Edgar Filing: BioMETRX

Washington, D.C. 20549

x	ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2007

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

For the transition period from ______________ to________________

Commission file number 0-15807

BIOMETRX, INC.

(Name of small business issuer in its charter)

DELAWARE		31-1190725
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

500 North Broadway, Suite 204, Jericho, New York		11753
(Address of principal executive offices)		(Zip Code)

(516) 937-2828

Securities registered under Section 12(b) of the Exchange Act:

Title of each class		Name of each exchange on which registered

None		___________________________________

___________________________________		___________________________________

Securities registered under Section 12 (g) of the Exchange Act:

Common Stock Par Value $.001

(Title of class)

Check whether the issuer is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. o

Note - Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Exchange Act from their obligations under those Sections.

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

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will 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-KSB or any amendment to this Form 10-KSB. x

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

State issuer’s revenues for its most recent fiscal year. $1,476,000

The aggregate market value of the Company’s common stock held by non-affiliates was approximately $2,154,128 based upon the average bid and asked price of $0.20 as reported by the OTC Bulletin Board as of April 2, 2008.

The Company has 19,280,510 shares of common stock outstanding, as of April 2, 2008

DOCUMENTS INCORPORATED BY REFERENCE

None

Transitional Small Business Disclosure Format (Check one): Yes o No x

PART I

INTRODUCTORY COMMENT

Throughout this Annual Report on Form 10-KSB the terms “we,” “us,” “our,” “bioMETRX” and “our company” refer to bioMETRX, Inc., a Delaware corporation, and, unless the context indicates otherwise, includes our wholly owned subsidiaries.

FORWARD-LOOKING STATEMENTS

The discussion in this report on Form 10-KSB contains forward-looking statements that involve risks and uncertainties. The statements contained in this Report that are not purely historical are 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, including statements regarding our expectations, beliefs, intentions or strategies regarding the future. All forward-looking statements included in this document are based on information available to us on the date hereof, and we assume no obligation to update any such forward-looking statements. Our actual results could differ materially from those described in our forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, our unproven business model and a limited operating history in a new and rapidly evolving industry; our ability to implement our business plan; and our ability to manage our growth, retain and grow our customer base and expand our service offerings.

We make forward-looking statements in the “Management’s Discussion and Analysis of Financial Condition and, Results of Operations” below. These forward-looking statements include, but are not limited to, statements about our plans, objectives, expectations, intentions and assumptions and other statements that are not historical facts. We generally intend the, words “expect”, “anticipate”, “intend”, “plan”, “believe”, “seek”, “estimate” and similar expressions to identify forward-looking statements.

This Report contains certain estimates and plans related to us and the industry in which we operate, which assumes certain events, trends and activities will occur and the projected information based on those assumptions. We do not know that all of our assumptions are accurate. In particular, we do not know what level of growth will exist in our industry, if any, and particularly in the foreign markets in which we operate, have devoted resources and in which we shall seek to expand. If our assumptions are wrong about any events, trends and activities, then our estimates for future growth for our business may also be wrong. There can be no assurances that any of our estimates as to our business growth will be achieved.

The following discussion and analysis should be read in conjunction with our financial statements and the notes associated with them contained elsewhere in this Report. This discussion should not be construed to imply that the results discussed in this quarterly report will necessarily continue into the future or that any conclusion reached in this quarterly report will necessarily be indicative of actual operating results in the future. The discussion represents only the best present assessment of management.

ITEM 1. DESCRIPTION OF BUSINESS.

The Company, through its wholly owned subsidiaries, designs, develops, engineers and markets biometrics-based products for the consumer home security and consumer electronics markets.

BioMETRX is focused on developing simple-to-use, cost-effective, power-efficient, finger-activated, lifestyle products under the trade name smartTOUCH .Through several agreements in place with consumer security brand giant Master Lock, most of the Company’s products are co-branded Master Lock smartTOUCH. The Company’s product line includes biometrically enabled residential locks, central station alarm keypads, thermostats, garage/gate openers, mailboxes as well as kitchen, liquor and gun cabinets. Our products utilize finger recognition technology designed to augment or replace conventional security methods such as keys, keypads, and PIN numbers.

The consumer home security industry consists of garage door manufacturers, key and locks manufacturers and central station alarm monitoring companies, representing a $25 billion global market. bioMETRX develops market-specific products in these areas which are being sold through retailers, dealers and direct to consumers in the United States. In early October, the Company began fulfilling significant orders of its first product, the Garage Door Opener, also known as the Master Lock™ smartTOUCH GDO, and since initial delivery has received thousands of reorders.

The Company has also received and shipped against its initial order for its second product, a biometric USB Flash Drive. This product is also co-branded Master Lock smartTOUCH and the company has shipped 1,000 units of this product to Master Lock, to be used as demo and marketing pieces by their sales reps, to secure additional product orders through existing Master Lock sales channels.

The Company is the exclusive biometric provider to Master Lock Corporation, a wholly owned subsidiary of Fortune Brands, a New York Stock Exchange company, that owns and operates some of the most popular consumer home and hardware brands in the United States.

Through Master Lock, other similar OEM relationships and the Company’s own distribution channels, the Company expects increasing product offerings in 2008 and 2009, though it cannot offer specific guarantees as to the significance of the revenues that might be realized.

bioMETRX, to date, has introduced its products and services commercially and is considered an entry level market vendor of consumer-based biometric products. bioMETRX has limited assets, significant liabilities and limited business operations, though it has realized initial meaningful revenues from its initial product, the Company continues to realize losses from operations and cannot provide assurances that further revenues from this initial product will create positive cash flow to support operations.

Intellectual Property

The Company currently owns four patents and has six patents pending, all of which incorporate the biometric design and/or architecture used within smartTOUCH products that have been, or are being developed. owns patents covering biometric garage door openers, thermostats, padlocks and security/retrieval of electronic medical records.

Wherever possible we seek to protect our inventions through filing U.S. patents and foreign counterpart applications in selected other countries. Because patent applications in the U.S. are maintained in secrecy for at least eighteen months after the applications are filed and since publication of discoveries in the scientific or patent literature often lags behind actual discoveries, we cannot be certain that we were the first to make the inventions covered by each of our issued or pending patent applications or that we were the first to file for protection of inventions set forth in such patent applications. Our planned or potential products may be covered by third-party patents or other intellectual property rights, in which case continued development and marketing of the products would require a license. Required licenses may not be available to us on commercially acceptable terms, if at all. If we do not obtain these licenses, we could encounter delays in product introductions while we attempt to design around the patents, or could find that the development, manufacture or sale of products requiring these licenses is foreclosed.

We may rely on trade secrets to protect our technology. Trade secrets are difficult to protect. We seek to protect our proprietary technology and processes by confidentiality agreements with our employees and certain consultants and contractors. These agreements may be breached, we may not have adequate remedies for any breach and our trade secrets may otherwise become known or be independently discovered by competitors. To the extent that our employees or our consultants or contractors use intellectual property owned by others in their work for us, disputes may also arise as to the rights in related or resulting know-how and inventions.

Manufacturing

We do not own any manufacturing facilities and have been negotiating with, and are now working with a third party contract manufacturer, RDI, Inc. (“RDI”), to manufacture our garage door opening units. RDI is located in the United States and has overseas capabilities which mitigate the production costs,. As the need arises, we plan to either contract additional contract manufacturers or license our technology to third party Original Equipment Manufacturers (“OEMs”) to incorporate into their products. Each decision will depend on customer demand, our available cash resources and our ability to access expertise at competitive rates

Marketing

The target markets for our home security and electronic products are consumer and home security OEMs. bioMETRX has established its own marketing initiatives by developing initial brand recognition for its smartTOUCH product line through retailers, development partner's, authorized dealers and these such OEMs..

The Company currently markets its products through three (3) distinct sales channels, (i) Retailers, (ii) partner distribution channels and (iii) direct to consumer sales. The Company has entered into a development and co-marketing agreement with Master Lock™ which allows the Company’s products to be sold and distributed under the co-brand Master Lock smartTOUCH, through Master Lock’s existing established channels, which includes almost every home improvement domestic and international retailer, a network of authorized Master Lock dealers, as well as specialty security hardware catalogues. .

The Company has been successful in its initial sale and delivery to over 1400 Home Depot stores throughout the United States. To date, the Company has delivered over 18,000 GDO units under the Master Lock smartTOUCH brand, and has experienced sell through and re-orders from individual Home Depot stores in excess of 5,000 units and $400,000..

The Company also offers its products through direct Internet sales on its website www.smarttouchstore.com. The Company’s online marketplace was necessitated through direct consumer inquiry after company products were featured on various television shows. The Company has generated over 1000 Internet orders to date.

The Company expects as Master Lock introduces our co-developed products to the various home improvement, hardware and consumer security markets, our co-branded products will be incorporated into much wider scale product marketing initiatives that are expected to result in accelerated revenue growth for our Company.

Competition

The markets for our products and solutions are somewhat competitive and are characterized by rapid technological change as a result of technical developments exploited by our competitors, the changing technical needs of our customers, and frequent introductions of new features. We expect competition to increase as other companies introduce products that are competitively priced, have increased performance or functionality, or that incorporate technological advances not yet developed or implemented by us. In order to compete effectively in this environment, we must continually develop and market new and enhanced products at competitive prices, and have the resources to invest in significant research and development activities. Based on the Company’s current financial situation there is a risk that we may not be able to make the technological advances necessary to compete successfully. Existing and new competitors may enter or expand their efforts into our markets, or develop new products to compete against ours. Our competitors may develop new technologies or enhancements to existing products or introduce new products that will offer superior price or performance features. New products or technologies may render our products obsolete.

Employees

As of December 31, 2007, the Company has 6 full time employees and no part time employees. The Company expects that it will hire at least 4 more key people over the next 6 months. We believe our employee relations are satisfactory.

ITEM 2. PROPERTIES

We operate our business in leased facilities. We occupy two offices with approximately 3,900 square feet in an office building in Jericho, New York. Our rent for this space is $9,100, plus utilities, per month. The Company’s lease for this space expires on January 31, 2010. The Company believes this space is adequate for its needs.

ITEM 3. LEGAL PROCEEDINGS

On November 16, 2006, the Company was the subject of a complaint filed in the Supreme Court of New York State, County of Nassau (Index No. 019475-06) by Intellicon seeking final payment of $20,000 plus accrued interest for engineering design services performed for the Company. The Company answered and counter-claimed on January 5, 2007 asserting damages of $25,000 incurred then and continuing to incur to remedy design defects performed by Intellicon. The Company intends to vigorously defend its position in this claim.

On March 7, 2007, the Company’s subsidiary, bioMETRX Technologies Inc. became the subject of a complaint filed by Frank Giannuzzi, the former Chief Financial Officer and Sante Santopadre, a former consultant with whom it had previously had severed its business relationship. The complaint was filed in the Supreme Court of the State of New York, County of Nassau (Index No. 07-004088). The plaintiffs allege damages arising from certain inducements which were relied upon to their detriment. The Company considers these allegations to be baseless and without merit and will continue to vigorously pursue damages in the course of its defense of this complaint and other previous acts of the plaintiffs and has initiated counterclaims for damages as a result of adverse actions by the individuals which have impaired the Company’s operations.

On March 10, 2008, the Company became the subject of a complaint entitled Arrow Electronics, Inc. v. bioMETRX Technologies, Inc. etal. The Complaint was filed in the Supreme Court of the State of New York County of Nassau (Index No. 08-4900). The complaint alleges breach of contract and the plaintiff is seeking damages of $194,139.15. The Company has requested an extension to answer the complaint. The Company intends to vigorously defend this action.

The Company is a defendant in a lawsuit entitled Worldwide Electronic Solutions, L.L.C. v. Biometrx, Inc. etal.. The action was filed in the Superior Court of the State of Arizona for the County of Maricopa (Index No. CV2007-023760). The complaint alleged breach of contract and sought damages of approximately $190,000, the Company did not answer the complaint in that it believes that the Court had no jurisdiction. The Plaintiff obtained a default judgment and has filed an Application for Entry of Default, the Company intends on filing a motion to vacate the Default Judgment and has been in negotiations with the Plaintiff to settle this matter.

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

The Company’s Information Statement (the “Information Statement”) was mailed on or about January 30, 2008 to the holders of record at the close of business on December 31, 2007, of the Common Stock of bioMETRX, Inc., a Delaware corporation (“bioMETRX” or the “Company”), in connection with action by written consent in lieu of a meeting to authorize and approve an amendment to our Certificate of Incorporation increasing the number of authorized shares of our Common Stock, from 25,000,000 to 100,000,000 shares

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

Market Information

Our common stock has been quoted on the OTCBB under the symbol BMRX since March 16, 2006. Prior to that, the Company traded under the symbol BMTX and prior to that the Company’s common stock traded under the symbol MKSH. The following table sets forth, for the periods indicated, the high and low sales prices per share of common stock as reported on the OTCBB. These quotations reflect interdealer prices, without retail markup, markdown or commission and may not necessarily represent actual transactions:

	2005
COMMON STOCK	High		Low
First quarter	$	1.28	$	0.60
Second quarter	$	15.40	$	0.60
Third quarter	$	15.80	$	2.20
Fourth quarter	$	8.00	$	2.40

	2006
COMMON STOCK	High		Low
First quarter	$	6.80	$	2.40
Second quarter	$	3.75	$	1.35
Third quarter	$	1.80	$	0.60
Fourth quarter	$	2.95	$	1.05

	2007
COMMON STOCK	High		Low
First quarter	$	3.49	$	1.80
Second quarter	$	2.20	$	1.05
Third quarter	$	1.40	$	0.56
Fourth quarter	$	1.35	$	0.42

All prices for fiscal 2005, 2006 and 2007 are split-adjusted to reflect a reverse 1:12 stock split which occurred on December 20, 2004 and also reflect a reverse 1:4 stock split which occurred March 14, 2006.

On April 2, 2008, the last sale price of our common stock reported by the OTCBB was $0.20 per share.

Shareholders

Records of our stock transfer agent indicate that as of April 2, 2008, we had 699 record holders of our common stock. The Company estimates there are nearly 500 holders of lots of 100 or more shares. Since a significant number of our shares are held by financial institutions in “street name,” it is likely that we have significantly more stockholders than indicated above. We estimate that we have approximately 1,000 beneficial holders, including such shares held in “street name.” As of April 2, 2008 we had 19,280,510 outstanding shares of common stock.

Dividend Policy

Our board of directors determines any payment of dividends. We have never declared or paid any cash dividends, and we do not anticipate or contemplate paying cash dividends in the foreseeable future. It is our Board of Directors intention to utilize all available funds for working capital of bioMETRX.

Unregistered Sales of Equity Securities

All number of shares and other securities described here reflect a 1:4 reverse stock split effective March 14, 2006

On January 4, 2006, the Company issued 12,500 restricted shares of its common stock to Ms. Lorraine Yarde in connection with the exercise of a stock option in such amount. The exercise price of the option was $.40 per share.

On February 14, 2006, the Company issued 250,000 shares of its common stock to Russell Kuhn pursuant to a Consulting Agreement entered into between the Company and Mr. Kuhn.

In connection with this transaction, the Company paid a finder’s fee to Harbor View of $70,950 and issued to Harbor View 102,300 shares of its common stock.

The Company will utilize the proceeds from this transaction for general working capital.

On February 27, 2006, the Company issued 25,000 restricted shares of its common stock to Empire Relations Group, Inc. pursuant to a consulting agreement between the Company and Empire Relations Group.

On March 21, 2006, Mr. Basile exercised 250,000 stock options at $1.00 per share pursuant to his amended employment agreement dated February 6, 2006. Mr. Basile exercised the options via “cash-less exercise” and was issued 179,578 shares of common stock.

On March 21, 2006, the Company received debt financing in the aggregate amount of $100,000 from Jane Petri and Joseph Panico. The principal and interest of 12% per annum is due on June 21, 2006. The note carries a default rate of 18% per annum. In addition, the Company issued an aggregate of 25,000 restricted shares common stock to Petri and Panico as debt issuance costs.

On May 4, 2006, the Company issued 20,000 restricted shares of its common stock to Pasadena Capital Partners, LLC pursuant to a Letter of Engagement entered into between the parties on March 17, 2006.

On May 3, 2006, the Company issued 180,000 restricted shares of its common stock to New Castle Consulting, LLC pursuant to a Consulting Agreement entered into between the parties on April 10, 2006.

On May 11, 2006, the Company issued 125,000 restricted shares of its common stock to Santo Santopadre as a settlement of a dispute between Mr. Santopadre and the Company.

On June 29, 2006, the Company entered into a Securities Purchase Agreement dated as of June 29, 2006, with four investors relating to the issuance and sale, in a private placement exempt from the registration requirements of the Securities Act of 1933, as amended, of units (the “Units”) consisting of 8% Convertible Notes in the principal amount of $950,000 (“Notes”), Series A Common Stock Purchase Warrants (“A Warrants”) and Series B Common Stock Purchase Warrants (“B Warrants”). In addition, the company entered into an Exchange Agreement with the two investors who purchased $650,000 of the Preferred Stock Units, previously reported on Form 8-K dated April 28, 2006 whereby the Company agreed to issue the Units in exchange for the return and cancellation of the previously issued Preferred Stock Units. Accordingly, at closing the Company issued its 8% Convertible Notes in the aggregate principal amount of $1,600,000, 1,600,000 A Warrants and 800,000 B Warrants to the Investors. The Company also issued an aggregate of 128,000 shares of its common stock to the investors representing one year’s of prepaid interest on the Notes.

The Notes mature 24 months from the closing. The Notes are convertible at the option of the holder into the Company’s common stock at the rate of $1.00 per share. The Notes are mandatorily convertible into the Company’s common stock if the closing bid price of the Company’s common stock is above $2.50 per share for ten (10) consecutive trading days and if the daily volume for the same period exceeds 100,000 shares per day. The Company may redeem the Notes for 125% of the principal amount of the Note together with all accrued and unpaid interest provided that (i) an event of default has not occurred, and (ii) an effective registration statement covering the shares underlying the Note exists. As a result of the anti-dilution provisions contained in the Notes the conversion price has been adjusted several times, the lowest conversion price to date was approximately $.25 per share.

Each A Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $1.75 per share commencing on the date of issuance and expiring at the close of business on the fifth anniversary of the issuance date. Each B Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $.10 per share commencing 181 days after issuance and expiring at the close of business on the fifth anniversary of the initial exercise date. Notwithstanding the foregoing if the Company provides the holder of a B Warrant with validation and acknowledgement, in the form of bona fide purchase order demonstrating that at least $1,000,000 of the Company’s products have been ordered, other than its initial order from a national retailer in the amount of approximately 23,000 garage door opening units, within 181 days after the date of the Securities Purchase Agreement, the B Warrants shall automatically terminate. Both the A and B Warrants contain provisions that protect the holder against dilution by adjustment of the exercise price in certain events including, but not limited to, stock dividends, stock splits, reclassifications, or mergers.

Pursuant to the Selling Agent Letter Agreement between the Company and the Selling Agent, the Selling Agent was paid a cash fee of $95,000 (10% of the aggregate purchase price of the Units sold to the subscribers) in addition to the $75,000 it received on April 28, 2006, inclusive of $10,000 in expenses. The Company also issued the Selling Agent a warrant to purchase 160,000 shares of its common stock on the same terms as the A Warrants. In addition, the Company paid $15,000 to the Selling Agent’s counsel and $32,500 to its counsel.

As part of the Private Placement, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with each subscriber who purchased Units in the Private Placement. Under the Registration Rights Agreement, the Company is obligated to file a registration statement (the “Registration Statement”) on Form SB-2, relating to the resale by the holders of the Common Stock underlying the Notes, Warrants and Selling Agent Warrant. If such Registration Statement was not filed by July 14, 2006, or does not become effective within 90 days after closing, the Company has agreed to pay to the investors 1.5% of the gross proceeds of the offering for each month in which the Company fails to comply with such requirements. The Company did not file the Registration Statement by July 14, 2006 and therefore is accruing 1.5% ($24,000) of the gross proceeds for each month the Company fails to file the Registration Statement. (See Note 11 on “Forebearance Notes”).

On October 10, 2006 the Company amended the exercise price of the 1,600,000 Class A Warrants from $1.75 to $1.00.

On June 5, 2006 the Company issued 54,201 restricted shares of its common stock to Mark Basile in lieu of indebtedness to Mr. Basile by the Company.

On July 17, 2006, the Company issued 2,827 shares to Mr. Dennis Rutowicz. These shares were issued to Mr. Rutowicz to correct a mistake whereby Mr. Rutowicz was accidentally omitted from a list of investors in the Company.

On July 19, 2006, the Company issued an aggregate of 20,000 restricted shares of its common stock to Jane Petri (10,000) and Joseph Panico (10,000) as an incentive for them extending the maturity dates of their respective loans.

On August 4, 2006, the Company granted J. Richard Iler 400,000 options to purchase shares of its common stock and issued 100,000 shares of its common stock to Mr. Iler as a bonus. 200,000 of the options are exercisable at $1.05 per share and 200,000 options are exercisable at $1.10 per share. The 200,000 options exercisable at $1.05 were issued under the Company’s 2005 Incentive Equity Plan (the “Plan”) and the other 200,000 options were issued outside the Plan. The securities were issued to Mr. Iler pursuant to his employment agreement. On October 19, 2006, Mr. Iler returned 100,000 options issued under the Plan in exchange for 100,000 options issued outside of the Plan.

