Apple iSports Group, Inc. - Quarter Report: 2008 October (Form 10-Q)

f10q1008_prevention.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________________

FORM 10-Q

__________________________

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2008

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

For the transition period from:

Commission file number: 000-32389

PREVENTION INSURANCE.COM, INC.

(Exact name of small business issuer as specified in its charter)

Nevada		88-0126444
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

c/o Paragon Capital LP, 110 East 59th Street, 29th Floor New York, NY 10022

(Address of principal executive offices)

(212) 593-1600

(Issuer’s telephone number)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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

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	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	x
(Do not check if a smaller reporting company)

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

Applicable Only to Issuers Involved in Bankruptcy Proceedings During the Preceding Five Years

Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by court. YES NO

Applicable Only to Corporate Issuers

Indicate the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date:

Class		Outstanding at December 15, 2008
Common stock, $0.01 par value		97,872,933

Transitional Small Business Disclosure Format: Yes o No x

PREVENTION INSURANCE.COM

TABLE OF CONTENTS

	Page

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements	4
Condensed Balance Sheets - October 31, 2008 (unaudited) and April 30, 2008 (audited)	4
Condensed Statements of Operations – Three and six months ended October 31, 2008 and 2007 (unaudited)	5
Condensed Statements of Cash Flows–Six months ended October 31, 2008 and 2007 (unaudited)	6
Notes to Condensed Financial Statements (unaudited)	7

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3. Quantitative and Qualitative Disclosures About Market Risk	17
Item 4T. Controls and Procedures	17

PART II – OTHER INFORMATION

Item 1. Legal Proceedings	19
Item 1a. Risk Factors	19
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	19
Item 3. Defaults Upon Senior Securities	19
Item 4. Submission of Matters to a Vote of Security Holders	19
Item 5. Other Information	19
Item 6. Exhibits	19

SIGNATURE	20

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Part I. – Financial Information

Item 1. Financial Statements

PREVENTION INSURANCE.COM, INC.
CONDENSED BALANCE SHEETS


ASSETS
	October 31, 2008			April 30, 2008
	(unaudited)			(audited)
Current assets
Cash	$	10,037		$	9,440
Total current assets		10,037			9,440

TOTAL ASSETS	$	10,037		$	9,440

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
Accounts payable	$	8,424		$	-
Net liabilities to be spun-off, net of related assets of $0 and $59,800 respectively		-			58,485
Contingent liability		-			10,000
Due to shareholder		400,000			400,000
Total current liabilities		408,424			468,485

TOTAL LIABILITIES		408,424			468,485

Stockholders' deficit:
Preferred stock, par value $0.001; 8,000,000 shares authorized; 0 shares issued		-			-
Preferred stock, par value $0.01; 2,000,000 shares authorized: 0 shares issued		-			-
Common stock, $0.01 par value; 100,000,000 shares authorized; 97,872,933 shares issued		978,730			978,730
Treasury stock, 24,142 shares, at cost		(52,954	)		(52,954	)
Additional paid in capital		2,705,226			2,675,226
Accumulated (deficit)		(4,029,389	)		(4,060,047	)
Total stockholders' (deficit)		(398,387	)		(459,045	)

TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT)	$	10,037		$	9,440

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

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PREVENTION INSURANCE.COM, INC
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)

	Three Months Ended						Six Months Ended
	October 31,						October 31,

	2008			2007			2008			2007

Revenue	$	-		$	-		$	-		$	-

Operating expenses
General and administrative		16,505			30,047			16,505			35,899
Officers compensation		-			9,473			-			22,938
Total operating expenses		16,505			39,520			16,505			58,837

Operating loss from continuing operations		(16,505	)		(39,520	)		(16,505	)		(58,837	)

Other income (expense)
Other income		-			27,000			-			27,000
Gain on contingency		10,000			-			10,000			-
Total other income (expense)		10,000			27,000			10,000			27,000

Loss from continuing operations		(6,505	)		(12,520	)		(6,505	)		(31,837	)

Discontinued operations
Gain on disposoal of operating activity		59,914			-			59,914			-
Loss on discontinued operations		(24,437	)		(36,079	)		(22,750	)		(43,449	)
Income (loss) from discontinued operations		35,477			(36,079	)		37,164			(43,449	)

Net income (loss)	$	28,972		$	(48,599	)	$	30,659		$	(75,286	)

Earnings per commons share - basic and dilutive:
Income (loss) from continuing operations	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
Income (loss) from discontinued operations	$	0.00		$	(0.00	)	$	0.00		$	(0.00	)
Net income (loss)	$	0.00		$	(0.00	)	$	0.00		$	(0.00	)

