IMPERIALI INC - FORM 10-Q/A - November 25, 2009

Attached files

file	filename
EX-31.1 - IMPERIALI INC	v167706_ex31-1.htm
EX-32.2 - IMPERIALI INC	v167706_ex32-2.htm
EX-32.1 - IMPERIALI INC	v167706_ex32-1.htm
EX-31.2 - IMPERIALI INC	v167706_ex31-2.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q/A

Amendment 1

(Mark One)

þ	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May 31, 2009

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

For the transition from _______ to _______

Imperiali, Inc.

(Name of Small Business Issuer as Specified in Its Charter)

Florida		65-0574887
(State of Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

222 Lakeview Avenue, Suite 160

West Palm Beach, Florida 33401

(Address of Principal Executive Offices)

(561) 805-9494

(Issuer’s Telephone Number, including Area Code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days:

YES þ NO ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES o NO þ

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

Large accelerated filer ¨ Accelerated filer ¨ Non-accelerated filer ¨ smaller reporting company þ

(Do not check if a smaller reporting company)

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

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

Class – Common Stock, 39,643,319 shares outstanding as of July 9, 2009.

IMPERIALI INC.

QUARTERLY REPORT ON FORM 10-Q/A

For the quarterly period May 31, 2009

EXPLANATORY NOTE

This Amendment No. 1 on Form-10-Q/A to the Quarterly Report on Form-10-Q of Imperiali, Inc. (the Company) for the quarterly period ended May 31, 2009 is being filed to correct the date referenced in Item 4 CONTROLS AND PROCEDURES under the paragraph ‘Management’s Report on Internal Control over Financial Reporting’. The date has been changed from August 31, 2008 to May 31, 2009.

Imperiali, Inc.

Form 10-Q/A

For the Quarter Ended May 31, 2009

Table of Contents

		Page
PART I	FINANCIAL INFORMATION

Item 1.	Financial Statements

	Balance Sheets at May 31, 2009 (unaudited) and August 31, 2008	4

	Statements of Operations for the three and nine month periods ended May 31, 2009 and May 31, 2008 (unaudited)	5

	Statements of Cash Flows for the nine month periods ended May 31, 2009 and May 31, 2008 (unaudited)	7

	Notes to Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	16

Item 4.	Controls and Procedures	17

PART II	OTHER INFORMATION

Item 1	Legal Proceedings	18

Item 1A	Risk Factors	18

Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	18

Item 3	Defaults Upon Senior Securities	18

Item 4	Submission of Matters to a Vote of Security Holders	18

Item 5	Other Information	18

Item 6.	Exhibits	18 – 19

	Exh. 31.1 Section 302 Certification of Chief Executive Officer
	Exh. 31.2 Section 302 Certification of Chief Financial Officer
	Exh. 32.1 Section 906 Certification of Chief Executive Officer
	Exh. 32.2 Section 906 Certification of Chief Financial Officer

	Signatures	20

PART I.

ITEM 1 - FINANCIAL STATEMENTS

Imperiali, Inc.

(a Development Stage Company)

Balance Sheets

As of May 31, 2009 and August 31, 2008

(Unaudited)

	May 31, 2009			August 31, 2008

ASSETS
Current assets:
Cash	$	6,874		$	3,059
Total current assets		6,874			3,059

Fixed assets (net of accumulated depreciation of $1,089 and $160 at May 31, 2009 and August 31, 2008, respectively)		5,666			840
Total assets	$	12,540		$	3,899

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable – related party	$	4,369		$	43,000
Accounts payable		49,991			1,651
Note payable and accrued interest – related party		302,038			269,262
Total current liabilities		356,398			313,913
Stockholders' deficit:
Common stock; $.001 par value; authorized - 500,000,000 shares; 39,643,319 and 36,961,319 shares issued and outstanding at May 31, 2009 and August 31, 2008, respectively		39,643			36,961
Additional paid in capital		24,725,357			16,469,539
Accumulated deficit prior to entering the development stage		(15,983,833	)		(15,983,833	)
Accumulated deficit since entering the development stage		(9,125,025	)		(832,681	)
Total stockholders' deficit		(343,858	)		(310,014	)

Total liabilities and stockholders' deficit	$	12,540		$	3,899

The accompanying notes are an integral part of these financial statements

IMPERIALI, INC.

