Friendable, Inc. - Annual Report: 2010 (Form 10-K)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark One)

[X]     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT  OF 1934

For the fiscal year ended December 31, 2010

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

For the transition period from [ ] to [ ]

Commission file number 000-52917

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

Registrant's telephone number, including area code: (425) 286-3068

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act:

Common
(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 the Securities Act.
Yes [ ] No [ x ]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act
Yes [ ] No [ x ]

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 last 90 days.
Yes [ x ] No [ ]

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Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
[ x ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

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

The aggregate market value of Common Stock held by non-affiliates of the Registrant on June 30, 2010 was $Nil based on a $Nil average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter.

The Company’s common stock is not currently traded.

Indicate the number of shares outstanding of each of the registrant’s classes of common stock as of the latest practicable date.

5,151,000 common shares as of May 17, 2011

DOCUMENTS INCORPORATED BY REFERENCE

None.

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Table of Contents

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FORWARD LOOKING STATEMENTS

This Annual Report contains forward-looking statements about our business, financial condition and prospects that reflect our management’s assumptions and beliefs based on information currently available. We can give no assurance that the expectations indicated by such forward-looking statements will be realized. If any of our assumptions should prove incorrect, or if any of the risks and uncertainties underlying such expectations should materialize, our actual results may differ materially from those indicated by the forward-looking statements.

The key factors that are not within our control and that may have a direct bearing on operating results include, but are not limited to, acceptance of our services, our ability to expand its customer base, managements’ ability to raise capital in the future, the retention of key employees and changes in the regulation of our industry.

There may be other risks and circumstances that management may be unable to predict. When used in this Report, words such as, "believes,""expects," "intends,""plans,""anticipates,""estimates" and similar expressions are intended to identify and qualify forward-looking statements, although there may be certain forward-looking statements not accompanied by such expressions.

Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.

In this annual report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” refer to the common shares in our capital stock.

As used in this current report and unless otherwise indicated, the terms "we", "us", "our" and "our company" mean Digital Yearbook, Inc.

PART I

 Item 1. Business Overview of the Company

Digital Yearbook, Inc. was incorporated in Nevada on June 5, 2007. We produce user-friendly software that creates interactive digital yearbook software for schools and allows them to create and burn their own interactive digital yearbooks on CD/DVD. From our inception to December 31, 2010, we generated minimal revenues of $Nil. We have no recurring customers and have limited revenue-generating capability at this time.

We are a development stage company. We have never declared bankruptcy, have never been in receivership, and have never been involved in any legal action or proceedings. We have not made any significant purchase or sale of assets, nor has our company been involved in any mergers, acquisitions or consolidations. We are not a blank check registrant as that term is defined in Rule 419(a)(2) of Regulation C of the Securities Act of 1933, since we have a specific business plan or purpose. Neither we nor our officers, directors, promoters or affiliates, have had preliminary contact or discussions with, nor do we have any present plans, proposals, arrangements or understandings with any representatives of the owners of any business or company regarding the possibility of an acquisition or merger.

Objectives

We intend to focus on developing user-friendly software that creates interactive digital yearbook software for schools and will allow them to create and burn their own interactive digital yearbooks on CD/DVD. Students and school staff will be able to watch and play their digital yearbooks on a personal computer or DVD. Our software will allow schools to add photos, video and text to their digital yearbooks. The traditional yearbook is a display of a series of chosen images. We intend to develop software that will enable schools to turn their school videos and digital photos into an interactive digital yearbook on CD/DVD based on their school events and activities. Our target market is primarily high schools who wish to capture their school memories in a fun and interesting way for their students and their families to watch and play for years to come. We plan to expand our market in the future to all schools such as colleges, universities, trade schools etc.

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Our planned software involves the following three-step process for the creation of the interactive digital yearbooks:

Add Media – A teacher or student, possibly with teacher supervision, imports photos and videos from a digital camera, scanner, hard drive and the internet to our software. They can also add text during this process.

Preview – The preview can be accessed at any time during the creation of the yearbook and shows what is being created as they go. They can then return to step one and continue to build their digital yearbook, edit or change anything they want at anytime.

Produce – Click a button and choose the format (CD or DVD) with which to burn the finished yearbook on a CD or DVD disc that can be played on any domestic CD or DVD player or personal computer.

We plan to develop a software product that will be easy enough for anyone to use, regardless of his/her level of computer literacy. Our software product will provide useful features, contain help support and be easy to install. We intend to concentrate our efforts on:

Software Functions – the digital yearbook software will contain basic functions, including:

• Easy and fast uploading, supporting a wide variety of formats such as: BMP, GIF, JPG, AVI, MPG, WMV, MP3.

• Photo, video and text preview at any time.

• A variety of colors to choose from for the finished yearbook templates

• Ability to burn their digital yearbook projects to CD/DVD.

In the future, after we begin to generate revenues, we plan to add enhanced features such as:

• Themes for many varieties of schools such as colleges, universities, trade schools etc.

• Supporting other languages such as Spanish and French.

• More choice of template colors.

When completed, our website will enable customers to download the Digital Yearbook software as well as place orders and pay for an activation key code which will activate the software and enable the software to burn their finished yearbook projects onto CD/DVD online. Once the customer selects to purchase our product they are then directed to our order fulfillment page to complete their order billing and shipping information if they request a hard copy rather than download the software from our website. On completion, the customer is asked to agree with our terms and conditions of sale, and if in agreement, they are directed to the checkout page where PayPal information is requested. On completion, a final step displays the order and payment information for final confirmation by the customer. The customer then receives an email summarizing the order, shipping and payment information. We receive an identical email for order processing and fulfillment.

Once we complete the set up our website and complete our software development, a school will be able to purchase and download our software directly from our website. We plan to price our software at below $500 for a downloadable version and slightly higher for a boxed version. According to our business model, the majority of our revenues will come from online sales of our software.

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For additional information, please see “Plan of Operation” below.

We do not currently have sufficient capital to operate our business, and we will require additional funding in the future to sustain our operations. There is no assurance that we will have revenue in the future or that we will be able to secure the necessary funding to develop our business.

