and accounts payable, approximate their fair value due to the short term nature of the instruments.

 Advertising expense:

 The Company expenses advertising expenses as incurred. Advertising expenses for the year ended December 31, 2007 were approximately $902,000. Advertising expenses for the period from September 5, 2006 (inception) through December 31, 2006 were not significant. Advertising expenses are included in sales and marketing expenses in the statement of operations.

 Recent pronouncements:

 In September 2006, the FASB issued SFAS No. 157,Fair Value Measurements. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in accordance with accounting principles generally accepted in the United States, and expands disclosures about fair value measurements. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007. In February 2008, the FASB issued FASB Staff Position No. FAS 157-2, Effective Date of FASB Statement No. 157 (the FSP). The FSP amends SFAS No. 157 to delay the effective date of Statement 157 for non-financial assets and non-financial liabilities, except for items that are recognized or disclosed at fair value in the financial statements on a recurring basis (that is, at least annually). For items within its scope, the FSP defers the effective date of Statement 157 to fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. The Company is currently evaluating the potential impact of the adoption of SFAS No. 157 on our financial position, results of operations, and cash flows.

 In February 2007, the FASB issued SFAS No. 159,The Fair Value Option for Financial Assets andFinancial Liabilities- including an Amendment of FASB Statement No. 115(“SFAS 159”), which allows an entity to choose to measure certain financial instruments and liabilities at fair value. Subsequent measurements for the financial instruments and liabilities an entity elects to fair value will be recognized in earnings. SFAS 159 also establishes additional disclosure requirements. SFAS 159 is effective for us beginning January 1, 2008. The Company is currently evaluating the potential impact of the adoption of SFAS 159 on our financial position, results of operations or cash flows.


 In December 2007, the FASB issued SFAS No. 141 (revised 2007),Business Combinations(“SFAS 141R”). SFAS 141R establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any noncontrolling interest in the acquiree and the goodwill acquired. SFAS 141R also establishes disclosure requirements to enable the evaluation of the nature and financial effects of the business combination. This statement is effective for us beginning January 1, 2009. The Company is currently evaluating the potential impact of the adoption of SFAS 141R on our financial position, results of operations or cash flows.

 In December 2007, the FASB issued SFAS No. 160,Noncontrolling Interests in Consolidated FinancialStatements—an amendment of Accounting Research Bulletin No. 51(“SFAS 160”). SFAS 160 establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, the amount of consolidated net income attributable to the parent and to the noncontrolling interest, changes in a parent’s ownership interest, and the valuation of retained noncontrolling equity investments when a subsidiary is deconsolidated. SFAS 160 also establishes disclosure requirements that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. This statement is effective for us beginning January 1, 2009. The Company is currently evaluating the potential impact of the adoption of SFAS 160 on our financial position, results of operations or cash flows.

3.Shareholders’ equity:

 In November 2006, the Company issued 21,250,000 shares of its common shares at par value (or $0.0001 per share) in exchange for a receivable. Proceeds of $2,125 were received in February 2007.

 In March 2007, the Company completed a private placement of 5,796,000 shares of common stock for gross proceeds of $2,898,000. The shares were issue at a price of $0.50 per share. As part of the offering, $50,000 of advances due to the Chairman were converted to 100,000 shares of common stock. In April 2007, the Company issued 500,000 shares to an employee at $.50 per share, for total gross proceeds of $250,000. There were no offering costs in relation to this private placement.

 In September 2007, the Company closed a private placement of 7,128,000 shares of common stock and 5,346,000 warrants to purchase 5,346,000 common shares for gross proceeds of $5,346,000. The shares were issued at a price of $0.75 per share. For each $0.75 invested, the purchaser received one common share plus warrants to acquire three-fourths of share. Offering costs in relation to this private placement totaled approximately $539,000.

 In October 2007, the Company had a closing of $349,500 under a private placement of unregistered securities. For each $0.75 invested, each purchaser received one common share plus warrants to acquire three-fourths of a share. A total of 449,333 common shares and 337,000 warrants to purchase the same number of common shares were issued in this closing. Offering costs in relation to this private placement totaled approximately $28,700.

 In connection with the September 2007 and October 2007 private placements, the Company also granted 554,800 warrants, exercisable at a price of $2.25 per share, to placement agents as partial commissions for the offering. The warrants expire three years from their date of issuance.

 In December 2007, the Company closed a $5,000,000 private placement under the same terms as those of the private placement closed in September and October 2007. In December 2007 the company issued a total of 6,666,665 common shares and 5,000,000 warrants to purchase the same number of common shares were issued at closing. The shares of common stock are not registered under the Securities Act of 1933, as amended.   Offering costs in relation to this private placement totaled $405,000. The Company also granted an aggregate of 455,396 warrants to placement agents as partial commissions for the offering containing the same terms and conditions as those offered to investors.

 Warrants related to the September 2007, October 2007 and December 2007 private placements consisted of two series, Redeemable and Non-Redeemable. For every four shares of Common Stock purchased, each purchaser received Redeemable warrants to purchase two shares of Common Stock and Non-Redeemable warrants to purchase one share of Common Stock, exercisable at a price of $1.00 per share. Upon notification from the Company the Redeemable warrants may be called or redeemed by the Company at a price of $1.00 per warrant share if the following conditions are met: (1) the shares underlying the warrants have been registered for at least 30 consecutive days, (2) the price of the Company’s stock has been at $1.25 for 20 consecutive trading days, and (3) the average trading volume of the Company’s stock has been at least 25,000 shares for 20 consecutive trading days. Non-redeemable warrants cannot be redeemed by the Company but will expire three years after issuance.


 Total gross proceeds received by the Company since its inception from the issuance of common stock are $13,845,625.

 Common stock outstanding also includes: 18,000 shares issued under a committed agreement (Note 4), 24,194 restricted common shares issued under an October 2007 Business Development Agreement with a third party, 9,440 unrestricted common shares issued in exchange for a $13,750 payable, 3,448 unrestricted common shares issued in exchange for a $5,000 payable, and 1,000 restricted common shares were issued to a third party in exchange for services.

4.Significant agreements and subsequent events:

 Effective May 1, 2007, the Company entered into a consulting agreement with the Memphis Consulting Group (“MCG”), whereby MCG provides investor relations services to the Company. Effective July 6, 2007, the Company entered into a new consulting agreement with MCG, whereby MCG provides investor relations services to the Company. The consulting agreement that the Company previously entered into with MCG was scheduled to expire on August 1, 2007. The July 6, 2007 agreement is for a twelve month term and may be extended by the parties. Pursuant to the agreement the Company is to pay MCG $12,000 per month. Additionally, the Company issued MCG a warrant to purchase 400,000 shares of our common stock at $1.45 per share for a term of five years. The shares underlying the warrant vest in 100,000 share installments on September 30, 2007, December 31, 2007, March 31, 2008 and June 30, 2008, contingent upon MCG continuing to provide us with consulting services under the agreement. The warrant issued pursuant to the July 6 agreement was in addition to the warrant to purchase 50,000 shares of our common stock issued to MCG under the terms of our previous agreement. The warrant was valued at $411,200 on the date of the grant, of which $205,600 was expensed as of December 31, 2007. Effective November 1, 2007, upon the mutual consent of the Company and MCG, the Company is to pay MCG $6,000 per month for the remainder of the term of the July 6, 2007 agreement.

 On July 5, 2007 the Company entered into a services agreement with Cowboy International, Inc (“Cowboy”), which was subsequently amended on August 3, 2007 and September 28, 2007. The August 3, 2007 amended agreement replaced the initial agreement with Cowboy and modified the compensation the Company was to pay Cowboy for the services being provided. In exchange for the services under the first amended agreement, the Company agreed to pay Cowboy $133,071 per month on a monthly retainer basis through June 30, 2008. On September 28, 2007, the Company entered into a second amended agreement through the period ending June 30, 2008. Cowboy was helping the Company create a comprehensive and integrated marketing, advertising, and branding campaign for its website. The second amended agreement replaced the initial amended agreement with Cowboy and the compensation the Company was to pay Cowboy for the services it was being provided. According to the second amended agreement, in exchange for Cowboy’s marketing, advertising and branding services, the Company agreed to pay Cowboy a base payment of $86,938 per month on a monthly retainer basis, however in certain months the Company paid Cowboy addition amounts for certain services it requested to be provided. On January 31, 2008, the Company terminated its agreement with Cowboy.

 On October 9, 2007, we acquired the rights to the Internet domain and web site of Lovebyrd.com in exchange for $25,000 cash and 55,000 shares of common stock valued at $74,250.  Lovebyrd.com is an online dating and social networking service for individuals living with conditions that make it difficult to meet and connect with other people.

 On October 19, 2007, we entered into a Business Development Agreement with a third party. The agreement is for an eighteen month term, but may be terminated by either party. Pursuant to the agreement, the third party will serve as a non-exclusive business developer for Disaboom and help us generate advertising, sponsorships, revenue sharing, and other sales and business development opportunities. As part of the consideration for entering into the agreement we are obligated to issue restricted stock in four installments, so long as the agreement is still in effect on each installment date.

 In December 2007, the Company granted warrants to purchase 76,325 shares of our common stock to consultants. The warrants were valued at $84,531 on the date of grant, are exercisable at $1.00 per share and expire in December 2010.

 During 2007, the Company entered into various employment agreements with management. In connection with these agreements, the Company granted 2,600,000 options to these executives at various exercise prices and under vesting schedules. Some of these agreements provide that if the agreement is terminated without cause, these individuals will be entitled to a severance payment equal to their annual salary.

 In January 2008, the Company granted performance warrants to purchase 225,000 shares of common stock to consultants. The warrants have an exercise price of $1.30 and expire on January 3, 2013

 On January 17, 2008, a former employee of the Company was issued 10,000 shares of the Company’s Common Stock in connection with the exercise and purchase of that employee’s vested stock options. On February 18, 2008, the Company issued 15,000 unrestricted common shares to a third party in exchange for services.


 Between January 2, 2008 and March 3, 2008 we granted employees and a new member of our Board of Directors an aggregate of 819,000 options to purchase our common stock all subject to vesting schedules. The options were granted in consideration for services.