Weighted average common shares outstanding
Basic		97,872,933			23,132,188			97,872,933			22,482,840
Dilutive		104,854,065			23,132,188			115,969,932			22,482,840

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

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PREVENTION INSURANCE.COM, INC
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)


	October 31,
	2008			2007
Cash flows from operating activities:
Net loss	$	30,659		$	(75,286	)
Adjustments to reconcile net loss to provided by operating activities:
Stock issued for services		-			40,000
Gain on disposal of operating activity		(59,914	)
Gain on contingency		(10,000	)		-
Changes in assets and liabilities:
Change in accounts receivable		-			3,388
Change in accounts payable		8,424			(3,367	)
Bank overdraft		-			1,580
Net cash used by operating activities		(30,831	)		(33,685	)

Cash flows from investing activities:
Change in net liabilities spun-off		1,428			-
Net cash provided by investing activities		1,428			-

Cash flows from financing activities:
Proceeds from issuance of common stock		-			31,500
Proceeds from issuance of warrants		30,000			-
Increase in stock payable		-			7,500
(Decrease) in acquisition liability		-			(22,000	)
Net cash provided by financing activities		30,000			17,000

Net change in cash		597			(16,685	)

Cash, beginning of period		9,440			16,685

Cash, end of period	$	10,037		$	-

Supplemental cash flow disclosures:
Interest paid	$	-		$	655
Income taxes paid	$	-		$	-

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

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PREVENTION INSURANCE.COM

FORM 10-QSB

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION

Basis of Presentation

The accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations and cash flows of Prevention Insurance.com (the “Company”) for the respective periods presented. The results of operations for an interim period are not necessarily indicative of the results that may be expected for any other interim period or the year as a whole. The accompanying unaudited condensed financial statements should be read in conjunction with the audited financial statements and notes thereto in the Company’s Annual Report on Form 10-KSB for the fiscal year ended April 30, 2008 as filed with the SEC on August 19, 2008.

Nature of Business

Prevention Insurance.Com (the “Company”) was incorporated under the laws of the State of Nevada in 1975 as Vita Plus Industries, Inc. In March 1999, the Company sold its remaining inventory and changed its name to Prevention Insurance.Com. Since 2005, the Company has additionally focused on a second line of business and has been focused on the development of its ATM machine sale operations.

On December 28, 2007 the Company entered into an agreement where the Company had a change in control which resulted in the divestiture of the ATM division “Quick Pay” at October 31, 2008. Management determined that as of November 1, 2008 the Company has re-entered the development stage. (See “Note 3 – Divestiture of Quick Pay”.)

Reclassifications

Certain amounts in the October 31, 2007 Statement of Operations have been reclassified to conform to the October 31, 2008 presentation. These reclassifications have no effect on the previously reported net loss. Specifically in the prior period net income of “QuickPay” has been reclassified to Discontinued Operations.

Use of Estimates

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 the disclosure of contingent assets and liabilities at the date of the financial statements and the reported revenues and expenses during the reporting periods. Because of the use of estimates inherent in the financial reporting process, actual results may differ significantly from those estimates.

Cash and cash Equivalents

The Company maintains cash balances in a non-interest bearing account that currently does not exceed federally insured limits. For the purpose of the statements of cash flows, all highly liquid investments with a maturity of three months or less are considered to be cash equivalents. There were no cash equivalents as of October 31, 2008 and 2007.

Fair Value of Financial Instruments

The fair value of cash and cash equivalents and accounts payables approximates the carrying amount of these financial instruments due to their short maturity.

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Earnings per Share

In February 1997, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 128 Earnings Per Share which requires the Company to present basic and diluted earnings per share for all periods presented. Basic earnings per share, is computed as net income divided by the weighted average number of common shares outstanding for the period. Diluted earnings per share, reflects the potential dilution that could occur from common shares issuable through stock options, warrants, convertible debt and other convertible securities. Diluted earnings per share is computed by dividing net income by the weighted average shares outstanding, assuming all dilutive potential common shares were issued.