On August 14, 2006, the Company granted Lorraine Yarde 600,000 options to purchase shares of its common stock issued 150,000 shares of its common stock a to Ms. Yarde as a bonus. 200,000 of the options are exercisable at $1.00 per share, 200,000 options are exercisable at $1.25 per share and 200,000 options are exercisable at $1.50 per share. The 200,000 options exercisable at $1.00 were issued under the Plan and the other 400,000 options were issued outside the Plan. On October 19, 2006, Ms. Yarde returned 100,000 options issued under the Plan in exchange for 100,000 options issued outside of the Plan.

On September 21, 2006, the Company issued Jay Pitlake 50,000 shares of its common stock as a finder’s fee in connection with the sale of the units described above.

The Company entered into a Securities Purchase Agreement dated September 18, 2006, with Jane Petri and Joseph Panico relating to the issuance and sale, in a private placement exempt from the registration requirements of the Securities Act of the Company’s 10% Promissory Notes due March 15, 2007 in the aggregate principal amount of $400,000, 400,000 Common Stock Purchase Warrants and 160,000 Shares of the Company’s Common Stock. In connection with this transaction the two investors provided the Company with $300,000 and exchanged $100,000 in Notes, described above, that were previously issued by the Company to the investors.

Each Warrant entitles the holder to purchase one share of the Company’s Common Stock at an exercise price of $1.00 per share commencing on the date of issuance and expiring at the close of business on September 15, 2011.

As part of the Private Placement, the Company agreed to register the 400,000 shares of Common Stock underlying the Warrants and the 160,000 shares of the Common Stock issued as part of this Private Placement.

The Company entered into a Securities Purchase Agreement in September 2006, with Dorothy Christofides ($30,000) and Barry and Marci Mainzer ($25,000) relating to the issuance and sale, in a private placement exempt from the registration requirements of the Securities Act of the Company’s 10% Promissory Notes due March 30, 2007 in the aggregate principal amount of $55,000, 55,000 Common Stock Purchase Warrants and 22,000 Shares of the Company’s Common Stock.

As part of the Private Placement, the Company agreed to register the 55,000 shares of Common Stock underlying the Warrants and the 22,000 shares of the Common Stock issued as part of this Private Placement.

On October 23, 2006 the Company issued 25,000 shares of its common stock to Brendan Hopkins (“Hopkins”) pursuant to a consulting agreement between the Company and Hopkins. These shares were issued pursuant to the Company’s Plan.

On November 17, 2006, the Company entered into a Securities Purchase Agreement with Jane Petri and Joseph Panico relating to the issuance and sale in a private placement exempt from the registration requirements of the Securities Act of the Company’s 10% Promissory Notes due March 15, 2007 in the aggregate principal amount of $300,000, 99,000 Common Stock Purchase Warrants and 300,000 shares of the Company’s Common Stock. In connection with this transaction, the two investors provided the Company with $300,000.

Each Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $1.25 per share commencing on the date of issuance and expiring at the close of business on September 14, 2011.

As part of the Private Placement, the Company agreed to register the 99,000 shares of common stock underlying the Warrants and the 300,000 shares of the common stock issued as part of this private placement.

On October 20, 2006 the Company entered into a Consulting Agreement with Interactive Resources Group, Inc. (“IRG”). IRG was hired to provide the Company with corporate consulting services in connection with the Company’s corporate finance relations, investor relations to enhance the Company’s visibility in the financial community. The term of the agreement is six months. As compensation, the Company agreed to issue IRG an aggregate of 225,000 shares of its common stock, payable 75,000 on November 1, 2006, 75,000 payable on January 1, 2007 and 75,000 payable on March 1, 2007. The Company has issued the first 75,000 shares. In addition, the Company agreed to issue three hundred thousand (300,000) common stock purchase warrants which vest on or about January 20, 2007, ninety-one (91) days from the date of the Agreement.

The warrants are exercisable for four years at the following exercise prices:

100,000 at $1.50 per share

100,000 at $2.00 per share

100,000 at $4.00 per share

The Company entered into a Securities Purchase Agreement dated as of December 28, 2006, with three investors relating to the issuance and sale, in a private placement (“Private Placement”) exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), of units (the “Units”) consisting of Senior Convertible Debentures in the principal amount of $1,500,000 (“Debentures”), 1,500,000 Series A Common Stock Purchase Warrants (“A Warrants”) and 750,000 Series B Common Stock Purchase Warrants (“B Warrants”). The closing occurred on January 5, 2007.

The Debentures mature on June 29, 2008. The Debentures are convertible at the option of the holder into the Company’s common stock at the rate of $1.00 per share. The Debentures are convertible at the option of the Company into the Company’s common stock if the closing bid price of the Company’s common stock is above $2.50 per share for ten (10) consecutive trading days and if the shares underlying the Debentures are registered. The Company may redeem the Debentures for 125% of the principal amount of the Debenture together with all accrued and unpaid interest provided that (i) an event of default has not occurred, (ii) the price of the Company’s common stock exceeds $1.50 and (ii) an effective registration statement covering the shares underlying the Debentures exists. As a result of the anti-dilution provisions contained in the Debentures the conversion price has been adjusted several times, the lowest conversion price to date was approximately $.25 per share.

Each A Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $1.00 per share commencing on the date of issuance and expiring at the close of business on the fifth anniversary of the issuance date. Each B Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $.10 per share at any time after July 1, 2007 and expiring at the close of business on the fifth anniversary of the initial issuance date. Notwithstanding the foregoing if the Company provides the holder of a B Warrant with validation and acknowledgement on or before June 30, 2007 that the Company has both received and booked revenues for its products totaling $1,000,000, the B Warrants shall automatically terminate. Both the A and B Warrants contain provisions that protect the holder against dilution by adjustment of the exercise price in certain events including, but not limited to, stock dividends, stock splits, reclassifications, or mergers.

Pursuant to the Selling Agent Letter Agreement between the Company and First Montauk Securities Corporation (“Selling Agent”), the Selling Agent was paid a cash fee of $150,000 (10% of the aggregate purchase price of the Units sold to the subscribers). The Company also issued the Selling Agent a warrant to purchase 150,000 shares of its common stock on the same terms as the A Warrants.

As a condition to closing, the Company obtained consents and waivers from the investors of its private placement of $1,600,000 principal amount of Convertible Notes (“Notes”) issued on June 29, 2006, pursuant to which each of the prior investors agreed to waive any and all existing defaults relating to the Notes and agreed to forebear from exercising any rights accruing upon default until March 31, 2007. In connection therewith, the Company issued to the investors Convertible Notes (“Forebearance Notes”) in the aggregate principal amount of $387,437.39, representing liquidated damages due under the Notes. The Forebearance Notes are convertible into the Company’s common stock at $1.00 per share.

On January 9, 2007, Ms. Yarde exercised 250,000 stock options at $.40 per share. Ms. Yarde exercised the options via “cash-less exercise” and was issued 217,213 shares of common stock.

On January 9, 2007, the Company issued an aggregate of 44,250 bonus shares of its common stock pursuant to the Company’s 2005 Equity Incentive Plan to the following individuals:

Mark Basile			15,000
Lorraine Yarde			12,500
J. Richard Iler			10,000
Bernie Lee			2,000
Peter O’Neil			1,500
Donna Basile			2,000
Jon Guttman			1,000
Christina Romita			250
Total			44,250

On January 16, 2007, the Company issued an aggregate of 40,000 shares of its common stock to Patricia Giberson (26,000) and Oceana Partners (14,000) pursuant to a consulting agreement between the Company and Ocean Partners.

On January 16, 2007, the Company issued 40,000 shares of its common stock to Brad Schwab pursuant to a consulting agreement between the Company and Mr. Schwab.

On January 16, 2007, the Company issued an aggregate of 4,000 shares of its common stock to the owners of Vintage Filings, Inc. (Seth Farbman 2,000 and Shai Stern 2,000) for services rendered to the Company in connection with its SEC filings. These shares were issued under the Company’s 2005 Equity Incentive Plan.

On January 22, 2007, the Company issued 50,000 shares of its common stock to Mark Basile as consideration for Mr. Basile providing the Company his personal guarantee in connection with the opening of a Letter of Credit in the amount of $1,040,400.

On January 23, 2007, the Company issued 80,000 shares of its common stock to Mark Basile in exchange for Mr. Basile foregoing $140,000 of his 2007 salary.

On January 31, 2007, the Company issued 110,000 restricted shares of its common stock to Equity Services LLC pursuant to a consulting agreement between the Company and ICR, LLC.

On February 13, 2007, the Company issued 75,000 restricted shares of its common stock to Interactive Resources Group, Inc. (“IRG”) pursuant to a consulting agreement between the Company and IRG.

On February 14, 2007, the Company issued 25,000 restricted shares of its common stock to Barry and Marci Mainzer upon the exercise of a warrant for a like number of shares. The exercise price of the warrant was $1.00 per share and was paid for by forgiving the principal payment of a $25,000 promissory note due to the Mainzers.

On February 14, 2007 the Company issued 25,000 restricted shares of its common stock to Dorothy Christofides upon conversion of a promissory note in the principal amount of $30,000. As additional consideration for Ms. Christofides converting her promissory note, the Company issued her 20,000 common stock purchase warrants exercisable for a period of five years at $2.00 per share.

On February 14, 2007, the Company issued an aggregate of 7,000 shares of its common stock to the owners of Vintage Filings, Inc. (Seth Farbman 3,500 and Shai Stern 3,500) in exchange for Vintage providing one (1) year of filing the Company’s reports with the SEC via the Edgar filing system. These shares were issued under the Company’s 2005 Equity Incentive plan.

On March 6, 2007, the Company issued The Incredible Card Company 150,000 restricted shares of its common stock as consideration for the purchase of a patent the Company acquired in January 2007. Mr. Basile, the Company’s Chairman and CEO, was a former officer and director of The Incredible Card Company.

On March 12, 2007, the Company issued Robert Jacobs 150,000 restricted shares of its common stock as consideration for the purchase of a patent.

On April 11, 2007, the Company’s Chief Operating Officer cashlessly exercised 200,000 warrants exercisable at $1.00. The market value of the Company’s common stock on that date was $2.00. Accordingly, the Company issued 100,000 shares to Ms. Yarde pursuant to such cashless exercise. The stock was issued under the Company’s Employee Stock Plan.

On April 11, 2007, the Company’s Chief Financial Officer cashlessly exercised 200,000 warrants exercisable at $1.05. The market value of the Company’s common stock on that date was $2.00. Accordingly, the Company issued 95,000 shares to Mr. Iler pursuant to such cashless exercise. The stock was issued under the Company’s Stock Incentive Plan

On April 24, 2007, the Company issued 1,750 to the partners of its legal counsel, Sommer & Schneider LLP, in consideration for legal services rendered in the ordinary course of business. The stock was issued under the Company’s Stock Incentive Plan.

On April 24, 2007, the company issued 140,000 shares of its common stock and 140,000 warrants exercisable at $1.00 per share to Mark Basile, the Company’s President and CEO as consideration for providing the Company a loan in the amount of $130,000.

On May 21, 2007, the Company issued 50,000 shares of its common stock and 50,000 warrants exercisable at $1.00 per share to Lorraine Yarde, the Company’s Chief Operating Officer as consideration for providing the Company a loan in the amount of $50,000.

On June 1, 2007, the Company issued 300,000 shares of its common stock and 200,000 warrants exercisable at $1.50 per share to IRG as consideration for performing shareholder relations and other financial advisory services for a six month period. The aggregate value of such services based upon valuations of the Company’s stock at this time was 4486,105.

On June 11, 2007, the Company issued 100,000 shares of its common stock to Nite Capital upon the conversion of $100,000 principal amount of a convertible note issued to Nite Capital in the aggregate principal amount of $150,000. The convertible note converts into the Company’s common stock at $1.00 per share. Seventy-five thousand (75,000) of these shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628)_ which was declared effective by the SEC on June 25,2007.

On June 15, 2007, the Company issued 45,000 shares of its common stock and 45,000 warrants exercisable at $1.00 per share to Lorraine Yarde, the Company’s Chief Operating Officer as consideration for providing the Company a loan in the amount of $45,000.

On June 16, 2007, the Company issued an aggregate amount of 125,000 shares of its common stock to Peter Thompson upon the conversion of $125,000 principal amount of a convertible note issued to Mr. Thompson in that amount. The convertible note converted into the Company’s common stock at $1.00 per share. Sixty-two thousand-five hundred (62,500) of these shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628) which was declared effective by the SEC on June 25, 2007.

On June 16, 2007, the Company issued an aggregate of 125,000 shares of its common stock to Lighthouse Capital Insurance Company- Policy # 03-046 upon the conversion of $125,000 principal amount of a convertible note issued to Lighthouse Capital Insurance in that amount. The convertible note converted into the Company’s common stock at $1.00 per share. Sixty-two thousand-five hundred (62,500) of these shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628)_ which was declared effective by the SEC on June 25,2007.

On June 18, 2007,, the Company awarded Lorraine Yarde 150,000 shares of its common stock as a bonus for securing an increased purchase order from Home Depot and an additional purchase order from MasterLOCK.

On June 18, 2007,, the Company issued 20,000 shares to Rodger Michell, an accountant as consideration of accounting services in connection with the Company’s upgrading its accounting system and electronic data interchange.

On June 18, 2007, the Company issued 75,000 shares of its common stock and 75,000 warrants exercisable at $1.00 per share to The Naples Trust, of which the Company’s Chief Executive Officer is a related party as consideration for providing the Company a loan in the amount of $75,000.

On June 21, 2007, the Company issued 20,000 shares of its Common stock to Black Dog Communications as consideration for public relations services to the Company.

On June 26, 2007, the Company issued an aggregate of 300,000 shares of its common stock to Linden Growth Partners upon the conversion of $300,000 principal amount of a convertible note issued to Linden Growth Partners in that amount. The convertible note converted into the Company’s common stock at $1.00 per share. One hundred and fifty thousand (1500,00) of these shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628) which was declared effective by the SEC on June 25, 2007.

On June 26, 2007, the Company issued an aggregate of 450,000 shares of its common stock to Linden Growth Master Fund upon the conversion of $450,000 principal amount of a convertible debenture issued to Linden Growth Master Fund in that amount. The convertible debenture converted into the Company’s common stock at $1.00 per share. Two hundred and twenty five thousand (225,000) of those shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628) which was declared effective by the SEC on June 25, 2007.

On June 27, the Company issued 5,000 shares of its common stock to the partners of its legal counsel, Sommer and Schneider LLP in consideration of $5,000 in legal services rendered to the Company. The stock was issued under the Company’s Equity Incentive Plan.

On June 28, 2007, the Company issued 75,000 shares of its common stock and 75,000 warrants exercisable at $1.00 per share to J. Richard Iler, the Company’s Chief Financial Officer as consideration for providing the Company a loan in the amount of $75,000.

On July 11, 2007 the Company granted 375,000 warrants exercisable at $1.00 to Alpha Capital in consideration of its loan to the Company to be expressly used for manufacturing of the Company’s MasterLOCK™ smartTouch Garage Door Opener. The proceeds from receivable financing will be used to repay this loan.

On July 13, 2007, the Company issued 50,000 shares of its common stock to BridgePointe Master Fund Ltd. upon the conversion of $50,000 principal amount of a convertible debenture issued to BridgePointe Master Fund in the aggregate principal amount of $1,000,000. The convertible debenture converts into the Company’s common stock at $1.00 per share. These shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628) which was declared effective by the SEC on June 25, 2007.

On July 13, 2007, the Company issued 50,000 shares of its common stock to Alpha Capital AG. upon the conversion of $25,000 principal amount of a convertible note issued to Alpha Capital in the aggregate principal amount of $400,000. The convertible note converts into the Company’s common stock at $1.00 per share. These shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628) which was declared effective by the SEC on June 25, 2007.

On July 13, 2007, the Company issued Nite Capital 75,000 shares of its common stock issuable upon the exercise of a like number of warrants exercisable at $0.10 per share.

On July 24th, 2007, the Company issued 20,222 shares as payment in kind for interest payment due to Bridgepointe Master Fund, LTD on a $1,000,000 convertible note issued to the Company. on January 5, 2007.

On July 25th, 2007, the Company issued 50,000 shares as payment in kind for fees related to a factoring commitment to BLX, Funding.

On July 25th, 2007, the Company issued 25,000 shares of its common stock and 25,000 warrants exercisable at $1.00 per share to Mark Basile, the Company’s Chief Executive Officer as consideration for providing the Company a loan in the amount of $25,000.

On July 25th, 2007, the Company issued 150,000 shares of its common stock to Mark Basile as consideration for Mr. Basile providing the Company his personal guarantee in connection with the opening of an escrow agreement in the amount of $750,000.

On August 1, 2007, the Company issued 8,365 of its common stock to A2E Technologies as payment of $9,535.75 due A2E Technologies pursuant to a Service Level Agreement dated March 16, 2007.

On August 15, 2007, the Company issued 150,000 shares of its common stock to Linden Growth Partners L.P. upon the exercise of a like number of warrants exercisable at $0.10 per share.

On August 15, 2007, the Company issued 225,000 shares of its common stock to Linden Growth Partners Master Fund L.P. upon the exercise of a like number of warrants exercisable at $0.10 per share.

On August 16, 2007 the Company issued 22,269 shares of its common stock to Osher Capital Partners LLC upon the cashless exercise of 25,000 warrants exercisable at $0.10 per share.

On August 24, 2007 the Company issued 178,152 shares of its common stock to Alpha Capital AG upon the cashless conversion of 200,000 warrants exercisable at $0.10 per share.

On August 30, 2007 the Company issued 87,500 shares of its common stock and 87,500 warrants exercisable at $1.00 each to Joe Panico and Jane Petri respectively as an inducement to renew with an extension to maturity to May 15th, 2008 and increase a loan to the Company in the amount of $800,000.

On August 31, 2007 the Company issued 62,500 shares of its common stock upon the exercise of 62,500 warrants exercisable at $0.10 to Lighthouse Capital Insurance Company.

On August 31, 2007 the Company issued 62,500 shares of its common stock upon the exercise of 62,500 warrants exercisable at $0.10 to Peter Thomson.

On September 7, 2007, the Company issued to Bridgepointe Master Fund, Ltd. 435,342 shares of its common stock upon the cashless exercise of 500,000 warrants exercisable at $0.10 per share.

On September 7, 2007, the Company issued 6,647 shares as payment in kind for interest payment due to Bridgepointe Master Fund, Ltd. on a $1,000,000 convertible note issued to the Company. on January 5, 2007.

On September 11, 2007, the Company issued an aggregate of 50,000 shares of its common stock to Bridgepointe Master Fund, Ltd. upon the conversion of $50,000 principal amount of a convertible note issued to Bridgepointe Master Fund, Ltd. in that amount. The convertible note converted into the Company’s common stock at $1.00 per share

On September 12, 2007, the Company issued an aggregate of 81,193 shares of its common stock to Whalehaven Capital Fund Limited upon the conversion of $81,193 of principal and interest amount of a convertible note issued to Whalehaven Capital Fund Ltd. The convertible note converted into the Company’s common stock at $1.00 per share.

On September 12, 2007 the Company issued 250,000 shares of its common stock upon the exercise of 250,000 warrants exercisable at $0.10 to Whalehaven Capital Fund, Ltd.

On September 27th, 2007, the Company issued an aggregate of 14,761 shares of its common stock to Whalehaven Capital Fund Limited upon the conversion of $14,761 of principal and interest due under a convertible note issued to Whalehaven Capital Fund Ltd. The convertible note is convertible into the Company’s common stock at the rate of $1.00 per share. These shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628) which was declared effective by the SEC on June 25, 2007.

On October 10, 2007, the Company issued 16,823 shares of its common stock to Whalehaven Capital Fund Ltd. upon the conversion of $16,823 of principal and interest due under a convertible note issued to Whalehaven Capital Fund Ltd. The convertible note is convertible into the Company’s common stock at the rate of $1.00 per share. These shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628) which was declared effective by the SEC on June 25, 2007.

On October 11, 2007, the Company issued an aggregate of 218,500 shares of its common stock to the following employees and executive officers:

Mark Basile			50,000
J. Richard Iler			50,000
Lorraine Yarde			50,000
Cliff Zsevc			50,000
Peter O’Neill			50,000
Carol Seaman			2,500
Marcia Strain			1,000

TOTAL			218,500

On October 15, 2007, the Company issued an aggregate of 100,000 shares of its common stock to Richard Quintana (50,000 shares) and Michael Niccole (50,000) in connection with the acquisition of a Patent.

On October 17, 2007, the Company issued 10,000 shares of its common stock to the partners of Sommer & Schneider LLP, the Company’s securities counsel as partial payment of legal services rendered to the Company.

On November 6, 2007, the Company issued 114,545 shares of its common stock to Mark Basile, the Company’s CEO upon the cashless exercise of 140,000 warrants, exercisable at $.10 per share.