Our offices are currently located at 4320 – 196 Street, S.W., #111, Lynwood, Washington, 98036-6754. Our telephone number is 1- (425) 286-3068.

The Market Opportunity

We plan to market our interactive digital yearbook software to elementary and high schools.

According to the following surveys in the United States and Canada, our target market in North America is very large:

The U.S. Census Bureau’s estimate for the number of students in 2003, 75 million people - more than one-fourth of the U.S. population age 3 and older - were in school throughout the country. (http://www.census.gov/Press-Release/www/releases/archives/education/005157.html)

There are over 150,000 K-12 schools in the US: (http://www.allschoolsandlearning.com) and approximately 50,000 in Canada: (http://canadaonline.about.com/gi/dynamic/offsite.htm?zi=1/XJ/Ya&sdn=canadaonline&cdn=newsissues&tm=27& gps=156_220_1020_593&f=00&tt=14&bt=0&bts=0&zu=http%3A//www.oise.utoronto.ca/canedweb/schools.html)

These numbers do not include online schools.

According to Statistics Canada, based on a census conducted in 2006, the number of school aged children under 15 residing in Canada was 5,644,600. (http://www40.statcan.ca/l01/cst01/demo10a.htm)

Based on the foregoing information, we believe that attracting only a small percentage of our target market in North America will enable us to operate profitably. There can be no assurance, however, that our software products will appeal to schools, teachers or students.

Our Competitive Position in the Interactive Digital Yearbook Software Industry

The interactive digital yearbook software industry is a fairly new industry but also highly competitive. The digital yearbook software we plan to introduce will encounter strong competition from many other companies, including many with greater financial resources than ours as well as from larger and more established companies.

Our competitors include companies such as:
*International MultiMedia Yearbooks

(http://www.multimediayearbook.com)
*Yearbook International

(http://www.yearbookinteractive.com)

These companies currently dominate the digital yearbook software market and we expect them to remain the dominant force for the time being. These companies offer software programs or yearbook programs which are similar to our future product. The one main difference is that our software will be completely do-it-yourself which means the schools, teachers and students will not be reliant on a company to put their projects together for them as with our competitors. This means we seek to differentiate ourselves by providing our customers with software that they will be able to not only build their interactive digital yearbooks with but will also be able to burn them themselves.

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Marketing & Sales Strategy

We plan to market our interactive digital yearbook software with a web-based marketing campaign; this web-based campaign will include the following:

E-mail marketing

We have budgeted $5,000 from our marketing budget for an e-mail campaign. Emails will be sent only to those schools which have asked for or shown an interest in receiving information about our software.

Catalogue Advertising

One of the main sources for advertising our interactive digital yearbook software is by placing ads in school software distributor catalogues. These catalogues are distributed to elementary and high schools across Canada and the United States who rely on the catalogues to find and purchase the equipment and software they need.

Given the ease with which statistics can be collected on the number of times catalogue ads have been successful by users, there is strong evidence that they can be very effective. Nevertheless, it is difficult to determine whether these catalogue ads are more or less effective than other forms of advertising.

We budgeted $5,000 from our marketing campaign for school software distributor catalogue advertising. We intend to place ads in catalogues that specifically target schools.

Submission to directories and search engines

We plan to submit our website to directories and search engines in order to increase our presence on the Internet, as well as to get better rankings on search results. There are many directories to which we plan to submit our website for free, such as Google (http://www.google.com), Yahoo (http://www.yahoo.com – regional Yahoos also exist), AltaVista (http://www.altavista.com) and Excite (http://www.excite.com). There are literally hundreds of such directories where we can list our software at no cost to the company.

Distribution of software

We plan to price our software at below $500 for a downloadable version and slightly higher for a boxed version. According to our business model, the majority of our revenues will come from online sales of our software.

When our product is ready for commercial sale, we will enter into an agreement with PayPal to act as our credit card merchant. PayPal is a financial company that accepts and clears all customer credit card payments on behalf of participating merchants, such as our company. There are no short or long term contracts or obligations associated with the use of PayPal. PayPal accepts all major credit cards (Visa, Mastercard, Discover, American Express, ECheque, and transfer of funds to and from bank accounts.)

PayPal commission varies between 1.9% to 2.9% + $0.55 per transaction.

PayPal rate structure:

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Sources and Availability of Products and Supplies

There are no constraints on the sources or availability of products and supplies related to our business. We are producing our own software product and the distribution of the software product and services will be primarily over the internet.

Dependence on One or a Few Major Customers

We plan on selling our software products and services directly to schools over the internet. Our interactive digital yearbook software will be priced for mass market consumption. Therefore, we do not anticipate dependence on one or a few major customers for at least the next 12 months or the foreseeable future.

Patent, Trademark, License & Franchise Restrictions and Contractual Obligations & Concessions

We have not entered into any franchise agreements or other contracts that have given, or could give rise to obligations or concessions.

We are planning to develop our interactive digital yearbook software. Beyond our trade name, we currently do not hold any other intellectual property, and except for the copyright to our software product we do not anticipate any additions in the foreseeable future. We plan to rely for the most part on trade secrecy laws and contractual proprietary rights and non-disclosure provisions to protect any intellectual property rights that we create in our digital yearbook software products.

Existing or Probable Government Regulations

If we create and utilize a web site, as we plan to do, online access through a company-operated web site requires careful consideration of legal and regulatory compliance requirements and issues.

Research and Development Activities and Costs

We have not incurred any costs to date and, except for outsourcing the development of our interactive digital yearbook software, we have no plans to undertake any research and development activities during the first year of operation.

Facilities

We have our current office located at 4320 – 196 Street, S.W., #111, Lynwood, Washington, 98036-6754. Our telephone number is 1- (425) 286-3068. This location will serve as our primary executive offices for the foreseeable future.

Employees

We have no employees at the present time. Our officers and directors, are responsible for all planning, developing and operational duties, and will continue to do so throughout the early stages of our growth.

We have no intention of hiring employees until the business has been successfully launched and we have sufficient, reliable revenue from our operations. Since our ongoing operation is not labor intensive, our officers and directors will do whatever work is required until our business reaches the point of having positive cash flow. Human resource planning will be part of an ongoing process that will include regular evaluation of operations and revenue realization. We do not expect to hire any employees within the first year of operation. Instead, we plan on outsourcing the necessary tasks.