The following table reconciles basic earnings per share and diluted earnings per share and the related weighted average number of shares:

	For the three months ended October 31, 2008								For the six months ended October 31, 2008
	Income			Shares		Per-Share			Income			Shares		Per-Share
	(Numerator)			(Denominator)		Amount			(Numerator)			(Denominator)		Amount
Basic EPS:
Loss from continuing operations	$	(6,505	)			$	(0.00	)	$	(6,505	)			$	(0.00	)
Income (loss) from discontinued operations		35,477					0.00			37,164					0.00
Net income (loss)		28,972			97,872,933		0.00			30,659			97,872,933		0.00

Common stock equivalents - warrants					6,981,132								18,096,999

Diluted EPS:
Loss from continuing operations		(6,505	)				(0.00	)		(6,505	)				(0.00	)
Income (loss) from discontinued operations		35,477					0.00			37,164					0.00
Net income (loss)	$	28,972			104,854,065	$	0.00		$	30,659			115,969,932	$	0.00

	For the three months ended October 31, 2007								For the Six months ended October 31, 2007
	Income			Shares		Per-Share			Income			Shares		Per-Share
	(Numerator)			(Denominator)		Amount			(Numerator)			(Denominator)		Amount
Basic EPS:
Loss from continuing operations	$	(12,520	)			$	(0.00	)	$	(31,837	)			$	(0.00	)
Income (loss) from discontinued operations		(36,078	)				(0.00	)		(43,449	)				(0.00	)
Net income (loss)		(48,598	)		23,132,188		(0.00	)		(75,286	)		22,482,840		(0.00	)

Common stock equivalents - warrants					-								-

Diluted EPS:
Loss from continuing operations		(12,520	)				(0.00	)		(31,837	)				(0.00	)
Income (loss) from discontinued operations		(36,078	)				(0.00	)		(43,449	)				(0.00	)
Net income (loss)	$	(48,598	)		23,132,188	$	(0.00	)	$	(75,286	)		22,482,840	$	(0.00	)

Revenue Recognition

Commission income from the sale of ATM machines is recognized at the time of sale. The income is presented as part of loss from discontinued operations as this division was conveyed on October 31, 2008.

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Stock Based Compensation

In December 2004, SFAS No. 123 (revised 2004), "Share-Based Payment"("SFAS 123(R)") was issued. The Company applies SFAS 123R in accounting for stock options issued for services which requires the recognition of compensation cost based upon the fair value of stock options at the grant date using a fair value pricing model.

There were no options issued as stock based compensation to any officers, directors, or non-employees for the three and six months periods ended October 31, 2008 or October 31, 2007, respectively.

Recently Issued Accounting Pronouncements

In December 2007, the FASB issued SFAS 160, “Noncontrolling Interests in Consolidated Financial Statements, an amendment of ARB No. 51” which applies to all entities that prepare consolidated financial statements, except not-for-profit organizations, but will affect only those entities that have an outstanding noncontrolling interest in one or more subsidiaries or that deconsolidate a subsidiary. The statement is effective for annual periods beginning after December 15, 2008. The Company does not expect the adoption of SFAS 161 will have a material impact on its financial condition or results of operation

In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities – an amendment of FASB Statement No. 133,” as amended and interpreted, which requires enhanced disclosures about an entity’s derivative and hedging activities and thereby improves the transparency of financial reporting. Disclosing the fair values of derivative instruments and their gains and losses in a tabular format provides a more complete picture of the location in an entity’s financial statements of both the derivative positions existing at period end and the effect of using derivatives during the reporting period. Entities are required to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. Early adoption is permitted. The Company does not expect the adoption of SFAS 161 will have a material impact on its financial condition or results of operation

In May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles,”. SFAS 162 identifies the sources of accounting principles and the framework for selecting the principles used in the preparation of financial statements of non-governmental entities that are presented in conformity with generally accepted accounting principles in the United States of America. SFAS 162 will be effective 60 days after the Security and Exchange Commission approves the Public Company Accounting Oversight Board’s amendments to AU Section 411. The Security and Exchange Commission approved the PCAOB’s amendment to AU Section 411 on September 16, 2008. The Company does not anticipate the adoption of SFAS 162 will have an impact on its financial statements.

In May 2008, the FASB issued SFAS No. 163, “Accounting for Financial Guarantee Insurance Contracts – an interpretation of FASB Statement No. 60.” SFAS 163 requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Statement also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. Those clarifications will increase comparability in financial reporting of financial guarantee insurance contracts by insurance enterprises. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of the Statement will improve the quality of information provided to users of financial statements. SFAS 163 will be effective for financial statements issued for fiscal years beginning after December 15, 2008. The Company does not expect the adoption of SFAS 163 will have a material impact on its financial condition or results of operation.