On November 6, 2007, the Company issued 20,000 shares of its common stock to the partners of Sommer & Schneider LLP.

On November 6, 2007, the Company issued an aggregate of 150,000 shares of its common stock to the members of its board of directors Mark Basile (50,000) Lorraine Yarde (50,000) and J. Richard Iler (50,000) as consideration for services rendered in the performance of their duties as directors of the Company.

On November 15th, 2007, the Company issued 17,507 shares of its common stock to A2E Technologies

as partial consideration toward engineering services performed on behalf of the Company.

On November 16th, 2007, the Company escrowed 500,000 shares of its stock as collateral for extending the maturity of loans given by Joseph Panico and Jane Petri to the Company.

On November 16th, 2007, the Company granted 50,000 shares to Wendy Borow-Johnson as consideration for serving on the Board of the Company.

On November 27th, 2007 the Company granted 20,000 shares to ICR, LLC as consideration and settlement of investor relations services to the Company.

On December 4th, 2007 the Company issued 125,000 shares to Lighthouse Capital Insurance Company upon exercise of 125,000 warrants exercisable at $.30.

On December 4th, 2007 the Company issued 125,000 shares to Peter Thompson upon exercise of 125,000 warrants exercisable at $.30.

On December 4th, 2007 the Company issued 12,500 shares to Robert Casolaro upon exercise of 125,000 warrants exercisable at $.30.

On December 6th, 2007 the Company issued 9,135 shares to Fort Mason Partners LP upon exercise of 9,135 warrants exercisable at $.30. These warrants were assigned by Nite Capital to the benefit of Fort Mason Partners LP.

On December 6th, 2007 the Company issued 140,865 shares to Fort Mason Master LP upon exercise of 140,865 warrants exercisable at $.30. These warrants were assigned by Nite Capital to the benefit of Fort Mason Master LP.

On December 18th, 2007, the Company issued 67,857 shares of its common stock to The Naples Trust upon the cashless exercise of 75,000 warrants, exercisable at $.10 per share.

On December 18th, the Company issued 100,000 shares of its common stock to Interactive Resources Group in accordance with a consulting agreement of like date.

On December 19th, 2007, the Company authorized the issuance of 100,000 shares of its common stock to BridgePointe Master Fund, Ltd as part of the conversion and Forebearance Agreement dated as of December 19, 2007. The shares were issued on January 28, 2008.

On December 20th, 2007, the Company issued 85,952 shares of its common stock to the Company’s Chief Operating Officer upon the cashless exercise of 95,000 warrants, exercisable at $.10 per share.

Unless otherwise indicated, the securities discussed above were offered and sold in reliance upon exemptions from the registration requirements of Section 5 of the Act, pursuant to Section 4(2) of the Act and Rule 506 promulgated thereunder. Such securities were sold exclusively to accredited investors as defined by Rule 501(a) under the Act, unless otherwise noted.

ITEM 6. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION .

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the Financial Statements and the related notes. This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Our actual results and the timing of certain events could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth under “Risks Relating to Our Business,” “Description of Business” and elsewhere in this document. See “Forward-Looking Statements.”

Operations

The Company operates its business current business efforts through two (2) wholly owned subsidiaries, bioMETRX Technologies Inc., which conducts the product engineering and design and smartTOUCH Consumer Products, Inc., the consumer-based marketing and sales group.

Management’s plan of operations for the next twelve months is to raise additional capital, complete further engineering of its product line and continue marketing the Company’s products and services through its distribution channels. The Company has recently expanded its co-marketing/co-development agreement with Master Lock™ , adding several new products that will be branded Master Lock smartTOUCH The Company expects it will require $4,500,000 - $7,500,000 over the next 12 months to accomplish these goals, though it is anticipated that this will incrementally be raised in stages, and expects to be financed by the private sale of its securities and lines of credit with commercial banks for continuous manufacturing output of its products.. The Company has shipped its initial product to the Home Depot and has realized revenues of nearly $1,500,000 during the fourth quarter 2007. The Company has received funding from one of its institutional investors for advance purchase of components in the amount of $750,000. Further, as the Company replenishes orders and maintains inventory levels, the Company will require additional financing until it is internally generating positive cash flow. There are no firm commitments on anyone’s part to invest in the Company, and if it is unable to obtain financing through the sale of its securities or other financing, the Company’s products and services may never be commercially sold. The Company’s balance sheet continues to reflect negative shareholder equity, though it has been reduced through the conversion of institutional debt to equity. For the foreseeable year, the Company will be solely reliant on the attraction of additional equity in order for it to reflect shareholder equity unless revenues should exceed expectations for the current market ready products or other products planned for release during this fiscal year 2008. Should the Company not prevail in its efforts to attract capital, it will require strict budget adherence in order to manage the many demands for capital.

Our corporate address is 500 North Broadway, Suite 204, Jericho, New York 11753, our telephone number is (516) 937-2828 and our facsimile number is (516) 937-2880.

Current Market Outlook - Target Markets/Applications

There is a unique opportunity in the consumer electronics market for the incorporation of biometrics technology in multiple devices, requiring personal identification or key access. Two current examples are biometrically secured laptops (IBM-Lenovo Thinkpad) and cell phones (Samsung SCH370). Prospective home/office security and electronics devices includes the introduction of “biometric” access controls on anything that presently requires a key, keypad or Personal Identification Number (“PIN”). bioMETRX is the first company to offer biometric security and electronics products for the home consumer market at any significant level.

We are focused on developing simple to use, cost effective, power-efficient, finger activated consumer electronics products principally under the trade name “smartTOUCH Ô”. Our current and prospective consumer products include biometrically enabled and secure residential garage/gate door openers/locks, central station alarm pads and thermostats.

Product Offerings

smartTOUCH Ô products allow a person to open a door, or set an alarm or thermostat simply by placing/swiping a finger upon a sensor chip, a fraction of the size of a postage stamp. smartTOUCH Ô products are designed to simplify access, while substantially increasing the level of security for the products and applications that incorporate the “powered by smartTOUCH platform. . Our smartTOUCH Ô products use a one-to-one biometrics matching authentication system embedded into each device. The bioMETRX patent-pending system also includes a hand held universal programmer designed to control access to the administrative functions of each smartTOUCH Ô device. All smartTOUCH Ô products are designed to work with this universal programmer, and permit up to twenty (20) authorized users to be enrolled. Our system allows two types of users, an access user who can only operate the smartTOUCH Ô device, and an administrative user who can operate and also add or delete other users.

Consumer Products

The Company has been designing various practical consumer biometric products since 2001, with its first product, a finger activated garage door opener, debuting in the summer of 2005 to very strong media and retailer interest. The product was featured on several television home improvement shows including HGTV’s “I Want That”, as well as making appearances in the television reality show, “It Takes a Thief”, a Discovery Networks program. The smartTOUCH GDO was the very first practical consumer biometric product offered in the United States, and since its debut, is now the most widely distributed consumer biometric product available in the U.S. through The Home Depot.

The Company focus continues to be incorporating biometric technology, through protected proprietary design and architecture, into products that consumers use everyday. The Company’s management had established a vision early on for an entire family of products that would simplify consumers lives by removing the need to remember PIN codes or carry keys. The Company’s current product offerings include its GDO, a thermostat, a portable USB drive and a gate controller. These products are expected to be available at domestic retailers in 2008, and are in various stages of final testing and/or manufacturing. The Company also expects that several other products will be launched in 2008, including a door lock, mailbox and cabinet lock. The Company continues to work with its partners to generate product ideas, integrated architecture solutions, as well as low power, low cost designs that will continue to accelerate product development and introductions to market..

Results of Operations

Results of Operation for the years ended December 31, 2006 and 2005

For Twelve Month period ended December 31, 2006 compared to December 31, 2005

During the twelve months ended December 31, 2006, net losses totaled $10,837,218 compared to $12,173,969 for the same twelve month period ending December 31, 2005. For the twelve months ending December 31, 2006, the Company’s general and administrative expenses totaled $12,673,521, or 94.9% of total operating expenses. During the same twelve month period in 2005, general and administrative expenses totaled $11,074,632 or 91.0% of total operating expenses. Salaries comprised $786,333, or 6.90% of total expenses for the twelve month period ended December 31, 2006 as compared to $396,504, or 4.42% for the nine months ended December 31, 2005. Included in the net loss for 2006 was a one-time gain of $2,600,000 related to the return to the Company by a former officer and director of 187,500 stock options valued at $2,362,500 and $2,500 shares of common stock valued at $237,500.

For the twelve months ending December 31, 2006, interest expense was $104,356, as compared to $7,012 for the twelve months ending December 31, 2005.

Research and development expenses for the year ending December 31, 2006 was $658,579, 5.00% of net loss as compared to $361,490, or 2.97% for the same period in 2005.

Results of Operations for the years ended December 31, 2007 and 2006

For Twelve Month period ended December 31, 2007 compared to December 31, 2006

During the twelve months ended December 31, 2007, net losses totaled $11,126,954 compared to $10, 837,218 for the same twelve month period ending December 31, 2006.

Revenues - Net

For the year ending Dec 31, 2007, the Company received its first revenues of $1,476,370 principally relating to its shipment of its first product,the MasterLOCK smartTouch ™ Garage Door Opener (GDO) to the Home Depot.

Cost of Goods Sold

The Company’s Cost of Goods Sold relating to the production was $1,926,966 due to higher costs relating to a limited production run, tooling costs and higher component costs. The Company has commenced a redesign of all parts of the GDO and believes that it can bring component and production costs to bring the product’s margin to be more in line with the cost of producing its other products scheduled for release in fiscal 2008.

Operating Expenses

General and Adminstrative

For the twelve months ending December 31, 2007, bioMETRX,s general and administrative expenses totaled $4,227,646,, or 93.9% of total operating expenses as compared to $11,854,191, or 94,7% for the year ending December 31, 2006.

Salaries comprised $950,000, or 23.41% of total operating expense for the year ending December 31, 2007, as to the comparable year’s expense of $1,019,470, or 8.67% ending December 31,2006.

Interest Expense and Finance Costs

For the twelve month period ending December 31, 2007, the Company incurred interest and finance costs of $6,173, 490 of which $4,590,142 was a non-cash item relating to the amortization of deferred finance costs on convertible debt held by the Company. The Company had interest expense of $923,687 for the comparable period ending December 31, 2006

Other non-cash items

The Company had compensatory expenses relating to the issuance of stock and warrants in the amount of $3,179, 917 for the period ending December 31, 2007 as compared to $7,573, 591 for the period ending December 31, 2006. If not for these non-cash items, the Company’s net loss would have been $3,356, 895 as compared to $2,569,191 for the comparable period ending December 31, 2006.

Liquidity and Capital Resources

As of December 31, 2007 bioMETRX had total assets of $1,896,770 and total current assets of $864,833. At December 31, 2007 bioMETRX had total liabilities of $4,356,206 of which all were recorded as current liabilities. bioMETRX’s had negative working capital at December 31, 2007 of $3,491,373 and an equity deficit of $2,459,436 positive. The Company’s net cash provided by financing activities was $2,317,738 and was barely adequate to fund the net cash used in operating activities of $2,121,197. . Because of this deficit, the Company’s ability to continue to operate and its future remains in question as a going concern unless additional capital is contributed or until such time as it generates revenues and become cash flow.

However,the Company is optimistic, presuming its ability to raise additional capital through the issuance of its securities, about its ability to generate revenues sufficient to achieve profitability based upon related events;

Entering of a co-development and co-marketing agreement with MasterLOCK™ as of March 28^th, 2007.

Amending of this agreement with MasterLOCK™ to include an additional 9 products as of March 24^th, 2008.

Demonstrated ability to sell to big box retailers such as the Home Depot and partner with other Original Equipment Manufacturers who sell through similar distribution channels.

Since inception, bioMETRX has financed its activities solely from the private sales of its securities and the incurrence of debt. In November 2001, bioMetrx Technologies issued 275,000 shares of its common stock, valued at $275,000 ($1.00 per share), for services rendered. In December 2002, bioMETRX sold 20,000 shares of its common stock for $5,000 ($2.50 per share).

On March 21, 2006, the Company received debt financing in the aggregate amount of $100,000 from Jane Petri and Joseph Panico. The principal and interest of 12% per annum was due on June 21, 2006. The note carried a default rate of 18% per annum. In addition, the Company issued 25,000 restricted shares of common stock to Petri and Panico as debt issuance costs at a cost of $71,250.

On June 29, 2006, the Company entered into a Securities Purchase Agreement dated as of June 29, 2006, with four investors relating to the issuance and sale, in a private placement (“Private Placement”) exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), of units (the “Units”) consisting of 8% Convertible Notes in the principal amount of $950,000 (“Notes”), Series A Common Stock Purchase Warrants (“A Warrants”) and Series B Common Stock Purchase Warrants (“B Warrants”). In addition, the company entered into an Exchange Agreement with the two investors who purchased $650,000 of the Preferred Stock Units, previously reported on Form 8-K dated April 28, 2006 whereby the Company agreed to issue the Units in exchange for the return and cancellation of the previously issued Preferred Stock Units. Accordingly, at closing the Company issued its 8% Convertible Notes in the aggregate principal amount of $1,600,000, 1,600,000 A Warrants and 800,000 B Warrants to the Investors. The Company also issued an aggregate of 128,000 shares of its common stock to the investors representing one year’s of prepaid interest on the Notes.

The Notes mature 24 months from the closing. The Notes are convertible at the option of the holder into the Company’s common stock at the rate of $1.00 per share. The Notes are mandatorily convertible into the Company’s common stock if the closing bid price of the Company’s common stock is above $2.50 per share for ten (10) consecutive trading days and if the daily volume for the same period exceeds 100,000 shares per day. The Company may redeem the Notes for 125% of the principal amount of the Note together with all accrued and unpaid interest provided that (i) an event of default has not occurred, and (ii) an effective registration statement covering the shares underlying the Note exists. As of December 31, 2007 a principal amount of $821,000 of these Notes were converted into our common stock leaving a principal balance due of $779,000 as of December 31, 2007.

Each A Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $1.75 per share commencing on the date of issuance and expiring at the close of business on the fifth anniversary of the issuance date. Each B Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $.10 per share commencing 181 days after issuance and expiring at the close of business on the fifth anniversary of the initial exercise date. Notwithstanding the foregoing if the Company provided the holder of a B Warrant with validation and acknowledgement, in the form of bona fide purchase order demonstrating that at least $1,000,000 of the Company’s products have been ordered, other than its initial order from a national retailer in the amount of approximately 23,000 garage door opening units, within 181 days after the date of the Securities Purchase Agreement, the B Warrants shall automatically terminate. The Company was unable to provide the holders with such validation and therefore the B Warrants were not terminated. Both the A and B Warrants contain provisions that protect the holder against dilution by adjustment of the exercise price in certain events including, but not limited to, stock dividends, stock splits, reclassifications, or mergers. In December the Company lowered the exercise price of the A warrants to $.30.

The Company entered into a Securities Purchase Agreement dated September 18, 2006, with Jane Petri and Joseph Panico relating to the issuance and sale, in a private placement exempt from the registration requirements of the Securities Act of the Company’s 10% Promissory Notes due March 15, 2007 in the aggregate principal amount of $400,000. In connection there with the Company issued an aggregate of 400,000 Common Stock Purchase Warrants and 160,000 Shares of the Company’s Common Stock. In connection with this transaction the two investors provided the Company with $300,000 and exchanged $100,000 in Notes, described above, that were previously issued by the Company to the investors.

The Company entered into a Securities Purchase Agreement dated September 30, 2006, with two investors relating to the issuance and sale, in a private placement exempt from the registration requirements of the Securities Act of the Company’s 10% Promissory Notes due March 30, 2007 in the aggregate principal amount of $55,000, 55,000 Common Stock Purchase Warrants and 22,000 Shares of the Company’s Common Stock.

The Debentures mature on June 29, 2008. The Debentures are convertible at the option of the holder into the Company’s common stock at the rate of $1.00 per hare. The Debentures are convertible at the option of the Company into the Company’s common stock if the closing bid price of the Company’s common stock is above $2.50 per share for ten (10) consecutive trading days and if the shares underlying the Debentures are registered. The Company may redeem the Debentures for 125% of the principal amount of the Debenture together with all accrued and unpaid interest provided that (i) an event of default has not occurred, (ii) the price of the Company’s common stock exceeds $1.50 and (ii) an effective registration statement covering the shares underlying the Debentures exists. As of December 31, 2007 a principal amount of $600,000 of these Debentures were converted into our common stock. The principal amount due under these Debentures as of December 31, 2007 was $900,000.

Each A Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $1.00 per share commencing on the date of issuance and expiring at the close of business on the fifth anniversary of the issuance date. Each B Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $.10 per share at any time after July 1, 2007 and expiring at the close of business on the fifth anniversary of the initial issuance date. Notwithstanding the foregoing if the Company provides the holder of a B Warrant with validation and acknowledgement on or before June 30, 2007 that the Company has both received and booked revenues for its products totaling $1,000,000, the B Warrants shall automatically terminate. The Company was unable to provide the holders with the validation and therefore the B Warrants were not terminated. Both the A and B Warrants contain provisions that protect the holder against dilution by adjustment of the exercise price in certain events including, but not limited to, stock dividends, stock splits, reclassifications, or mergers. In December 2007, the Company lowered the exercise price of the A Warrants to $.30.

During 2007, the Company received an aggregate of $231,250 from the exercise of an aggregate of 1,162,500 warrants. All but 25,000 of these warrants were issued in connection with the two private placements discussed above. Of these warrants 25,000 were exercised at $1.00 per share, 825,000 were B Warrants exercisable at $.10 per share and 337,500 were A Warrants with a reduced exercise price of $.30 per share.

On February 7, 2007, the Company deposited $200,000 into an escrow account with its counsel. The funds were utilized in connection with the manufacture of the Company’s garage door openers. As of December 31, 2007, all monies were expended from this fund.

On November 16th, 2007, the Company escrowed 500,000 shares of its stock as collateral for extending the maturity of loans given by Joseph Panico and Jane Petri to the Company.

bioMETRX is dependent on raising additional funding necessary to implement its business plan. bioMETRX’ auditors have issued a “going concern” opinion on the financial statement for the year ended December 31, 2007, indicating bioMETRX is in the development stage of operations, has a working capital and net equity deficiency. These factors raise substantial doubt in bioMETRX’ ability to continue as a going concern. If bioMETRX is unable to raise the funds necessary to complete the development of its products and fund its operations, it is unlikely that bioMETRX will remain as a viable going concern.

Critical Accounting Policies and Estimates:

Our financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make significant estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosure of contingent assets and liabilities. We evaluate our estimates, including those related to contingencies, on an ongoing basis. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

We believe the following critical accounting policy, among others; involve the more significant judgments and estimates used in the preparation of our consolidated financial statements:

The Company accounts for compensation costs associated with stock options and warrants issued to non-employees using the fair-value based method prescribed by Financial Accounting Standard No. 123 - Accounting for Stock-Based Compensation. The Company uses the Black-Scholes options-pricing model to determine the fair value of these instruments as well as to determine the values of options granted to certain lenders by the principal stockholder. The following estimates are used for grants in 2007: Expected future volatility over the expected lives of these instruments is estimated to mirror historical experience, measured by a weighted average of closing share prices prior to each measurement date. Expected lives are estimated based on management’s judgment of the time period by which these instruments will be exercised.

In December 2004, the Financial Accounting Standards Board (“FASB”) issued Statement No. 123R (“SFAS 123R) “Share Based Payment, “a revision of statement No. 123, “Accounting for Stock Based Compensation.” This standard requires the Company to measure the cost of employee services received in exchange for equity awards based on grant date fair value of the awards. The Company adopted SFAS 123R effective January 1, 2006. The standard provides for a prospective application. Under this method, the Company will begin recognizing compensation cost for equity based compensation of or all new or modified grants after the date of adoption.

Information Relating To Forward-Looking Statements

When used in this Report on Form 10-QSB, the words “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “intend,” “plans”, and similar expressions are intended to identify forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 regarding events, conditions and financial trends which may affect the Company’s future plans of operations, business strategy, operating results and financial position. Such statements are not guarantees of future performance and are subject to risks and uncertainties and actual results may differ materially from those included within the forward-looking statements as a result of various factors. Such factors include, among others: (i) the Company’s ability to obtain additional sources of capital to fund continuing operations; in the event it is unable to timely generate revenues (ii) the Company’s ability to retain existing or obtain additional licensees who will act as distributors of its products; (iii) the Company’s ability to obtain additional patent protection for its technology; and (iv) other economic, competitive and governmental factors affecting the Company’s operations, market, products and services. Additional factors are described in the Company’s other public reports and filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. The Company undertakes no obligation to publicly release the result of any revision of these forward-looking statements to reflect events or circumstances after the date they are made or to reflect the occurrence of unanticipated events.

Recent Accounting Pronouncements

In June 2006, the FASB issued “Accounting for Uncertain Tax Positions - an Interpretation of FASB Statement No. 109”, (“FIN No. 48”), which prescribes a recognition and measurement model for uncertain tax positions taken or expected to be taken in the Company's tax returns. FIN No. 48 provides guidance on recognition, classification, presentation, and disclosure of unrecognized tax benefits. Fin No. 48 is effective for fiscal years beginning after December 15, 2006, The adoption of this statement have no material impact on the Company's financial position, results of operations or cash flows. In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements”, which defines fair value, establishes a framework for measuring fair value, and expands fair value disclosures. The standard does not require any new fair value measurements. This standard is effective for fiscal years beginning after November 15, 2007. The adoption of this new standard is not expected to have a material effect on the Company's financial position, results of operations or cash flows.