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Reports to Security Holders

Item 1A. Risk Factors

An investment in our common stock involves a high degree of risk. You should carefully consider the following factors and other information in this prospectus before deciding to invest in our company. If any of the following risks actually occur, our business, financial condition, results of operations and prospects for growth would likely suffer. As a result, you could lose all or part of your investment.

Risks Relating to Our Business

We have a going concern opinion from our auditors, indicating the possibility that we may not be able to continue to operate.

Our company has incurred loss of $73,398 for the period from June 05, 2007 (inception) to December 31, 2010. On December 31, 2010 we had a working capital deficit of $15,448.

We anticipate generating losses for at least the next 12 months. Therefore, we may be unable to continue operations in the future as a going concern. No adjustment has been made in the accompanying financial statements to the amounts and classification of assets and liabilities which adjustment may have to be made should we be unable to continue as a going concern. If we cannot continue as a viable entity, our shareholders may lose some or all of their investment in our company.

We are a development stage company and may never be able to execute our business plan.

We were incorporated on June 5, 2007. We have never had any products, customers or revenues. Although we have begun initial planning for the development of our interactive Digital Yearbook software for high schools and have retained a consultant to assist us in attaining the milestones set forth in our business plan, we may not be able to execute our business plan unless and until we are successful in raising additional funds. In addition, our independent auditors included an explanatory paragraph in their report on the accompanying financial statements regarding concerns about our ability to continue as a going concern. As a result, we may not be able to obtain additional necessary funding. There can be no assurance that we will ever achieve any revenues or profitability. The revenue and income potential of our proposed business and operations are unproven, and the lack of an operating history makes it difficult to evaluate the future prospects of our business.

Our Business Plan may be unsuccessful and we may not be able to continue operations as a going concern.

The success of our business plan is dependent on our developing and offering interactive digital yearbook software. Our ability to develop such software is unproven, and the lack of an operating history makes it difficult to validate our business plan.

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Our ability to continue as a going concern is dependent upon our generating cash flow sufficient to fund operations and reduce operating expenses. Our business plans may not be successful in addressing these issues. If we cannot continue as a going concern, our stockholders may lose their entire investment in our company.

We expect our losses to continue in the future and as a result, we may not be able to continue operations. Unless we are able to generate revenue and make a profit, our stockholders may lose their entire investment in us.

We expect to incur losses over the next 12 months because we do not yet have any revenues to offset the expenses associated with the development and the marketing of our proposed software.

We cannot guarantee that we will ever be successful in generating revenues in the future. We recognize that if we are unable to generate revenues, we will not be able to earn profits or continue operations.

There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide investors with no assurance that we will generate any operating revenues or ever achieve profitable operations and as a result our stockholders may lose their entire investment in us.

We have no operating history. There is no assurance that our future operations will result in profitable revenues and we expect to maintain losses over the next 12 months. These factors raise substantial doubt about our ability to continue as a going concern. If we cannot generate sufficient revenue to operate profitably, we will likely suspend or cease operations and investors could lose their entire investment in our company.

There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide investors with no assurance that we will generate any operating revenues or ever achieve profitable operations. If we are unsuccessful in addressing these risks, our business will most likely fail.

In the future, our success will be dependent upon the success of our efforts to gain market acceptance of our software. If we cannot attract a significant number of customers or should the target market not be as responsive as we anticipate, we cannot guarantee that we will ever be successful in generating revenues in the future to ensure our survival.

We have generated little revenue from our business and therefore we will need to raise funds in the near future. If we are not able to obtain future financing when required, we might be forced to discontinue our business.

Since we have generated only little revenue from our business, we will need to raise additional funds for the future development and working capital of our business and to be able to respond to unanticipated requirements and/or expenses.

We will need to raise additional funds if we do not generate any revenues within the next 12 months. We do not currently have any arrangements for financing and we can provide no assurance to investors that we will be able to find such financing if required. The most likely source of future funds presently available to us will be through the sale of equity capital. Any sale of share capital will result in dilution to existing shareholders. Furthermore, there is no assurance that we will not incur debt in the future, that we will have sufficient funds to repay our future indebtedness or that we will not default on our future debts, jeopardizing our business viability.

We may not be able to borrow or raise additional capital in the future to meet our needs or to otherwise provide the capital necessary to conduct business, which might result in the loss of some or all of your investment in our common stock. There can be no assurance that additional financing will be available to us on terms that are acceptable. Consequently, we may not be able to proceed with our intended business plans. Substantial additional funds will still be required if we are to reach our goals that are outlined in this Registration Statement. Without additional funding, we may not commence our planned business operations.

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We are dependent on contracting with third party firm(s) to develop and maintain our software for us.

We intend to hire a software development firm(s) to develop and maintain our interactive digital yearbook software. We have estimated the costs for this purpose at $15,200. If we be unable to contract qualified software development firm(s) to develop and maintain our software, whether because we cannot find them, cannot attract them to our company, or cannot afford them, we will never become profitable and our business will be unsuccessful.

If we are not able to complete the development of our website, or when developed, may contain defects, will not be able to generate revenues and the shareholders will lose their investment.

We have not completed the development of our proposed website. The success of our business will depend on its completion and the acceptance of our website by our target market. Achieving such acceptance will require significant marketing investment.

Our website, once developed and tested, may contain undetected design faults and software errors that are discovered only after it has been installed and used by customers. Any such default or error could cause delays and further expenses and could adversely affect our competitive position and cause us to lose potential customers or opportunities. If this is the case, we may not be accepted by our customers at sufficient levels to support our operations and build our business and our business will fail.

Our executive officers have no experience or technical training in the development, maintenance and marketing of internet websites or in operating businesses that license software or services over the internet. This could cause them to make inexperienced or uninformed decisions that have bad results for us. As a result, our operations could suffer irreparable harm and may cause us to suspend or cease operations, which could cause investors to lose their entire investment.