 On February 29, 2008 the Company filed a complaint against Cowboy International, Inc. (“Cowboy”) in the Colorado District Court, for the District of Arapahoe County.  The complaint alleges that Cowboy: 1) breached the services agreement entered into between the Company and Cowboy; 2) breached its obligations to hold certain Company information confidential; and 3) failed to comply with its contractual obligations regarding Company intellectual property.  The complaint seeks both monetary relief and a declaratory judgment.

 On February 29, 2008 Kevin Hall was appointed to our Board of Directors. Further, on March 1, 2008 Mr. Hall began providing the Company consulting services related to the continuing development of our website and technical operations.  In consideration we have agreed to pay Mr. Hall $10,000 per month for an initial 60 day period ending April 30, 2008, and thereafter have agreed to pay Mr. Hall $3,750 per calendar quarter until either we or Mr. Hall terminate the consulting arrangement.  We expect to enter into a written consulting agreement with Mr. Hall containing the described terms. 

 On March 10, 2008 we issued 10,000 shares to an investor upon the exercise of warrants granted in October 2007. We received $10,000 upon the exercise of the warrants. The proceeds will be used for working capital and general corporate purposes. The shares were issued in reliance on the exemption from registration contained in Section 4(2) of the 1933 Act and Rule 506 of Regulation D. No commissions or other remuneration was paid in connection with this issuance.

 On March 12, 2008, Disaboom Inc. (the “Company”) closed on $1,552,000 in gross proceeds under a private placement. In the closing the Company issued a total of 1,552,000 shares of common stock at a price of $1.00 per share. The shares were issued in reliance on Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder, and the offering was made to accredited investors only. No commissions or other remuneration were paid in connection with this issuance.

 On March 13, 2008, J. Glen House, a co-founder, director and officer of the Company voluntarily surrendered 3,750,000 shares of common stock back to the Company for no consideration, reducing his total share ownership to 7,500,000 shares.  Dr. House surrendered the shares to make additional capital stock available for other corporate purposes. 

5.Income taxes:

 No income tax benefit from continuing operations was recorded for any of the periods presented as management was unable to conclude that it was more likely than not that the income tax benefit would be realized.

 The reconciliation between income taxes computed at the statutory federal tax rate of 34% and the effective tax rate for the year ended December 31, 2007, and the period from September 5, 2006 (inception) through December 31, 2006 is as follows:

2007
2006
Federal tax benefit at statutory rate   34.00%  34.00%
State taxes, net of federal benefit   2.55%  3.06% 
Permanent items   (5.66%) 0.00% 
Change in valuation allowance and other   (30.89%) (37.06%)


Effective income tax rate   0.00%  0.00% 



 The tax effects of temporary differences that would give rise to substantially all deferred tax assets subject to the valuation allowance at December 31, 2007 and 2006 are as follows:

2007
2006
Deferred tax assets:      
Net operating loss carryforwards  $1,454,885 $2,500 
Intangible assets   767,166   
Stock-based compensation   149,953   
Property and equipment   60,721   
Other   29,145   


Gross deferred tax assets   2,461,870  2,500 


Less: Valuation allowance   (2,461,870) (2,500)


Net deferred tax assets  $ $ 



 The Tax Reform Act of 1986 contains provisions that limit the utilization of net operating loss and tax credit carryforwards if there has been a change of ownership as described in Section 382 of the Internal Revenue Code. Such an analysis has not been performed by the Company to determined the impact of these provisions on the Company’s net operating losses, though managment believes the impact would be minimal, if any. A limitation under these provisions would reduce the amount of losses available to offset future taxable income of the Company.

 At December 31, 2007, approximately $3.9 million of net operating loss carryforwards for federal income tax purposes were available to offset future taxable income through the year 2027.

6.Commitments and contingencies:

 Since June 2007 the Company leases its administrative offices under a noncancelable operating lease that expires on July 31, 2009. Rent expense for the year ended December 31, 2007 totaled approximately $62,000. The Company had no rent expense in 2006. Future minimum payments under this operating lease are approximately as follows:

Year ending
December 31,
2008  $92,000 
2009   54,000 

   $146,000 


7.Advances, related party:

 There are no related party advances outstanding as of December 31, 2007. At December 31, 2006, the Company had related party advances made by the Chairman and Chief Executive Officer (the “Chairman”) or an entity controlled by him, to provide working capital to the Company or expenses paid by the Chairman on behalf of the Company. Total advances amounted to $63,000, of which $50,000 was converted to equity in connection with a private placement (Note 4), and the remaining $13,000 was subsequently repaid.


8.Property and equipment:

 At December 31, 2007, property and equipment consisted of the following. The Company had no property and equipment at December 31, 2006.

Computer software, hardware, and office equipment  $21,825 
Furniture and fixtures   12,865 

    34,690 
Less accumulated depreciation and amortization   (4,557)

   $30,133 









DISABOOM, INC.
(A DEVELOPMENT STAGE COMPANY)
FOR THE PERIOD ENDED MARCH 31,JUNE 30, 2008

CONTENTS





PAGE
      
Financial Statements (unaudited)     
 
   Balance Sheets as of March 31,June 30, 2008 (unaudited) and December 31, 2007  F-17  
 
   Statements of Operations for the three-month and six-month periods ended March 31,June 30, 2008  
   and March 31,June 30, 2007, and for the period from September 5, 2006 (inception)  
   through March 31,June 30, 2008 (unaudited)  F-18  
 
 
   Statements of Cash Flows for the three-monthsix-month periods ended March 31,June 30, 2008  
   and March 31,June 30, 2007, and for the period from September 5, 2006 (inception)  
   through March 31,June 30, 2008 (unaudited)  F-19  
 
   Notes to financial statements  F-20 - F-26  





DISABOOM, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS

March 31, 2008
December 31, 2007
(unaudited)
ASSETS      
Current assets:  
      Cash and cash equivalents  $5,773,252 $4,432,751 
      Short-term investments   1,355,795  2,212,442 
      Accounts receivable   145,658  77,713 
      Prepaid expenses   87,753  104,319 


 Total current assets   7,362,458  6,827,225 
    Property and equipment, net   37,921  30,133 
    Deposits   7,667  7,667 


 Total assets  $7,408,046 $6,865,025 


LIABILITIES AND SHAREHOLDERS' EQUITY  
 Current liabilities:  
      Accounts payable  $169,218 $219,064 
      Accrued expenses   137,541  185,988 
      Other current liabilities   102,476  14,559 


 Total liabilities (all current)   409,235  419,611 


 Commitments and contingencies  
   
 Shareholders' equity (Note 3):  
      Preferred stock, $0.0001 par value; authorized  
      10,000,000 shares; none issued and outstanding  
      Common stock, $0.0001 par value; authorized 65,000,000  
      shares; 42,351,581 and 41,926,080 issued and outstanding, respectively   4,235  4,193 
      Additional paid-in capital   18,608,995  14,407,558 
      Deficit accumulated during the development stage   (11,614,419) (7,966,337)


                Total shareholders' equity   6,998,811  6,445,414 


                Total liabilities and shareholders' equity  $7,408,046 $6,865,025 


 

 

 

 

 

 

 

 

 

 

June 30, 2008

 

December 31, 2007

 

 

 


 


 

 

 

(unaudited)

 

 

 

ASSETS

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

3,640,599

 

$

4,432,751

 

Short-term investments

 

 

1,409,654

 

 

2,212,442

 

Accounts receivable

 

 

82,231

 

 

77,713

 

Prepaid expenses

 

 

459,933

 

 

104,319

 

 

 



 



 

 

 

 

 

 

 

 

 

Total current assets

 

 

5,592,417

 

 

6,827,225

 

Property and equipment, net

 

 

44,171

 

 

30,133

 

Deposits

 

 

7,667

 

 

7,667

 

 

 



 



 

 

 

 

 

 

 

 

 

Total assets

 

$

5,644,255

 

$

6,865,025

 

 

 



 



 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Accounts payable

 

$

267,949

 

$

219,064

 

Accrued expenses

 

 

158,296

 

 

185,988

 

Other current liabilities

 

 

42,232

 

 

14,559

 

 

 



 



 

Total liabilities (all current)

 

 

468,477

 

 

419,611

 

 

 



 



 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders’ equity (Note 3):

 

 

 

 

 

 

 

Preferred stock, $0.0001 par value; authorized 10,000,000 shares; none issued and outstanding Common stock, $0.0001 par value; authorized 65,000,000 shares; 43,319,058 and 41,926,080 issued and outstanding, respectively

 

 

4,332

 

 

4,193

 

Additional paid-in capital

 

 

20,103,684

 

 

14,407,558

 

Deficit accumulated during the development stage

 

 

(14,932,238

)

 

(7,966,337

)

 

 



 



 

 

 

 

 

 

 

 

 

Total shareholders’ equity

 

 

5,175,778

 

 

6,445,414

 

 

 



 



 

Total liabilities and shareholders’ equity

 

$

5,644,255

 

$

6,865,025

 

 

 



 



 

The accompanying notes are an integral part of these financial statements.



DISABOOM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months
ended
June 30, 2008

 

Three months
ended
June 30, 2007

 

Six months
ended
June 30, 2008

 

Six months ended
June 30, 2007

 

September 5, 2006
(inception)
through
June 30, 2008

 

 

 


 


 


 


 


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

141,355

 

 

 

 

$

191,215

 

 

 

 

$

274,897

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing

 

 

(1,600,054

)

$

(81,930

)

 

(3,729,766

)

$

(235,305

)

 

(6,581,585

)

General, administrative and other

 

 

(1,928,921

)

 

(751,863

)

 

(3,416,142

)

 

(936,205

)

 

(8,650,621

)

 

 



 



 



 



 



 

Loss from operations

 

 

(3,387,620

)

 

(833,793

)

 

(6,954,693

)

 

(1,171,510

)

 

(14,957,309

)

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

18,985

 

 

21,748

 

 

71,340

 

 

31,398

 

 

158,309

 

Income (loss) on short-term investments

 

 

50,816

 

 

-

 

 

(82,548

)

 

 

 

 

(133,238

)

 

 



 



 



 



 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(3,317,819

)

 

(812,045

)

$

(6,965,901

)

$

(1,140,112

)

$

(14,932,238

)

 

 



 



 



 



 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share, basic and diluted (Note 2)

 

$

(0.08

)

$

(0.03

)

$

(0.16

)

$

(0.05

)

 

 

 

 

 



 



 



 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding, basic and diluted (Note 2)

 

 

43,173,903

 

 

27,536,989

 

 

42,342,288

 

 

25,115,348

 

 

 

 

 

 



 



 



 



 

 

 

 


The accompanying notes are an integral part of these financial statements.