In December 2006, the FASB issued FSP EITF 00-19-2, “Accounting for Registration Payment Arrangements” ("FSP 00-19-2"), which addresses accounting for registration payment arrangements. FSP 00-19-2 specifies that the contingent obligation to make future payments or otherwise transfer consideration under a registration payment arrangement, whether issued as a separate agreement or included as a provision of a financial instrument or other agreement, should be separately recognized and measured in accordance with SFAS No. 5, “Accounting for Contingencies”. FSP 00-19-2 further clarifies that a financial instrument subject to a registration payment arrangement should be accounted for in accordance with other applicable generally accepted accounting principles without regard to the contingent obligation to transfer consideration pursuant to the registration payment arrangement. For registration payment arrangements and financial instruments subject to those arrangements that were entered into prior to the issuance of EITF 00-19-2, this guidance shall be effective for financial statements issued for fiscal years beginning after December 15, 2006 and interim periods within those fiscal years. The Company does not expect the adoption of this standard will have a material impact on its financial position, results of operations or cash flows.

In February, 2007, the FASB issued SFAS No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities - Including an amendment of FASB Statement No. 115" ("SFAS No. 159"). This statement permits entities to choose to measure many financial instruments and certain other items at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. This Statement is expected to expand the use of fair value measurement, which is consistent with the Board's long-term measurement objectives for accounting for financial instruments. This statement is effective as of the beginning of an entity's first fiscal year that begins after November 15, 2007, although earlier adoption is permitted. Management has not determined the effect the adoption of this standard will have on the Company's financial position, results of operations or cash flows.

In June 2007, the Accounting Standards Executive Committee issued Statement of Position 07-1, “Clarification of the Scope of the Audit and Accounting Guide Investment Companies and Accounting by Parent Companies and Equity Method Investors for Investments in Investment Companies” (“SOP 07-1”). SOP 07-1 provides guidance for determining whether an entity is within the scope of the AICPA Audit and Accounting Guide Investment Companies (the “Audit Guide”). SOP 07-1 was originally determined to be effective for fiscal years beginning on or after December 15, 2007, however, on February 6, 2008, FASB issued a final Staff Position indefinitely deferring the effective date and prohibiting early adoption of SOP 07-1 while addressing implementation issues.

In June 2007, the FASB ratified the consensus in EITF Issue No. 07-3,“Accounting for Nonrefundable Advance Payments for Goods or Services to be Used in Future Research and Development Activities” (EITF 07-3), which requires that nonrefundable advance payments for goods or services that will be used or rendered for future research and development (R&D) activities be deferred and amortized over the period that the goods are delivered or the related services are performed, subject to an assessment of recoverability. EITF 07-3 will be effective for fiscal years beginning after December 15, 2007. The Company does not expect that the adoption of EITF 07-3 will have a material impact on its financial position, results of operations or cash flows.

In December 2007, the FASB issued SFAS No. 141(R),"Business Combinations" ("SFAS No. 141(R)"), which establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in an acquiree, including the recognition and measurement of goodwill acquired in a business combination. SFAS No. 141(R) is effective as of the beginning of the first fiscal year beginning on or after December 15, 2008. Earlier adoption is prohibited and the Company is currently evaluating the effect, if any, that the adoption will have on its financial position, results of operations or cash flows.

In December 2007, the FASB issued SFAS No. 160, "Noncontrolling Interest in Consolidated Financial Statements, an amendment of ARB No. 51" ("SFAS No. 160"), which will change the accounting and reporting for minority interests, which will be recharacterized as noncontrolling interests and classified as a component of equity within the consolidated balance sheets. SFAS No. 160 is effective as of the beginning of the first fiscal year beginning on or after December 15, 2008. Earlier adoption is prohibited and the Company is currently evaluating the effect, if any, that the adoption will have on its financial position, results of operations or cash flows.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC did not, or are not believed by management to, have a material impact on the Company’s present or future consolidated financial statements.

COMMITMENTS

We do not have any commitments that are required to be disclosed in tabular form as of December 31, 2006 and as of December 31, 2007.

OFF BALANCE SHEET ARRANGEMENTS

We do not have any off balance sheet arrangements.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

bioMetrx, Inc. and Subsidiaries

We have audited the accompanying consolidated balance sheet of bioMetrx, Inc. and Subsidiaries (“the Company”) as of December 31, 2007, and the related consolidated statements of operations, changes in stockholders’ deficit and cash flows for each of the two years in the period ended December 31, 2007. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit 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. Also, 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 consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of bioMetrx, Inc. and Subsidiaries as of December 31, 2007 and the results of their operations and their cash flows for each of the two years in the period ended December 31, 2007 in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company's operations have generated recurring losses and cash flow deficiencies for the years ended December 31, 2007 and 2006. In addition, as of December 31, 2007 the Company has a significant working capital deficit and stockholders’ deficit. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

WOLINETZ, LAFAZAN & COMPANY, P.C.

Rockville Centre, New York

April 8, 2008

ITEM 7. FINANCIAL STATEMENTS .

BIOMETRX, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
December 31, 2007

ASSETS

Current Assets:
Cash	$	108,756
Accounts Receivable		183,920
Stock Subscriptions Receivable		225,000
Prepaid Expenses		61,034
Inventories		286,123
Total Current Assets		864,833

Property and Equipment, net		92,170

Other Assets:
Deferred Finance Costs, net		53,192
Security Deposit		17,045
Patents		869,530
Total Other Assets		939,767

TOTAL ASSETS	$	1,896,770


LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities:
Accounts Payable	$	1,052,541
8% Convertible Notes, net of unamortized discounts of $695,956		997,544
Convertible Forbearance Notes, net of unamortized discounts of $129,146		258,292
Notes Payable - Related Parties		410,000
Notes Payable - Other		1,004,088
Patent Payable		100,000
Accrued Taxes Payable		299,405
Accrued Salaries		21,304
Accrued Interest		213,032

Total Current Liabilities		4,356,206

TOTAL LIABILITIES		4,356,206

COMMITMENTS AND CONTINGENCIES

Stockholders' Deficit:
Preferred Stock, $.01 par value; 100,000,000 shares authorized;
no shares issued and outstanding		-
Common Stock, $.001 par value; 25,000,000 shares authorized;
16,098,791 shares issued and outstanding		16,599
Common Stock Subscribed; 750,000 shares		750
Shares held in Escrow; 500,000 shares		(400,000	)
Additional Paid-In-Capital		33,881,513
Deferred Finance Costs		(233,814	)
Accumulated Deficit		(35,724,484	)

Total Stockholders' Deficit		(2,459,436	)

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	1,896,770

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

F-1

BIOMETRX, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS

	For The Year			For The Year
	Ended			Ended
	December 31, 2007			December 31, 2006
Revenues - net	$	1,476,370		$	-

Cost of Sales		1,926,966			-

Gross Profit (Deficit)		(450,596	)		-

Operating Expenses:

Selling Expenses		223,072			94,638
General and Administrative Expenses		4,058,299			11,759,553
Research and Development Expenses		275,222			658,879
Total Expenses		4,556,593			12,513,070

Loss before Other Income (Expense)		(5,007,189	)		(12,513,070	)

Other Income (Expense):

Value of Common Stock and Options Cancelled					2,600,000
Interest Income		3,271			-
Interest Expense and Finance Costs		(6,123,036	)		(923,687	)
Unrealized Loss on Marketable Securities		-			(461	)
Total Other Income (Expense)		(6,119,765	)		1,675,852

Net Loss		(11,126,954	)		(10,837,218	)

Preferred Stock Dividend		-			(8,975	)

Net Loss Allocated to Common Shareholders	$	(11,126,954	)	$	(10,846,193	)

Weighted Average Common Shares - Outstanding - Basic		11,636,142			7,605,851

Net Loss per Common Share (Basic)	$	(0.96	)	$	(1.43	)

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

F-2

BIOMETRX, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE PERIOD JANUARY 1, 2006 TO DECEMBER 31, 2007

Common Stock

Shares

Amount

Common Shares Held in Escrow

Common Stock Subscribed

Additional

Paid In Capital

Prepaid Interest

Deferred Compensation

Deferred Finance Costs

Accumulated Deficit

Total

BALANCE, JANUARY 1, 2006

5,947,914

5,948

13,308,776

(86,400

)

(194,514

)

(13,751,338

)

(717,528

)

STOCK ISSUED FOR CASHLESS EXERCISES

179,578

180

(180

)

Issuance of Common Stock pursuant to the 2005 Equity Incentive Plan - Related Parties.

44,250

128,281

128,325

Common Stock issued exercise of stock warrants - Related Party

281,250

281

224,719

225,000

Effect of return of Shares of Common Stock and cancellation of Common Stock Options pursuant to a Termination Agreement - Related Party.

(62,500

)

(63

)

(2,359,342

)

(2,359,405

)

Issuance of Common Stock for Cash Related Party

183,750

184

146,816

147,000

Issuance of Common Stock

2,827

9,998

10,000

Issuance of Common Stock Purchase Options for Services

126,803

Common Stock issued for Services Related Party

500,000

500

1,079,500

1,080,000

Common Stock issued in connection with financing Notes Payable

527,000

527

888,323

(888,850

)

Common Stock issued for Services

490,000

490

1,364,010

1,364,500

Commissions paid on sales of common stock.

(37,200

)

(37,200

)

Commissions accrued on sale of Common Stock

(431,706

)

(431,706

)

Common Stock issued as commissions on sales of common stock

164,637

165

656,324

656,489

Issuance of Common Stock purchase options - Related Party

4,788,813

Penalty shares issued to Related Party in connection

with non-registration

300,000

300

673,950

674,250

Value of Escrow shares issued

67,948

Common Stock issued in Settlement of Threatened Litigation

125,000

125

368,625

368,750

Common Stock issued as consideration for Accrued Salaries

54,201

108,348

108,402

Common Stock issued as Prepaid Interest on 8% Convertible Notes

128,000

128

172,672

172,800

Finder's Fees paid on sale of Preferred Stock

(147,500

)

(28,500

)

(176,000

)

Common Stock issued as Finder's Fees on the sale of Preferred Stock

50,000

64,950

65,000

Common Stock purchase warrants issued as payment of placement fees.

182,716

(182,716

)

Beneficial Conversion Feature of common stock purchase warrants issued relative to 8% Convertible Notes.

1,217,392

Beneficial Conversion Feature of Forbearance Notes.

387,439

Issuance of Preferred Stock in conjunction with a Private Placement.

643,500

Conversion of Preferred Stock to 8% Convertible Notes in conjunction with an Exchange Agreement.

(643,500

)

(643,500

)

Preferred Dividend accrued

8,975

(8,975

)

Issuance of Common Stock purchase options for services - Related Party

978,251

Issuance of Common Stock purchase options related to deferred financing costs

377,526

(377,526

)

Financing Costs Related to Issuance of 8% Convertible Notes

(107,500

)

(107,500

)

Amortization of deferred compensation.

194,514

Amortization of deferred finance costs.

495,233

CURRENT PERIOD LOSS

(10,837,218

)

(10,837,218

)

BALANCE, December 31, 2006

8,915,907

8,916

24,355,224

(86,400

)

(1,089,859

)

(24,597,531

)

(1,409,650

)

STOCK ISSUED FOR SERVICES

781,750

782

998,468

999,250

STOCK ISSUED FOR PURCHASES OF ASSETS

300,000

300

664,200

664,500

STOCK ISSUED FOR STOCK BASED COMPENSATION

598,500

599

880,626

881,225

STOCK ISSUED FOR CASHLESS EXERCISES

1,162,521

1,163

(1,163

)

STOCK ISSUED FOR PAYMENT OF NOTES PAYABLE, ACCRUED INTEREST, AND RELATED INTEREST

1,536,991

1,536

1,537,059

1,538,595

STOCK ISSUED FOR PAYMENT OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES

97,622

92,592

92,690

STOCK ISSUED FOR DEFERRED FINANCE COSTS

585,000

585

813,165

(813,750

)

STOCK ISSUED FOR INTEREST EXPENSE

150,000

150

149,850

150,000

PROCEEDS FROM ISSUANCE OF STOCK

2,070,500

2,071

454,079

456,150

COMMON STOCK ISSUED TO PAY DEBT ISSUED FOR PATENTS

100,000

100

79,400

79,500

COMMON SHARES HELD IN ESCROW

500,000

500

(400,000

)

399,500

REVERSAL OF PENALTY SHARES

(200,000

)

(200

)

200

WARRANTS ISSUED FOR PAYMENT OF INTEREST EXPENSE

29,060

WARRANTS ISSUED FOR DEFERRED FINANCE COSTS

1,062,400

(835,575

)

226,825

WARRANTS ISSUED FOR DEFERRED COMPENSATION

81,800

(81,800

)

ADDITIONAL FINANCES COSTS RELATED TO RE-PRICING OF WARRANTS

385,000

Commissions paid on Equity Raises

(55,000

)

(55,000

)

WARRANTS ISSUED FOR SERVICES

230,800

COMMON STOCK SUBSCRIBED

750

224,250

225,000

Beneficial Conversion Feature of Common Stock Purchase warrants issued relative to 8% Convertible Notes

1,500,000

Amortization of Prepaid interest, Deferred Compensation, and Deferred Finance Costs

86,400

81,800

2,505,370

2,673,570

Net Loss for the Year Ended December 31, 2007

(11,126,954

)

(11,126,954

)

Balance December 31, 2007

16,598,791

16,599

(400,000

)

750

33,881,513

(233,814

)

(35,724,485

)

(2,459,436

)

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

F-3

BIOMETRX INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

	FOR THE YEAR ENDED DECEMBER 31, 2007			FOR THE YEAR ENDED DECEMBER 31, 2006

Cash Flows from Operating Activities:
Net Loss	$	(11,126,954	)	$	(10,837,218	)
Adjustment to reconcile net loss to net cash used in operating activities:
Non-Cash Item adjustments:
Compensatory Element of Stock and Warrant Issuances		3,179,917			7,573,591
Liquidated Damages paid by Issuance of Forbearance Notes		-			387,437
Amortization of Deferred Finance Costs		4,590,142			694,436
Depreciation		64,480			3,999
Unrealized Loss on Marketable Securities		-			461

Change in Operating Assets and Liabilities:

(Increase) in Accounts Receivable		(183,920	)		-
Decrease in Prepaid Expenses		64,030			41,989
(Increase) Decrease in Inventories		137,730			(423,853	)
(Increase) Decrease in Deposits on Inventory		57,197			(57,197	)
(Increase) in Security Deposits		-			(509	)
Increase in Accounts Payable		573,557			285,406
Increase in Accrued Liabilities		528,040			52,759
(Decrease) in Accrued Settlement of Threatened Litigation		-			(368,750	)
(Decrease) in Accrued Salaries		(5,416	)		-
Net Cash Used in Operating Activities		(2,121,197	)		(2,647,449	)

Cash Flows from Investing Activities:

Capital Expenditures		(64,836	)		(95,813	)
Purchases of Patents		(25,530	)		-
Payment of Deferred Finance Costs		(12,500	)		-

Net Cash Used in Investing Activities		(102,866	)		(95,813	)

Cash Flows from Financing Activities:
Restricted Cash		-			66,427
Proceeds of Loans		1,312,033			-
Proceeds from Related Party notes		440,000
Proceeds from Issuance of 8% Convertible Notes		1,500,000			950,000
Proceeds from Issuance of Notes Payable		175,000			755,000
Proceeds from Issuance of Preferred Stock		-			650,000
Repayment of Related Party Loans		(30,000	)		-
Repayments of Loans		(1,107,945	)
Advances to Employee		-			3,000
Repayments of Notes Payable		(130,000	)		-
Deferred Finance Costs		(242,500	)		(155,000	)
Proceeds from Issuances of Common Stock		456,150			342,000
Commissions Paid on Sales of Common Stock		(55,000	)		(37,200	)
Net Cash Provided by Financing Activities		2,317,738			2,574,227

Net Increase (Decrease) in Cash		93,675			(169,035	)

Cash, Beginning		15,081			184,116

Cash, Ending	$	108,756		$	15,081



Supplemental Cash Flow Information:
Cash Paid During the Period for:
Interest	$	16,300		$	-

Income Taxes	$	-		$	-

Supplemental Disclosures of Cash Flow Information:

Non Cash Financing Activities:

Debt Issued for Patents	$	200,000		$	-

Common Stock Issued to pay Debt Issued for Patents	$	75,000		$	-

Warrants Issued for Deferred Finance Costs	$	774,175		$	-

Warrants Issued for Deferred Compensation	$	81,800		$	-

Stock Subscribed	$	225,000		$	-

Common Stock Issued as Commissions on
Sale of Common Stock	$	-		$	431,706

Common Stock Issued for Interest Expense	$	174,374		$	-

Issuance of Common Stock as Payment of Accrued
Officers' Salaries	$	-		$	310,000

Issuance of Common Stock - Deferred Finance Costs	$	813,750		$	2,248,354

Application of Loans Receivable - Officer Against
Accrued Compensation	$	-		$	201,598

Common Stock Issued (Cancelled) as Penalty Shares for
Non-Registration	$	(313,500	)	$	674,175

Common Stock Issued as Prepaid Interest
on 8% Convertible Notes	$	-		$	172,800

Issuance of Convertible Forbearance Notes
in connection with Liquidated Damages	$	-		$	387,439

Beneficial Conversion Feature of Convertible Forbearance Notes				$	387,439

Cashless Exercise of Stock Options - Related Parties	$	1,163,000		$	250,000

Accrued Deferred Finance Costs	$	-		$	67,948

Preferred Stock Dividend	$	-		$	8,975

Common Stock Issued as Payment of Accounts Payable	$	114,554.00

Common Stock Issued for payment of Accrued Interest	$	20,222		$	-

Accrued Interest Payable funded with new Notes Payable	$	55,000		$	-

Common Stock Issued to pay Notes Payable	$	55,000		$	-

Common Stock Issued for Conversion of Convertible Notes Payable	$	1,792,898		$	-

Issuance of Common Stock as Payment of Accrued
Settlement of Threatened Litigation				$	368,750

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

F-4

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Description of Business and Nature of Operations

Description of Business

The Company was incorporated with the name “M2 Extreme Sports Centers, Inc” in the State of Delaware on February 1, 2001. On November 8, 2001 the Company’s Certificate of Incorporation was amended to change the Company’s name to “Biostat Technologies S.P.A., Inc”.

On April 1, 2002 the Company’s certificate of Incorporation was amended to:

	1.	Change the Company’s name to bioMETRX Technologies, Inc.

	2.	Increase the total number of shares that the corporation is authorized to issue to 10,000,000 common shares, each with a par value of $0.01.

	3.	Authorize a 4000 to 1 split of the then outstanding common shares.

In December 2004, the Board of Directors authorized an increase of the Company’s common stock from 10,000,000 to 20,000,000 shares, each having a par value of $0.001.

On May 27, 2005, we completed the merger (“Merger”) of Marketshare Merger Sub, Inc., (“Merger Sub”) a wholly owned subsidiary of Marketshare Recovery, Inc. (“Marketshare”) with bioMETRX Technologies, Inc. a Delaware corporation (“bioMETRX Technologies”) pursuant to the Agreement and Plan of Merger dated April 27, 2005, by and among the Company, Merger Sub and bioMETRX Technologies (“Merger Agreement”). bioMETRX Technologies is a development stage company that is engaged in the development of biometrics-based products for the home security and electronics market, including biometrically enabled residential door locks, central station alarm keypads, thermostats and garage/gate openers.

On June 1, 2005 bioMETRX Technologies merged with and into Merger Sub. The merger was treated as a reorganization of bioMETRX Technologies (reverse merger) for accounting purposes pursuant to which bioMETRX Technologies is treated as the continuing entity although Marketshare is the legal acquirer. The aggregate amount of shares of Marketshare common stock issued to the shareholders of bioMETRX Technologies pursuant to the merger represented approximately 90% of Marketshare’s issued and outstanding common stock after the merger and related cancellation of outstanding shares by certain former insiders.

The merger was accounted for as a reverse merger, which is effectively a recapitalization of the target company (bioMETRX Technologies) and the consolidated financial statements presented are those of bioMETRX Technologies.

On September 30, 2005 the Company formed two subsidiary companies, smartTOUCH Medical, Inc and smartTOUCH Security, Inc. The two subsidiaries were incorporated in the State of Delaware. smartTOUCH Security, Inc tests and markets the Company’s biometrically secured garage door openers, thermostats, deadbolts and home alarm keypads. smartTOUCH Medical, Inc designs, tests and markets biometrically secured medical crash carts, rolling medicine carts, portable patient medical information devices and, security and retrieval systems for electronic medical records.

On October 10, 2005 Marketshare changed its name to bioMETRX, Inc. bioMETRX, Inc. and its subsidiaries are hereinafter referred to as “the Company”.