2. GOING CONCERN

The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a "going concern", which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Until October 31, 2008, the Company’s only source of revenue was via commissions from the sale of ATM machines. The Company’s ability to remain a going concern is subject to its ability to raise capital either from equity or debt and/or its successful operations as a long term solution to its lack of resources. To date, management has demonstrated the ability to raise sufficient capital to continue its limited operations. As shown in the accompanying financial statements, the Company has incurred a net income of $30,659 for the six months ended October 31, 2008 and has reported an accumulated deficit of $4,029,389. The Company completed the divestiture of the ATM machine sales operations as of October 31, 2008. We may seek out private equity capital or a strategic partner as possible sources of financing. While we currently have minimal cash, it is anticipated that at least for the near term our controlling shareholder, Paragon Capital LP, will continue to invest in the Company in exchange we will issue warrants to purchase our common stock.

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3. DIVESTITURE OF “QUICK PAY”

During the third quarter of fiscal 2008, in association with the change of control, Management made the decision to divest the division related to the sale of ATM machines known as “Quick Pay”. The divestiture occurred on October 31, 2008 and resulted in the conveyance of $59,914 in net liabilities.

4. STOCKHOLDERS' EQUITY

The authorized common stock of the Company consists of 100,000,000 shares of Common stock with a par value of $0.01 and 2,000,000 shares of Preferred stock with a par value of $0.01 and 8,000,000 shares of Preferred stock with a par value of $0.001.

During the three months and six months ended October 31, 2008, the Company did not issue any shares of common or preferred stock.

5. RELATED PARTY TRANSACTIONS

The Company issued warrants in exchange for $30,000 in funds from Paragon Capitol LP. The Company’s Chief Executive Officer, Alan P. Donenfeld, as a beneficial owner for securities held by Paragon Capital LP, holds the Warrants issued. See Note 6 - “Warrants” for additional detail.

6. WARRANTS

The Company has adopted FASB No. 123R and accounts for stock issued for services, stock options, and warrants for compensation under the fair value method.

On August 29, 2008, the Company issued 20,000,000 fully vested warrants to Paragon Capital LP for a consideration of $20,000. The options are exercisable over a three year period at $0.01 each to purchase 20,000,000 shares of common stock.

On October 8, 2008, the Company issued 10,000,000 fully vested warrants to Paragon Capital LP for a consideration of $10,000. The options are exercisable over a three year period at $0.005 each to purchase 10,000,000 shares of common stock.

There were no other options granted or exercised by the directors and executive officers outstanding as of October 31, 2008.

The following is a schedule of the activity relating to the Company's warrants.

	Six Months Ended				Six Months Ended
	October 31, 2008				October 31, 2007
	Weighted Avg.				Weighted Avg.
			Exercise				Exercise
	Shares		Price		Shares		Price

Warrants outstanding
beginning of year		10,000,000	$	0.010		2,000,000	$	0.10

Granted:
Warrants		30,000,000	$	0.008		-	$	-
Exercised		-	$	-		-	$	-

Cancelled:
Warrants		-	$	-		-	$	-

Warrants outstanding exercisable at end
of period 10/31/08 and 10/31/07, respectively		40,000,000	$	0.009		2,000,000	$	0.10

Weighted average fair
value of warrants granted during the year	$	30,000			$	44,350

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The following table summarizes information about the Company's common stock warrants outstanding at October 31, 2008.

Weighted	Average
Range of	Number	Remaining	Weighted Average	Life Exercise
Exercise	Prices	Outstanding	Contractual	Price

$ 0.009	$ 0.009	40,000,000	3 years	$ 0.009

As of October 31, 2008, the common stock equivalents of the Company exceeded the total common stock available for issuance by approximately 37,872,933 shares. The Company’s Chief Executive Officer, Alan P. Donenfeld, as a beneficial owner for securities held by Paragon Capital LP, holds Warrants that are exercisable into 40,000,000 common shares of the Company. Unless and until there is enough authorized common stock available to cover all common stock equivalents, Mr. Donenfeld and Paragon Capital LP will not exercise any of their warrants.

7. COMMITMENTS & CONTINGENCIES

On February 5, 2008, Scott Goldsmith (“Mr. Goldsmith”), Paragon Capital LP and the Company signed an Agreement and Release providing for, among other items, (a) cancellation of Mr. Goldsmith’s Preferred stock, (b) cancellation of Mr. Goldsmith’s warrants, in exchange for (1) payment in full of all of the Company’s liabilities, debts, and payables, (2) an initial payment to Mr. Goldsmith of $200,000, (3) conveyance of the assets and liabilities of Quick Pay, Inc. to Mr. Goldsmith, (4) an additional payment to Mr. Goldsmith upon certain events happening such as a reverse merger with a private company of $400,000 or 1,600,000 shares of common stock, regardless of any stock splits for a period from four years from the date of the issuance of the stock and (5) future assignment of warrants held by Paragon to Mr. Goldsmith upon completion of a reverse merge. A liability of $400,000 remains due to Mr. Goldsmith, although this liability can be repaid during July 2009 through September 2009, at the option of the Company, through the issuance of 1,600,000 shares of common stock of the Company.