(a Development Stage Company)

Statements of Operations

For the three and nine months ended May 31, 2009 and May 31, 2008

and the period from September 1, 2007 to May 31, 2009

(unaudited)

	For the Three months ended						For the Nine months ended
	May 31, 2009			May 31, 2008			May 31, 2009			May 31, 2008			Development Stage (Sept. 1, 2007 to May 31, 2009)
				(Restated)						(Restated)

Dividend Income	$	—		$	10		$	—		$	735		$	735
Total Income		—			10			—			735			735

Expenses:
Employees and Related Party Consulting		12,601			9,613			8,120,357			181,771			8,186,497
General and Administrative		26,367			12,608			126,630			354,561			202,144
Total Operating Expenses		38,968			22,221			8,246,987			536,332			8,388,641
Net Income (loss) from Operations		(38,968	)		(22,211	)		(8,246,987	)		(535,597	)		(8,387,906	)

Other Income (Expenses):
Other Expense														(680,000	)
Interest expense		(15,542	)		—			(45,357	)		—			(57,119	)
Net Loss for the period	$	(54,510	)	$	(22,211	)	$	(8,292,344	)	$	(535,597	)	$	(9,125,025	)

Earnings (loss) per common share – basic and diluted	$	(0.001	)	$	(0.001	)	$	(0.215	)	$	(0.014	)

Weighted avg. common shares out. – basic and diluted		39,643,319			36,961,319			38,600,468			36,945,506

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

IMPERIALI, INC.

(a Development Stage Company)

Statement of Changes in Stockholders' Equity (Deficit)

From August 31, 2006 to May 31, 2009

(unaudited)

	Shares		Amount		Additional Paid in Capital		Accumulated Deficit Prior to Entering the Development Stage			Deficit Accumulated Since Entering the Development Stage			Total

Balance August 31, 2006		20,358,486	$	20,358	$	11,760,605	$	(11,171,422	)	$	-		$	609,541

Issuance of common stock		16,561,000		16,561		4,358,828		-			-			4,375,389

Net loss for the year		-		-		-		(4,812,411	)		-			(4,812,411	)
Balance August 31, 2007		36,919,486	$	36,919	$	16,119,433	$	(15,983,833	)	$	-		$	172,519

Capital contribted by shareholder		-		-		336,000		-			-			336,000
Shares sold for cash		41,833		42		14,106		-			-			14,148
Net loss for the year								-			(832,681	)		(832,681	)
Balance August 31, 2008		36,961,319	$	36,961	$	16,469,539	$	(15,983,833	)	$	(832,681	)	$	(310,014	)

Capital contribted by shareholder		-		-		212,500		-			-			212,500
Stock based compensation		2,682,000		2,682		8,043,318								8,046,000
Net loss for the year								-			(8,292,344	)		(8,292,344	)

Balance May 31, 2009		39,643,319	$	39,643	$	24,725,357	$	(15,983,833	)	$	(9,125,025	)	$	(343,858	)

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

IMPERIALI, INC.

(a Development Stage Company)

Statements of Cash Flows

For the nine months ended May 31, 2009 and May 31, 2008

and the period from September 1, 2007 to May 31, 2009

(unaudited)

	For the Nine Months Ended May 31, 2009			For the Nine Months Ended May 31, 2008			Development Stage (Sept. 1, 2007 to May 31, 2009)
				(Restated)
Cash flow from operating activities:
Net loss	$	(8,292,344	)	$	(535,597	)	$	(9,125,025	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock based compensation		8,046,000			—			8,046,000
Write-off of Kaiser Himmel loan		—			—			680,000
Depreciation expense		929			80			1,089
Change in operating assets and liabilities:
Other assets		—			—			9,765
Notes Receivable		—			—			(680,000	)
Change in accounts payable and accrued expenses		38,899			(201,890	)		68,698
Net cash (used in) operating activities		(206,516	)		(737,407	)		(999,473	)