F-5

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Description of Business and Nature of Operations (Continued)

Nature of Operations

The Company is focused on developing simple-to-use, cost-efficient finger print activation products under the trade name SmartTOUCH Ô . The Company’s engineers and manufactures biometrically enabled security products. These products utilize fingerprint recognition technology designed to augment or replace conventional security methods such as keys, keypads, and PIN numbers.

The Company operates its business through three (3) wholly owned subsidiaries, bioMETRX Technologies Inc., which conducts the product engineering and design, smartTOUCH Consumer Products, Inc., the consumer-based marketing and sales group and smartTOUCH Medical, Inc. which will market medical information and products. The Company’s executive offices are located in Jericho, New York.

Note 2 - Basis of Presentation

The Company has incurred net losses of $11,126,954 and $10,837,218 during the years ended December 31, 2007 and 2006 respectively. In addition, the Company has a working capital deficiency of $3,491,373 and a stockholders’ deficiency of $2,459,436 at December 31, 2007. These factors raises substantial doubt about the Company’s ability to continue as a going concern.

There can be no assurance that sufficient funds required during the next year or thereafter will be generated from operations or that funds will be available from external sources such as debt or equity financings or other potential sources. The lack of additional capital resulting from the Company’s inability to generate cash flow or to raise capital from external sources would force it to substantially curtail or cease operations and would, therefore, have a material adverse effect of its business. Furthermore, there can be no assurance that any such required funds, if available, will be available on attractive terms or that they will have a significant dilutive effect on the Company’s existing stockholders. The company plans to address its lack of liquidity by raising additional funds, either in the form of debt or equity, or some combination there. There can be no assurances that the Company will be able to raise the additional funds it requires.

The accompanying consolidated financial statements do not include any adjustments related to the recoverability or classification of asset-carrying amounts or the amounts and classification of liabilities that may result should the Company be unable to continue as a going concern.

The Company has exited the development stage during 2007 since principal operations have commenced.

Note 3 - Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of bioMETRX, Inc and all of its wholly-owned subsidiaries. Such subsidiaries are bioMETRX Technologies, Inc., smartTOUCH Medical Inc. and smartTOUCH Consumer Products, Inc. All significant inter-company accounts and transactions have been eliminated in consolidation.

F-6

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 3 - Summary of Significant Accounting Policies (Continued)

Revenue Recognition

For revenue from product sales, the Company will recognize revenue in accordance with Staff Accounting Bulletin No. 104, “Revenue Recognition” (SAB No. 104”), which superseded Staff Accounting Bulletin No. 101, “Revenue Recognition in Financial Statements” (SAB No. 101”). SAB No. 104 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectibility is reasonably assured. Determination of criteria (3) and (4) are based on management’s judgment regarding the fixed nature of the selling prices of the products delivered and the collectibility of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments will be provided for in the same period and related sales are recorded.

Cash and Cash Equivalents

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

Inventories

Inventories are stated at the lower of cost (first-in, first-out method) or market. Inventories at December 31, 2007 consist of finished goods and raw materials.

Debt Issuance Costs

Debt issuance costs are amortized over the lives of the related debt.

Property and equipment

Property and equipment consist of office equipment and is stated at cost less accumulated depreciation and amortization. Depreciation and amortization is determined by using the straight-line method over the estimated useful lives of the related assets, generally five to seven years.

Stock Based Compensation

The Company follows the provisions of Statement of Financial Accounting Standards No. 123R, Share-Based Payment (SFAS 123R), which revised SFAS 123, Accounting for Stock-Based Compensation and supersedes Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees (APB 25). SFAS 123R requires that new, modified and unvested share-based payment transactions with employees, such as stock options and restricted stock, be recognized in the financial statements based on their fair value and recognized as compensation expense over the requisite service period. The Company adopted SFAS 123R effective January 1, 2006.

Prior to the adoptions of SFAS 123(R), stock-based compensation expense related to employee stock options was not recognized in the statement of operations if the exercise price was at least equal to the market value of the common stock on the grant date, in accordance with Accounting Principles Board Option No. 25, “Accounting for Stock Issued to Employees.”

F-7

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 3 - Summary of Significant Accounting Policies (Continued)

During 2007, options were awarded to officers, employees and consultants of the Company. The fair value of the options at the dates of grant were calculated using the Black -Scholes fair value based method using the following assumptions (expected life -2-5 years; interest rate - 4.00% to 5.00%; annual rate of dividends - 0%; and volatility - 75% to 118%).

The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. In addition, option-pricing models require the input of highly subjective assumptions including the expected stock price volatility. Because the Company employee stock options have characteristics significantly different from those of traded options and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion the existing models may not necessarily provide a reliable single measure of the fair value of its employee stock options.

Fair Value of Financial Instruments

The carrying amounts of cash, accounts payable, accrued liabilities and other current liabilities approximates fair value because of the immediate or short term maturity of these financial instruments.

Advertising and Marketing Expenses

The costs of advertising and marketing expenses are expensed as incurred. Advertising and marketing expenses for the years December 31, 2007 and 2006 were $50,451 and $1,000, respectively

Research and Development

Research and development costs are expensed as incurred. Research and development costs amounted to $275,222 and $658,879 for the years ended December 31, 2007 and 2006, respectively.

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 amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ form those estimates. Significant estimates relate to ultimate revenue and costs for investments in research and development, design engineering, property and equipment and intangible assets. Actual results differ from those estimates.

Reclassifications

Certain items in these consolidated financial statements have been reclassified to conform to the current period presentation.

F-8

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 3 - Summary of Significant Accounting Policies (Continued)

Income Taxes

The Company accounts for income taxes under the asset and liability method using the SFAS No. 109 “Accounting for Income Taxes”. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to apply to taxable income to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

The tax effects of temporary differences that gave rise to the deferred tax assets and deferred tax liabilities at December 31, 2007 and 2006 were primarily attributable to net operating loss carry forwards. Since the Company has a history of losses a full valuation allowance has been established. In addition, utilization of net operating loss carry-forwards are subject to a substantial annual limitation due to the “Change in Ownership” provisions of the Internal Revenue Code. The annual limitation may result in the expiration of net operating loss carry-forwards before utilization.

Loss per Share

The Company has adopted Financial Accounting Standards Board (“FASB”) Statement Number 128, “Earnings per Share,” (“EPS”) which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS

Basic loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the period.

Diluted loss per share is computed similarly to basic loss per share except that it includes the potential dilution that could occur if dilutive securities were converted. Diluted loss per common share is the same as basic loss per share, as the effect of potentially dilutive securities convertible debt and warrants (9,459,432 and 7,001,495, at December 31, 2007 and 2006, respectively inclusive of all potential convertible shares warrants and options) are anti-dilutive.

Long Lived Assets

The Company has adopted SFAS No. 144. “Accounting for the Impairment or Disposal of Long-Lived Assets” (“SFAS No. 144”). SFAS No. 144 requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve break-even operating results over an extended period. The company evaluates the recoverability of long-lived assets based upon discounted cash flows. Should impairment in value be indicated, the carrying value of intangible assets will be adjusted, based on estimates of future discounted cash flows resulting from the use and ultimate disposition of the asset. SFAS No.144 also requires assets to be disposed or be reported at the lower of the carrying amount of fair value less costs to sell.

F-9

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 3 - Summary of Significant Accounting Policies (Continued)

Recently Issued Accounting Pronouncements .

F-10

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 3 - Summary of Significant Accounting Policies (Continued)

Recently Issued Accounting Pronouncements .

Note 4 - Property and Equipment

Property and equipment at December 31, 2007 consist of the following:

	Estimated
	Useful Lives		December 31, 2007
Computer Equipment and Software		3-7 Years	$	66,724
Office Equipment		3-7 Years		22,240
Tooling and Dies		25,000 Units		71,639
				160,603
Less: Accumulated Depreciation				68,433
			$	97,170

Depreciation expense was $64,480 and $3,990 for the year ended December 31, 2007 and 2006, respectively.

Note 5 - Inventories

Inventories as of December 31, 2007 ocnsists of the following:

Finished Goods	$	11,532
Raw Materials		274,591
Inventory Total	$	286,123

Note 6 - Notes Payable

Notes payable at December 31, 2007 consist of the following:


Notes payable to private investors; bearing interest at 10% per annum and due March 15, 2007 (see Note 7)	$	800,000

Note payabe - Alpha Capital		204,088
	$	1,004,088

On July 12, 2007, bioMETRX, Inc. entered into several agreements with Alpha Capital Anstalt (“Alpha”) whereby Alpha lent the Company $750,000 to be held in escrow pending delivery of the Company’s garage door openers. The funds will be used to pay the manufacturer of the garage door openers once they have been completed and inspected for shipment to fulfill certain outstanding customer purchase orders.

In connection with the transaction the Company executed a $750,000 secured promissory note. The Note bears interest at the rate of 24.99% per annum, payable on the first day of each month and on the maturity date the Note matures fifteen (15) days following the release of funds from the escrow account to any person other than the holder. The Note may be prepaid all or any portion of the Note without penalty or premium.

In addition to the Note, the Company and each of its subsidiaries entered into Security Agreements with Alpha whereby each entity pledged all their assets to secure the Note. The Company also issued Alpha a warrant to purchase 375,000 shares of the Company’s common stock at an exercisable price of $1.00 per share valued at $236,250 and charged to finance costs. The Warrant is exercisable for a period of five (5) years.

As a condition to Alpha providing the loan to the Company, the Company’s CEO Mark Basile entered into a Guaranty with Alpha whereby Mr. Basile agreed to guaranty the Company’s obligations under the Note and all related documents.

In connection with the transaction the Company paid a due diligence fee of $10,000 to Osher Capital Partners, LLC, paid Alpha a commitment fee of $22,500 and agreed to pay Alpha’s legal fees in connection with this transaction not to exceed $40,000.

F-11

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 7 - Convertible Notes

On June 29, 2006, the Company entered into a Securities Purchase Agreement, with four investors relating to the issuance and sale, in a private placement exempt from the registration requirements of the Securities Act of 1933, as amended, of units (the “Units”) consisting of 8% Convertible Notes in the principal amount of $950,000 (“Notes”), Series A Common Stock Purchase Warrants (“A Warrants”) and Series B Common Stock Purchase Warrants (“B Warrants”). In addition, the company entered into an Exchange Agreement with the two investors who purchased $650,000 of the Preferred Stock Units, previously reported on Form 8-K dated April 28, 2006 whereby the Company agreed to issue the Units in exchange for the return and cancellation of the previously issued Preferred Stock Units. Accordingly, at closing the Company issued its 8% Convertible Notes in the aggregate principal amount of $1,600,000, 1,600,000 A Warrants and 800,000 B Warrants to the Investors. The Company also issued an aggregate of 128,000 shares of its common stock valued at $172,800 to the investors representing one year’s of prepaid interest on the Notes.

Each A Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $1.75 per share commencing on the date of issuance and expiring at the close of business on the fifth anniversary of the issuance date. Each B Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $.10 per share commencing 181 days after issuance and expiring at the close of business on the fifth anniversary of the initial exercise date. Notwithstanding the foregoing if the Company provides the holder of a B Warrant with validation and acknowledgement, in the form of bona fide purchase order demonstrating that at least $1,000,000 of the Company’s products have been ordered, other than its initial order from a national retailer in the amount of approximately 23,000 garage door opening units, within 181 days after the date of the Securities Purchase Agreement, the B Warrants shall automatically terminate. The Company did not receive this purchase order. Both the A and B Warrants contain provisions that protect the holder against dilution by adjustment of the exercise price in certain circumstances including, but not limited to, stock dividends, stock splits, reclassifications, or mergers.

Pursuant to the Selling Agent Letter Agreement between the Company and the Selling Agent, the Selling Agent was paid a cash fee of $95,000 (10% of the aggregate purchase price of the Units sold to the subscribers) in addition to the $75,000 it received, inclusive of $10,000 in expenses. The Company also issued the Selling Agent a warrant to purchase 160,000 shares of its common stock on the same terms as the A Warrants. Such warrant was valued at $182,716 using the Black Scholes model. In addition, the Company paid $15,000 to the Selling Agent’s counsel and $32,500 to its counsel.

The Company recorded a combined debt discount in the amount of $1,215,200 to reflect the beneficial conversion feature of the convertible debt and the value of the warrants. The beneficial conversion feature, was recorded pursuant to Emerging Issues Task Force (“ETIF”) 00-27: Application of EITF No. 98-5, “Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios,” to certain convertible instruments. In accordance with EITF 00-27, the Company evaluated the value of the beneficial conversation feature and recorded this amount ($207,200) as a reduction of the carrying amount of the convertible debt and as an addition to paid-in capital. Additionally, the fair value of the warrants ($1,008,000) was calculated and recorded as a further reduction to the carrying amount of the convertible debt and as addition to paid-in capital.

F-12

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 7 - Convertible Notes (Continued)

As part of the Private Placement, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with each subscriber who purchased Units in the Private Placement. Under the Registration Rights Agreement, the Company is obligated to file a registration statement (the “Registration Statement”) on Form SB-2, relating to the resale by the holders of the Common Stock underlying the Notes, Warrants and Selling Agent Warrant. If such Registration Statement was not filed by July 14, 2006, or did not become effective within 90 days after closing, the Company has agreed to pay to the investors 1.5% of the gross proceeds of the offering for each month in which the Company fails to comply with such requirements. The Company did not file the Registration Statement by July 14, 2006 and therefore was accruing 1.5% ($24,000) of the gross proceeds for each month the Company failed to file the Registration Statement. For the year ended December 31, 2006 the Company recorded $144,000 as additional finance costs. In December 2006 the Company issued to the Convertible Noteholders Forebearance Notes in the amount of $387,437 that included the $144,000 liquidated damages.

The Company recorded a debt discount in the amount of $387,437 to reflect the beneficial conversion feature of the forbearance convertible debt. The beneficial conversion feature, was recorded pursuant to Emerging Issues Task Force ("EITF")00-27 Application of EITF No. 98-5. "Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios," to certain convertible instruments. In accordance with EITF 00-27, the Company evaluated the value of the beneficial conversion feature and recorded this amount as a reduction of the carrying amount of the convertible debt and as an addition to paid-in capital.

On October 10, 2006 the Company amended the exercise price of the 1,600,000 Class A Warrants relating to the above referenced Private Placement from $1.75 to $1.00. During 2007 the Company further reduced the exercise price to $.30. The Company recorded additional finance costs of $385,000 in connection with these repricings.

On September 21, 2006, the Company issued Jay Pitlake 50,000 shares of its common stock valued at $65,000 as a finder’s fee in connection with the sale of the convertible debentures.

F-13

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 7 - Convertible Notes (Continued)

The Company recorded a combined debt discount in the amount of $1,500,000 to reflect the beneficial conversion feature of the convertible debt and the value of the warrants. The beneficial conversion feature, was recorded pursuant to Emerging Issues Task Force (“EITF”) 00-27: Application of EITF No. 98-5, “Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios,” to certain convertible instruments. In accordance with EITF 00-27, the Company evaluated the value of the beneficial conversion feature and recorded this amount ($284,307) as a reduction of the carrying amount of the convertible debt and as an addition to paid-in capital. Additionally, the fair value of the warrants ($1,215,693) was calculated and recorded as a further reduction to the carrying amount of the convertible debt and as addition to paid-in capital.

As a condition to closing, the Company obtained consents and waivers from the investors of its private placement of $1,600,000 principal amount of Convertible Notes (“Notes”) issued on June 29, 2006, pursuant to which each of the prior investors agreed to waive any and all existing defaults relating to the Notes and agreed to forebear from exercising any rights accruing upon default until June 30, 2007. In connection therewith, the Company issued to the investors Convertible Notes (“Forebearance Notes”) in the aggregate principal amount of $387,437, representing liquidated damages due under the Notes. The Forebearance Notes are convertible into the Company’s common stock at $1.00 per share.

The Company recorded a debt discount in the amount of $387,437 to reflect the beneficial conversion feature of the forbearance convertible debt. The beneficial conversion fature, was recorded pursuant to Emerging Issues Task Force (“EITF”)00-27 Application of EITF No. 98-5. “Accounting for Convertible Securities with Benefical Conversion Features or Contingently Adjustable Conversion Ratios,” to certain convertible instruments. In accordance with EITF 00-27, the Company evaluated the value of the benefical conversion feature and recorded this amount as a reduction of the carrying amount of the convertible debt and as an addition to paid-in capital.

F-14

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 7 - Convertible Notes (Continued)

The Company is amortizing the discounts over the term of the related debt. Amortization of the debt discount for the years ended December 31, 2007 and 2006 was $1,968,333 and $694,003, respectively, and this amortization is recorded as interest expense.

During the year ended December 31, 2007 noteholders converted $1,406,500 of principal into 1,462,662 shares of common stock.

Note 8 - Stockholders’ Deficit

Preferred Stock

Our certificate of incorporation authorizes the issuance of up to 10,000,000 shares of $.01 par value preferred stock, with such designation rights and preferences as may be determined from time to time by the Board of Directors. Our Board of Directors is empowered to, without shareholder approval, issue these shares of preferred stock with dividend, liquidation, conversion, voting or other rights which could adversely affect the voting power or other rights of the holders of our common stock. In the event of such issuances, the preferred stock could be utilized, under certain circumstances, as a method of discouraging, delaying or preventing a change in control of our company.

F-15

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock (Continued)

On March 14, 2006, the Company filed an amendment to its Certificate of Incorporation to effect a reverse split of all of the outstanding shares of its Common Stock at a ratio of one-for-four and increase the number of authorized shares of its Common Stock to 25,000,000 shares and decrease the par value of the Company’s common stock to $.001 per share. The Company’s amended certificate of incorporation also authorized the issuance of up to 10,000,000 shares of $.01 par value preferred stock, with such designation rights and preferences as may be determined from time to time by the Board of Directors.

At various stages in the Company’s development, shares of the Company’s common stock and common stock purchase warrants have been issued at fair market value in exchange for services or property received with a corresponding charge to operations, property and equipment or additional paid-in capital depending on the nature of the services provided or property received.

During the month of January 2006, Russell Kuhn (“Kuhn”) provided $147,000 to the Company, and the Company agreed to issue him 183,750 shares ($.80 per share) of common stock. In addition, during February 2006, the Company issued to Kuhn 281,250 shares of common stock upon exercise of warrants with an exercise price of $.80 per share for proceeds of $225,000. In connection with this transaction, the Company paid a finder’s fee to Harbor View of $37,200 and accrued commissions payable to Harbor View of 102,300 shares of its common stock.

During February 2006, the Company entered into a one (1) year consulting agreement with Russell Kuhn, and issued him 250,000 shares of common stock valued at $875,000 under the Company’s 2005 Equity Incentive Plan. Pursuant to the agreement, Mr. Kuhn is to provide the Company with consulting services in connection with corporate finance relations and, introduce the Company to various lending sources, investment advisors, or other members of the financial community with whom he has established relationships.

On February 27, 2006, the Company issued 25,000 restricted shares of its common stock valued at $150,000 to Empire Relations Group, Inc. pursuant to a consulting agreement between the Company and Empire Relations Group.

On March 21, 2006, the Company received debt financing in the aggregate amount of $100,000 from Jane Petri and Joseph Panico. The principal and interest of 12% per annum was due on June 21, 2006. The note carries a default rate of 18% per annum. In addition, the Company issued an aggregate of 25,000 shares of restricted common stock valued at $71,250 to Petri and Panico as debt issuance costs.

On July 19, 2006, the Company issued an aggregate of 20,000 restricted shares of its common stock valued at $38,000 to Jane Petri (10,000) and Joseph Panico (10,000) as an incentive for them extending the maturity dates of their respective loans.

F-16

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock (Continued)

On September 18, 2006 the Company entered into a Securities Purchase Agreement, with Jane Petri and Joseph Panico relating to the issuance and sale, of the Company’s 10% Promissory Notes due March 15, 2007 in the aggregate principal amount of $400,000, In addition, the Company issued to Petri and Panico 400,000 Common Stock Purchase Warrants valued at $146,800 and 160,000 Shares of the Company’s Common Stock valued at $174, 400 as consideration for the financing. In connection with this transaction the two investors provided the Company with $300,000 and exchanged $100,000 in Notes that were previously issued by the Company to the investors. Each Warrant entitles the holder to purchase one share of the Company’s Common Stock at an exercise price of $1.00 per share commencing on the date of issuance and expiring at the close of business on September 15, 2011. As part of the Private Placement, the Company agreed to register the 400,000 shares of Common Stock underlying the Warrants and the 160,000 shares of the Common Stock issued as part of this Private Placement.

On November 17, 2006, the Company entered into a Securities Purchase Agreement with Jane Petri and Joseph Panico relating to the issuance and sale in a private placement of the Company’s 10% Promissory Notes due March 15, 2007 in the aggregate principal amount of $300,000. In addition, the Company issued to Petri and Panico 99,000 Common Stock Purchase Warrants valued at $187,606 and 300,000 shares of the Company’s Common Stock valued at $570,000 as consideration for the financing. Each Warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $1.25 per share commencing on the date of issuance and expiring at the close of business on September 14, 2011. As part of the Private Placement, the Company agreed to register the 99,000 shares of common stock underlying the Warrants and the 300,000 shares of the common stock issued as part of this private placement.