Mr. Mulhern has no experience or technical training in the development, maintenance and marketing of internet websites or in operating businesses that market software or services over the internet. Due to their lack of experience and knowledge in these areas, our executive officers could make the wrong decisions regarding the development, operation and marketing of our website and the operation of our business, which could lead to irreparable damage to our business. Consequently, our operations could suffer irreparable harm from mistakes made by our executive officers and we may have to suspend or cease operations, which could cause investors to lose their entire investment.

We may not be successful in developing interactive digital yearbook software that will achieve market acceptance.

The success or failure of developing interactive digital yearbook software depends in large part on its desirability and ease of application in the target market. We cannot be sure that our development efforts will produce software that will fulfill the needs and appeal to the tastes of schools, teachers or students.

The yearbook and digital yearbook industry is characterized by technological change, frequent product introductions and evolving industry standards. Our success will depend, to a significant extent, on our ability to develop software and introduce upgrades or new software products to satisfy an expanding range of customer needs and achieve market acceptance.

We may never be able to achieve sales revenues sufficient to become profitable.

There can be no assurance that our software will achieve a level of market acceptance that will make us profitable.

We believe that the acceptance of our software products will depend on our ability to:

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We face intense competition from other businesses that currently market yearbook software.

Competition will come not only from those who deliver their products through traditional retail establishments but also from those who deliver their products and software through the internet. Our competitors have longer operating histories, greater brand recognition, larger marketing budgets and installed customer bases. In addition, these companies are able to field full-time, directly employed sales personnel to better cover certain markets and customers. They can also invest greater resources in the development of technology, content and research which will allow them to react to market changes faster, putting us at a possible competitive disadvantage.

Many of our competitors have significantly more financial resources, which could allow them to develop software that could render our proposed software inferior.

Our competition, including International Multimedia Yearbooks and Yearbook Interactive may have software or may develop software that will render our proposed software inferior. We will likely need to obtain and maintain certain advantages over our competitors in order to be competitive, which require resources. There can be no assurance that we will have sufficient financial resources to maintain our research and development, marketing, sales and customer support efforts on a competitive basis, or that we will be able to make the improvements necessary to maintain a competitive advantage with respect to our software products.

Marketing and making our software products available on the internet expose us to regulatory and legal issues.

A range of exposures may exist due to how we intend to market our software. If we create and utilize a web site, as we plan to do, online access through a company-operated web site requires careful consideration of legal and regulatory compliance requirements and issues. We will need sufficient security measures to protect information and preserve the privacy of our customers and monitor the use of the site. This may require extensive legal services that may become an increased cost component when considering the development of our software and technologies.

If we are unable to protect our proprietary technology and other intellectual property rights, our ability to compete in the marketplace may be substantially reduced.

If we are unable to protect our intellectual property, our competitors could use our intellectual property to market software similar to our software, which could decrease demand for our software, thus decreasing our revenues. We rely on a combination of copyright, trademark and trade secret laws to protect our intellectual property rights. These protections may not be adequate to prevent our competitors from copying or reverse-engineering our interactive digital yearbook software. In addition, our competitors may independently develop technologies that are substantially equivalent or superior to our technology. To protect our trade secrets and other proprietary information, we will require employees, consultants, advisors and collaborators to enter into confidentiality agreements. These agreements may not provide meaningful protection for our trade secrets, know-how or other proprietary information in the event of any unauthorized use, misappropriation or disclosure of such trade secrets, know-how or other proprietary information. Existing copyright laws afford only limited protection for our intellectual property rights and may not protect such rights in the event competitors independently develop similar software products. Policing unauthorized use of our products is difficult, and litigation could become necessary in the future to enforce our intellectual property rights. Any litigation could be time consuming and expensive to prosecute or resolve, result in substantial diversion of management attention and resources, and materially harm our business or financial condition.

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If a third party asserts that we infringe upon its proprietary rights, we could be required to redesign our software, pay significant royalties or enter into license agreements.

Although presently we are not aware of any such claims, a third party may assert that our technology or technologies of entities we acquire violates its intellectual property rights. As the number of software products in our markets increases and the functionality of these software products further overlap, we believe that infringement claims will become more common. Any claims against us, regardless of their merit, could:

• be expensive and time consuming to defend;
• result in negative publicity;
• force us to stop licensing our software products that incorporate the challenged intellectual property;
• require us to redesign our software products;
• divert management’s attention and our other resources; or
• require us to enter into royalty or licensing agreements in order to obtain the right to use necessary technologies, which may not be available on terms acceptable to us, if at all.

We believe that any successful challenge to our use of a trademark or domain name could substantially diminish our ability to conduct business in a particular market or jurisdiction and thus decrease our revenues and result in possible losses to our business.

Item 1B. Unresolved Staff Comments

None.

Item 2. Description of Property

We do not lease or own any real property. We currently maintain our corporate office at 4320 – 196 Street, S.W., #111, Lynwood, Washington, 98036-6754. This space is sufficient until we commence full operations.

Item 3. Legal Proceedings

We know of no material, existing or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our company.

Item 4. [Removed and Reserved]

PART II

Item 5. Market For Registrant’s Common Equity And Related Stockholder Matters and Issuer Purchases of Equity Securities

We have 5,151,000 shares of common stock outstanding.

Holders

As of the date of this Annual Report our company has 5,151,000 shares of $0.001 par value common stock issued and outstanding held by twenty shareholders of record. Our Transfer Agent is Holladay Stock Transfer, Inc., 2939 N. 67th Place, Suite C, Scottsdale, Arizona 85251, phone (480) 481-3940.

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Dividends

We do not currently intend to pay cash dividends. Our proposed dividend policy is to make distributions of its revenues to its stockholders when our board of directors deems such distributions appropriate. Because we do not intend to make cash distributions, shareholders would need to sell their shares to realize a return on their investment. There can be no assurances of the projected values of the shares, nor can there be any guarantees of the success of our company. A distribution of revenues will be made only when, in the judgment of our board of directors, it is in the best interest of our stockholders to do so. Our board of directors will review, among other things, the investment quality and marketability of the securities considered for distribution; the impact of a distribution of securities on its customers, joint venture associates, management contracts, other investors, financial institutions, and our internal management, plus the tax consequences and the market effects of an initial or broader distribution of such securities.