Cash flows from investing activities:
Capital expenditures		(5,755	)		(1,000	)		(6,755	)
Net cash (used in) investing activities		(5,755	)		(1,000	)		(6,755	)

Cash flows from financing activities:
Net proceeds from related party note		3,586			300,000			261,086
Net capital contribution from shareholder		212,500			234,891			548,500
Proceeds from sale of common stock		—			14,148			14,148
Net cash provided by financing activities		216,086			549,039			823,734

Net increase (decrease) in cash		3,815			(189,368	)		(182,494	)
Cash at beginning of period		3,059			189,368			189,368
Cash at end of period	$	6,874		$	—		$	6,874

Supplemental Cash Flow Information:
Income taxes paid in cash		—			—			—
Interest paid in cash	$	3,259			—		$	3,259

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

Imperiali Inc.

(a Development Stage Company)

Notes To Financial Statements

(unaudited)

Note 1 - Basis of presentation

The accompanying unaudited financial statements have been prepared in accordance with the accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with Imperiali’s annual financial statements and notes thereto filed with the SEC on form 10-K/A for the year ended August 31, 2008. The interim financial information presented in this report is done so following the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for financial statements. In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation, have been included. Operating results for the nine months ended May 31, 2009 are not necessarily indicative of the results that may be expected for the year ending August 31, 2009.

Note 2 – Going Concern

Imperiali’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlements of liabilities and commitments in the normal course of business for the foreseeable future. The company has insufficient working capital to meet operating needs for the next twelve months as of May 31, 2009, which raises doubt about Imperiali’s ability to continue as a going concern.

Note 3 – Organizational Information

Nature of Business - Imperiali, Inc. is a team of global expansion and business development company experts that are strategically positioned around the globe to identify emerging companies that wish to align with strategic partners to grow their businesses, and raise capital for business development and telecommunications infrastructure. The Company is currently in the development stage.

Note 4 – Note Payable

As of May 31, 2009 the company has a note payable due of $251,086, plus $50,952 in accrued interest, to Daniel Imperato a member of the Board of Directors and the interim CEO. As of August 31, 2008, the balance of the note was $257,500, plus $11,762 in accrued interest.

Note 5 - Guaranteed Commitments

The Company leases approximately 2,000 square feet of space at 529 Flagler Drive and the mailing address is 222 Lakeview Avenue, Suite 160, West Palm Beach, Florida USA 33401. The office space is used for sales, administrative offices, and customer support.

Note 6 - Related Party Transactions

Included in current liabilities is $4,369 of accrual expenses owed to Mr. Imperato for travel and miscellaneous expenses incurred on behalf of the company. The Company also received capital contributions of $82,500 from shareholders during the quarter ended May 31, 2009, for a total of $212,500 for the nine months ended May 31, 2009.

The company also owes Mr. Imperato $302,038 related to a note payable and accrued interest, which is described in Note 4.

Note 7 - Entry into a Material Definitive Agreement

On February 10, 2009, the company entered into an agreement with three entities controlled by Mr. Imperato that had been providing management, marketing and consulting services to the company for an extended period of time. Pursuant to the terms of the agreement, the Company issued 2,682,000 shares of common stock for these services. The consideration for this transaction consisted solely of Company common stock valued at $3.00 per share, thereby totaling $8,046,000, which has been recorded as stock-based compensation on the Statement of Operations. The capitalization of the Company now consists of 39,643,319 shares of common stock outstanding. The $3.00 per share value was the last price at which the Company sold its common stock, and was used as the market value of the stock for this transaction.

Note 8 - Unregistered Sales of Equity Securities

Pursuant to the share transaction described above in Note 7, on February 10, 2009, the Company issued 2,682,000 shares of its common stock to entities controlled by Mr. Imperato. These persons were the only offerees in connection with this transaction. The registrant relied upon section 4(2) and Regulation D of the Securities Act of 1933, as amended.