As of April 15, 2008, as partial consideration for the cancellation of the 2,000,000 warrants and 1,000,000 preferred shares, the Company paid $200,000 to Mr. Goldsmith who designated that the capital be transferred to Quick Pay. The $200,000 paid to Quick Pay was recorded as a liability to Mr. Goldsmith and is included under net liabilities held for sale caption. As of October 31, 2008 the Company Conveyed $59,914 in net liabilities of Quick Pay to Mr. Goldsmith. The Company does not anticipate any additional liability related to the conveyance of Quick Pay.

As part of the amendment to the February 5, 2008 agreement the Company had agreed that a $10,000 penalty would be paid to Mr. Goldsmith if the Company did not convey the net assets of Quick Pay by October 31, 2008. The Company previously accrued for the penalty as of April 30, 2008. The Company has conveyed Quick Pay and therefore a gain due to compliance of the contingency was recognized in the amount of $10,000.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward Looking Statements and Associated Risks

We begin Management’s Discussion and Analysis of Financial Condition and Results of Operations with an overview of our description of business, historical operations, plan of operations, and existing ventures. This overview is followed by a detailed analysis of our results of operations and our financial condition as of, and for, the three months and six months ended October 31, 2008.

Certain matters in this Quarterly Report on Form 10-Q for the three and six months ended October 31, 2008 and our other filings with the SEC, including, without limitation, certain matters discussed in this Management’s Discussion and Analysis of Financial Condition and Results of Operations, constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. Those statements reflect the intent, belief or current expectations of the Company, its directors or its officers with respect to, among other things, future events and financial trends affecting the Company.

Such forward-looking statements include statements regarding, among other things, (a) our projected sales and profitability, (b) our growth strategies, (c) anticipated trends in our industry, (d) our future financing plans, (e) our anticipated needs for working capital, (f) our lack of operational experience, and (g) the benefits related to ownership of our common stock. Forward-looking statements, which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by use of the words "may," "will," "should," "expect," "anticipate," "estimate," "believe," "intend," or "project" or the negative of these words or other variations on these words or comparable terminology. This information may involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from the future results, performance, or achievements expressed or implied by any forward-looking statements. These statements may be found under "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business," as well as in this Report generally. Actual events or results may differ materially from those discussed in forward-looking statements as a result of various factors, including, without limitation, the risks outlined under "Risk Factors" and matters described in this Report generally. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this report will in fact occur as projected.

Description of Business

Prevention Insurance.com (the "Company") was incorporated in the State of Nevada on May 7, 1975, to engage in any lawful corporate undertaking, including, but not limited to, selected mergers and acquisitions. The Company was originally incorporated under the name Vita Plus Industries, Inc. later we changed our name to Vita Industries, Inc. and in 1999 again changed it to Prevention Insurance.com.

Historical Operations

Historical Operations: In 1983 we made a public offering of 700,000 shares of our common stock for our own account. We registered the stock under the Securities Act of 1933. Upon completion of that offering, we registered the stock under Section 12 (g) the National Association of Securities Dealers Automated Quotation System ("NASDAQ"). However, in 1989 we terminated the registration of our stock under Section 12(g) of the Act because our total assets had decreased to less than $3,000,000. Our stock was then no longer quoted on NASDAQ.

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From inception until early 1999, our principle business engagement had been the sale and distribution of our own formulations of specific vitamins and nutritional supplements, and of various other health and personal care products. We sold our products through traditional methods: we employed a force of salespersons at our headquarters in Las Vegas, Nevada and compensated them on a commission basis; we also sold through a network of independent brokers. Our sales were made primarily to drug stores and other large retailers. Beginning in 1983, we also manufactured some of our products. However, after a period of approximately eight years, we stopped the manufacturing activity because it did not prove to be profitable. In 1991 we were licensed in Nevada as an agent for health and life insurance. Historically since 1991 we have not derived any significant income from sales of insurance policies.

During the mid 1990s we developed the concept of reducing insurance costs for both health and life insurance through prevention measures by emphasizing the maintenance of good health by members of the insured population. Subsequently, we began the development of hybrid insurance products incorporating preventive features with traditional health and life insurance products. Specifically, we developed two specially formulated preparations of vitamins and nutritional supplements: Nutra-Prevention Formula and Nutra- Protection. Those are formulations that emphasize health maintenance by providing multiple vitamins and a wide range of additional nutritional supplements for daily consumption, and which we believe provide optimal nutrition necessary for good health. We had planned to commence negotiations for joint venture arrangements with insurance companies using those two formulations to offer low-cost, preventive nutritional products combined with reduced premium rates for specialty insurance policies, but to date we have not entered into any such joint ventures.