DISABOOM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONSCASH FLOWS
(unaudited)(Unaudited)

Three months ended March 31, 2008
Three months ended March 31, 2007
September 5, 2006 (inception) through March 31, 2008
Revenue  $49,860 $ $133,542 
Expenses:  
   Sales and marketing   (2,129,712) (153,375) (4,981,531)
   General, administrative and other   (1,487,221) (184,342) (6,721,700)



Loss from operations   (3,567,073) (337,717) (11,569,689)
Other income (expense):  
   Interest income   52,355  9,650  139,324 
   Loss on short-term investments   (133,364)   (184,054)



Net loss  $(3,648,082)$(328,067)$(11,614,419)



Net loss per share, basic and diluted (Note 2)  $(0.09)$(0.01)   


Weighted average number of common shares  
   outstanding, basic and diluted (Note 2)   41,510,673  22,666,800    




 

 

 

 

 

 

 

 

 

 

 

 

 

Six months ended
June 30, 2008

 

Six months ended
June 30, 2007

 

September 5, 2006
(inception) through
June 30, 2008

 

 

 






 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(6,965,901

)

$

(1,140,112

)

$

(14,932,238

)

Adjustments to reconcile net loss to cash used in operating activities:

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

579,817

 

 

145,515

 

 

1,930,070

 

Common stock issued for services

 

 

42,500

 

 

 

 

 

132,240

 

Unrealized loss (gain) on short-term investments

 

 

82,548

 

 

 

 

 

133,238

 

Common stock issued for website

 

 

 

 

 

 

 

 

74,250

 

Depreciation expense

 

 

7,701

 

 

 

 

 

12,259

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

Short-term investments

 

 

720,240

 

 

 

 

 

(1,542,892

)

Accounts receivable

 

 

(4,517

)

 

 

 

 

(82,231

)

Prepaid expenses and deposits

 

 

(355,614

)

 

(180,801

)

 

(467,600

)

Accounts payable

 

 

48,885

 

 

188,918

 

 

286,699

 

Accounts payable, related party

 

 

 

 

 

41,853

 

 

 

 

Accrued expenses

 

 

(27,692

)

 

 

 

 

158,296

 

Advances, related party

 

 

-

 

 

33,929

 

 

50,000

 

Other current liabilities

 

 

27,673

 

 

-

 

 

42,232

 

 

 









 

Net cash used in operating activities

 

 

(5,844,360

)

 

(910,698

)

 

(14,205,677

)

 

 









 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

Purchase of property and equipment

 

 

(21,739

)

 

(35,039

)

 

(56,429

)

 

 









 

Net cash used in investing activities

 

 

(21,739

)

 

(35,039

)

 

(56,429

)

 

 









 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

Proceeds from issuance of common stock

 

 

2,342,000

 

 

3,098,000

 

 

15,165,758

 

Proceeds from redemption of warrants, net

 

 

2,720,947

 

 

 

 

 

2,720,947

 

Proceeds from exercise of options

 

 

11,000

 

 

 

 

 

16,000

 

Proceeds applied to receivable from issuance of common stock

 

 

 

 

 

2,125

 

 

-

 

 

 









 

Net cash provided by financing activities

 

 

5,073,947

 

 

3,100,125

 

 

17,902,705

 

 

 









 

Increase in cash and cash equivalents

 

 

(792,152

)

 

2,154,388

 

 

3,640,599

 

Cash and cash equivalents at beginning of period

 

 

4,432,751

 

 

-

 

 

-

 

 

 









 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at end of period

 

$

3,640,599

 

$

2,154,388

 

$

3,640,599

 

 

 









 

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure of non-cash investing and financing activities:

 

 

 

 

 

 

 

 

 

 

Conversion of related party advances to common stock

 

$

-

 

$

50,000

 

$

50,000

 

Payment of accounts payable with common stock

 

 

-

 

 

-

 

 

18,750

 

The accompanying notes are an integral part of these financial statements.


DISABOOM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
(unaudited)

Three months ended March 31, 2008
Three months ended March 31, 2007
September 15, 2006 (inception) through March 31, 2008
Cash flows from operating activities:        
   Net loss  $(3,648,082)$(328,067)$(11,614,419)
   Adjustments to reconcile net loss to cash  
       used in operating activities:  
       Stock-based compensation expense   25,979  19,799  1,376,232 
       Common stock issued for services       89,740 
       Unrealized loss on short-term investments   133,364    184,054 
       Common stock issued for website       74,250 
       Depreciation expense   3,724    8,281 
       Changes in operating assets and liabilities:  
           Short-term investments   723,283    (1,539,849)
           Accounts receivable   (67,945)   (145,658)
           Prepaid expenses and deposits   16,566    (95,420)
           Accounts payable   (49,847) 86,142  187,967 
           Accrued expenses   (48,447)   137,541 
           Advances, related party     33,929  50,000 
           Other current liabilities   87,917    102,476 



                  Net cash used in operating activities   (2,823,488) (188,197) (11,184,805)



Cash Flows from investing activities:  
   Purchase of property and equipment   (11,512)   (46,202)



                 Net cash used in investing activities   (11,512)   (46,202)



Cash flows from financing activities:  
   Proceeds from issuance of common stock   1,552,000  2,848,000  14,375,758 
   Proceeds from common stock to be issued     250,000   
   Proceeds from redemption of warrants   2,623,501    2,623,501 
   Proceeds from exercise of options       5,000 
   Proceeds applied to receivable from issuance of common stock     2,125   



                  Net cash provided by financing activities   4,175,501  3,100,125  17,004,259 



Increase in cash and cash equivalents   1,340,501  2,911,928  5,773,252 
Cash and cash equivalents at beginning of period   4,432,751     



Cash and cash equivalents at end of period  $5,773,252 $2,911,928 $5,773,252 



Supplemental disclosure of non-cash investing and financing  
   activities:  
   Conversion of related party advances to common stock  $ $50,000 $50,000 
   Payment of accounts payable with common stock       18,750 

The accompanying notes are an integral part of these financial statements.


DISABOOM, INC.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

ThreeSix months ended March 31,June 30, 2008
(Unaudited)

(Unaudited)

1.

Organization and basis of presentation:


Disaboom, Inc. (the “Company”) was incorporated in the State of Colorado on September 5, 2006 with the primary purpose of developing the first interactive online community dedicated to constantly improving the way Americans with disabilities or functional limitations live their lives. It serves as a comprehensive online resource not only for people living with such conditions, but their immediate families and friends, caregivers, recreation and rehabilitation providers, and employers. The activities of the Company in 2007 were primarily organizational in nature, including planning and developing version 1.0 of our main website (www.disaboom.com),(www.disaboom.com) and social networking platform, researching and beginning to implement our marketing and business development initiatives, planning and beginning to establish our sales operations, and continuing to build our management team and staff. During the quarter ended December 31, 2007 and through the quartersix months ended March 31,June 30, 2008, our focus began to switch from organizational matters and the initial launch of our main website, to operational matters related to (a) expanding the resources, services and servicescapabilities of our main website and social networking platform, (b) launching additional resources and services through related microsites and the Company’s marketplace, (c) integrating our main website with ourand related microsites into a cohesive network,the Disaboom Network, (d) driving Internet traffic and registered users into our community, and (e) beginning to generate traditional cost per mille (“CPM”) related advertising and sponsorship revenues, as well as directory services revenues.


The balance sheet as of March 31,June 30, 2008, and the statements of operations and cash flows for the three monthsand six month periods ended March 31,June 30, 2008 and 2007 and the period from September 5, 2006 (inception) through March 31,June 30, 2008, respectively, have been prepared by the Company and have not been audited. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary to present fairly the financial position, results of operations and cash flows at March 31,June 30, 2008 and for all periods presented have been appropriately made.


Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted. It is suggested that these financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s 2007 Annual Report on Form 10-K. The results of operations for interim periods presented are not necessarily indicative of the operating results for the full year.


The December 31, 2007 balance sheet was derived from the Company’s December 31, 2007 audited financial statements.


2.

Summary of significant accounting policies:


Development stage company:


The Company complies with Statement of Financial Accounting Standard (“SFAS”) No. 7 for its characterization of the Company as development stage. Furthermore, the Company has adopted Statement of Position (“SOP”) 98-5, “Reporting on the Costs of Start-Up Activities,” which provides guidance on the financial reporting of start-up costs and organizational costs, to be expensed as incurred.

5



Revenue recognition:


During the quartersix months ended March 31,June 30, 2008, the Company received limited amounts of revenue through the sale of advertising and sponsorship products from its version 2.0 main website Disaboom.com, and related microsites DisaboomJobs.com and Lovebyrd.com. Advertising and sponsorship revenue comprised 95%98% of the Company’s total revenue received. Advertising and sponsorship revenue is recognized ratably over the period in which it is delivered and earned.earned through the development and release of sponsor landing pages, microsites and channels on the Company’s websites, and/or the delivery of advertising impressions by recognized and independent third party vendors. The Company has agreements ranging in term from one month test agreements to twelve month advertising and sponsorship agreements. At March 31, 2008, other current liabilities include approximately $95,260 of deferred revenue that represents amounts billed or received under advertising and sponsorship contracts for which the advertisements and/or sponsorship landing pages have not yet been presented or launched.


Cash and cash equivalents:


The Company considers all highly liquid investments with original maturities of three months or less at date of purchase to be cash equivalents.


Short-term investments:


Short-term investments consist of a certificate of deposit with an original maturity of six months and mutual funds. The Company accounts for short-term marketable securities in accordance with the Financial Accounting Standards Board (“FASB”), Statement of Financial Accounting Standard (“SFAS”) No. 115,Accountingfor Certain Investments in Debt and Equity Securities.


Marketable securities are classified as trading securities, as the Company expects to use these funds for operating purposes within the next year. Trading securities are reported at fair value and unrealized gains and losses are included in earnings.