Note 9 – Restatement

The Company has restated its’ previously issued May 31, 2008 financial statements for matters related to the following: revenue, operating expense and depreciation expense. The following is a summary of the restatements for May 31, 2008:

STATEMENT OF OPERATIONS

	Previously reported						Restated
	Nine months ended 5/31/2008			Adjustment			Nine months ended 5/31/2008
Revenue
Consulting Income	$	358,000		$	(358,000	)	$	—
Interest and dividends		735			—			735
Total Revenue	$	358,735		$	(358,000	)	$	735

Expenses
Employee and Related Party Consulting costs		325,525			(143,754	)		181,771
General and administrative		346,720			7,761			354,481
Depreciation Expense		—			80			80
Total Expenses		672,255			(135,913	)		536,332
Operating Income		(313,520	)		(222,077	)		(535,597	)

Other (income)expense		—			—			—
Net Income (loss)	$	(313,520	)	$	(222,077	)	$	(535,597	)
Earnings (loss) per share (basic and diluted)	$	(0.007	)	$	(0.020	)	$	(0.014	)
Weighted average common shares (basic and diluted)		48,200,986			(11,255,480	)		36,945,506

The result of these restatements is an increase in the net loss of $222,077.

This Amendment to our Quarter Report on Form 10-Q for the quarter ended May 31, 2008 was filed to amend certain errors in the following sections: shares outstanding, cash, depreciation expense, interest expense, accounts payable and Shareholders Equity.

Except as required to reflect the change noted above, this Form 10-Q does not attempt to modify or update any other disclosures set forth in our Quarter Report on Form 10-Q. Additionally, this Form 10-Q does not purport to provide a general update or discussion of any other developments of the Company subsequent to the original filing. The filing of this Form 10-Q shall not be deemed an admission that the original filing, when made, included any untrue statement of material fact or omitted to state a material fact necessary to make a statement not misleading.

1 -	Consulting income was overstated by $358,000, which should have been reported as capital contributed from shareholder.

2 –	Consulting expenses and G&A expenses were overstated by $135,993.

3 –	Depreciation expense was understated by $ 80.

ITEM 2. MANAGEMENT’S DISCUSSION and ANALYSIS or PLAN of OPERATIONS

The following discussion should be read in conjunction with our unaudited financial statements and notes thereto.

Forward-Looking Statements

This quarterly report contains forward-looking statements and information relating to us that are based on the beliefs of our management as well as assumptions made by, and information currently available to, our management. When used in this report, the words “anticipate”, “believe”, “estimate”, “expect”, “intend”, “plan” and similar expressions, as they relate to us or our management, are intended to identify forward-looking statements. These statements reflect management’s current view of us concerning future events and are subject to certain risks, uncertainties and assumptions, including among many others: a general economic downturn; a downturn in the securities markets; federal or state laws or regulations having an adverse effect on proposed transactions that we desire to effect; Securities and Exchange Commission regulations which affect trading in the securities of “penny stocks,”; and other risks and uncertainties. Should any of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this report as anticipated, estimated or expected. All forward-looking statements attributable to us are expressly qualified in their entirety by the forgoing cautionary statement.

Overview

On November 6, 2008, Imperiali, Inc. filed a Form N-54C with the SEC withdrawing the Company’s election to be regulated as a business development company pursuant to the Investment Company Act of 1940.

The Company is now pursuing a business model whereby it would consolidate its subsidiaries and provide global business development consulting services (the “New Business Model”). Specifically, the Company will identify client companies and assist them with their global expansion, and provide them with business advice and management expertise related thereto. Under the New Business Model, the Company will at all times be managed and conduct its activities in such a way as to not act as an “investment company” subject to regulation under the 1940 Act. Thus, it will not hold itself out as being engaged primarily in the business of investing, reinvesting or trading in securities. In addition, the Company will conduct its business in such a manner as to ensure that it will at no time own or propose to acquire investment securities having a value exceeding 40 percent of the Company's total assets at any one time. The Company has recently implemented a share exchange whereby shareholders of each of the Company’s subsidiaries may exchange the subsidiary shares for Company shares on a 1:1 basis.