Transfer Agent

Our Transfer Agent is Holladay Stock Transfer, Inc., 2939 N. 67th Place, Suite C, Scottsdale, Arizona 85251, phone (480) 481-3940.

Securities Authorized for Issuance Under Equity Compensation Plans

The following table provides the following information as of December 31, 2010, for equity compensation plans previously approved by security holders, as well as those not previously approved by security holders:

Recent Sales of Unregistered Securities

The following sets forth information regarding all sales of our unregistered securities during the past three years. None of the holders of the shares issued below have subsequently transferred or disposed of their shares and the list is also a current listing of the Company's stockholders.

We have issued unregistered securities to the persons, as described below. None of these transactions involved any underwriters, underwriting discounts or commissions or any public offering, and we believe that each transaction was exempt from the registration requirements of the Securities Act of 1933 by virtue of Section 4(2) thereof, or Regulation D promulgated thereunder. All recipients had adequate access, through their relationships with us, to information about us.

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On June 5, 2007, we sold 2,000,000 shares of our common stock to Mr. Ohad David, our Ex-President and director, for cash payment to us of $200. We believe this issuance was deemed to be exempt under Regulation D and Section 4(2) of the Securities Act. No advertising or general solicitation was employed in offering the securities. The offerings and sales were made only to accredited investors, and transfer was restricted by us in accordance with the requirements of the Securities Act of 1933.

On June 5, 2007, we sold 2,000,000 shares of our common stock to Ms. Ruth Navon, our Ex-Secretary, Ex-Treasurer and director, for cash payment to us of $200. We believe this issuance was deemed to be exempt under Regulation D and Section 4(2) of the Securities Act. No advertising or general solicitation was employed in offering the securities. The offerings and sales were made only to accredited investors, and transfer was restricted by us in accordance with the requirements of the Securities Act of 1933.

On March 21, 2008, we issued 350,000 shares of our common stock to Service Merchants Corp., for payment in lieu of cash for services rendered valued at $17,500. We believe this issuance was deemed to be exempt under Section 4(2) of the Securities Act and the common stock bears a restrictive legend. No advertising or general solicitation was employed in offering the securities.

As of December 31, 2010, there have been no other issuances of common stock.

Item 6. Selected Financial Data

As a “smaller reporting company”, we are not required to provide the information required by this Item.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our audited financial statements and the related notes that appear elsewhere in this annual report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to; those discussed below and elsewhere in this annual report.

Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.

Results of Operations for our Years Ended December 31, 2010 and 2009

Our net loss and comprehensive loss for our year ended December 31, 2010, for our year ended December 31, 2009 and the changes between those periods for the respective items are summarized as follows:

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Our cash in the bank at December 31, 2010 was $Nil. For the period from inception (June 5, 2007) to December 31, 2010 we had no operating revenues and incurred net operating losses of $75,519 consisting of general and administrative expenses and professional fees incurred in connection with the day-to-day operation of our business and filing of our periodic reports. Going forward, we expect to incur additional software development fees and other costs of start-up operations. The specific levels of such expenses are unpredictable and may exceed our current capital resources.

As a result of our minimal amount of revenues and ongoing expenditures in pursuit of our business, we incurred net losses since our inception. For the year ended December 31, 2010, our net loss was $9,485. Since our inception to December 31, 2010, our accumulated deficit was $75,519. We expect to incur ongoing losses for the next 12 months of operations unless we are able to successfully launch and receive revenues from our proposed digital yearbook software.

Liquidity and Financial Condition

Working Capital

Operating Activities

Net cash used in operating activities was $Nil for our year ended December 31, 2010 compared with cash used in operating activities of $Nil in the same period in 2009.

Investing Activities

Net cash used in investing activities was $Nil for our year ended December 31, 2010 compared to net cash provided by investing activities of $Nil in the same period in 2009.

Financing Activities

Net cash from financing activities was $Nil for our year ended December 31, 2010 compared to $Nil in the same period in 2009.

Contractual Obligations

As a “smaller reporting company”, we are not required to provide tabular disclosure obligations.

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Going Concern

We expect to have negative cash flows for the fiscal year 2011, as we have a limited ability to realize cash flows from sales. Since our inception, we have raised capital through sales of our common stock. In June 2007, we sold a total of 4,000,000 shares of common stock to two ex-officers and ex-directors for cash of $400. In August 2007, we raised $40,050 in a private placement of our common stock, whereby we sold 801,000 shares of common stock at a price per share of $0.05. In March 21, 2008, we issued 350,000 shares of its common stock to cure an account payable in lieu of cash in the aggregate of $17,500. We believe that our cash on hand as of December 31, 2010 in the amount of $Nil is not sufficient to sustain our expected operations for the next approximately 12 months. We believe that in order to continue as a going concern, we need to raise additional capital by issuing equity or debt securities in exchange for cash. There are no agreements or commitments for these funds and there can be no assurance that we will be able to secure any such funds to stay in business. Our principal accountants have expressed substantial doubt about our ability to continue as a going concern because we have limited operations and have not fully commenced planned principal operations.

Our management does not anticipate the need to hire additional full- or part- time employees over the next 12 months, as the services provided by our current officers and directors appear sufficient at this time. Our officers and directors work for us on a part-time basis, and are prepared to devote additional time, as necessary. We do not expect to hire any additional employees over the next 12 months.

Our management does not expect to incur research and development costs.

We do not have any off-balance sheet arrangements.

We currently do not own any significant plant or equipment that we would seek to sell in the near future.

We have not paid for expenses on behalf of our directors. Additionally, we believe that this fact shall not materially change.

We currently do not have any material contracts and or affiliations with third parties.

There are no known trends, events or uncertainties that have had or that are reasonably expected to have a material impact on our revenues from continuing operations.

Plan of Operation

We are a development stage company with very limited operations to date and no revenue. We have very limited financial backing and few assets. Our goal is to establish ourselves as a company that will produce and distribute interactive digital yearbook software via download from the Internet directly to elementary and high schools in the United States and Canada.