Use of estimates in financial statement preparation:


The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from these estimates.


Accounts receivable:


Accounts receivable are recorded at their face amount less an allowance for doubtful accounts. The allowance for doubtful accounts reflects management’s best estimate of probable losses in the accounts receivable balance. Management determines the allowance based on known troubleddoubtful accounts, historical experience, and other currently available evidence. The allowance for doubtful accounts was zero at June 30, 2008 and December 31, 2007 and 2006.2007. The Company generally does not require collateral from its customers. At March 31,June 30, 2008, threetwo customers accounted for 19%, 13%23% and 13%17% of accounts receivable.


Website development costs:


The Company has adopted the provisions of Financial Accounting Standards Board (“FASB”) Emerging Issues Task Force (“EITF”) 00-2, “Accounting for Web Site Development Costs,” which specifies the appropriate accounting for costs incurred in connection with the development and maintenance of web sites. Under EITF 00-2, costs related to certain web site development activities are expensed as incurred (such as planning and operating stage activities). Costs relating to certain website application and infrastructure development are generally capitalized, and are amortized over their estimated useful life. In January 2007,Through June 30, 2008, the Company entered into an agreementhas expensed all significant website development costs as these costs primarily related to begin its website development.planning and operational activities. For the three and six months ended March 31,June 30, 2008 and 2007, and the period from September 5, 2006 (inception) to March 31,June 30, 2008, website development costs of approximately $11,000, $136,250$73,000, $84,000, $112,000, $248,000, and $496,000,$569,000 respectively, were expensed.




Stock-based compensation:


The Company accounts for stock options and similar equity instruments in accordance with SFAS No. 123(R),Share-Based Payment. SFAS 123(R) requires the recognition of the cost of employee services received in exchange for an award of equity instruments in the financial statements and is measured based on the grant date fair value of the award. SFAS 123(R) also requires the stock option compensation expense to be recognized over the period during which an employee is required to provide service in exchange for the award (usually the vesting period).


The Board of Directors has adopted the 2006 Stock Option Plan (the “2006 Plan”). The 2006 Plan authorizes the Board of Directors to grant stock bonuses or stock options to purchase shares of the Company’s common stock to employees, officers, directors and consultants. Options granted under the 2006 Plan may be either incentive stock options or non-qualified stock options. The aggregate number of shares of common stock as to which options and bonuses may be granted under the 2006 Plan cannot exceed 7,000,000.


During the quartersix months ended March 31,June 30, 2008, the Company granted 912,5002,501,500 stock options to employees at a weighted average exercise price of $1.38$1.25 per share. The options are subject to various vesting schedules and are exercisable through various dates the latest of which is in 2014. The weighted average fair value of stock options atgranted during the dates of grantsix month ended June 30, 2008 was $689,293.estimated to be $.63 per option. The Company used the following assumptions to determine the fair value of stock option grants during the threesix months ended March 31,June 30, 2008 and 2007:


2008
2007

 

 

 

 

 

 

 

Expected life  3.25 - 4   5 

 

2008

 

2007

 

 


 


 

Expected life (years)

 

2.25 - 4.00

 

2.25 - 6.00

 

Volatility  75 - 85%  55% 

 

69 - 85

%

 

47 - 68

%

Risk-free interest rate  1.87 - 3.28%  4.6% 

 

1.87 - 3.73

%

 

4.51 - 5.07

%

Dividend yield  0%  0% 

 

0

%

 

0

%


The expected term of stock options represents the period of time that the stock options granted are expected to be outstanding and was calculated using the simplified method per the guidance of SAB 107 “Share Based Payment” (“SAB 107”) for “plain vanilla” options. The expected volatility is based on the historical price volatility of the common stock of similar companies in the development stage. The risk-free interest rate represents the U.S. Treasury bill rate for the expected term of the related stock options. The dividend yield represents the anticipated cash dividend over the expected term of the stock options.

Summary of stock option activity for the six months ended June 30, 2008 is presented below:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares Under
Option

 

Weighted
Average
Exercise
Price

 

Weighted
Average
Remaining
Contractual
Life (Years)

 

Aggregate
Intrinsic Value

 

 

 


 


 


 


 

Outstanding at January 1, 2008

 

 

6,158,500

 

$

0.85

 

 

 

 

 

 

 

Granted

 

 

2,501,500

 

$

1.25

 

 

 

 

 

 

 

Exercised

 

 

(22,000

)

$

0.50

 

 

 

 

 

 

 

Expired

 

 

(25,000

)

$

0.50

 

 

 

 

 

 

 

Forfeited

 

 

(3,360,250

)

$

1.23

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

Outstanding at June 30, 2008

 

 

5,252,750

 

$

0.80

 

 

4.94

 

$

2,025,150

 

 

 



 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vested at June 30, 2008

 

 

(2,163,250

)

$

0.59

 

 

3.83

 

$

1,230,450

 

 

 



 



 

 

 

 

 

 

 


          Summary of stock option activity for the quarter ended March 31, 2008 is presented below:

Shares
Under
Option

Weighted
Average
Exercise
Price

Weighted
Average
Remaining
Contractual
Life (Years)

Aggregate
Intrinsic
Value

Outstanding at January 1, 2008   6,158,500 $0.85      
     Granted   912,500$1.38    
     Exercised    $       
     Forfeited   (1,036,250)$1.23       


Outstanding at March 31, 2008   6,034,750 $0.86 4.58 $2,766,160 


Exercisable at March 31, 2008   2,017,500 $0.61 4.08 $1,515,050 



During the quarterthree and six month periods ended March 31,June 30, 2008, compensation expense of $(76,821)$40,145 was recorded and ($36,676) was reversed relative to the 2006 Plan, respectively. Compensation during the six months ended June 30, 2008 was reversed to account for the forfeiture of unvested options. Total intrinsic value of the options exercised during the quarterthree months ended March 31,June 30, 2008 was $0.$13,200.


A summary of the status of the Company’s non-vested shares as of and for the quartersix months ended March 31,June 30, 2008, is presented below.


Nonvested Shares
Nonvested
Shares
Under
Option

Weighted
Average
Grant Date
Fair Value

Nonvested at January 1, 2008   4,726,000 $0.57 

 

 

 

 

 

 

 

 

Nonvested
Shares Under
Option

 

Weighted
Average
Grant Date
Fair Value

 

 


 


 

Outstanding January 1, 2008

 

4,726,000

 

$

0.57

 

Granted  912,500 0.76 

 

2,501,500

 

$

0.63

 

Vested  (575,000) 0.32 

 

(720,750

)

$

0.36

 

Forfeited  (1,036,250) 0.77 

 

(3,360,250

)

$

0.72

 



 

 

 

 

 

Nonvested at March 31, 2008  4,027,250 $0.61 


 


 


 

Nonvested at June 30, 2008

 

3,146,500

 

$

0.52

 

 


 


 


As of March 31,June 30, 2008, the Company had $1,156,702$895,478 of unrecognized compensation cost related to stock options that will be recognized over a weighted average period of approximately 3 years.


Loss per share:


The Company computes net earnings (loss) per share in accordance with SFAS No. 128, “Earnings per Share”, which establishes standards for computing and presenting net earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding and the number of dilutive potential common share equivalents during the period. Stock options and warrants are not considered in the calculation, as the impact of potential common shares (14,457,271(14,681,090 at March 31,June 30, 2008 and 862,5004,473,500 at March 31,June 30, 2007) would be to decrease loss per share. Therefore, diluted loss per share is equivalent to basic loss per share.




Recent pronouncements:


In FebruaryDecember 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities141 (Revised 2007),Business Combinations, (“SFAS 159”No. 141R”). SFAS 159 allows entitiesNo. 141R will change the accounting for business combinations. Under SFAS No. 141R, an acquiring entity will be required to voluntarily choose to measure certain financialrecognize all the assets acquired and liabilities assumed in a transaction at the acquisition-date fair value (“fair value option”). The fair value option may be electedwith limited exceptions. SFAS No. 141R will also change the accounting treatment and disclosure for certain specific items in a business combination. SFAS No. 141R applies prospectively to business combinations for which the acquisition date is on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. Ifor after the fair value option is elected for an instrument, SFAS 159 specifies that unrealized gains and losses for that instrument be reported in earnings at each subsequentbeginning of the first annual reporting date. SFAS 159 was effective forperiod beginning on or after December 15, 2008. Accordingly, any business combinations the Company on January 1,engages in will be recorded and disclosed following existing GAAP until December 31, 2008. The Company did not apply the fair value option to any of its outstanding instruments and therefore,expects SFAS 159 did notNo. 141R will have an impact on accounting for business combinations once adopted and the Company’s consolidated financial statements.effect is dependent upon acquisitions at that time.


In September 2006,March 2008, the FASB issued SFAS No. 157, Fair Value Measurements161,Disclosures about Derivative Instruments and Hedging Activities (“SFAS 157”No. 161”), which defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles,. SFAS No. 161 amends and expands disclosuresthe disclosure requirements for FASB Statement No. 133, “Derivative Instruments and Hedging Activities” (“SFAS No. 133”). It requires enhanced disclosure about fair value measurements.(i) how and why an entity uses derivative instruments, (ii) how derivative instruments and related hedge items are accounted for under SFAS 157 was effective for the Company on January 1, 2008 for allNo. 133 and its related interpretations, and (iii) how derivative instruments and related hedge items affect an entity’s financial assetsposition, financial performance, and liabilities. For all nonfinancial assets and liabilities,cash flows. SFAS 157No. 161 is effective for the Company onas of January 1, 2009. As it relates to the Company’s financial assets and liabilities, the adoption of SFAS 157 did not have a material impact on the Company’s consolidated financial statements. The Company is in the process of evaluatingcurrently assessing the impact thatof SFAS 157 will have161 on its nonfinancial assetsfinancial position and liabilities.results of operations.


3.

Shareholders’ equity:


On March 12, 2008, the Company closed on $1,552,000 in gross proceeds under a private placement. In the closing, the Company issued a total of 1,552,000 shares of common stock at a price of $1.00 per share. The shares were issued in reliance on Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder, and the offering was made to accredited investors only. The Company is obligated to paypaid $10,000 and issueissued warrants to purchase 10,000 shares of Company common stock as commissions for this offering. The warrants have an exercise price of $1.00 per share and expire on March 12, 2011.