Plan of Operation

Imperiali, Inc. (the “Company”) was incorporated in Florida on September 27, 1994 under the name Automated Energy Security Inc.

From September 1994 through March 1999, our Company provided energy management services and intelligent security for residential dwellings, commercial buildings and government facilities. In 1994, the Company purchased all of the patented technology, software and patents pending on the Wide Area Energy Savings System known as “TESS” (Total Energy Security System) from Associated Data Consultants, Inc. In 1998, after Bell Atlantic (one of our strategic partners) withdrew from the development of TESS and engaged in litigation with Associated Data, the Company abandoned our business operations related to TESS.

In March 1999, we changed our name to New Millennium Development Group, Inc. and our business operations to media and telecommunications, focusing on connectivity solutions, storage, fiber optic cable systems, security and the international long distance market. Our plan was to spearhead a subsea fiber optic cable system connecting 70 countries around the globe. In furtherance of the plan the Company entered into Memoranda of Understanding with 30 countries, completed landing party site and ocean surveys, arranged long-term financing and selected vendors and subcontractors for fiber optic cable and equipment. During the process, however, the price of cable systems skyrocketed, forcing us to reconsider our business plans and projections. The Company retained the services of an independent consultant who concluded that not only would increasing cable prices decrease long-term gains, the rapid development of the internet and Intellectual Property systems would render obsolete the market for fiber optic cable. Accordingly, in mid 2001 we shifted our focus away from fiber optic cable systems and concentrated on Voice over Internet Protocol (VOIP) and related services including high-speed wireless standard ISP and broadband services; international calling cards; video conferencing and related IP products.

Failed corporate history, management infighting, the tragedy of September 11, 2001 and the general economic downturn especially related to technology, led us to cease business operations in mid-2002 until mid-2005. However, during this time, Mr. Imperato, the Company’s Chairman, at the time, and majority shareholder, worked to maintain management relationships with previous businesses, associates and professionals for the eventual resurrection of business operations.

In November 2005, we changed our name to Imperiali, Inc. and commenced operations as a business development company an investment company and elected to be regulated as a business development by the Securities and Exchange Commission under the Investment Company Act 1940. As a business development company, we were primarily engaged in the business of furnishing capital and making available managerial assistance to companies that do not have ready access to capital through conventional financial channels. As a business development company we were required to comply with numerous regulatory requirements.

On November 19, 2007, our Company entered into an initial subscription agreement with Kaiser Himmel Corporation (“Kaiser”) whereby Kaiser agreed to purchase 10,000,000 shares of our Company’s common stock in exchange for Kaiser transferring to the Company 1.6 million shares of Sprint Nextel common stock, which Kaiser indicated was held in the name of Kaiser at Bank of America. The shares were purportedly restricted until October 2008.

Pursuant to the initial subscription agreement, (i) Kaiser agreed to provide non-cancellable instructions, along with all necessary and supporting documents related thereto, to Bank of America to directly transfer the 1.6 million shares Sprint Nextel stock to our Company’s stock account upon the expiration of the restrictions in October 2008. Such shares were valued at $23,800,120; and (ii) our Company agreed to loan Kaiser an aggregate of $380,000 at the current prime interest rate plus 1%, with such loan due and payable in October 2008. $150,000 was to be transferred to Kaiser upon execution of the subscription agreement, with the balance to be transferred to Kaiser within 30 days. Further, the Company agreed to deliver 10,000,000 shares of Company common stock to Kaiser.

On November 22, 2007, our Company entered into a second subscription agreement with Kaiser whereby Kaiser agreed to purchase an additional 70,000,000 shares of our Company’s common stock in exchange for Kaiser transferring to our Company 11.8 million shares of Sprint Nextel common stock, which Kaiser indicated was held in the name of Kaiser at Bank of America. These shares were also purportedly restricted until October 2008.