On May 3, 2006, the Company issued 180,000 restricted shares of its common stock valued at $630,000 to New Castle Consulting, LLC pursuant to a Consulting Agreement.

On May 4, 2006, the Company issued 20,000 restricted shares of its common stock valued at $71,000 to Pasadena Capital Partners, LLC pursuant to a Letter of Engagement entered into between the parties on March 17, 2006.

On May 11, 2006, the Company issued 125,000 restricted shares of its common stock valued at $368,750 to Santo Santopadre as a settlement of a dispute between Mr. Santopadre and the Company.

On June 5, 2006 the Company issued 54,201 restricted shares of its common stock valued at $108,402 to Mark Basile, the Company’s CEO, in payment of indebtedness to Mr. Basile by the Company.

On September 29, 2006 the Company entered into a Securities Purchase Agreement, with Dorothy Christofides ($30,000) and Barry and Marci Mainzer ($25,000) relating to the issuance and sale, in a private placement of the Company’s 10% Promissory Notes due March 30, 2007 in the aggregate principal amount of $55,000. In addition, the Company issued to the Noteholders 55,000 Common Stock Purchase Warrants valued at $43,120 and 22,000 Shares of the Company’s Common Stock valued at $35,200 as consideration for the financing. Each Warrant entitles the holder to purchase one share of the Company’s Common Stock at an exercise price of $1.00 per share commencing on the date of issuance and expiring at the close of business on September 15, 2011. As part of the Private Placement, the Company agreed to register the 55,000 shares of Common Stock underlying the Warrants and the 22,000 shares of the Common Stock issued as part of this Private Placement.

F-17

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock (Continued)

On October 20, 2006 the Company entered into a Consulting Agreement with Interactive Resources Group, Inc. (“IRG”). IRG was hired to provide the Company with corporate consulting services in connection with the Company’s corporate finance relations, investor relations to enhance the Company’s visibility in the financial community. The term of the agreement is six months. As compensation, the Company agreed to issue IRG an aggregate of 225,000 shares of its common stock, payable 75,000 on November 1, 2006, 75,000 payable on January 1, 2007 and 75,000 payable on March 1, 2007. The Company has issued the first 75,000 shares valued at $112,500 and the second 75,000 shares valued at $221,250. In addition, the Company has issued three hundred thousand (300,000) common stock purchase warrants valued at $101,800 which vest on or about January 20, 2007, ninety-one (91) days from the date of the Agreement.

The warrants are exercisable for four years at the following exercise prices:

100,000 at $1.50 per share

100,000 at $2.00 per share

100,000 at $4.00 per share

On October 23, 2006 the Company issued 75,000 shares of its common stock valued at $119,750 to Brendan Hopkins (“Hopkins”) pursuant to a consulting agreement to provide investment advisory services. . These shares were issued under the Company’s Equity Incentive Plan.

In November 2006 the Company issued 18,250 common stock purchase warrants with an exercise price of $.01 per share and valued at $25,003 to a consultant pursuant to the terms of a consulting agreement. The warrants expire January 31, 2012.

In October 2006 the Company issued 40,000 shares of common stock valued at $60,000 to a consultant for providing equity research services.

During December 2006, the Company issued an aggregate of 44,250 bonus shares of its common stock valued at $128,325 pursuant to the Company’s 2005 Equity Incentive Plan. Of these shares 37,500 were issued to the Companies executives.

During 2006, the Companies Chief Technology officer resigned and entered into a termination agreement with the Company. In connection with the termination agreement the officer returned 187,500 stock options valued at $2,362,500 and 62,500 shares of common stock valued at $237,500. The value of those stock and options were originally charged to operations in the year they were issued. Accordingly, the Company is reporting other income in the amount of $2,600,000, representing the value of the stock options returned. In addition, the officer transferred 133,664 shares of common stock to various other officers and directors. These shares were valued at $240,595 and were included in operations, with a corresponding credit to additional paid in capital.

2005 Equity Incentive Plan

Effective December 20, 2005, the Board of Directors approved the formation of the 2005 Equity Incentive Plan (“the Plan”) to benefit the Company’s key employees (including its directors, officers and employees) as well as consultants of the Company and its affiliates.

On January 5, 2006 the Company amended its 2005 Equity Incentive Plan by allowing for a “cashless exercise” of stock options. When this provision is utilized, the shareholder will return the cost of the exercise of the option in shares back to the Company.

The aggregate of shares that amy be issued under the Plan is 1,250,000. The plan permits the company to make awards of stock options, stock appreciations rights, warrants, stock awards and other equity awards.

Awards under the Plan for the year ended December 31, 2007 and 2006 respectively amounted to 22,750 and 1,006,750 shares of common stock.

F-18

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock

On January 10, 2007, Ms. Yarde exercised 250,000 stock options at $.40 per share. Ms. Yarde exercised the options via “cash-less exercise” and was issued 217,213 shares of common stock.

On January 16, 2007, the Company issued 40,000 shares of its common stock valued at $130,000 to Brad Schwab pursuant to a consulting agreement between the Company and Mr. Schwab.

On January 16, 2007, the Company issued an aggregate of 4,000 shares of its common stock valued at $11,600 to the owners of Vintage Filings, Inc. (Seth Farbman 2,000 and Shai Stern 2,000) for services rendered to the Company in connection with its SEC filings. These shares were issued under the Company’s 2005 Equity Incentive Plan.

On January 22, 2007, the Company issued 50,000 shares of its common stock valued at $167,500 to Mark Basile as consideration for Mr. Basile providing the Company his personal guarantee in connection with the opening of a Letter of Credit in the amount of $1,040,400.

On January 23, 2007, the Company issued 70,000 shares of its common stock to Mark Basile in exchange for Mr. Basile foregoing $140,000 of his 2007 salary. In addition the Company issued Mr. Basile an additional 10,000 shares of common stock as a bonus. These shares were valued at $248,000 in the aggregate.

On January 31, 2007, the Company issued 20,000 restricted shares of its common stock valued at $58,000 pursuant to a consulting agreement between the Company and ICR, LLC.

On February 13, 2007, the Company issued 75,000 restricted shares of its common stock valued at $153,750 to Interactive Resources Group, Inc. (“IRG”) pursuant to a consulting agreement between the Company and IRG.

F-19

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock (Continued)

On February 8, 2007, the Company issued an aggregate of 7,000 shares of its common stock valued at $18,900 to the owners of Vintage Filings, Inc. (Seth Farbman 3,500 and Shai Stern 3,500) in exchange for Vintage providing one (1) year of filing the Company’s reports with the SEC via the Edgar filing system. These shares were issued under the Company’s 2005 Equity Incentive plan.

On March 6, 2007, the Company issued The Incredible Card Company 150,000 restricted shares of its common stock valued at $330,000 as consideration for the purchase of a patent the Company acquired in January 2007. Mr. Basile, the Company’s Chairman and CEO, was a former officer and director of The Incredible Card Company.

On March 12, 2007, the Company issued Robert Jacobs 150,000 restricted shares valued at $334.500 of its common stock as consideration for the purchase of a patent.

On April 24, 2007, the Company issued 1,750shares of its common stock valued at $3,150 to the partners of its legal counsel, Sommer & Schneider LLP, in consideration for legal services rendered in the ordinary course of business. The stock was issued under the Company’s Stock Incentive Plan.

On April 24, 2007, the company issued 140,000 shares of its common stock valued at $252,000 and 140,000 5 year warrants exercisable at $1.00 per share to Mark Basile, the Company’s President and CEO as consideration for providing the Company a loan in the amount of $140,000.

On May 21, 2007, the Company issued 50,000 shares of its common stock valued at $70,000 and 50,000 warrants exercisable at $1.00 per share to Lorraine Yarde, the Company’s Chief Operating Officer as consideration for providing the Company a loan in the amount of $50,000.

On June 1, 2007, the Company issued 300,000 shares of its common stock valued at $258,750 and 200,000 warrants exercisable at $1.50 per share to IRG as consideration for performing shareholder relations and other financial advisory services for a six month period. The aggregate value of such services based upon valuations of the Company’s stock at this time was $340,550.

F-20

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock (Continued)

On June 15, 2007, the Company issued 45,000 shares of its common stock valued at $74,250 and 45,000 warrants exercisable at $1.00 per share to Lorraine Yarde, the Company’s Chief Operating Officer as consideration for providing the Company a loan in the amount of $45,000.

On June 16, 2007, the Company issued an aggregate of 125,000 shares of its common stock to Lighthouse Capital upon the conversion of $125,000 principal amount of a convertible note issued to Lighthouse Capital Insurance in that amount. The convertible note converted into the Company’s common stock at $1.00 per share. Sixty-two thousand-five hundred (62,500) of these shares were registered pursuant to a Registration Statement on Form SB-2.

On June 18, 2007, the Company awarded Lorraine Yarde 150,000 shares of its common stock valued at $240,000 as a bonus for securing an increased purchase order from Home Depot and an additional purchase order from MasterLOCK.

On June 18, 2007,, the Company issued 20,000 shares valued at $32,000 to Rodger Michell, an accountant as consideration of accounting services in connection with the Company’s upgrading its accounting system and electronic data interchange.

On June 18, 2007, the Company issued 75,000 shares of its common stock valued at $120,000 and 75,000 warrants exercisable at $1.00 per share to The Naples Trust, of which the Company’s Chief Executive Officer is a related party as consideration for providing the Company a loan in the amount of $75,000.

On June 21, 2007, the Company issued 20,000 shares of its Common stock valued at $40,000 to Black Dog Communications as consideration for public relations services to the Company.

On June 26, 2007, the Company issued an aggregate of 300,000 shares of its common stock to Linden Growth Partners upon the conversion of $300,000 principal amount of a convertible note issued to Linden Growth Partners in that amount. The convertible note converted into the Company’s common stock at $1.00 per share. One hundred and fifty thousand 150,000 of these shares were registered pursuant to a Registration Statement on Form SB-2.

F-21

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock (Continued)

On June 27, the Company issued 5,000 shares of its common stock valued at $6,500 to the partners of its legal counsel, Sommer and Schneider LLP in consideration of $6,000 in legal services rendered to the Company. The stock was issued under the Company’s Equity Incentive Plan.

On June 28, 2007, the Company issued 75,000 shares of its common stock valued at $75,000 and 75,000 warrants exercisable at $1.00 per share to J. Richard Iler, the Company’s Chief Financial Officer as consideration for providing the Company a loan in the amount of $75,000.

On July 13, 2007, the Company issued Nite Capital 75,000 shares of its common stock issuable upon the exercise of a like number of warrants exercisable at $0.10 per share.

On July 25th, 2007, the Company issued 50,000 shares as payment in kind for fees related to a factoring commitment to BLX, Funding.

On July 25th, 2007, the Company issued 25,000 shares of its common stock valued at $11,000 and 25,000 warrants exercisable at $1.00 per share to Mark Basile, the Company’s Chief Executive Officer as consideration for providing the Company a loan in the amount of $25,000.

On July 25th, 2007, the Company issued 150,000 shares of its common stock valued at $150,000 to Mark Basile as consideration for Mr. Basile providing the Company his personal guarantee in connection with the opening of an escrow agreement with Alpha in the amount of $750,000.

On August 1, 2007, the Company issued 8,365 of its common stock to A2E Technologies as payment of $9,535.75 due A2E Technologies pursuant to a Service Level Agreement dated March 16, 2007.

On August 15, 2007, the Company issued 150,000 shares of its common stock to Linden Growth Partners L.P. upon the exercise of a like number of warrants exercisable at $0.10 per share.

On August 15, 2007, the Company issued 225,000 shares of its common stock to Linden Growth Partners Master Fund L.P. upon the exercise of a like number of warrants exercisable at $0.10 per share.

F-22

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock (Continued)

On August 16, 2007 the Company issued 22,269 shares of its common stock to Osher Capital Partners LLC upon the cashless exercise of 25,000 warrants exercisable at $0.10 per share.

On August 24, 2007 the Company issued 178,152 shares of its common stock to Alpha Capital AG upon the cashless conversion of 200,000 warrants exercisable at $0.10 per share.

On August 31, 2007 the Company issued 62,500 shares of its common stock upon the exercise of 62,500 warrants exercisable at $0.10 to Lighthouse Capital Insurance Company.

On August 31, 2007 the Company issued 62,500 shares of its common stock upon the exercise of 62,500 warrants exercisable at $0.10 to Peter Thomson.

On September 7, 2007, the Company issued to Bridgepointe Master Fund, Ltd. 435,342 shares of its common stock upon the cashless exercise of 500,000 warrants exercisable at $0.10 per share.

On September 12, 2007 the Company issued 250,000 shares of its common stock upon the exercise of 250,000 warrants exercisable at $0.10 to Whalehaven Capital Fund, Ltd.

F-23

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock (Continued)

On October 11, 2007, the Company issued an aggregate of 218,500 shares of its common stock valued at $185,725 to employees (150,000) and executive officers (68,500).

On October 15, 2007, the Company issued an aggregate of 100,000 shares of its common stock valued at $80,000 to Richard Quintana (50,000 shares) and Michael Niccole (50,000) in connection with the acquisition of a Patent.

On October 17, 2007, the Company issued 10,000 shares of its common stock valued at $8,000 to the partners of Sommer & Schneider LLP, the Company’s securities counsel as partial payment of legal services rendered to the Company.

On November 6, 2007, the Company issued 114,545 shares of its common stock to Mark Basile, the Company’s CEO upon the cashless exercise of 140,000 warrants, exercisable at $.10 per share.

On November 6, 2007, the Company issued 20,000 shares of its common stock valued at $11,000 to the partners of Sommer & Schneider LLP.

On November 6, 2007, the Company issued an aggregate of 150,000 shares of its common stock valued at $82,500 to the members of its board of directors Mark Basile (50,000) Lorraine Yarde (50,000) and J. Richard Iler (50,000) as consideration for services rendered in the performance of their duties as directors of the Company.

On November 15th, 2007, the Company issued 17,507 shares of its common stock valued at $10,505 to A2E Technologies

as partial consideration toward engineering services performed on behalf of the Company.

On November 16th, 2007, the Company escrowed 500,000 shares of its stock as collateral for extending the maturity of loans given by Joseph Panico and Jane Petri to the Company.

On November 16th, 2007, the Company granted 50,000 shares of common stock valued at $30,000 to Wendy Borow-Johnson as consideration for serving on the Board of the Company.

F-24

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock (Continued)

On December 4th, 2007 the Company issued 125,000 shares to Lighthouse Capital Insurance Company upon exercise of 125,000 warrants exercisable at $.30.

On December 4th, 2007 the Company issued 125,000 shares to Peter Thompson upon exercise of 125,000 warrants exercisable at $.30.

On December 4th, 2007 the Company issued 12,500 shares to Robert Casolaro upon exercise of 12,500 warrants exercisable at $.30.

On December 18th, 2007, the Company issued 67,857 shares of its common stock to The Naples Trust a related party upon the cashless exercise of 75,000 warrants, exercisable at $.10 per share.

On December 18th, the Company issued 100,000 shares of its common stock valued at $86,600 to Interactive Resources Group in accordance with a consulting agreement of like date.

On December 20th, 2007, the Company issued 85,952 shares of its common stock to the company’s Chief Operating Officer upon the cashless exercise of 95,000 warrants, exercisable at $.10 per share.

F-25

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Common Stock (Continued)

Stock Options

Stock option share activity and weighted average exercise prices for the years ended December 31, 2007 and 2006 were as follows:

	2007				2006
2005 Equity Incentive Plan	Number of Options			Weighted Average Exercise Price	Number of Options			Weighted Average Exercise Price
Balance - January 1,	287,500		$	1.65	375,000		$	2.00
Options Granted	-		$	-	350,000		$	1.00
Options Cancelled	-				(187,500	)		2.00
Options Exercised	(100,000	)	$	1.00	(250,000	)		1.00
Outstanding - December 31,	187,500		$	2.00	287,500		$	1.65
Exercisable	187,500		$	2.00	287,500		$	1.65

	2007					2006
Other Options	Number of Options			Weighted Average Exercise Price		Number of Options			Weighted Average Exercise Price
Balance - January 1,		2,150,000		$	2.66		25,000		$	.40
Options Granted		-			-		2,150,000			2.18
Options Exercised		(550,000	)		.75		(25,000	)		.40.
Outstanding - December 31,		1,600,000		$	2.66		2,150,000			2.18
Exercisable		1,600,000		$	2.66		1,850,000			2.35

The following table summarized information about stock options at December 31, 2007:

Options Outstanding

Options Exercisable

Range of Exercise Prices

Number Outstanding

Weighted Average Remaining Contractual Life (Years)

Weighted Average Exercise Price

Number Exercisable

Weighted Average Price

$1.00 - $1.99

600,000

3.70

1.28

600,000

1.28

$2.00

437,500

2.50

2.00

437,500

2.00

$3.00

250,000

2.50

3.00

250,000

3.00

$4.00

250,000

2.50

4.00

250,000

4.00

$5.00

250,000

2.50

5.00

250,000

5.00

$1.00 - $5.00

1,787,500

2.95

2.67

1,787,500

2.67

F-26

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Stockholders’ Deficit (Continued)

Stock Options (Continued)

Warrants

	Warrants Outstanding				Warrants Exercisable
		Weighted Average
		Remaining		Weighted			Weighted
Range of Exercise Price	Number Outstanding	Contracted Life (Years)		Average Exercise Price	Number Exercisable		Average Exercise Price
$ .01-.1.99	43,250	4.10	$	.06	43,250	$	.06
$1.00-1.99	4,333,500	4.13	$	1.06	4,333,500	$	1.06
$2.00	235,198	3.69	$	2.13	235,198	$	2.13
$3.00	52,698	2.75	$	3.40	52,698	$	3.40
$4.00	126,349	3.19	$	4.00	126,349	$	4.00

	4,790,995	4.07	$	1.21	4,790,995	$	1.21

A summary of warrant activity for the year ended December 31, 2007 and 2006 is as follows:

	2007				2006
	Number of Warrants			Weighted Average Exercise Price	Number of Warrants			Weighted Average Exercise Price
Balance - January 1,	3,626,495		$	1.17	475,495		$	1.62
Warrants Granted	4,270,000		$	.90	3,432,250		$	1.27
Warrants Exercised	(3,105,500	)	$	.28	(281,250	)		.80
Balance - December 31,	4,790,995		$	1.21	3,626,495		$	$1.17

Note 9 - Commitments and Contingencies

Employment Contracts

We have employment agreements with three of our executive officers, Mark Basile, Rick Iler and Lorraine Yarde.

Mr. Basile’s employment agreement, originally entered into in February 2002, and amended on February 6, 2006 has an initial term of five years from the date of the Amendment and a base salary of:

$360,000 for Calendar Year 2006

$500,000 for Calendar Year 2007

$560,000 for Calendar Year 2008

$620,000 for Calendar Year 2009

$700,000 for Calendar Year 2010

F-27

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Stock Options (Continued)

Mr. Basile also receives a $1,500 per month car allowance and a five million dollar ($5,000,000) term life insurance policy naming Mr. Basile’s family as the beneficiary thereof.

After the initial term, Mr. Basile’s agreement automatically renews for additional one-year periods. Under the terms of this agreement, any accrued compensation may be converted into shares of the Company’s common stock at $2.00 per share. Bonuses, if any, are to be paid at the sole discretion of the Board of Directors. On November 6, 2007, the Company issued 114,545 shares of its common stock to Mark Basile, the Company’s CEO upon the cashless exercise of 140,000 warrants, exercisable at $.10 per share.

Upon signing the Amendment, Mr. Basile also received options to purchase up to 1,250,000 shares of the Company’s common stock valued at $4,788,813. The options are exercisable at the following prices:

Employment Contracts (Continued)

Number of Shares	Exercise Price
*250,000	$	1.25
250,000	$	2.00
250,000	$	3.00
250,000	$	4.00
250,000	$	5.00

*Options were issued under the Company’s 2005 Equity Incentive Plan and subsequently exercised on a cashless basis.

The Company originally entered into an employment agreement with Ms. Lorraine Yarde in August 2005, and amended in January 2006, in the capacity of Chief Operating Officer. It has an initial term of three years commencing on the date of the Amendment.

On August 14, 2006, the Company entered into an amended three-year employment agreement with Lorraine Yarde with a base annual salary of $175,000 for calendar year 2007 $200,000,000 for the remainder of the term of the agreement. This was subsequently modified and effective as of August 17, 2007 to increase her salary to $215,000.

Ms. Yarde also receives a $750 per month car allowance.

Upon signing the employment agreement, Ms. Yarde also received immediately vested options to purchase up to 600,000 shares of the Company’s common stock valued at $77,000. The options are exercisable at the following prices:

Number of Options	Exercise Price
200,000	$	1.00
200,000	$	1.25
200,000	$	1.50

On January 9, 2007, Ms. Yarde exercised 250,000 stock options at $.40 per share. Ms. Yarde exercised the options via “cash-less exercise” and was issued 217,213 shares of common stock.