On January 17, 2008, a former employee of the Company was issued 10,000 shares of the Company’s common stock in connection with the exercise and purchase of that employee’s vested stock options. Cash of $5,000 was received in December 2007. On February 18, 2008, the Company issued 15,000 unrestricted common shares to a third party in exchange for services. These services were received in 2007 and were expensed at that time.


On March 1, 2008 the Company exercised its call option on certain warrants issued in September and October 2007 requiring the warrant holders to either exercise the warrants or be redeemed at $0.01 per share during the month of March. In March and April 2008 we issued an aggregate of 2,623,501 shares to investors upon the exercise of warrants granted in September and October 2007. We received $2,623,501 upon the exercise of the warrants. The proceeds will be used for working capital and general corporate purposes. The shares were issued in reliance on the exemption from registration contained in Section 4(2) of the 1933 Act and Rule 506 of Regulation D. NoAlthough the Company paid commissions at the time of the issuance of the warrants, no commissions or other remuneration was paid in connection with this issuance.the shares issued upon the exercise of the warrants. During this same period, 1,173,499 warrants that were called were not exercised. In accordance with the provisions of the warrant agreement, the Company paid out $.01 per share or $11,735 to these warrant holders on April 4, 2008, and 1,173,499 shares previously reserved for issuance under these redeemed warrants are now available for other corporate purposes.


On March 13, 2008, J. Glen House, a co-founder, director and officer of the Company voluntarily surrendered 3,750,000 shares of common stock back to the Company for no consideration, reducing his total share ownership to 7,500,000 shares. Dr. House surrendered the shares to make additional capital stock available for other corporate purposes.




Effective April 1, 2008, the Company entered into a consulting agreement whereby the business consultant provides media and agency related services to the Company. The Company issued the business consultant a warrant to purchase 100,000 shares of our common stock at $1.26 per share for a term of five years. The warrant was valued at $87,000 on the date of grant, of which $29,000 was expensed at June 30, 2008. The shares underlying the warrant vest in 11,111 share installments each month during the vesting term, contingent upon the business consultant continuing to provide us with consulting services under the agreement.

On April 4, 2008, the Company closed on $800,000 in gross proceeds under a private placement. In the closing the Company issued a total of 800,000 shares of common stock at a price of $1.00 per share. The shares were issued in reliance on Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder, and the offering was made to accredited investors only. The Company paid $10,000 and issued 10,000 warrants in connection with this offering (being the same offering described above for which the Company had an initial close of March 12, 2008).

Effective April 8, 2008, the Company entered into a business consulting agreement. In consideration for entering into the agreement the Company issued the consultant a warrant to purchase 1,000,000 shares of our common stock at $1.15 per share for a term of one year. The warrant was valued at $377,000 on the date of grant and was expensed at June 30, 2008.

In April 2008, the Company issued 36,296 unrestricted common shares to third parties in exchange for services.

Effective May 15, 2008, the Company entered into a business consulting agreement and issued the consultant a warrant to purchase 25,000 shares of common stock. The warrant has an exercise price of $1.40, expires on May 15, 2013, and 20,000 shares underlying the warrant only vest upon the occurrence of certain events. Compensation expense of $4,895 was recorded at June 30, 2008.

On May 27, 2008, we issued an aggregate of 29,727 shares to an investor upon the exercise of warrants granted in December. We received $29,727 upon the exercise of the warrants. The proceeds will be used for working capital and general corporate purposes. The shares were issued to an accredited investor, and thus in reliance on the exemption from registration contained in Section 4(2) of the 1933 Act and Rule 506 of Regulation D. No commissions or other remuneration was paid upon the exercise of the warrant.

On June 6, 2008, we issued an aggregate of 79,454 shares to an investor upon the exercise of warrants granted in December. We received $79,454 upon the exercise of the warrants. The proceeds will be used for working capital and general corporate purposes. The shares were issued to an accredited investor, and thus in reliance on the exemption from registration contained in Section 4(2) of the 1933 Act and Rule 506 of Regulation D. No commissions or other remuneration was paid upon the exercise of the warrant.

On June 20, 2008, a former employee of the Company was issued 22,000 shares of the Company’s common stock in connection with the exercise and purchase of that employee’s vested stock options. Cash of $11,000 was received on June 9, 2008. These shares were issued under a registration statement on Form S-8.

4.

Significant agreements and subsequent events:


Effective May 1, 2007, the Company entered into a consulting agreement with the Memphis Consulting Group (“MCG”), whereby MCG provides investor relations services to the Company. Effective July 6, 2007, the Company entered into a new consulting agreement with MCG, whereby MCG provides investor relations services to the Company. The consulting agreement that the Company previously entered into with MCG was scheduled to expire on August 1, 2007. The July 6, 2007 agreement is for a twelve month term and may be extended by the parties. Pursuant to the agreement, the Company is to pay MCG $12,000 per month. Additionally, the Company issued MCG a warrant to purchase 400,000 shares of our common stock at $1.45 per share for a term of five years. The shares underlying the warrant vestvested in 100,000 share installments on September 30, 2007, December 31, 2007, March 31, 2008 and June 30, 2008, contingent upon MCG continuing to provide us with consulting services under the agreement.2008. The warrant issued pursuant to the July 6 agreement was in addition to the warrant to purchase 50,000 shares of our common stock issued to MCG under the terms of our previous agreement. The warrant was valued at $411,200 on the date of the grant, of which $205,600 was expensed as of December 31, 2007, andthe final $102,800 was expensed as of March 31,during the three months ended June 30, 2008. Effective November 1, 2007, upon the mutual consent of theThe Company and MCG, the Company is to payalso paid MCG $6,000 in cash per month for the remainder of the term of the July 6, 2007 agreement.month.



On July 5, 2007 the Company entered into a services agreement with Cowboy International, Inc (“Cowboy”). Cowboy was retained to help the Company create a comprehensive and integrated marketing, advertising, and branding campaign for ourthe Company's main website. During 2007, the Company paid a total of approximately $904,000 to Cowboy for services rendered. On January 31, 2008, the Company terminated its agreement with Cowboy.


On February 29, 2008, the Company filed a complaint against Cowboy International, Inc. in the Colorado District Court, for the District of Arapahoe County. The complaint alleges that Cowboy: 1) breached the services agreement entered into between the Company and Cowboy; 2) breached its obligations to hold certain Company information confidential; and 3) failed to comply with its contractual obligations regarding Company intellectual property.  The compliant contains five claims against Cowboy, four of which seek monetary damages to be determined at trial. On April 2, 2008, Cowboy filed counterclaims seeking amounts allegedly due under the services agreement and seeking monetary damages. In its counterclaim Cowboy has alleged specific damages of at least $142,000 for the Company’s alleged breach of the services agreement and has also alleged specific damages of up to $710,000 for Cowboy’s expectancy under the agreement. We believe Cowboy’s position with respect to its counterclaims is unfounded and without merit. The Company intends to vigorously prosecute its claims and defend against Cowboy’s counterclaims.


During the quarter ended March 31, 2008, the Company granted performance warrants to purchase 225,000 shares of common stock to consultants, of which 100,000 of the warrants were forfeited. The warrants have an exercise price of $1.30 per share and expire on January 3, 2013.


On February 29, 2008, Kevin Hall was appointed to our Board of Directors. Upon his appointment, Mr. Hall was granted an option to purchase 50,000 shares of the Company’s common stock exercisable at $1.42 per share. The option is subject to vesting with 25,000 vesting on December 31, 2008 and the remaining 25,000 vesting on December 31, 2009. Further, on March 1, 2008, Mr. Hall began providing the Company consulting services related to the continuing development of our business, website and technical operations. In consideration, we have verbally agreed to pay Mr. Hall $10,000 per month until approximately June 30,July 31, 2008, and thereafter have agreed to pay Mr. Hall $3,750 per calendar quarter until either we or Mr. Hall terminate our agreement.



Effective April 1, 2008,

In the Company entered into a consulting agreement with the Thunderbolt Group LLC. (“Thunderbolt”), whereby Thunderbolt provides media and agency related services to the Company. The Company issued Thunderbolt a warrant to purchase 100,000 shares of our common stock at $1.26 per share for a term of five years. The shares underlying the warrant vest in 11,111 share installments each month during the vesting term, contingent upon Thunderbolt continuing to provide us with consulting services under the agreement.


In April and Mayquarter ended June 30, 2008, the Company granted employees an aggregate of 1,155,0001,589,000 options to purchase our common stock at exercise prices that range from $1.15$1.10 to $1.25$1.41 per share. The options are subject to vesting schedules or vest upon the achievement of defined performance goals. The options were granted in consideration for services.

On April 4, Since the quarter ended on June 30, 2008, the Company closed on $800,000 in gross proceeds under a private placement. In the closing the Company issued a totalhas granted employees an aggregate of 800,000 shares of52,000 options to purchase common stock at a price of $1.00exercise prices that range from $.55 to $1.01 per share. The shares were issued in reliance on Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder, and the offering was made to accredited investors only.


Effective April 8, 2008, the Company entered into a business consulting agreement. In consideration for entering into the agreement the Company issued the consultant a warrant to purchase 1,000,000 shares of our common stock at $1.15 per share for a term of one year.


In April 2008, the Company issued 36,296 unrestricted common shares to third parties in exchange for services.

5.

Income taxes:


No income tax benefit was recorded for any of the periods presented, as management was unable to conclude that it was more likely than not that the income tax benefit would be realized.


The Tax Reform Act of 1986 contains provisions that limit the utilization of net operating loss and tax credit carryforwards if there has been a change of ownership as described in Section 382 of the Internal Revenue Code. Such an analysis has not been performed by the Company to determine the impact of these provisions on the Company’s net operating losses, though management believes the impact would be minimal, if any. A limitation under these provisions would reduce the amount of losses available to offset future taxable income of the Company.



6.

Commitments and contingencies:


Since June 2007, the Company leases its administrative offices under a non-cancellable operating lease that expires on July 31, 2009. Rent expense for the quarterthree and six month periods ended March 31,June 30, 2008, June 30, 2007, and the period from September 5, 2006 (inception) through March 31,June 30, 2008 totaled approximately $22,000, $44,000, $9,000, $9,000, and $84,000,$106,000, respectively.