Effective March 15, 1999, we sold for cash substantially all of our assets associated with the traditional distribution of vitamin and dietary supplement formulations, including all inventory of vitamins and nutritional supplements and substantially all of our furniture and fixtures, and terminated all business activities associated with the distribution of individual vitamins and dietary supplements. However, we did retain our insurance agency license, our newly developed Prevention Insurance website and the ownership rights in the trademarks for Nutra-Prevention and Nutra-Protection formulas. While the insurance license has been retained, the Company’s main focus has been the ATM machine sales lines of business. Should an opportunity arise where the Company is able to capitalize on its experience in insurance we will benefit, but at this stage the focus of the company is solely on the further expansion of the line of business devoted to ATM machine sales.

In 2005, the Company added a second line of business, ATM machine sale operations. On October 31, 2008, the Company conveyed the ATM division “Quick Pay” to Mr. Goldsmith. As of November 1, 2008, the company has re-entered the development stage.

On December 31, 2007, the Company elected Mr. Alan P. Donenfeld to the Board of Directors. Mr. Donenfeld is also the President, Chief Executive Officer, Chief Financial Officer, of an investment company which he controls is a significant shareholder of the Company.

Effective December 31, 2007, Scott Goldsmith resigned from his positions as Chief Executive Officer, Chief Financial Officer and Director of the Company. Additionally, Richard Peterson and George T. Nassar resigned from the Company’s Board of Directors.

On February 5, 2008, Scott Goldsmith (“Mr. Goldsmith”), Paragon Capital LP and the Company signed an Agreement and Release providing for, amongst other items, (a) cancellation of Mr. Goldsmith’s preferred stock and (b) cancellation of Mr. Goldsmith’s warrants, in exchange for (1) payment in full of all of the Company’s liabilities, debts, and payables, (2) an initial payment to Mr. Goldsmith of $200,000, (3) conveyance of Quick Pay, Inc. assets and liabilities to Mr. Goldsmith, (4) an additional payment to Mr. Goldsmith upon certain events happening such as a reverse merger with a private company, and (5) future assignment of warrants held by Paragon to Mr. Goldsmith upon completion of a reverse merger.

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Plan of Operation

We will attempt to locate and negotiate with a business entity for the merger of that target business into the Company. In certain instances, a target business may wish to become a subsidiary of the Company or may wish to contribute assets to the Company rather than merge. No assurances can be given that we will be successful in locating or negotiating with any target business.

Management believes that there are perceived benefits to being a reporting company with a class of registered securities. These are commonly thought to include (1) the ability to use registered securities to make acquisition of assets or businesses; (2) increased visibility in the financial community; (3) the facilitation of borrowing from financial institutions; (4) improved trading efficiency; (5) stockholder liquidity; (6) greater ease in subsequently raising capital; (7) compensation of key employees through stock options; (8) enhanced corporate image; and (9) a presence in the United States capital market.

A business entity, if any, which may be interested in a business combination with us may include (1) a company for which a primary purpose of becoming public is the use of its securities for the acquisition of assets or businesses; (2) a company which is unable to find an underwriter of its securities or is unable to find an underwriter of securities on terms acceptable to it; (3) a company which wishes to become public with less dilution of its common stock than would occur normally upon an underwriting; (4) a company which believes that it will be able to obtain investment capital on more favorable terms after it has become public; (5) a foreign company which may wish to gain an initial entry into the United States securities market; (6) a special situation company, such as a company seeking a public market to satisfy redemption requirements under a qualified Employee Stock Option Plan; or (7) a company seeking one or more of the other perceived benefits of becoming a public company.

Management will continue to seek a qualified company as a candidate for a business combination. We are authorized to enter into a definitive agreement with a wide variety of businesses without limitation as to their industry or revenues. It is not possible at this time to predict which company, if any, we will enter into a definitive agreement or what will be the industry, operating history, revenues, future prospects or other characteristics of that company.

During second fiscal quarter 2008, the Company terminated its discussions to merge with a pulp and paper manufacturer in Shanghai, China. After numerous extensions and the merger candidate’s failure to provide audited financial statements, it was determined it was unlikely that a merger could be consummated. A letter informing the company’s council that negotiations were terminated was sent out on October 31, 2007. Additionally, a press release regarding the decision not to renew the extension was issued on October 11, 2007. Since the merger was not consummated, the non-refundable deposit of $27,000 was reclassified to other income.