During the first stages of our growth, our officers and directors will provide all of the labor required to execute our business plan at no charge. We do intend to hire a website programmer on a contract basis for two months to finish and upgrade our website and we do plan to outsource initial software development tasks. Management didn’t finalize the cost related to this planned activities. Management has no intention of hiring any employees during the first year of operations. Due to our limited financial resources, each member of the management team will dedicate approximately 10 - 20 hours per week in order to execute our plan of operation.

Our goals for fiscal year 2010 are to:

• Develop our interactive digital yearbook software.
• Establish a customer data-base from our e-mail campaign.
• Drive traffic to our website and achieve 200 visitors per day.
• Generate revenue during the second quarter of 2010.
• Achieve break-even results of operations during the fourth quarter of 2010.

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We plan to focus our efforts on listing our software with distributors and re-sellers of school software to have our interactive digital yearbook software listed on their websites and ads placed in their catalogues ready for schools to purchase and download.

There is no fee or costs for listing our software on their websites other than after a sale is made they will take up to a 25% commission for each sale of our software. There is however a cost or fee to place ads in their catalogues.

We plan to list our interactive digital yearbook software on websites such as Academic Superstore (http://www.academicsuperstore.com)

We will also focus our efforts on beginning our email marketing campaign. Our officers will begin to build a list (database) of contact information including phone numbers, email addresses, mailing addresses etc. for elementary and high schools in North America and begin to contact them to offer our software.

We plan to carry on with the email campaign and catalogue advertising and focus our efforts on contacting as many schools as possible to introduce our software. We will commence our initial marketing plan using an e-mail campaign targeted specifically at elementary and high schools in the North American market. There are many websites offering lists of schools in the US and Canada with certain contact information for each school. These online lists are free. One example of these websites is: (http://www.studycanada.ca/english/index.htm)

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

Critical Accounting Policies

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 at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition

We recognize revenue when products are fully delivered or services have been provided and collection is reasonably assured.

Advertising Costs

Our policy regarding advertising is to expense advertising when incurred. We have not incurred any advertising expense as of December 31, 2010.

Cash and Cash Equivalents

For purposes of the Statement of Cash Flows, we consider all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes.

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Impairment of Long-Lived Assets

We continually monitor events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, we assess the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows.

If the total of the future cash flows is less than the carrying amount of those assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell.

Recently Enacted Accounting Standards

In May 2009, the FASB issued SFAS 165 (ASC 855-10) entitled “Subsequent Events”. Companies are now required to disclose the date through which subsequent events have been evaluated by management. Public entities (as defined) must conduct the evaluation as of the date the financial statements are issued, and provide disclosure that such date was used for this evaluation. SFAS 165 (ASC 855-10) provides that financial statements are considered “issued” when they are widely distributed for general use and reliance in a form and format that complies with GAAP. SFAS 165 (ASC 855-10) is effective for interim and annual periods ending after June 15, 2009 and must be applied prospectively. The adoption of SFAS 165 (ASC 855-10) during the quarter ended September 30, 2009 did not have a significant effect on the company’s financial statements as of that date or for the quarter or year-to-date period then ended. In connection with preparing the accompanying unaudited financial statements as of September 30, 2009 and for the quarter and nine month period ended September 30, 2009, management evaluated subsequent events through the date that such financial statements were issued (filed with the SEC)..

In June 2009, the FASB issued SFAS 168, The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles. (“SFAS 168” or ASC 105-10) SFAS 168 (ASC 105-10) establishes the Codification as the sole source of authoritative accounting principles recognized by the FASB to be applied by all nongovernmental entities in the preparation of financial statements in conformity with GAAP. SFAS 168 (ASC 105-10) was prospectively effective for financial statements issued for fiscal years ending on or after September 15, 2009 nd interim periods within those fiscal years. The adoption of SFAS 168 (ASC 105-10) on July 1, 2009 did not impact the company’s results of operations or financial condition. The Codification did not change GAAP, however, it did change the way GAAP is organized and presented.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Item 8. Financial Statements and Supplementary Data

The following documents (pages F-1 to F-9) form part of the report on the Financial Statements.

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DIGITAL YEARBOOK, INC.

TABLE OF CONTENTS

DECEMBER 31, 2010

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
Digital Yearbook, Inc.
Las Vegas, Nevada

We have audited the accompanying balance sheets of Digital Yearbook, Inc., a Nevada Corporation, as of December 31, 2010 and 2009 and the related statements of operations, stockholders’ deficit, and cash flows for the years then ended and for the period from June 5, 2007 (date of inception) through December 31, 2010. 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 audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company has determined that it is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. 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 Digital Yearbook, Inc., as of December 31, 2010 and 2009 and the results of its operations and cash flows for the years then ended and for the period from June 5, 2007 (date of inception) through December 31, 2010, in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that Digital Yearbook, Inc. will continue as a going concern. As discussed in Note 3 to the financial statements, the Company has incurred losses from operations, has negative working capital, and is in need of additional capital to grow its operations so that it can become profitable. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans with regard to these matters are described in Note 3. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Silberstein Ungar, PLLC

Bingham Farms, Michigan
May 18, 2011

F-1

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

F-2

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

F-3

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

F-4

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

F-5

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business
Digital Yearbook, Inc. (the Company) was incorporated in the State of Nevada on June 5, 2007. The Company is engaged in developing and offering software products for the creation of interactive digital yearbook software for high schools. The Company has no revenues and limited operations and is accordingly classified as a development stage company.

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 at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition
The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.

Advertising Costs
The Company’s policy regarding advertising is to expense advertising when incurred. The Company had not incurred any advertising expense as of December 31, 2010.

Cash and Cash Equivalents
For purposes of the Statement of Cash Flows, the Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes.

Impairment of Long-Lived Assets
The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows.

If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell.

Accounting Basis
The basis is accounting principles generally accepted in the United States of America. The Company has adopted a December 31 fiscal year end.

Stock-based compensation
As of December 31, 2010, the Company has not issued any share-based payments to its employees.

The Company adopted ASC Topic 718 effective January 1, 2006 using the modified prospective method. Under this transition method, stock compensation expense includes compensation expense for all stock-based compensation awards granted on or after January 1, 2006, based on the grant-date fair value estimated in accordance with the provisions of ASC Topic 718.