On July 8, 2008 the Company entered into a Lease Agreement for the lease of additional office space. The lease commenced July 11, 2008 and terminates on July 31, 2009. We pay $3,249 per month under the terms of the lease.




PART II INFORMATION NOT REQUIRED IN PROSPECTUS

Other Expenses of Issuance and Distribution

        The following table sets forth an itemization of all estimated expenses, all of which we will pay, in connection with the issuance and distribution of the securities being registered:

NATURE OF EXPENSE AND AMOUNT

SEC Registration fee  $830 
Legal fees and expenses  $15,000*
Miscellaneous  $5,000*
TOTAL  $20,830 

*Estimates

Recent Sales of Unregistered Securities

        The following sets forth the information required by Item 701 of Regulation S-K with respect to the unregistered sale of equity securities:

           1.         On November 13, 2006 we issued 21,250,000 shares of common stock at par value, $0.0001 per share, in a private placement to our founders. We relied on the exemption from registration provided by Section 4(2) and Rule 506 under the Securities Act of 1933 for this offering. The proceeds of this issuance were used for general working capital purposes. No commissions or other remuneration were paid in the offering.

           2.         On February 15, 2007, pursuant to our 2006 Stock Option Plan (the “Plan”) we granted an aggregate of 62,500 options to four individuals to purchase our common stock at an exercise price of $0.50 per share. The shares options were issued in consideration for services provided for the development of our website and the creation of website content. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of these options after deducting any cash that may have been paid to the individuals. We relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this issuance. To the extent these option grants constitute “sales” of securities, we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration were paid on these issuances.

           3.         On February 26, 2007, pursuant to the Plan, we granted an employee 500,000 options to purchase our common stock at an exercise price of $0.50 per share. The options were issued in consideration for services provided and to be rendered to the Company by the employee for the development of our website and other services provided in the recipient’s capacity as a Company employee. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of these options after deducting any cash that may have been paid to the employee. We relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this issuance. To the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration were paid on this issuance.

           4.        On March 9, 2007, pursuant to the Plan, we granted an aggregate of 300,000 options to three of our directors (each being an accredited investor as that term is defined in Rule 501) to purchase our common stock at an exercise price of $0.50 per share. The shares options were issued in consideration for on-going services provided, and to be rendered, to the Company as members of our board of directors and for service on board committees. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of these options after deducting any cash that may have been paid to the directors. WeTo the extent these grants may be considered “sales” of securities, we relied on the exemptionexemptions from registration provided by Section 4(2) and 4(6) under the Securities Act of 1933 for this issuance.these issuances. No commissions or other remuneration was paid for these issuances.

            5.        On March 9, 2007, we issued 5,796,000 shares of common stock at $0.50 per share in a private placement. We relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933, and Rule 506 promulgated there underthereunder for this offering, and the offering was made to accredited investors only . No commissions or other remuneration were paid in the offering.

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            6.         On April 2, 2007, we issued 500,000 shares of common stock at $0.50 per share in a private placement. We relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 and Rule 506 promulgated there under for this offering, and the offering was made to accredited investors only. The proceeds of this issuance were used for general working capital purposes. No commissions or other remuneration were paid in the offering.

            7.         Between April 1, 2007 and June 30, 2007, pursuant to the Plan, we granted new employees and consultants an aggregate of 3,386,000 options to purchase our common stock all subject to vesting schedules. The options were granted to employees in consideration for becoming employees of the Company and for services to be provided to the Company in their capacity as employees. The options granted to consultants were issued in consideration for services provided to assist the Company in the development of our website and the creation of website content. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of the options after deducting any cash that may have been paid to the recipients. Werecipients.. To the extent any of these option grants constituted “sales” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these issuances.grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with these issuances.

            8.        Effective May 1, 2007, we entered into a consulting agreement whereby in consideration for business consulting services with respect to financial public relations, business promotion, business growth and development, provided to the Company we issued a consultant 18,000 shares of restricted stock. Additionally we issued the consultant a warrant to purchase 50,000 shares of our common stock at $0.50 per share for a period of five years. The Company deemed the aggregate consideration received for the warrants to be equal to the then fair market value of the shares and warrant respectivley after deducting any cash that may have been paid to the consultant. WeBecause the consultant is an accredited investor, we relied on the exemptionexemptions from registration provided by SectionSections 4(2) and 4(6) under the Securities Act of 1933 for these issuances. No commissions or other remuneration was paid in connection with these issuances.

            9.        On May 29, 2007, pursuant to the Plan, we granted three independent contractors an aggregate of 65,000 options to purchase our common stock at an exercise price of $0.50 per share. The options were granted in consideration services rendered to the Company for the development of our website and the creation of website content. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of these options after deducting any cash that may have been paid to the recipients.Werecipients. To the extent any of these option grants constituted “sales” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. We relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these issuances. No commissions or other remuneration was paid in connection with these issuances.

            10.        On July 3, 2007, pursuant to the Plan we granted a newly appointed director (being an accredited investor as defined in Rule 501) 100,000 options to purchase our common stock at an exercise price of $1.45 per share, subject to a vesting schedule and exercisable through 2011. The options were granted in consideration for services to be provided as a member of our board of directors. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of the option after deducting any cash that may have been paid to the recipient. WeTo the extent this option grant constituted a “sale” of securities, we relied on the exemption from registration provided by SectionSections 4(2) and 4(6) under the Securities Act of 1933 for this issuance.grant. No commissions or other remuneration was paid in connection with this issuance.

            11.         Effective July 6, 2007, we entered into a consulting agreement whereby in consideration for business consulting services with respect to financial public relations, business promotion, business growth and development provided to the Company we issued a warrant to purchase 400,000 shares of our common stock at $1.45 per share for a period of five years, with the shares vesting in 100,000 share increments through June 30, 2008. The Company deemed the aggregate consideration received for the warrant to be equal to the then fair market value of the warrant after deducting any cash that may have been paid to the recipient. WeBecause the consultant is an accredited investor, we relied on the exemption from registration provided by SectionSections 4(2) and 4(6)under the Securities Act of 1933 for this issuance. No commissions or other remunerations were paid in connection with this issuance.

            12.        Between July 1, 2007 and September 30, 2007, pursuant to the Plan, we granted employees and a director an aggregate of 395,000 options to purchase our common stock all subject to vesting schedules. The option grant to the director occurred on July 3, 2007 and is described above. The options issued to new employees were granted in consideration for the persons becoming Company employees and for services to be rendered in each recipient’s capacity as an employee. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of these options after deducting any cash that may have been paid to the recipients. WeTo the extent any of these option grants constituted “sales” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these issuances.grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with these issuances.

            13.         On September 26, 2007 as part of a private placement we issued 7,128,000 common shares and 5,346,000 warrants to purchase the same number of common shares. For each $0.75 invested, each purchaser received one common share plus warrants to acquire three-fourths of a share. We relied on the exemption from registration provided by Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated there under, and was made to accredited investors only. Commissions of 10% cash and 10% warrants were paid on the offering.

            14.           On October 1, 2007, pursuant to the Plan, we granted employees an aggregate of 725,000 options to purchase our common stock exercisable at $1.50 per share. Each of the option grants is subject to a vesting schedule, with certain of the option grants (an aggregate of 650,000 of the options granted) only vesting upon the achievement of defined performance goals. The options were granted in consideration for services rendered to the Company in each recipient’s capacity as an employee and for increased duties assumed by certain employees. Certain option grants (being 650,000 of the total options granted) were issued in consideration for services to be rendered by each recipient to assist the Company in achieving revenue and website traffic related objectives. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of these options after deducting any cash that may have been paid to the recipients. WeTo the extent any of these option grants constituted “sales” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these issuances.grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with these issuances.

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            15.        On October 9, 2007, as part of a private placement we issued 449,333 common shares and 337,000 warrants to purchase the same number of common shares. For each $0.75 invested, each purchaser received one common share plus warrants to acquire three-fourths of a share. We relied on the exemption from registration provided by Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated there under, and was made to accredited investors only. Commissions of 10% cash and 10% warrants were paid on the offering.

            16.        On October 9, 2007, as partial consideration for entering into an asset purchase agreement we issued 55,000 shares of common stock to Lovebyrd.com, LLC. The Company deemed the aggregate consideration received for the shares to be equal to the then fair market value of these options after deducting any cash that may have been paid to Lovebyrd.com. The shares were issued pursuant to Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder. No commissions or other remuneration was paid in connection with the issuance.

           17.        On November 1, 2007, pursuant to the Plan, we granted a new employee 210,000 options to purchase our common stock at an exercise price of $1.50 per share, with certain of the options only vesting upon the achievement of defined performance goals. The options were granted in consideration for the new employee becoming a Company employee for the services to be provided in his capacity as a Company employee. The Company deemed the aggregate consideration received for the option to be equal to the then fair market value of the option after deducting any cash that may have been paid to the recipient. Werecipient.. To the extent this option grant constituted a “sale” of securities, we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these issuances.the grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grant; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

           18.         On November 28, 2007, pursuant to the Plan, we granted a new employee 125,000 options to purchase our common stock at an exercise price of $1.40 per share, with certain of the options only vesting upon the achievement of defined performance goals. The options were granted in consideration for the new employee becoming a Company employee and the services to be provided in his capacity as a Company employee. The Company deemed the aggregate consideration received for the option to be equal to the then fair market value of the option after deducting any cash that may have been paid to the recipient. To the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for the grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for the grant the recipient obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

           19.         On December 10, 2007, pursuant to the Plan, we granted a new employee 100,000 options to purchase our common stock at an exercise price of $1.52 per share, with certain of the options only vesting upon the achievement of defined performance goals. The options were granted in consideration for the new employee becoming a Company employee and the services to be provided in his capacity as a Company employee. The Company deemed the aggregate consideration received for the option to be equal to the then fair market value of the option after deducting any cash that may have been paid to the recipient. WeTo the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this issuance.the grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grant; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

            20.       On December 10, 2007, we closed a $5,000,000 private placement of our equity securities. For each $0.75 invested, each purchaser received one common share plus warrants to acquire three-fourths of a share. A total of 6,666,660 common shares and 5,000,000 warrants to purchase the same number of common shares were issued at closing. The warrants are exercisable at $1.00 for a term of three years. The offering was conducted in reliance on Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder, and was made to accredited investors only. Commissions of 10% cash and 10% warrants were paid in connection with the offering.