Pursuant to the second subscription agreement, which was scheduled to close on February 28, 2008, (i) Kaiser agreed to provide non-cancellable instructions, along with all necessary and supporting documents related thereto, to Bank of America to directly transfer the 11.8 million shares Sprint Nextel stock to our Company’s stock account upon the expiration of the restrictions in October 2008. Such shares were valued at $175,525,880; and (ii) our Company agreed to loan Kaiser an aggregate of $3,000,000 at the current prime interest rate plus 1%, and to deliver 70,000,000 shares of Company common stock to Kaiser.

Upon closing of both of these transactions Kaiser acquired 80,000,000 shares of our Company and controlled 62.5% of the Company. Eric Skys, who owned and controlled Kaiser, appointed himself as our Company’s chief executive officer.

Over the next several months, management infighting began to occur and the Company’s assets began to disappear. On or about May 15, 2008, Eric Skys was arrested by the Federal Bureau of Investigation (FBI). In late July 2008, a New York grand jury indicted Mr. Skys on charges that he tried to defraud several banks out of millions of dollars in an elaborate stock sale scheme. Mr. Skys was indicted on three counts of wire fraud and one count each of securities fraud and bank fraud. According to the U.S. attorney’s office for the Southern District of New York, Mr. Skys, if convicted may face up to 110 years in prison and the greater of a $6 million fine or twice the gross gain or loss from his offense.

Authorities said Mr. Skys contacted several banks in 2007 claiming he had 13.4 million shares of Sprint Nextel stock valued at $243,076,000 and he was seeking large sums of money in exchange for ownership interest in the Sprint Nextel stock. Mr. Skys said Kaiser received the shares as compensation for computer technology services, according to the court documents. Authorities also said that Mr. Skys was trying to induce the banks to give him cash or a loan in exchange for ownership interest in the shares. Authorities also said that as part of the scheme, Mr. Skys sent the banks fabricated documents and altered e-mails that showed Kaiser possessed the shares of Sprint Nextel stock. According to court documents, an FBI investigator interviewed representatives from Sprint Nextel, who said they never entered into a multi-million stock agreement with Kaiser.

In connection with Mr. Sky’s arrest, the FBI seized all of our Company’s data center equipment in Kaiser’s possession. To date, certain Company funds provided to Kaiser have not been accounted for, and no Company equipment has been returned to the Company by the FBI. The Company loaned approximately $680,000 to Kaiser.

On May 29, 2008, at meeting of the Company’s Board of Directors, the board approved an agreement between the Company, Kaiser and Imperiali Organization, a company owned and controlled by Daniel J. Imperato, whereby in exchange for Imperiali Organization assuming the debt owed to the Company by Kaiser, Kaiser will transfer all of its assets, including accounts receivable, causes of action, software, hardware, and work in process for all software projects, prototypes, websites, trademarks, vehicles and source code, to Imperiali Organization.

On September 1, 2008, Mr. Daniel J. Imperato, our Company’s majority shareholder, removed the Company’s then current board of directors and named himself as Interim Non-Executive Chairman Emeritus of our Company, treasurer and as a member of our board of directors; he also named Mr. Richard E. Biggs as an additional member of our board of directors. He then cancelled all 80,000,000 shares of Company stock issued to Kaiser as a result of Kaiser’s inability to deliver the 13.4 million shares of Sprint Nextel stock to our Company.

As of September 1, 2007, Imperiali did not meet the criteria of a business development company and entered the development stage.

On November 6, 2008, Imperiali, Inc. filed a Form N-54C with the SEC, formally withdrawing the Company’s election to be regulated as a business development company pursuant to the Investment Company Act of 1940.

The Company is now pursuing a business model whereby it would consolidate its subsidiaries and provide global business development consulting services (the “New Business Model”). Specifically, the Company will identify client companies and assist them with their global expansion, and provide them with business advice and management expertise related thereto. Under the New Business Model, the Company will at all times be managed and conduct its activities in such a way as to not act as an “investment company” subject to regulation under the 1940 Act. Thus, it will not hold itself out as being engaged primarily in the business of investing, reinvesting or trading in securities. Subsequent to year-end, the Company has implemented a share exchange whereby shareholders of each of the Company’s subsidiaries may exchange the subsidiary shares for Company shares on a 1:1 basis.