As a result of the disposition of Quick Pay, Inc. under the February 5, 2008 Agreement and Release, and the foregoing, the Company intends to seek to acquire assets or shares of an entity actively engaged in a business, in exchange for its securities. Its purpose is to seek, investigate and, if such investigation warrants, acquire an interest in business opportunities presented to it by persons or firms who or which desire to seek the perceived advantages the Company may offer. The Company will not restrict its search to any specific business, industry or geographical location and it may participate in a business venture of virtually any kind or nature. Our management may affect transactions having a potentially adverse impact upon our shareholders pursuant to the authority and discretion of our board of directors to complete acquisitions without submitting any proposal to the stockholders for their consideration.

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We may seek a business opportunity with entities which have recently commenced operations, or which wish to utilize the public marketplace in order to raise additional capital in order to expand into new products or markets, to develop a new product or service, or for other corporate purposes. We may acquire assets and establish wholly-owned subsidiaries in various businesses or acquire existing businesses as subsidiaries.

Our management, which in all likelihood will not be experienced in matters relating to the business of a target business, will rely upon its own efforts in accomplishing our business purposes.

The analysis of new business opportunities will be undertaken by, or under the supervision of our officer and director, who is not a professional business analyst. In analyzing prospective business opportunities, management may consider such matters as:

* the available technical, financial and managerial resources;

* working capital and other financial requirements; history of operations, if any;

* prospects for the future;

* nature of present and expected competition;

* the quality and experience of management services which may be available and the depth of that management;

* the potential for further research, development, or exploration;

* specific risk factors not now foreseeable but which then may be anticipated to impact our proposed activities;

* the potential for growth or expansion;

* the potential for profit;

* the perceived public recognition or acceptance of products, services, or trades; name identification and;

* other relevant factors.

Number of Employees

As of October 31, 2008, the Company had 1 employee.

Results of Operations

We have, and will continue to have, no capital with which to provide the owners of business opportunities. However, management believes we will be able to offer owners of acquisition candidates the opportunity to acquire a controlling ownership interest in a publicly registered company without incurring the cost and time required to conduct an initial public offering. Our officer and director has not conducted market research and are not aware of statistical data to support the perceived benefits of a merger or acquisition transaction for the owners of a business opportunity. Due to the plan of operations the historical results do not show or provide any trends with which the Company can forecast the future of the Company.

Our April 30, 2008 audit reflects the fact that we do not have sufficient revenue to cover expenses. Our condition is at present under-capitalized. We have been able to pay off all of our payables as agreed. Further, that without realization of additional capital, it would be unlikely for the Company to continue as a going concern; we have previously sustained ourselves through commission income of ATM machine sales, but the Company divested itself of the ATM machine sales operations on October 31, 2008.

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We have received a small amount of capital from existing shareholders through periodic stock sales and warrant sales. We may also seek out private equity capital or a strategic partner as possible sources of financing. While we currently have minimal cash, it is anticipated that at least for the near term our controlling shareholder, Paragon Capital LP, will continue to invest in the Company in exchange we will issue warrants to purchase our common stock. Paragon made an investment of $30,000 through the purchase of warrants during the six months period ended October 31, 2008. Additional warrants will be sold to fund our operations going forward until we are able to raise larger amounts of capital and complete a business combination. Upon the closing of a business combination and a possible financing, we plan to pay Mr. Goldsmith $400,000 or issue 1,600,000 shares of our common stock, regardless of any stock splits for a period from four years from the date of the issuance of the stock, net of any liabilities not covered in the conveyance of Quick Pay, as the final consideration for amounts owed to him, for the cancellation of his preferred stock and warrants.

Our only operation, Quick Pay, is discontinued and has been conveyed to Mr. Goldsmith as of October 31, 2008. We are not allocating any additional capital to Quick Pay. At October 31, 2008, Quick Pay had net liabilities of $59,914, net of related assets. Quick Pay’s net liabilities amount was eliminated from our balance sheet and is not anticipated to result in any further risk or liability.

As we are divesting ourselves of our only operating division historical results provide no meaningful trend analysis for future financial results.

Critical Accounting Policies

Revenue Recognition

Earnings per Share

The weighted-average number of common shares outstanding for computing basic EPS for the six months period ended October 31, 2008 and October 31, 2007 were 97,872,933 and 22,482,840 respectively. The common stock equivalents included to calculate diluted EPS for the six months period ended October 31, 2008 were 115,969,932 and 22,482,840.