           21.         On December 17, 2007, pursuant to the Plan, we granted a new employee 300,000 options to purchase our common stock at an exercise price of $1.30 per share, with certain of the options only vesting upon the achievement of defined performance goals. The options were granted in consideration for the new employee becoming a Company employee and the services to be provided in his capacity as a Company employee. The Company deemed the aggregate consideration received for the option to be equal to the then fair market value of the option after deducting any cash that may have been paid to the recipient. WeTo the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this issuance.the grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grant; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for the grant the recipient obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

            22.        On January 3, 2008 we issued two consultants warrants to purchase a total of 225,000 shares of our common stock. The warrants are exercisable for five years at an exercise price of $1.30 (the closing sales price of our common stock on January 3, 2008). The shares underlying the warrants vest in accordance with defined performance objectives. The warrants were issued in consideration for business development services and other services aimed to assist us in generating traffic to our website. The Company deemed the aggregate consideration received for the warrants to be equal to the then fair market value of the warrants after deducting any cash that may have been paid to the recipients. WeThese consultants were sophisticated investors, and as such, we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this issuance.the issuance of the warrants because we: (i) did not engage in any public advertising or general solicitation in connection with the issuance; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the consultants obtained all information regarding the Company it requested (or believed appropriate) and received answers to all questions it (and its advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.these issuances.

            23.        Between January 2, 2008 and March 3, 2008, pursuant to the Plan, we granted employees and a new member of our Board of Directors an aggregate of 819,000 options to purchase our common stock all subject to vesting schedules. The options were granted in consideration for certain employees assuming increased duties; certain option grants were issued in consideration for new employees becoming Company employees and the services to be provided in their capacity as a Company employee; and 50,000 of these options were issued to a newly appointed board member for the services to be provided in his capacity as a director. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of the options after deducting any cash that may have been paid to the recipients Werecipients.. To the extent these option grants constituted “sales” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these issuances.the grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to the recipients disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with these issuances.

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           24.        On March 12, 2008, we closed on $1,552,000 in gross proceeds under a private placement and issued a total of 1,552,000 shares of common stock at a price of $1.00 per share. The shares were issued in reliance on Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder, and the offering was made to accredited investors only. We paid commissions of $10,000 and issued 10,000 warrants in connection with this private placement.

            25.        On April 4, 2008 we had a final closing under a private placement. In the closing we received gross proceeds of $800,000 in gross proceeds and issued a total of 800,000 shares of common stock at a price of $1.00 per share. The shares were issued in reliance on Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder, and the offering was made to accredited investors only. We paid commissions of $10,000 and issued 10,000 warrants in connection with this private placement.

           26.        On March 10, 2008 and April 2, 2008 we issued an aggregate of 2,623,501 shares of common stock upon the exercise of warrants that the Company issued in September and October 2007. The exercise price on the warrants was $1.00 per share and we received gross proceeds of $2,623,501 upon the exercise of the warrants. The proceeds will be used for working capital and general corporate purposes. The shares were issued pursuant to the exemption under Section 4(2) under the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder. The shares were issued to accredited investors only. Although we paid 10% commission and 10% warrant coverage in the offering conducted in September and October 2007, we paid no commissions or remuneration in connection with the shares issued upon exercise of the warrants.

            27.        On April 8, 2008 we issued a warrant to a consultant to purchase 1,000,000 shares of Company common stock at $1.15 per share. The warrant is exercisable until April 8, 2009. The warrant was issued in consideration for the consultant entering into an agreement with the Company to provide investor relations and other business development related services. The Company deemed the aggregate consideration received for the warrant to be equal to the then fair market value of the warrant after deducting any cash that may have been paid to the recipient Werecipient. Because the consultant is an accredited investor, we relied on the exemptionexemptions from registration provided by SectionSections 4(2) and 4(6) under the Securities Act of 1933 for this issuance. No commissions or other remunerations were paid in connection with this issuance.

            28.        On April 8, 2008, pursuant to the Plan, we granted an aggregate of 1,175,000 options to employees exercisable at $1.15 per share. The options only vest upon the achievement of certain defined performance objectives. These options were granted as performance options in consideration for services the employees will render to assist the Company in achieving revenue and website traffic related objectives. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of the options after deducting any cash that may have been paid to the recipients .The options were granted in reliancerecipients. To the extent these option grants constituted “sales” of securities we relied on the exemption from registration provided by Section 4(2) ofunder the Securities Act of 1933 as amended.for the grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to the recipients disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration were paid in connection with the option grants.

            29.        On May 7, 2008, pursuant to the Plan, we granted employees options to purchase an aggregate of 125,000 shares of our common stock. The options are exercisable at $1.25 per share with the option vesting on a pro-rata basis over a three year period from the date of grant (May 7, 2009, May 7, 2010, and May 7, 2011). These options were issued in consideration for certain employees assuming increased duties and for certain employees becoming Company employees and the services to be provided in their capacity as Company employees. The Company deemed the aggregate consideration received for the option to be equal to the then fair market value of the option after deducting any cash that may have been paid to the recipient. WeTo the extent these option grants constituted “sales” of securities, we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these option grants.the grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to the recipients disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this option grant.

            30.        On May 7, 2008, pursuant to the Plan, we granted employees an aggregate of 50,000 options to purchase our common stock exercisable at $1.25 per share. The options only vest upon the achievement of certain defined performance goals. The options were granted in consideration for services in to help generate traffic to the Company’s website. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of the options after deducting any cash that may have been paid to the recipient. WeTo the extent these option grants constituted “sales” of securities, we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these option grants.the grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to the recipients disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with these option grants.

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            31.        On May 15, 2008 we issued a consultant a warrant to purchase 25,000 shares of the Company’s common stock. The warrant is exercisable at $1.38 (the closing sales price of our common stock on May 15, 2008) through January 3, 2008. The warrant was issued after a separate warrant issued on January 3, 2008 to the same consultant was deemed terminated. 5,000 of the shares underlying the warrant vested immediately and the remaining 20,000 shares vest upon the accomplishment of a defined performance objective. The warrant was issued in consideration for promotional and business development services provided by the consultant. The Company deemed the aggregate consideration received for the warrant to be equal to the then fair market value of the warrant after deducting any cash that may have been paid to the recipient. WeThe consultant was a sophisticated investor, and as such, we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this issuance.the issuance of the warrant because we: (i) did not engage in any public advertising or general solicitation in connection with the issuance; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the consultant obtained all information regarding the Company it requested (or believed appropriate) and received answers to all questions it (and its advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

            32.        On May 19, 2008, pursuant to the Plan, we granted a new employee an aggregate of 100,000 options to purchase our common stock exercisable at $1.41 per share with the option only vesting upon the achievement of defined minimum monthly sales performance targets. The options were granted in consideration for the employee becoming a Company employee and for services to be provided in his capacity as employee. The Company deemed the aggregate consideration received for the option to be equal to the then fair market value of the option after deducting any cash that may have been paid to the recipient. WeTo the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these option grants.the grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipient obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this option grant.

            33.        On May 22, 2008 we issued 29,727 shares of common stock upon the exercise of warrants issued in September 2007 and December 2007. The exercise price on the warrants was $1.00 per share and we received gross proceeds of $29,727 upon the exercise of the warrants. The proceeds will be used for working capital and general corporate purposes. The shares were issued pursuant to the exemption under Section 4(2) under the Securities Act of 1933, as amended, and Rule 506 promulgated thereunder. The shares were issued to an accredited investor. Although we paid 10% commission and 10% warrant coverage in the offerings conducted in September and October 2007 and December 2007, we paid no commissions or remuneration in connection with the shares issued upon exercise of the warrants.

            34.        On June 2 and June 3, 2008, pursuant to the Plan we granted an aggregate of 60,000 options to five employees to purchase our common stock. The options vest upon the achievement of certain defined performance objectives. The options were granted in consideration for increased duties assumed by one recipient and in consideration for four persons becoming new employees and for services to be provided in their capacity as employees. The Company deemed the aggregate consideration received for the options to be equal to the then fair market value of the options after deducting any cash that may have been paid to the recipients. To the extent these option grants constituted “sales” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for the grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to the recipients disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with these option grants.

            35.        On June 6, 2008, we issued an aggregate of 79,454 shares to an investor upon the exercise of warrants granted in December. We received $79,454 upon the exercise of the warrants. The proceeds will be used for working capital and general corporate purposes. The shares were issued to an accredited investor, and thus in reliance on the exemption from registration contained in Section 4(2) of the 1933 Act and Rule 506 of Regulation D. No commissions or other remuneration was paid upon the exercise of the warrants.

            36.        On June 9, 2008, pursuant to the Plan, we granted an employee an aggregate of 10,000 options to purchase our common stock exercisable at $1.20 per share with the option vesting on a pro-rata basis over a three year period from the date of grant. The option was granted in consideration for the person agreeing to become a Company employee and for services to be rendered in the recipient’s capacity as an employee. To the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grant; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipient obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance. These options were subsequently forfeited.

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            37.        On June 16, 2008, pursuant to the Plan, we granted employees an aggregate of 10,000 options to purchase our common stock exercisable at $1.20 per share with the option vesting on a pro-rata basis over a three year period from the date of grant. The options were granted in consideration for the persons agreeing to become a Company employee and for services to be rendered in the recipients’ capacity as employees. To the extent these grants constituted “sales” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for these options grants.grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with these issuances. Of these options, 5,000 were subsequently forfeited.