Results of Operations

The following table summarizes selected unaudited financial information for the three and nine months ended May 31, 2009 compared to the restated three and nine months ended May 31, 2008.

	For the Three Months Ended						For the Nine Months Ended
	May 31, 2009			May 31, 2008 (restated)			May 31, 2009			May 31, 2008 (restated)
Consulting Income	$	—		$	—		$	—		$	—
Dividend Income		—			10			—			735
Total Income	$	—		$	10		$	—		$	735

Expenses:
Employees and Consulting		12,601			9,613			8,120,357			181,771
General and administrative		26,367			12,608			126,630			354561
Total Operating Expenses		38,968			22,221			8,246,987			536,332
Net Income (loss) from Operations		(38,968	)		(22,211	)		(8,246,987	)		(535,597	)
Other Income (Expenses):
Interest expense		(15,542	)		—			(45,357	)		—
Net Loss for the period	$	(54,510	)	$	(22,211	)	$	(8,292,344	)	$	(535,597	)
Loss per common share – basic and diluted	$	(0.001	)	$	(0.001	)	$	(0.215	)	$	(0.014	)
Weighted avg. common shares outstanding – basic and diluted		39,643,319			36,961,319			38,600,468			36,945,506

During the quarter ended May 31, 2009, the Company incurred a net loss of $54,510. General and administrative expenses related primarily to insurance, travel, telephone, other office costs and costs associated with being a reporting company was $26,367. Professional fees totaled $12,601, used for legal and accounting fees.

General and administrative expenses increased $13,759 to $26,367, when comparing the third quarter of 2009 to 2008, primarily due increases in accounting fees and computer/internet costs.

For the nine months ended May 31, 2009 as compared to nine months ended May 31, 2008, the Company incurred a net loss of $8,292,344 as compared to a loss of $535,597 (restated) for the prior year. The difference mainly is due to the recorded expense for stock based compensation in the amount of $8,046,000 (2,682,000 shares at $3.00 per share), offset partially by lower operating expenses.

Compared to the previous year, the nine months ended May 31, 2009 experienced a threefold decrease in the cost of internet access and web-hosting expenses as it began to reestablish itself in the global business development consulting market. Through the use of more competitive providers, the elimination of in-house salaries, and an influx of capital, the company was able to expand its technological capabilities as it reorganizes and positions itself for its reintroduction. The costs of insurance, regulatory filings and professional fees remain a constant fixed cost.

Interest expense of $15,542 in the quarter ending May 31, 2009 covers accrued interest payable on the related party loan. Year to date interest expense is $45,357.

Liquidity and Capital Resources

The Company had cash on hand of $6,874 at May 31, 2009 and had no other assets to meet ongoing expenses or debts that may accumulate. As of such date, we have accumulated a deficit of $25,108,858. As of May 31, 2009 we had current liabilities totaling $356,398.

Operating Activities

The decrease of $206,516 in cash resulting from operating activities was primarily attributable to a net loss after adjustments of $245,415 offset by net increase in operating liabilities of $38,899.

Investing Activities

The Company has fixed assets, net of accumulated depreciation of $5,666 and has no commitment for any additional capital expenditure and foresees none in the near future. However, we will incur routine fees and expenses incident to our reporting duties as a reporting company, and we will incur expenses in finding and investigating possible acquisitions and other fees and expenses in the event we make an acquisition or attempt but are unable to complete an acquisition. Our cash requirements for the next twelve months are relatively modest, principally operational accounting expenses and other expenses relating to making filings required under the Securities Exchange Act of 1934 (the “Exchange Act”), which should not exceed $1.7 million in the fiscal year ending August 31, 2009. Any travel, lodging or other expenses which may arise related to finding, investigating and attempting to complete a combination with one or more potential acquisitions could also amount to thousands of dollars.

Financing Activities

The Company generated $216,086 from financing activities through the first nine months, made up primarily of capital contributions from shareholders.