F-6

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Income Taxes
The Company provides for income taxes under ASC Topic 740-10. ASC Topic 740-10 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse.

ASC Topic 740-10 requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

The provision for income taxes differs from the amounts which would be provided by applying the statutory federal income tax rate of 34% to the net loss before provision for income taxes for the following reasons:

The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows:

Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of $75,519 for federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur net operating loss carry forwards may be limited as to use in future years.

Recent Accounting Pronouncements

Digital Yearbook does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s results of operations, financial position or cash flow.

NOTE 2 – PROPERTY AND EQUIPMENT

Property and equipment, recorded as cost, consisted of the following at December 31:

The software was being depreciated over 3 years. Depreciation expense was $2,333 for the years ended December 31, 2010 and 2009, respectively. The software was determined to be no longer useful as of December 31, 2010 and it was disposed of at that time. A loss on the disposal of assets of $1,667 was recorded for the year ended December 31, 2010.

F-7

NOTE 3 – GOING CONCERN

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate continuation of the Company as a going concern. However, the Company has accumulated deficit of $75,519 as of December 31, 2010. The Company currently has limited liquidity, and has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time. Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses The Company intends to position itself so that it may be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.

NOTE 4 – EQUITY TRANSACTIONS

On June 5, 2007 (inception), the Company issued 4,000,000 shares of its common stock to its Directors for cash of $400.

On August 1, 2007, the Company closed a private placement for 801,000 common shares at a price of $0.05 per share, or an aggregate of $40,050. The Company accepted subscriptions from 36 offshore non-affiliated investors.

On March 21, 2008, the Company issued 350,000 shares of its common stock to cure an account payable in lieu of cash in the aggregate of $17,500.

There were no additional shares issued during the year ended December 31, 2010.

Total shares outstanding as of December 31, 2010 were 5,151,000.

NOTE 5 – COMMITMENTS AND CONTINGENCIES

The Company neither owns nor leases any real or personal property. An officer has provided office services without charge. There is no obligation for the officer to continue this arrangement. Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future.

NOTE 6 – SUBSEQUENT EVENTS

In accordance with ASC Topic 855-10, the Company has analyzed its operations subsequent to December 31, 2010 to May 18, 2011, the date these financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these financial statements.

F-8

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer (also our principal executive officer, principal financial officer and principal accounting officer) to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

As of December 31, 2010, the end of our fiscal year covered by this report, we carried out an evaluation, under the supervision and with the participation of our chief executive officer and chief financial officer (also our principal executive officer, principal financial officer and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our chief executive officer and chief financial officer (also our principal executive officer, principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures are not effective to ensure that information required to be included in our periodic SEC filings is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms.

Management’s Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed by, or under the supervision of, the chief executive officer and chief financial officer (also our principal executive officer, principal financial officer and principal accounting officer) and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

Our evaluation of internal control over financial reporting includes using the COSO framework, an integrated framework for the evaluation of internal controls issued by the Committee of Sponsoring Organizations of the Treadway Commission, to identify the risks and control objectives related to the evaluation of our control environment.

Based on our evaluation under the frameworks described above, our management has concluded that our internal control over financial reporting was not effective as of December 31, 2010. After reviewing the weakness we are in the process of implementing the internal controls.

Our board of directors were advised by our company’s independent registered public accounting firm, that during their performance of audit procedures for 2010 they identified a material weakness as defined in Public Company Accounting Oversight Board Standard No. 2 in the Company’s internal control over financial reporting.

This deficiency consisted primarily of inadequate staffing and supervision that could lead to the untimely identification and resolution of accounting and disclosure matters and failure to perform timely and effective reviews. However, the size of our company prevents us from being able to employ sufficient resources to enable us to have adequate segregation of duties within our internal control system. Management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

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This annual report does not include an attestation report of the company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation requirements by the company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the company to provide only management’s report in this annual report.

Item 9B. Other Information

On March 14, 2011 Arunkumar Rajapandy, submitted his resignation as president and chief executive officer and director of our company. Consequently, on April 6, 2011 we appointed Ed Mulhern to act as our president, chief executive officer, chief financial officer, secretary, treasurer and director.

PART III

Item 10. Directors, Executive Officers and Corporate Governance

Our directors are elected by the stockholders to a term of one 1 year and serve until their successors are elected and qualified. The officers are appointed by the board of directors to a term of 1 year and serves until his/her successor is duly elected and qualified, or until he/she is removed from office. The board of directors has no nominating, auditing, or compensation committees.

The names and ages of our directors and executive officers and their positions are as follows:

Mr. Arunkumar Rajapandy

On January 22, 2009 we appointed Arunkumar Rajapandy, aged 41, as our chief executive officer. On December 15, 2008 we had already appointed Mr. Rajapandy as chief financial officer. Mr. Rajapandy is a chartered and cost accountant with 15 years of professional experience in the fields of auditing, information technology controls, accounting system review, Sarbanes-Oxley controls and project management. Mr. Rajapandy has expertise in costing, pricing, and closing of financial accounts. Mr. Rajapandy is a SAP, ORACLE and BaaN certified financial consultant for implementing ERP Financial Systems as per their countries GAAP requirements. On March 14, 2011, Arunkumar Rajapandy resigned as our president, chief executive officer and director;

Mr. Ed Mulhern

On April 6, 2011, we appointed Ed Mulhern, aged 52 to act as our president, chief executive officer, chief financial officer, secretary, treasurer and director. Ed Mulhern has previously been the VP of Sales at Onvia in Seattle from 1999 to 2010. Onvia (NASDAQ: ONVI) is the leading provider of solutions that help companies plan, market and sell to the public sector markets across the U.S. He has led the sales department from year 2000 sales of $500,000 to year 2010 sales of $7,000,000. Sales staff has grown from 5 account executives to 60 during this period. He has experience in all aspects of financial forecasting, staff training and development and creating new markets relating to new product development. From 1995 to 1999 Ed was the Director of Sales at Ingram Micro in Williamsville, NY. Ingram Micro (NYSE: IM) is the world’s largest technology distributor and a leading technology sales, marketing and logistics company.