            38.        On June 23, 2008, pursuant to the Plan, we granted an employee an aggregate of 12,000 options to purchase our common stock exercisable at $1.15 per share. The option grants.only vests upon the achievement of certain defined performance goals. The option was granted in consideration for the person agreeing to become a Company employee and for services to be rendered in the recipient’s capacity as an employee. To the extent this grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grant; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipient obtained all information regarding the Company he requested (or believed appropriate) and received answers to all questions he or she (and his advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

             39.        On June 30, 2008, pursuant to the Plan, we granted an employee an aggregate of 36,000 options to purchase our common stock exercisable at $1.10 per share. The option only vests upon the achievement of certain defined performance goals. The option was granted in consideration for the person agreeing to become a Company employee and for services to be rendered in the recipient’s capacity as an employee. To the extent this grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grant; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipient obtained all information regarding the Company he requested (or believed appropriate) and received answers to all questions he or she (and his advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

             40.        On June 30, 2008, pursuant to the Plan, we granted an employee an aggregate of 30,000 options to purchase our common stock exercisable at $1.10 per share; 15,000 of the options vest on a pro-rata basis over a three year period from the date of grant and 15,000 options vest upon the achievement of certain defined performance goals. The option was granted in consideration for the person agreeing to become a Company employee and for services to be rendered in the recipient’s capacity as an employee To the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grant; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipient obtained all information regarding the Company he requested (or believed appropriate) and received answers to all questions he or she (and his advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

             41.        On July 1, 2008, pursuant to the Plan, we granted an employee an aggregate of 42,000 options to purchase our common stock exercisable at $1.01 per share; 30,000 of the options vest on a pro-rata basis over a three year period from the date of grant and 12,000 options vest upon the achievement of certain defined performance goals. The option was granted in consideration for the person agreeing to become a Company employee and for services to be rendered in the recipient’s capacity as an employee. To the extent this grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grant; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that the recipient obtained all information regarding the Company he requested (or believed appropriate) and received answers to all questions he or she (and his advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

             42.        On July 18, 2008, pursuant to the Plan, we granted an employee an aggregate of 5,000 options to purchase our common stock exercisable at $0.55 per share with the options vesting on a pro-rata basis over a three year period from the date of grant. The option was granted in consideration for the person agreeing to become a Company employee and for services to be rendered in the recipient’s capacity as an employee. To the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

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             43.        On August 11, 2008, pursuant to the Plan, we granted an employee 5,000 options to purchase our common stock exercisable at $0.53 per share with the options vesting on a pro-rata basis over a three year period from the date of grant. The option was granted in consideration for the person agreeing to become a Company employee and for services to be rendered in the recipient’s capacity as an employee. To the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

             44.        On August 25, 2008, pursuant to the Plan, we granted an employee 5,000 options to purchase our common stock exercisable at $0.55 per share with the options vesting on a pro-rata basis over a three year period from the date of grant. The option was granted in consideration for the person agreeing to become a Company employee and for services to be rendered in the recipient’s capacity as an employee. To the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

             45.        On August 27, 2008, pursuant to the Plan, we granted an employee an aggregate of 20,000 options to purchase our common stock exercisable at $0.50 per share with the options vesting on a pro-rata basis over a three year period from the date of grant. The option was granted in consideration for the person agreeing to become a Company employee and for services to be rendered in the recipient’s capacity as an employee. To the extent this option grant constituted a “sale” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for this grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

             46.        On September 10, 2008, pursuant to the Plan, we granted employees an aggregate of 5,000 options to purchase our common stock exercisable at $0.52 per share with the options vesting on a pro-rata basis over a three year period from the date of grant. The options were granted in consideration for the person agreeing to become a Company employee and for services to be rendered in the recipient’s capacity as an employee. To the extent these option grants constituted “sales” of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for the grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he or she requested (or believed appropriate) and received answers to all questions he or she (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with this issuance.

Indemnification of Officers and Directors

        Our Articles of Incorporation provide that the Company shall indemnify, to the fullest extent permitted by applicable law, any person, and the estate and personal representative of any such person, against all liability and expense (including attorneys’ fees) incurred by reason of the fact that he is or was a director or officer of the Company or, while serving at the request of the Company as a director, officer, partner, trustee, employee, fiduciary, or agent of, or in any similar managerial or fiduciary position of, another domestic or foreign corporation or other individual or entity or of an employee benefit plan. The Company also shall indemnify any person who is serving or has served the Company as director, officer, employee, fiduciary, or agent, and that person’s estate and personal representative, to the extent and in the manner provided in any bylaw, resolution of the shareholders or directors, contract, or otherwise, so long as such provision is legally permissible.

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Exhibits

EXHIBIT
NO
DESCRIPTION

3.1Articles of Incorporation filed September 6, 2006. (1)
3.1.1Articles of Amendment to the Articles of Incorporation filed November 13, 2006. (1)
3.1.2Articles of Amendment to the Articles of Incorporation filed August 21, 2007. (2)
3.2Bylaws, as amended. (7)(6)
4.1Specimen Certificate of Common Stock. (1)
5.1Opinion of Burns, Figa & Will, P.C. Filed herewith.(7)
10.12006 Stock Option Plan. (1)
10.2Acceptance Agreement for Website Development, dated January 10, 2007. (1)
10.3Agreement with Blue Shirt Group dated March 1, 2007. (1)
10.4Employment Agreement with John Walpuck dated April 2, 2007. (1)
10.5Sublease Agreement with Merlin Technical Solutions, Inc. (3)
10.6Business Consultant Agreement and Warrant Dated July 6, 2007. (4)
10.7Employment Agreement with J. W. Roth, dated October 1, 2007. (5)
10.8Employment Agreement with J. Glen House, dated October 1, 2007. (5)
10.9EmploymentSecurities Purchase Agreement with Howard Lieber, dated December 1, 2007. (6)September 7, 2008. Filed herewith.
10.10Securities Purchase Agreement dated October 15, 2008. Filed herewith.
10.11Form of Redeemable Warrant. Filed herewith. (8)
10.12Form of Non-Redeemable Warrant. Filed herewith. (8)
10.132008 Stock Option Plan. Filed herewith.
23.1Consent of GHP Horwath, P.C. Filed herewith
24.0Power of Attorney (8)(7)



(1)Incorporated by reference from Form 10-QSB filed May 15, 2007.
(2)Incorporated by reference from Form 8-K, filed August 24, 2007.
(3)Incorporated by reference from Form 8-K filed June 11, 2007.
(4)Incorporated by reference from Form 8-K filed July 12, 2007.
(5)Incorporated by reference from Form 8-K filed December 26, 2007.
(6)Incorporated by reference from Form 8-K filed December 17, 2007.
(7)Incorporated by reference from Form 8-K filed March 6, 2008.
(8)(7)Previously filed with the Registration Statement on Form S-1 filed on April 29, 2008.

(8)The Form of Redeemable Warrant and Non-Redeemable Warrant issued to investors in September, October, and November 2007 contained identical terms except for their respective expiration dates and share amounts.

Undertakings

        The undersigned Company hereby undertakes to:

    (1)        File, during any period in which offers or sales are being made, a post-effective amendment to this registration statement to:

 (i)Include any prospectus required by Section 10(a)(3) of the Securities Act of 1933, as amended (the “Securities Act”);

 (ii)Reflect in the prospectus any facts or events which, individually or together, represent a fundamental change in the information in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of the securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) under the Securities Act if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement, and

 (iii)Include any additional or changed material information on the plan of distribution.

    (2)        For determining liability under the Securities Act, treat each post-effective amendment as a new registration statement of the securities offered, and the offering of the securities at that time to be the initial bona fide offering.

    (3)        File a post-effective amendment to remove from registration any of the securities that remain unsold at the end of the offering.

        Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the small business issuer pursuant to the foregoing provisions, or otherwise, the small business issuer has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the small business issuer of expenses incurred or paid by a director, officer or controlling person of the small business issuer in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the small business issuer will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

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    (4)        Intentionally omitted

    (5)        That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

 (i)If the registrant is relying on Rule 430B:

 (A)Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

 (B)Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of 314 securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date; or

 (ii)If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness.Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

 (h)Request for acceleration of effective date or filing of registration statement becoming effective upon filing. Include the following if acceleration is requested of the effective date of the registration statement pursuant to Rule 461 under the Securities Act, if a Form S-3 or Form F-3 will become effective upon filing with the Commission pursuant to Rule 462 (e) or (f) under the Securities Act, or if the registration statement is filed on Form S-8, and:

 (1)any provision or arrangement exists whereby the registrant may indemnify a director, officer or controlling person of the registrant against liabilities arising under the Securities Act, or (2) the underwriting agreement contains a provision whereby the registrant indemnifies the underwriter or controlling persons of the underwriter against such liabilities and a director, officer or controlling person of the registrant is such an underwriter or controlling person thereof or a member of any firm which is such an underwriter, and (3) the benefits of such indemnification are not waived by such persons:

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

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SIGNATURES



        In accordance with the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements of filing this Form S-1 and authorized this amended registration statement to be signed on its behalf by the undersigned, in Greenwood Village, Colorado on June 6,October 16, 2008.

DISABOOM, INC.


/s/ J. W. Roth
J. W. Roth, Principal Executive Officer

/s/ J. Walpuck
John Walpuck, Principal Financial Officer and Controller

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

        The undersigned officers and/or directors of Disaboom Inc., by virtue of their signatures appearing below, hereby constitute and appoint J. W. Roth with full power of substitution, as attorney-in-fact in their names, places and steads to execute any and all amendments to this Form S-1 in capacities set forth opposite their names on the signature page thereof and hereby ratify all that said attorneys-in-fact or either of them may do by virtue thereof.

Signature
 
Title
 
Date  
/s/ J.W. Roth
J.W. Roth
Principal Executive Officer and DirectorJune 6,October 16, 2008
 
/s/ J.W. Roth for Glen House
J. Glen House
Chief Medical Officer and DirectorJune 6,October 16, 2008
 
/s/ John Walpuck
John Walpuck
President, Principal Financial Officer, Principal Accounting Officer, Controller, Treasurer, Secretary and DirectorJune 6,October 16, 2008
 
/s/ J.W. Roth for Patrick Templeton
Patrick Templeton
DirectorJune 6,October 16, 2008
 
/s/ J.W. Roth for Victor Lazzaro
Victor Lazzaro
DirectorJune 6,October 16, 2008
 
/s/ J.W. Roth for Jerry Overgaard
R. Jerry Overgaard
DirectorJune 6,October 16, 2008
 
/s/ J.W. Roth for David Petso
David Petso
DirectorJune 6,October 16, 2008
 
/s/ J.W. Roth for Kevin Hall
Kevin Hall
DirectorJune 6,October 16, 2008

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