The Company will only be able to pay our future debts and meet operating expenses by raising additional funds, acquiring a profitable company or otherwise generating positive cash flow. As a practical matter, we are unlikely to generate positive cash flow by any means other than acquiring a company with such cash flow. We believe that management members or shareholders will loan funds to us as needed for operations prior to completion of an acquisition. Management and the shareholders are not obligated to provide funds to us, however, and it is not certain they will always want or be financially able to do so. Our shareholders and management members who advance money to us to cover operating expenses will expect to be reimbursed, either by us or by the company acquired, prior to or at the time of completing a combination. We have no intention of borrowing money to reimburse or pay salaries to any of our officers, directors or shareholders or their affiliates.

Should existing management or shareholders refuse to advance needed funds, however, we would be forced to turn to outside parties to either loan money to us or buy our securities. There is no assurance whatsoever that the Company will be able to raise necessary funds from outside sources. Such a lack of funds could result in severe consequences to us, including among others:

•

failure to make timely filings with the SEC as required by the Exchange Act, which also probably would result in suspension of trading or quotation in our stock and could result in fines and penalties to us under the Exchange Act;

•

curtailing or eliminating our ability to locate and perform suitable investigations of potential acquisitions; or

•

Inability to complete a desirable acquisition due to lack of funds to pay legal and accounting fees and acquisition-related expenses.

We hope to require potential candidate companies to deposit funds with us that we can use to defray professional fees and travel, lodging and other due diligence expenses incurred by our management related to finding and investigating a candidate company and negotiating and consummating a business combination. There is no assurance that any potential candidate will agree to make such a deposit.

Critical Accounting Policies

Financial Reporting Release No. 60 of the SEC encourages all companies to include a discussion of critical accounting policies or methods used in the preparation of the financial statements. There are no current business operations or revenue generating activities that give rise to significant assumptions or estimates.

Our most critical accounting policies relate to the accounting and disclosure of related party transactions. Our financial statements filed as part of this report include a summary of the significant accounting policies and methods used in the preparation of our financial statements.

ITEM 3 - Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

ITEM 4 - Controls and Procedures

Management’s Report on Internal Control over Financial Reporting.

The Company carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of May 31, 2009, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in internal control over financial reporting

There were no changes in internal controls over financial reporting that occurred during the quarter ended May 31, 2009, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II OTHER INFORMATION

ITEM 1. - LEGAL PROCEEDINGS

We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries' officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

ITEM 1A. - RISK FACTORS

The Company’s Annual Report on Form 10K for the fiscal year ended August 31,2008 includes a detailed discussion of its risk factors. The information presented below adds an additional risk factor and should be read in conjunction with the risk factors and information disclosed in the Company’s Annual Report on Form 10K.

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

Pursuant to the share transaction described in Note 7, on February 10, 2009, the Company issued 2,682,000 shares of its common stock to entities controlled by Mr. Imperato. These persons were the only offerees in connection with this transaction. The registrant relied upon section 4(2) and Regulation D of the Securities Act of 1933, as amended.

ITEM 3. - DEFAULTS UPON SENIOR SECURITIES

There were no defaults upon senior securities during the period ended May 31, 2009.

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

There were no matters submitted to the vote of securities holders during the period ended May 31, 2009.

ITEM 5. - OTHER INFORMATION

None.

ITEM 6.

EXHIBITS and REPORTS on FORM 8-K.

(a)

EXHIBITS. The following exhibits are filed as part of this report.

31.1

Certification pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 executed by the Principal Executive Officer of the Company

31.2

Certification pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 executed by the Principal Financial Officer of the Company

32.1

Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, executed by the Principal Executive Officer of the Company

32.2

Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, executed by the Principal Financial Officer of the Company

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the registrant caused this Report on Form 10-Q to be signed on its behalf by the undersigned, thereunto duly authorized.

DATE: July 15, 2009

	Imperiali Inc.,
	Registrant

	By	/s/ Daniel Imperato
	Daniel Imperato,
	Interim Non-Executive Chairman Emeritus
	Director

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

	By	/s/ Daniel Imperato
	Daniel Imperato,
	Interim Non-Executive Chairman Emeritus,
	Director