Stock Based Compensation

There were no options issued as stock based compensation to any officers, directors, or non-employees for the three and six months periods ended October 31, 2008 or October 31, 2007, respectively.

Recently Issued Accounting Pronouncements

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Dividends

Prevention Insurance.com does not intend to pay dividends in the foreseeable future.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

ITEM 4(T). CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

As required by Rule 13a-15(c) promulgated under the Exchange Act, our management, with the participation of our Chief Executive Officer/Principle Financial Officer, evaluated the effectiveness of our internal control over financial reporting as of October 31, 2008. Management’s assessment was based on criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated Framework (“COSO”). Based on this evaluation our Chief Executive Officer/Principle Financial Officer concluded that, as of October 31, 2008, our disclosure controls and procedures were not effective due to the existing weaknesses in our internal control over financial reporting previously identified and discussed in the 2008 10-K and below under “Internal Control Over Financial Reporting.”

In view of the fact that the financial information presented in this quarterly report on Form 10-Q for the fiscal quarter ended October 31, 2008, was prepared in the absence of effective internal control over financial reporting, we have devoted a significant amount of time and resources to the analysis of the financial statements contained in this report. In particular, we have reviewed the significant account balances and transactions reflected in the financial statements contained in this report and otherwise analyzed the transactions underlying our financial statements to verify the accuracy of the financial statements. Accordingly, management believes that the financial statements included in this report fairly present, in all material respects, our financial condition, results of operations, and cash flows.

Nevertheless, there can be no assurance that either this review process or our existing disclosure controls and procedures will prevent or detect all errors and all fraud, if any, or result in accurate and reliable disclosure. A control system can provide only reasonable and not absolute assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Additionally, judgments in decision-making can be faulty and breakdowns in controls can occur because of simple errors or mistakes that are not detected on a timely basis.

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Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting that includes effective accounting policies and procedures. Our continuing progress in establishing internal control over financial reporting is described below.

Certain Changes in Internal Control Over Financial Reporting during the Fiscal Quarter Ended October 31, 2008

During the quarter ended October 31, 2008, there were no other changes to our internal control over financial reporting during the three or six months ended October 31, 2008 that management believes have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Ineffective Controls Related to the Financial Closing Process

The Company's design and operation of controls with respect to the process of preparing and reviewing the annual and interim financial statements are ineffective. Deficiencies identified include the inadequate segregations of duties, lack of controls over procedures used to enter transactions into the general ledger, and lack of appropriate review of the reconciliations and supporting workpapers used in the financial close and reporting process. While these deficiencies did not result in a material misstatement of the financial statements, due to the potential pervasive effect on the financial statement account balances and disclosures and the importance of the annual and interim financial closing and reporting process, in the aggregate, management has concluded that there is more than a remote likelihood that a material misstatement in our annual or interim financial statements could occur and would not be prevented or detected. Management intends on discussing this issue with its outside consultants to develop controls which are better applicable to its industry and size.

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PART II

OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

There are no legal proceedings against us and we are unaware of such proceedings contemplated against us.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

A. EXHIBITS PURSUANT TO REGULATION S-K:

Exhibit 31.1	Section 302 Certification by President and Chief Executive Officer
Exhibit 32.1	Section 906 Certification by President and Chief Executive Officer
Exhibit 10.1	Securities Purchase Agreement dated as of April 30, 2008 between Paragon Capital LP and Prevention Insurance.com, Inc. including Exhibit 1. (1)
Exhibit 10.2	Securities Purchase Agreement dated as of August 29, 2008 between Paragon Capital LP and Prevention Insurance.com, Inc. including Exhibit 1. (2)
Exhibit 10.3	Clarification Agreement dated August 12, 2008 between Scott Goldsmith, Paragon Capital LP and Prevention Insurance.com, Inc. (2)
Exhibit 10.4	Securities Purchase Agreement dated as of October 8, 2008 between Paragon Capital LP and Prevention Insurance.com, Inc. including Exhibit 1.
Exhibit 10.5	Divestiture of Quick Pay as of October 31, 2008.

(1) Incorporated herein by reference to the Registrant’s Form 8-K filed May 28, 2008.

(2) Incorporated herein by reference to the Registrant’s Form 10-Q filed September 18, 2008.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto authorized.

	PREVENTION INSURANCE.COM, INC
	(Registrant)

Date: December 15, 2008	By:	/s/ Alan P. Donenfeld
		Alan P. Donenfeld
		Chief Executive Officer, Principal Financial Officer

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