F-28

On August 4 , 2006, the Company entered into a three-year employment agreement with J. Richard Iler with a base salary of:

$180,000 for the first year of the agreement

$207,000 for the second year of the agreement

$238,050 for the third year of the agreement

Mr. Iler also receives $500 per month car allowance.

F-29

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 9 - Commitments and Contingencies (Continued)

Employment Contracts (Continued)

Upon signing the employment agreement, Mr. Iler also received options to purchase up to 400,000 shares of the Company’s common stock valued at $76,800. The options are exercisable at the following prices and subject to the vesting schedule set forth below.

Number of Options	Exercise Price		Vesting
200,000	$	1.05		Immediately
100,000	$	1.10		1 year from date of agreement
100,000	$	1.00		2 years from date of agreement

Upon signing Mr. Iler also received 100,000 shares of the Company’s common stock valued at $85,000.

On April 11, 2007, the Company’s Chief Financial Officer cashlessly exercised 200,000 warrants exercisable at $1.05. The market value of the Company’s common stock on that date was $2.00.

Lease Obligations

The Company operates its business in leased facilities. The Company currently leases approximately 3719 square feet for its corporate office facilities located at 500 North Broadway, Jericho, New York for $8,523 with increases annually on January 31. The lease expires January 31, 2010.

Approximate future minimum commitments under these leases are as follows:

January 1, 2008 - December 31, 2008		109,249
January 1, 2009 - December 31, 2009		113,073
January 1, 2010 - January 31, 2010		9,449
	$	231,771

Rent expense under the office leases was approximately $125,565 and $99,623 for the years ended December 31, 2007 and 2006, respectively.

Legal Proceedings

On November 16, 2006, the Company was the subject of a complaint filed by Intellicon seeking a final payment of $20,000 plus accrued interest for engineering design services performed for the Company. The Company answered and counter-claimed on January 5, 2007 asserting damages of $25,000 incurred then and continuing to incur to remedy design defects performed by Intellicon. The Company intends to vigorously defend its position in this claim.

On March 7, 2007 the Company’s subsidiary, bioMETRX Technologies Inc. became the subject of a complaint filed by two individuals, a former officer and a consultant with whom it had previously severed its business relationship. The plaintiffs allege damages arising from certain inducements which were relied upon to their detriment.

The Company considers these complaints to be baseless and without merit and expects to file a Motion to Dismiss both claims of both plaintiffs and intends to vigorously pursue damages in the course of its defense of this complaint and other previous acts of the plaintiffs.

F-30

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 9 - Commitments and Contingencies (Continued)

Legal Proceedings

On March 10, 2008, the Company became the subject of a complaint entitle Arrow Electronics, Inc. v. bioMETRX Technologies, Inc. etal. The complaint was filed in the Supreme Court of the State of New York County of Nassau (Index No. 08-4900). The compliant alleges breach of contract and the plaintiff is seeking damages of $194,139.15. The Company intends to vigorously defend this action.

The Company is a defendant in a lawsuit titled Worldwide Electronic Solutions, L.L.C. v. Biometrx, Inc. etal. The action was filed in the Superior Court of the State of Arizona for the Country of Maricopa. The complaint alleged breach of contract and sought damages of approximately $190,000, the Company did not answer the complaint in that it believes that the Court had no jurisdiction. The Plaintiff obtained a default judgment and has filed and Application for Entry of Default. The Company intends on filing a motion to vacate the Default Judgment and has been in negotiations with the Plaintiff to settle this matter.

Note 10 - Income Taxes

At December 31, 2007 the Company had net operating loss carry forwards for Federal tax purposes of approximately $21,000,000 which are available to offset future taxable income, if any, from 2008 through 2028. Under Federal Tax Law IRC Section 382, certain significant changes including the reverse merger transaction of 2005, may restrict the utilization of these loss carry forwards.

At December 31, 2007, the Company had a deferred tax asset of approximately $9,000,000 representing the benefit of its net operating loss carry forwards. The Company has not recognized the tax benefit because realization of the tax benefit is uncertain and thus a valuation allowance has been fully provided against the deferred tax asset. The difference between the Federal Statutory Rate of 34% and the Company’s effective tax rate of 0% is due to an increase in the valuation of allowance of approximately $3,400,000.

Note 11 - Subsequent Events

Common Stock

On January 22, 2008, the Company issued 36,450 shares of its common stock to Whalehaven Capital Fund Ltd. upon the conversion of $36,450 of principal and interest due under a convertible note issued to Whalehaven Capital Fund Ltd. The convertible note is convertible into the Company’s common stock at the rate of $1.00 per share. These shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628) which was declared effective by the SEC on June 25, 2007.

On January 28^th, 2008, the Company issued 75,000 to Nite Capital for the conversion of $37,500 in principal and interest under a forebearance note issued to Nite Capital. The note was convertible into the Company’s common stock at the rate of $.50 per share.

On January 28^th, 2008 the company issued 39,200 shares and 19,200 shares to Nite Capital for the conversion of principal of $19,600 and further principal of $12,500 and $7,100 in interest respectively due under a convertible note issued to Nite Capital. The convertible note is convertible into the Company’s common stock at the rate of $.50 per share.

F-31

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 11 - Subsequent Events (Continued)

Common Stock (Continued)

On January 29^th and 30th, 2008, the Company issued 143,590 shares and 100,773 shares of its common stock to Whalehaven Capital Fund Ltd. upon the conversion of $119, 427 of principal and $2,754.41 in interest due under convertible and forebearance notes issued to Whalehaven Capital Fund Ltd. The convertible note is convertible into the Company’s common stock at the rate of $.50 per share. 100.773 shares were registered pursuant to a Registration Statement on Form SB-2 (SEC File No. 333-140628) which was declared effective by the SEC on June 25, 2007

On January 30, 2008 the Company amended our Certificate of Incorporation to increase the number of shares of Common Stock the Company is authorized to issue to 100,000,000 shares.

On January 31^st, 2008 the Company issued 82,873 shares of its common stock to BridgePointe Master Fund, Ltd. upon the conversion of $50,000 in principal due under a convertible note to BridgePointe Master Fund, Ltd. The convertible note was converted into common stock at the rate $.603 per share.

On February 14^th, 2008 the Company issued 833,000 shares to various upon the exercise of 833,000 warrants to various individuals. The warrants were exercisable originally at $1.00, but the exercise price was subsequently offered to be lowered to $.30 in order to induce the parties to exercise these warrants.

The 833,000 shares were distributed to :

Joseph Panico		200,000 shares
Jane Peti		200,000 shares
Bruce Loewy		300,000 shares
Harborview Capital		100,000 shares
Gary Brinster		33,000 shares

On February 15^th, 2008 the Company issued 25,000 shares to First Montauk and its designees in lieu of cash compensation pursuant to the Placement Agent Agreement.

On February 15^th, 2008 the Company issued 750,000 shares upon the exercise of 750,000 warrants. The warrants were exercisable originally at $1.00, but the exercise price was subsequently lowered to $.30 in order to induce the parties to exercise these warrants.

On December 31, 2007, the Companies Board of Directors voted to increase the authorized common stock to 100,000,000 shares effective March 18, 2008.

On March 28^th, 2008, the Company filed a Form S-8 Registration Statement under the Securities Act of 1933, as amended, with the Securities and Exchange Commission, registering shares of Common Stock issuable pursuant to the2008 Professional/Consultant Stock Compensation Plan. The S-8 will provide for the registration of 7,500,000 shares while limiting the number of shares which may be issued in any year to no more than 2,500,000 shares.

F-32

BIOMETRX, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 11 - Subsequent Events (Continued)

Acquisition Agreement

On March 19, 2008, the Company entered into a agreement with Biometric Investors, LLC. (“BIL”) whereby the Company will seek to acquire the assets of Sequiam Corporation (‘Sequiam”). BIL is Sequiam’s secured creditor.

The agreement is subject to BIL’s ability to secure the timely possession of Sequiam’s assets and the lawful authority to transfer those assets to the Company, free and clear of all liens.

Marketing Agreement

On March 24^th, 2008, bioMETRX and MasterLOCK agreed to amend the Cooperative Development and ,Marketing Agreement dated March 26, 2007. The agreement will now include an additional nine (9) products under this agreement.

F-33

ITEM 8A. CONTROLS AND PROCEDURES .

Evaluation of Disclosure Controls and Procedures

The Company's management carried out an evaluation, under the supervision and with the participation of the Company's Chairman of the Board of Directors and Chief Financial Officer, its principal executive officer and principal financial officer, respectively of the effectiveness of the design and operation of the Company's disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2007, pursuant to Exchange Act Rule 13a-15. Such disclosure controls and procedures are designed to ensure that information required to be disclosed by the Company is accumulated and communicated to the appropriate management on a basis that permits timely decisions regarding disclosure. Based upon that evaluation, the Company's Chairman of the Board of Directors and Chief Financial Officer concluded that the Company's disclosure controls and procedures as of December 31, 2007 are effective.

Management's Report on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. The Company's internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The Company's internal control over financial reporting includes those policies and procedures that:

pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, 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 required by Section 404 of the Sarbanes-Oxley Act of 2002, management assessed the effectiveness of the Company's internal control over financial reporting as of December 31, 2007. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") in Internal Control-Integrated Framework.

Based on our assessment and those criteria, management concluded that the Company maintained effective internal control over financial reporting as of December 31, 2007.

Changes in Internal Control Over Financial Reporting

No changes in the Company's internal control over financial reporting have come to management's attention during the fourth quarter ended December 31, 2007 that have materially affected, or are reasonably likely to materially affect the Company's internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act.)

PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT .

Directors and Executive Officers

The members of the Board of Directors serve until the next annual meeting of shareholders, or until their successors have been elected. The officers serve at the pleasure of the Board of Directors. The following are the directors and executive officers of the Company:

Name	Age	Position	Held Position Since
Mark Basile	48	Chief Executive Officer and Chairman	2002

J. Richard Iler	54	Chief Financial Officer and Director	2006

Lorraine Yarde	37	Chief Operating Officer and Director	2005

Wendy Borow-Johnson	53	Director	2007

Mark R. Basile is the Company's founder, Chairman of the Board and CEO. Since founding the Company in 2001, Mr. Basile has been responsible for its overall strategic direction, capital transactions, business development, executive hires, and the management of its overall operations. Mr. Basile has assembled a highly qualified team, completed the introduction of the first products, and developed strong relationships with prospective industry partners. In 1999, Mr. Basile founded and became CEO of Sickbay Health Media, Inc., a publicly owned company. During his tenure at Sickbay, Mr. Basile led several diverse initiatives and operations including the repositioning of the company to reflect the internet marketplace in which it competed directly with WebMD, the acquisition of publisher Healthline Publications and expanded the company’s health information content and distribution. Mr. Basile left Sickbay in April 2001. Mr. Basile is also one of the co-founding members of the eHI - e-Health Initiative , the single largest not-for-profit trade organization that promotes awareness and develops platforms for electronic health through interactivity of its membership. Mr. Basile began his career as a private practice attorney in 1988. Mr. Basile received a BS in Economics and BA in Political Science from Hofstra University in 1985, and a Juris Doctorate from Touro Law School in 1988.

Lorraine Yarde is Chief Operating Officer for bioMETRX Inc., and President of smartTOUCH Consumer Products, Inc. Ms. Yarde is currently responsible for the day to day operations of bioMETRX and the sales direction, focus and the complete concept to market life cycle for new product development for smartTOUCH Consumer Products. Ms. Yarde has over 15 years experience in Sales/Sales Management, Marketing and Business Development, predominantly in the fields of software, engineering and computer consulting, holding various senior management positions with complete operational accountability for a number of computer consulting organizations. At those entities, Ms. Yarde had been responsible for providing direction, driving revenue, and securing and maintaining successful business relationships with prestigious companies, such as Estee Lauder, Pfizer, Schering Plough and Henry Schein. As an entrepreneur, Ms. Yarde owned and operated a successful family run Commercial Flooring organization, which at its peak, employed over 20 installers and performed work for major construction firms such as Turner Construction. Notable installation accounts included Home Depot, Circuit City and Toys r Us.

J. Richard Iler is the Company’s Chief Financial Officer. From April 2003 to July 2006 Mr. Iler was the Chief Financial Officer and a member of the Board of Directors of SiriCOMM, Inc., a publicly traded company. From 2001 through 2003, Mr. Iler was managing director of a private equity fund responsible for financing activities, management consulting and investor relations of the funds portfolio companies and served as a management consultant to SiriCOMM, Inc. from June 2002 to the time of his appointment in April 2003. From 1998 through 2001 Mr. Iler was Chief Financial Officer of United American eHealth Technologies, a publicly traded company which he assisted in raising capital and preparation of regulatory filings. Mr. Iler graduated from Grand Valley State University in Allendale, Michigan, with a B.S. and attended South Texas College of Law in Houston, Texas.

Wendy Borow-Johnson was named to the Company’s Board of Directors on November 14, 2007. In connection with this election the Company issued Ms. Borow-Johnson fifty-thousand (50,000) shares of its common stock. MS Borow-Johnson was formally a consultant to the Company and briefly served as President of the Company’s wholly owned subsidiary smartTOUCH Medical, Inc. Ms. Borow-Johnson just completed serving as the President of Healthy Living Channel and as the Senior Vice President of the Networks Group of Turner Media Group, Inc. The Networks Group includes Healthy Living Channel, iShop, Beauty and Fashion, Men's Channel, Mall TV, Resorts and Residence TV, iDrive and America's Preview Network. She was responsible for overseeing programming, network development, and distribution and cross media marketing of lifestyle transactional networks. Prior to joining Turner Media Group, Inc., Ms. Borow-Johnson served on the Board of Directors of Brands Shopping Network, Inc. and was President of Television, securing 30 million cable and satellite homes and 25 name brand retailers for Brands Shopping Network. She was the President and Chief Executive Officer of RnetHealth Inc., a publicly traded company, and was the President and Chief Executive Officer of Recovery Television Network. She was the first woman Vice President of the American Medial Association. Ms. Borow-Johnson has been a consultant to over 15 major on line and media companies including ATT, Insight Digital Cable and AOL and has worked on Direct to Consumer advertising campaigns on more than 25 pharmaceutical and consumer packaged good products. She is a consultant to investment banking groups on media and emerging technology. She is a frequent speaker, talk show guest and expert on integrated advertising, transaction based media and communications. Ms. Borow-Johnson is a Phi Beta Kappa Magna Cum Laude graduate of Goucher College and was named alumni of the decade for the 1970’s. She has a Masters Degree in Counseling from Goddard College and a certificate in psychotherapy from Harvard’s Judge Baker Guidance Center.

The Company has not established an Audit Committee of the Board of Directors, or any other committee of the Board, but is actively seeking directors to serve in this capacity.

Compensation of Directors

The Company has no established compensation plan for its Board of Directors. However, on November 6, 2007 the Company issued an aggregate of 150,000 shares of its common stock to the members of its Board of Directors Mark Basile (50,000), Lorraine Yarde (50,000) and J. Richard Iler (50,000) as consideration for their services in the performance of their duties as directors of the Company.

On November 16, 2007, the Company issued 50,000 shares of its common stock to Wendy Borow-Johnson as consideration for joining the Company’s Board of Directors.

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires directors and certain officers of the Company, as well as persons who own more than 10% of a registered class of the Company’s equity securities (“Reporting Persons”), to file reports with the Securities and Exchange Commission. During fiscal 2007, each of J. Richard Iler the Company’s Chief Financial Officer, Mark Basile the Company’s Chief Executive Officer and Lorraine Yarde the Company’s Chief Operating Officer each filed one late Form 4. The Company believes with the exception of the of the foregoing, all Reporting Persons timely complied with all filing requirements applicable to them furing fiscal 2007.

To the Company’s knowledge, based solely on review of the copies of such reports furnished to the Company and written representations that no other reports were required, during the fiscal year ended December 31, 2006 all Section 16(a) filing requirements applicable to its officers, directors and greater than ten percent shareholders were complied with.

Code of Ethics

We have adopted a Code of Ethics and Business Conduct for Officers and Directors and a Code of Ethics for Financial Executives that applies to all of our executive officers, directors and financial executives.

Item 10. Executive Compensation

Summary Compensation Table

The table below shows certain compensation information for services rendered in all capacities for the fiscal years ended December 31, 2005, 2006 and 2007. Other than as set forth herein, no executive officer’s salary and bonus exceeded $100,000 in any of the applicable years. The following information includes the dollar value of base salaries, bonus awards, the number of stock options granted and certain other compensation, if any, whether paid or deferred.

SUMMARY COMPENSATION TABLE

	Annual Compensation						Long Term Compensation
Name and Principal Position	Fiscal Year End		Salary ($)		Bonus ($)		All other and annual Compensa-tion and LTIP Payouts ($)		Securities under Options/ SARS Granted (#)		Restricted Shares or Restricted Share Units (#)
Mark Basile		2007	$	373,461	$		$					180,000
President, CEO and		2006	$	370,384		80,000		18,000		1,250,000		—
Chairman		2005	$	360,000		—		—		187,500		—

Lorraine Yarde		2007	$	191,186			$					250,000
Chief Operating Officer		2006	$	150,577		—		7,500		850,000		150,000
		2005		33,334		—		—		25,000		—

J. Richard Iler		2007	$	196,923			$					100,000
Chief Financial Officer		2006		49,538		—		9,500		400,000		100,000
		2005		—		—		—		—		—

Employment Contracts

We have full-time employment agreements with our three executive officers, Mark Basile, J. Richard Iler and Lorraine Yarde.

Mr. Basile’s employment agreement, originally entered into in December 2002, and amended on February 6, 2006 has an initial term of five years from the date of the Amendment and a base salary of:

$360,000 for Calendar Year 2006

$500,000 for Calendar Year 2007

$560,000 for Calendar Year 2008

$620,000 for Calendar Year 2009

$700,000 for Calendar Year 2010

In addition to the base salary of 2006, Mr. Basile also received an $80,000 bonus upon execution of his amended contract. The $80,000 will have to be returned to the Company on a pro rata basis should Mr. Basile terminate his employment with the Company prior to the first anniversary of his amended employment agreement. Mr. Basile also receives a $1,500 per month car allowance and a five million dollar ($5,000,000) term life insurance policy naming Mr. Basile’s family as the beneficiary thereof.

Upon signing the Amendment, Mr. Basile also received options to purchase up to 1,250,000 shares of the Company’s common stock at the following prices:

Number of Shares	Exercise Price
*250,000	$	1.25
250,000	$	2.00
250,000	$	3.00
250,000	$	4.00
250,000	$	5.00

(*These options are included in the Company’s 2005 Equity Incentive Plan and were exercised cashlessly )

On January 23, 2007, the Company issued 80,000 shares of its common stock to Mark Basile in exchange for Mr. basile foregoing 140,000 of his 2007 salary.

On August 14, 2006, the Company entered into a three-year employment agreement with Lorraine Yarde with a base annual salary of $175,000, on August 14, 2007 the Company agreed to raise her annual compensation to $215,000 effective immediately and to $300,000 beginning August 2008.

Ms. Yarde also receives a $750 per month car allowance.

Upon signing the employment agreement, Ms. Yarde also received immediately vested options to purchase up to 600,000 shares of the Company’s common stock at the following prices:

Number of Options	Exercise Price
200,000	$	1.00
200,000	$	1.25
200,000	$	1.50

This agreement supersedes all prior employment agreements between Ms. Yarde and the Company.

On August 4, 2006, the Company entered into a three-year employment agreement with J. Richard Iler with a base salary of:

$180,000 for the first year of the agreement

$207,000 for the second year of the agreement

$238,050 for the third year of the agreement

Mr. Iler also receives $500 per month car allowance.

Upon signing the employment agreement, Mr. Iler also received options to purchase up to 400,000 shares of the Company’s common stock at the following prices and subject to the vesting schedule set forth below.

Number of Options	Exercise Price		Vesting
200,000	$	1.05		Immediately
100,000	$	1.10		1 year from date of agreement
100,000	$	1.00		2 years form date of agreement

Upon signing Mr. Iler also received 100,000 shares of the Company’s common stock.

Stock Options

OPTIONS/SAR GRANTS TABLE

Option/SAR Grants in the Last Fiscal Year

Individual Grants

Name and Principal Position	Number of Securities Underlying Options/SARs Granted (#)		% of Total Options/SARs Granted to Employees in Fiscal Year			Exercise or Base Price ($/Sh)		Expiration Date		Market Price on Date of Grant ($/Sh)
Mark Basile		1,250,000				$	3.50		01/31/2010	$	1.50
President, CEO, Chairman

Lorraine Yarde		850,000		75	%	$	1.25		08/14/2011	$	1.25
Chief Operating Officer

J. Richard Iler		400,000		25	%	$	1.05		08/14/2011	$	1.05
Chief Financial Officer

2005 Incentive Stock Option Plan

The Company, in 2005, adopted a 2005 Equity Incentive Plan (the “Plan”). The Plan designates and authorizes the Board of Directors to grant or award to eligible participants of the Company and its subsidiaries and affiliates, until December 2015, stock options, stock appreciation rights, restricted stock performance stock awards and Bonus Stock awards for up to 1,250,000 shares of common stock of the Company. The Company issued _______ options and/or bonus shares under the plan.