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Family Relationships

None.

Significant Employees

We have no significant employees other than the officers and directors described above, whose time and efforts are being provided to our company without compensation.

Board Committees

We currently have no compensation committee or other board committee performing equivalent functions. Currently, all members of our board of directors participate in discussions concerning executive officer compensation.

Involvement on Certain Material Legal Proceedings During the Last Five Years

Involvement in Certain Legal Proceedings

None of our directors, executive officers, promoters or control persons has been involved in any of the following events during the past five years:

1. A petition under the Federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer at or within two years before the time of such filing;

2. Such person was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);

3. Such person was the subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from, or otherwise limiting, the following activities:

4. Such person was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in paragraph (f)(3)(i) of this section, or to be associated with persons engaged in any such activity;

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5. Such person was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;

6. Such person was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;

7. Such person was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:

8. Such person was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

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

We are not aware of a director or officer who is delinquent in their reporting under Section 16(a) of the Exchange Act.

Code of Ethics

We have not adopted a Code of Business Conduct and Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions in that our sole officer and director serves in all the above capacities.

Board and Committee Meetings

Our board of directors held no formal meetings during the year ended December 31, 2010. All proceedings of the board of directors were conducted by resolutions consented to in writing by all the directors and filed with the minutes of the proceedings of the directors. Such resolutions consented to in writing by the directors entitled to vote on that resolution at a meeting of the directors are, according to the Nevada General Corporate Law and our Bylaws, as valid and effective as if they had been passed at a meeting of the directors duly called and held.

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Nomination Process

As of December 31, 2010, we did not effect any material changes to the procedures by which our shareholders may recommend nominees to our board of directors. Our board of directors does not have a policy with regards to the consideration of any director candidates recommended by our shareholders. Our board of directors has determined that it is in the best position to evaluate our company’s requirements as well as the qualifications of each candidate when the board considers a nominee for a position on our board of directors. If shareholders wish to recommend candidates directly to our board, they may do so by sending communications to the president of our company at the address on the cover of this annual report.

Audit Committee

We do not have an audit committee. Our board of directors performs the function of an audit committee. Section 10A(i) of the Securities Exchange Act of 1934, as amended, prohibits our auditors from performing audit services for us as well as any services not considered to be audit services unless such services are pre-approved by our audit committee or, in cases where no such committee exists, by our board of directors (in lieu of an audit committee) or unless the services meet certain de minimis standards.

Item 11. Executive Compensation

Summary Compensation Table

The table below summarizes all compensation awarded to, earned by, or paid to our current executive officers for each of the last three completed fiscal years.

Employment Contracts, Termination of Employment, Change-in-Control Arrangements

There is currently no employment or other contracts or arrangements with officers or directors. There are no compensation plans or arrangements, including payments to be made by us, with respect to our officers, directors or consultants that would result from the resignation, retirement or any other termination of such directors, officers or consultants from us. There are no arrangements for directors, officers, employees or consultants that would result from a change-in-control.

25

Directors’ Compensation

During the year ended December 31, 2010, we had no formal or informal arrangements or agreements to compensate our director for services they provide as directors of our company.

Option/SAR Grants

We do not currently have a stock option plan. No individual grants of stock options, whether or not in tandem with stock appreciation rights known as SARs or freestanding SARs have been made to any executive officer or any director since our inception; accordingly, no stock options have been granted or exercised by any of the officers or directors since we were founded.

Long-Term Incentive Plans and Awards

We do not have any long-term incentive plans that provide compensation intended to serve as incentive for performance. No individual grants or agreements regarding future payouts under non-stock price-based plans have been made to any executive officer or any director or any employee or consultant since our inception; accordingly, no future payouts under non-stock price-based plans or agreements have been granted or entered into or exercised by any of the officers or directors or employees or consultants since we were founded.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management

The following table sets forth as of December 31, 2010 certain information regarding the beneficial ownership of our common stock by:

Except as otherwise indicated, the persons or entities listed below have sole voting and investment power with respect to all shares of common stock beneficially owned by them, except to the extent such power may be shared with a spouse. No change in control is currently being contemplated.

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Item 13. Certain Relationships and Related Transactions, and Director Independence

In June 2007, we issued 2,000,000 shares of $0.0001 par value common stock to Ohad David, an ex-officer and ex-director, in exchange for cash of $200. Also in June 2007, we issued 2,000,000 shares of $0.0001 par value common stock to Ruth Navon, an ex-officer and ex-director, in exchange for cash of $200.

Except as disclosed herein, no director, executive officer, shareholder holding at least 5% of shares of our common stock, or any family member thereof, had any material interest, direct or indirect, in any transaction, or proposed transaction since the year ended December 31, 2010, in which the amount involved in the transaction exceeded or exceeds the lesser of $120,000 or one percent of the average of our total assets at the year-end for the last three completed fiscal years.

Director Independence

As at the year ended December 31, 2010 we had one director, consisting of Arunkumar Rajapandy. We determined that our director was not an “independent director” as defined in NASDAQ Marketplace Rule 4200(a)(15).

We do not have an audit committee. We currently do not have nominating, compensation committees or committees performing similar functions. There has not been any defined policy or procedure requirements for shareholders to submit recommendations or nomination for directors.

From inception to present date, we believe that the board of directors has been capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting.

Item 14. Principal Accountant Fees and Services

The aggregate fees billed for the most recently completed fiscal year ended December 31, 2010 and for fiscal year ended December 31, 2009 for professional services rendered by the principal accountant for the audit of our annual financial statements and review of the financial statements included in our quarterly reports on Form 10-Q and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:

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Audit Committee’s Pre-Approval Practice.

We do not have an audit committee. Our board of directors performs the function of an audit committee. Section 10A(i) of the Securities Exchange Act of 1934, as amended, prohibits our auditors from performing audit services for us as well as any services not considered to be audit services unless such services are pre-approved by our audit committee or, in cases where no such committee exists, by our board of directors (in lieu of an audit committee) or unless the services meet certain de minimis standards.

Item 15. Exhibits Financial Statement Schedules

* Filed herewith

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SIGNATURES

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

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