The following is a general description of certain features of the Plan:

1. Eligibility. Officers, directors and other key employees and consultants of the Company, its subsidiaries and its affiliates who are responsible for the management, growth and profitability of the business of the Company, its subsidiaries and its affiliates are eligible to be granted stock options, stock appreciation rights, and restricted or deferred stock awards under the Plan. Directors are eligible to receive Stock Options.

2. Administration. The Incentive Plan is administered by the Stock Option Committee of the Company. The Board, in the absence of the establishment of this Committee, acts in the capacity of this Committee. The Stock Option Committee has full power to select, from among the persons eligible for awards, the individuals to whom awards will be granted, to make any combination of awards to any participants and to determine the specific terms of each grant, subject to the provisions of the Incentive Plan.

3. Stock Options. The Plan permits the granting of non-transferable stock options that are intended to qualify as incentive stock options (“ISO’s”) under section 422 of the Internal Revenue Code of 1986 and stock options that do not so qualify (“Non-Qualified Stock Options”). The option exercise price for each share covered by an option shall be determined by the Board of Directors, but shall not be less than 100% of the fair market value of a share on the date of grant. The term of each option will be fixed by the Stock Option Committee, but may not exceed 10 years from the date of the grant in the case of an ISO or 10 years and two days from the date of the grant in the case of a Non-Qualified Stock Option. In the case of 10% stockholders, no ISO shall be exercisable after the expiration of five (5) years from the date the ISO is granted.

4. Stock Appreciation Rights. Non-transferable stock appreciation rights (“SAR’s”) may be granted in conjunction with options, entitling the holder upon exercise to receive an amount in any combination of cash or unrestricted common stock of the Company (as determined by the Stock Option Committee), not greater in value than the increase since the date of grant in the value of the shares covered by such right. Each SAR will terminate upon the termination of the related option.

5. Restricted Stock. Restricted shares of the common stock may be awarded by the Stock Option Committee subject to such conditions and restrictions as they may determine. The Stock Option Committee shall also determine whether a recipient of restricted shares will pay a purchase price per share or will receive such restricted shares without, any payment in cash or property. No Restricted Stock Award may provide for restrictions beyond ten (10) years from the date of grant.

6. Performance Stock. Performance shares of Common Stock may be awarded without any payment for such shares by the Stock Option Committee if specified performance goals established by the Committee are satisfied. The designation of an employee eligible for a specific Performance Stock Award shall be made by the Committee in writing prior to the beginning of the period for which the performance is based. The Committee shall establish the maximum number of shares to stock to be issued to a designated Employee if the performance goal or goals are met. The committee reserves the right to make downward adjustments in the maximum amount of an Award if, in it discretion unforeseen events make such adjustment appropriate. The Committee must certify in writing that a performance goal has been attained prior to issuance of any certificate for a Performance Stock Award to any Employee.

7. Bonus Stock. The committee may award shares of Common Stock to Eligible Persons, without any payment for such shares and without any specified performance goals. The Employees eligible for bonus Stock Awards are senior officers and consultants of the Company and such other employees designated by the Committee.

8. Transfer Restrictions. Grants under the Plan are not transferable except, in the event of death, by will or by the laws of descent and distribution.

9. Termination of Benefits. In certain circumstances such as death, disability, and termination without cause, beneficiaries in the Plan may exercise Options, SAR’s and receive the benefits of restricted stock grants following their termination or their employment or tenure as a Director as the case may be.

10. Change of Control. The Plan provides that (a) in the event of a “Change of Control” (as defined in the Plan), unless otherwise determined by the Stock Option Committee prior to such Change of Control, or (b) to the extent expressly provided by the Stock Option Committee at or after the time of grant, in the event of a “Potential Change of Control” (as defined in the Plan), (i) all stock options and related SAR’s (to the extent outstanding for at least six months) will become immediately exercisable: (ii) the restrictions and deferral limitations applicable to outstanding restricted stock awards and deferred stock awards will lapse and the shares in question will be fully vested: and (iii) the value of such options and awards, to the extent determined by the Stock Option Committee, will be cashed out on the basis of the highest price paid (or offered) during the preceding 60-day period, as determined by the Stock Option Committee. The Change of Control and Potential Change of Control provisions may serve as a disincentive or impediment to a prospective acquirer of the Company and, therefore, may adversely affect the market price of the common stock of the Company.

11. Amendment of the Plan. The Plan may be amended from time to time by majority vote of the Board of Directors provided as such amendment may affect outstanding options without the consent of an option holder nor may the plan be amended to increase the number of shares of common stock subject to the Plan without stockholder approval.

12. 2008 Professional/Consultant Stock Compensation Plan. Effective March 13^th, 2008, the Company’s Board of Directors registered with the SEC, a Form S-8 Registration, provide compensation in the form of Common Stock of the Company to eligible consultants that have previously rendered services or that will render services during the term of this 2008 Professional/Consultant Stock Compensation Plan.

Item 11. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The following table sets forth, as of March 30, 2007, the number and percentage of shares of Common Stock of the Company, owned of record and beneficially, by each person known by the Company to own 5% or more of such stock, each director of the Company, and by all executive officers and directors of the Company, as a group:

Name and Address	Number of Shares			Percentage
Mark Basile		3,824,955	(1)(2 )		18.25	%
500 N. Broadway
Jericho, NY 11753

J. Richard Iler		512,500	(3)		2.6	%
500 N. Broadway
Jericho, NY 11753

Lorraine Yarde		1,068,545	(4)		5.3	%
500 N. Broadway
Jericho, NY 11753

The Naples Trust (5)		1,178,457			6.3	%
736 Carlisle Road
Jericho, NY 11753

Wendy Borow-Johnson		50,000			.3
500 N. Broadway
Jericho, NY 11753

Russell Kuhn		1,614,307	(6)		8.2	%
8680 Greenback Lane
Orangevale, CA 95662

BridgePointe Master Fund Ltd.		1,100,000	(7)		5.3	%
c/o Roswell Capital Partners, LLC
1125 Sanctuary Parkway, Suite 725
Alpharetta, GA 30004

Linden Growth Partners Master Fund, LP		1,149,000			5.8	%
718 South State Street
Clarks Summit, PA 18411

Officers and directors as a group 4 persons) (1)(2)(3)(4)(5)		5,456,000			32.75	%

(1)			Includes 1,178,457 shares held by The Naples Trust. Mr. Basile’s mother-in-law is the trustee for The Naples Trust and Mr. Basile’s wife is the beneficiary.

(2)			Includes 1,215,000 shares of common stock issuable upon the exercise of stock options and warrants to purchase a like number of shares.

(3)			Includes 275,000 shares of common stock issuable upon the exercise of stock options and warrants to purchase a like number of shares.

(4)			Includes 295,000 shares of common stock issuable upon the exercise of stock options and warrants to purchase a like number of shares.

(5)			Mr. Basile’s mother-in-law is the trustee for The Naples Trust and Mr. Basile’s wife is the beneficiary.

(6)			Includes 29,511 shares of common stock issuable upon the exercise of warrants to purchase a like number of shares.

(7)			Includes stock underlying a warrant to purchase 1,000,000 shares of common stock at an exercise price of $1.00 per share. Does not include shares underlying a convertible debenture in the principal amount of $700,000 as of March 25, 2009 in that these shares would not be deemed beneficially owned within the meaning of Sections 13(d) and 13(g) of the Exchange Act before their acquisition by BridgePointe Master Fund Ltd. Eric Swartz, who hold voting and dispositive power with respect to the securities held by BridgePointe Master Fund Ltd., disclaims beneficial ownership of such securities. The debenture and warrant contain language restricting the shareholder from owning in excess of 4.99% of the Company’s common stock at any given time.

As ownership of shares of the Common Stock by each of the Company’s directors and executive officers is included within the foregoing table, and as the Company currently employs no additional executive officers, no separate table has been provided to identify Company stock ownership by management personnel.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

On March 6, 2008, the Company issued The Incredible Card Company 150,000 restricted shares of its common stock as consideration for the purchase of a patent. Mark Basile, the Company’s Chairman and Chief Executive Officer, is a former officer and director of he Incredible Card Company.

On January 23, 2007, the Company issued 80,000 shares of its common stock in exchange for Mr. Basile foregoing $140,000 of his 2007 salary.

On April 24, 2007, the Company issued 140,000 shares of its common stock and 140,000 warrants exercisable at $1.00 per share to Mark Basile as consideration for providing the Company a loan in the principal amount of $130,000.

On May 21, 2007 the Company issued 50,000 shares of its common stock and 50,000 warrants exercisable at $1.00 per share to Lorraine Yarde, the Company’s Chief Operating Officer as consideration for providing the Company a loan in the principal amount of $50,000.

On June 15, 2007, the Company issued 45,000 shares of its common stock and 45,000 warrants exercisable at $1.00 per share to Lorraine Yarde as consideration for providing the Company a loan in the principal amount of $45,000.

On June 18, 2007, the Company awarded Lorraine Yarde 150,000 shares of common stock as a bonus for securing an increased purchase order form The Home Depot and an additional purchase order from MasterLOCK.

On June 18, 2007, the Company issued 75,000 shares of its common stock and 75,000 warrants exercisable at $1.00 per share to The Naples Trust, of which Mark Basile is a related party, as consideration for providing the Company a loan in the principal amount of $75,000.

On June 28, 2007, the Company issued 75,000 shares of its common stock and 75,000 warrants exercisable at $1.00 per share to J. Richard Iler , the Company’s Chief Financial Officer as consideration for providing the Company a loan in the principal amount of $75,000.

On July 25, 2007, the Company issued 25,000 shares of its common stock and 25,000 warrants exercisable at $1.00 per share to Mark Basile as consideration for providing the Company a loan in the principal amount of $25,000.

On July 25, 2007 the Company issued 150,000 shares of its common stock to Mark Basile as consideration for Mr. Basile providing the Company his personal guarantee in connection with the opening of an escrow agreement in the amount of $750,000.

ITEM 13. EXHIBITS

Exhibit No.	Description of Exhibit	If Incorporated by Reference, Document with which Exhibit was Previously Filed with SEC
3.1	Certificate of Incorporation	Annual Report on Form 10-K for the year ended December 31, 1987, filed March 30, 1988

3.1	Certificate of Amendment to Certificate of Incorporation filed May 2, 1988	Annual Report on Form 10-K for the year ended December 31, 1988 filed December 28, 1989

3.1	Certificate of Amendment to Certificate of Incorporation filed September 12, 1990	Annual Report on Form 10-K for the year ended December 31, 1990 filed April 15, 1991

3.1.1	Certificate of Amendment to Certificate of Incorporation filed August 26, 2003	Annual Report on Form 10-K for the year ended December 31, 2003

3.1.2	Certificate of Amendment to Certificate of Incorporation filed August 28, 2003	Annual Report on Form 10-K for the year ended December 31, 2003

3.1.3	Certificate of Amendment to Certificate of Incorporation filed December 14, 2004	Annual Report on Form 10-K for the year ended December 31, 2005

3.1.4	Certificate of Amendment to Certificate of Incorporation filed September 23, 2005	Annual Report on Form 10-K for the year ended December 31, 2005

3.1.5	Certificate of Amendment to Certificate of Incorporation filed March 10, 2006	Annual Report on Form 10-K for the year ended December 31, 2005

3.2	Bylaws	Annual Report on Form 10-K for the year ended December 31, 2003

4	Designation of Preference with respect to Series A Preferred Stock, filed August 23, 2000	Annual Report on Form 10-KSB for the year ended December 31, 2000, filed April 2, 2001

4.1	Amended Designation of Preference with respect to Series A Preferred Stock, filed August 23, 2000	Current Report on Form 8-K, filed July 18, 2003

10.1	Asset Purchase Agreement dated October 7, 2004 between the Registrant and Palomar Enterprises, Inc.	Current Report on Form 8-K, filed October 13, 2004

10.2	Capital Stock Purchase Agreement dated October 7, 2004 between shareholders of the Registrant and Palomar Enterprises, Inc.	Current Report on Form 8-K, filed October 13, 2004

10.3	Agreement and Plan of Merger dated as of April 27, 2005 between the Registrant, its Merger Subsidiary and bioMETRX Technologies, Inc.	Current Report on Form 8-K, filed May 3, 2005

10.4	Subscription Agreement dated July 5, 2005 between the Registrant and Russell Kuhn	Current Report on Form 8-K, filed July 8, 2005

10.5	Common Stock Purchase Warrant issued to Russell Kuhn on July 5, 2005	Current Report on Form 8-K, filed July 8, 2005

10.6	Employment Agreement dated December 12, 2002 between Mark Basile and bioMetrx Technologies, Inc.	Annual Report on Form 10-K for the year ended December 31, 2005

10.7	Amendment to Employment Agreement dated February 6, 2006 between the Registrant and Mark Basile	Annual Report on Form 10-K for the year ended December 31, 2005

10.8	Employment Agreement dated January 1, 2004 between Steven Kang and bioMetrx Technologies, Inc.	Annual Report on Form 10-K for the year ended December 31, 2005

10.9	Employment Agreement dated August 5, 2005 between Lorraine Yarde and bioMetrx Technologies, Inc.	Annual Report on Form 10-K for the year ended December 31, 2005

10.10	Amendment to Employment Agreement dated January 26, 2006 between the Registrant and Lorraine Yarde	Annual Report on Form 10-K for the year ended December 31, 2005

10.11	Finder’s Fee Agreement dated November 28, 2005 between the Registrant and Harbor View Group, Inc.	Annual Report on Form 10-K for the year ended December 31, 2005

10.12	Finder’s Fee Agreement dated February 8, 2006 between the Registrant and Harbor View Group, Inc.	Annual Report on Form 10-K for the year ended December 31, 2005

10.13	Subscription Agreement dated October 28, 2005 between the Registrant and Russell Kuhn	Current Report on Form 8-K, filed November 1, 2005

10.14	Common Stock Purchase Warrant issued to Russell Kuhn on October 28, 2005	Current Report on Form 8-K, filed November 1, 2005

10.15	Settlement Agreement dated January 12, 2006 between the Registrant and Adam Laufer, Esq.	Annual Report on Form 10-K for the year ended December 31, 2005

10.16	Consulting agreement dated November 7, 2005 between the Registrant and Wendy Borow-Johnson	Quarterly Report on Form 10-QSB for the quarter ended September 30, 2005, filed November 18, 2005

10.17	2005 Equity Incentive Plan	Registration Statement on Form S-8 filed December 23, 2005

10.18	Form of Stock Option issued pursuant to 2005 Equity Incentive Plan	Annual Report on Form 10-K for the year ended December 31, 2005

10.19	Form of Stock Option issued outside of plan	Annual Report on Form 10-K for the year ended December 31, 2005

10.20	Letter of Engagement dated March 17, 2006 between the Registrant and Pasadena Capital Partners, LLC	Quarterly Report on From 10-QSB for the quarter ended March 31, 2006, filed May 15, 2006

10.21	Consulting Agreement dated April 20, 2006 between the Registrant and New Castle Consulting, Inc.	Quarterly Report on From 10-QSB for the quarter ended March 31, 2006, filed May 15, 2006

10.22	Form of Securities Purchase Agreement	Current Report on Form 8-K filed May 2, 2006

10.23	Form of Series A Common Stock Purchase Warrant	Current Report on Form 8-K filed May 2, 2006

10.24	Form of Series B Common Stock Purchase Warrant	Current Report on Form 8-K filed May 2, 2006

10.25	Form of Registration Rights Agreement	Current Report on Form 8-K filed May 2, 2006

10.26	Form of Escrow Agreement	Current Report on Form 8-K filed May 2, 2006

10.27	Termination Agreement dated July 11, 2006 between the Registrant and Steven Kang	Current Report on Form 8-K filed July 14, 2006

10.28	Consulting Agreement dated October 20, 2006 between the Registrant and Interactive Resources Group, Inc.	Quarterly Report on Form 10-QSB for the quarter ended September 30, 2006

10.29	Consulting Agreement dated October 23, 2006 between the Registrant and Brendan Hopkins	Quarterly Report on Form 10-QSB for the quarter ended September 30, 2006

10.30	Form of Warrant issued to Interactive Resources Group, Inc.	Quarterly Report on Form 10-QSB for the quarter ended September 30, 2006

10.31	Form of Warrant issued to Investors	Quarterly Report on Form 10-QSB for the quarter ended September 30, 2006

10.32	Form of Securities Purchase Agreement entered into between the Registrant and Investors	Quarterly Report on Form 10-QSB for the quarter ended September 30, 2006

10.33	Form of Note issued by the Registrant to Investors	Quarterly Report on Form 10-QSB for the quarter ended September 30, 2006

10.34	Form of Securities Purchase Agreement	Current Report on Form 8-K filed January 8, 2007

10.35	Form of Series A Common Stock Purchase Warrant	Current Report on Form 8-K filed January 8, 2007

10.36	Form of Series B Common Stock Purchase Warrants	Current Report on Form 8-K filed January 8, 2007

10.37	Form of Registration Rights Agreement	Current Report on Form 8-K filed January 8, 2007

10.38	Form of Convertible Debenture	Current Report on Form 8-K filed January 8, 2007

10.39	Form of Consent and Waiver	Current Report on Form 8-K filed January 8, 2007

10.40	Form of Forebearance Note	Current Report on Form 8-K filed January 8, 2007

10.41	Employment Agreement dated August 4, 2006 between the Registrant and J. Richard Iler	Current Report on Form 8-K filed August 9, 2006


10.42	Consulting Agreement dated as of January 15, 2007 between the Registrant and ICR, LLC	Filed herewith

10.43	Factoring Agreement between BLX Funding LLC and the Registrant effective January 17, 2007	Current Report on Form 8-K filed January 22, 2007

10.44	Funding Agreement between BLX Funding LLC and the Registrant effective January 17, 2007	Current Report on Form 8-K filed January 22, 2007

10.45	Letter Amending Factoring Agreement dated January 17, 2007 between BLX Funding LLC and the Registrant	Current Report on Form 8-K filed January 22, 2007

10.46	Performance Guaranty between BLX Funding LLC and Mark Basile	Current Report on Form 8-K filed January 22, 2007

10.47	Purchase and Sale Agreement between BLX Funding LLC and Registrant effective January 17, 2007	Current Report on Form 8-K filed January 22, 2007

10.48	Right of Set-Off Letter dated January 17, 2007	Current Report on Form 8-K filed January 22, 2007

10.49	Security Agreement between BLX Funding LLC and the Registrant effective January 17, 2007	Current Report on Form 8-K filed January 22, 2007

10.50	Assignment of Intellectual Property Technology Purchase Agreement dated as of March 16, 2007	Current Report on Form 8-K filed March 16, 2007

10.51	Service Level Agreement between A2E Technologies and the Registrant dated March 16, 2007	Current Report on Form 8-K filed March 17, 2007

16	Letter on Change In Certifying Accountants	Current Report on Form 8K, filed August 20, 2003 and an amendment thereto on Form 8K/a filed March 5, 2004.

16.1	Letter on Change In Certifying Accountants	Current Report on Form 8K, filed April 25, 2005

21	List of Subsidiaries	Contained herein.

31.1	Certification of Chief Executive Officer of Periodic Report pursuant to Rule 13a-14a and Rule 15d-14(a).	Contained herein.

31.2	Certification of Principal Financial Officer of Periodic Report pursuant to Rule 13a-14a and Rule 15d-14(a).	Contained herein.

32.1	Certification pursuant to 18 U.S.C. Section 1350.	Contained herein.

32.2	Certification pursuant to 18 U.S.C. Section 1350.	Contained herein.

99.2	Code of Ethics, as Adopted by the Board of Directors	Annual Report on Form 10-K for the year ended December 31, 2003

Item 14. Principal Accountant Fees and Services.

Audit Fee

The aggregate fees billed for the most recent fiscal year for professional services rendered by the principal accountant for the audit of bioMETRX, Inc. and Subsidiary’s annual financial statement and review of financial statements included in bioMETRX, Inc. and Subsidiary’s 10-QSB reports and services normally provided by the accountant in connection with statutory and regulatory filings or engagements were $________ and $84,000 for years ended 2007 and 2006, respectively.

Audit-Related Fees

There were no audit related fees for the fiscal year ended 2007.

Tax Fees

Fees for tax compliance, tax advice and tax planning for the years 2007 and 2006 was $-0-.

All Other Fees

There were no other aggregate fees billed in either of the last two fiscal years for products and services provided by the principal accountant, other than the services reported above.

We do not have an audit committee currently serving and as a result our board of directors performs the duties of an audit committee. Our board of directors will evaluate and approve in advance, the scope and cost of the engagement of an auditor before the auditor renders audit and non-audit services. We do not rely on pre-approval policies and procedures.

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, thereunto duly authorized.


	bioMETRX, INC.

Dated: April 15, 2007	By:	/s/ Mark Basile
		Mark Basile, Chief Executive Officer

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.


Dated: April 15, 2007	By:	/s/ Mark Basile
		Mark Basile, Chief Executive Officer (Principal Executive Officer)


Dated: April 15, 2007	By:	/s/ J. Richard Iler
		J. Richard Iler, Chief Financial Officer and Director (Principal Accounting Officer)


Dated: April 15, 2007	By:	/s/ Lorraine Yarde
		Lorraine Yarde, Chief Operating Officer and Director