Risk Factors

You should carefully consider the risks and uncertainties described below and the other information in this prospectus before deciding to invest in shares of our common stock.

The occurrence of any of the following risks could materially and adversely affect our business, financial condition and operating result.  In this case, the trading price of our common stock could decline and you might lose all or part of your investment.

Risks Related to This Offering and Our Stock

Future issuances of our common stock could dilute current shareholders and adversely affect the market if it develops.

We have the authority to issue up to 100,000,000 shares of common stock and 25,000,000 shares of preferred stock and to issue options and warrants to purchase shares of our common stock, without shareholder approval.  These future issuances could be at values substantially below the price paid for our common stock by investors in this offering, which would result in significant dilution to those investors.  In addition, we could issue large blocks of our common stock to fend off unwanted tender offers or hostile takeovers without further shareholder approval, which would not only result in further dilution to investors in this offering but could also depress the market value of our common stock, if a public trading market develops.

We may issue preferred stock that would have rights that are preferential to the rights of the common stock that could discourage potentially beneficial transactions to our common stockholders.

An issuance of additional shares of preferred stock could result in a class of outstanding securities that would have preferences with respect to voting rights and dividends and in liquidation over the common stock and could, upon conversion or otherwise, have all of the rights of our common stock.  Our Board of Directors' authority to issue preferred stock could discourage potential takeover attempts or could delay or prevent a change in control through merger, tender offer, proxy contest or otherwise by making these attempts more difficult or costly to achieve.  The issuance of preferred stock could impair the voting, dividend and liquidation rights of common stockholders without their approval.

There is currently no market for our common shares, and investors may be unable to sell their shares for an indefinite period of time.

There is presently no market for our common shares.  There is no assurance that a liquid market for our common shares will ever develop in the United States or elsewhere, or that if such a market does develop that it will continue.  Accordingly, an investment in common shares of our Company should only be considered by those investors who do not require liquidity and can afford to suffer a total loss of their investment.  An investor should consult with professional advisers before making such an investment.

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Over-the-counter stocks are subject to risks of high volatility and price fluctuation .

We have not applied to have our shares listed on any stock exchange or on the NASDAQ Capital Market, and we do not plan to do so in the foreseeable future.  As a result, if a trading market does develop for our common stock, of which there is no assurance, it is likely that our shares will trade on the over-the-counter (“OTC”) market.  The OTC market for securities has experienced extreme price and volume fluctuations during certain periods.  These broad market fluctuations and other factors, such as new product developments and trends in our Company's industry and the investment markets generally, as well as economic conditions and quarterly variations in our results of operations, may adversely affect the market price of our common stock and make it more difficult for investors in this offering to sell their shares.

Trading in our securities will in all likelihood be conducted on an electronic bulletin board established for securities that do not meet NASDAQ listing requirements.  As a result, investors will find it substantially more difficult to dispose of our securities.  Investors may also find it difficult to obtain accurate information and quotations as to the price of, our common stock.  

Our stock price may be volatile and as a result, investors could lose all or part of their investment. The value of an investment could decline due to the impact of any of the following factors upon the market price of our common stock:

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failure to meet sales and marketing goals or operating budget;

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decline in demand for our common stock;

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operating results failing to meet the expectations of securities analysts or investors in any quarter;

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downward revisions in securities analysts' estimates or changes in general market conditions;

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investor perception of our Company's industry or prospects; and

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general economic trends.

In addition, stock markets have experienced extreme price and volume fluctuations and the market prices of securities have been highly volatile.  These fluctuations are often unrelated to operating performance and may adversely affect the market price of our common stock.  As a result, investors may be unable to resell their shares at or above the offering price.  

Outstanding shares that are eligible for future sale could adversely impact a public trading market for our common stock, if a public trading market develops.

All of the 992,650 shares of common stock that will be distributed under this prospectus will be free-trading shares.  In addition, in the future, we may offer and sell shares without registration under the Securities Act. All of such shares are "restricted securities" as defined by Rule 144 ("Rule 144") under the Securities Act and cannot be resold without registration except in reliance on Rule 144 or another applicable exemption from registration.  Once revisions to Rule 144 become effective on February 15, 2008, under Rule 144 a non-affiliate of the Company can sell restricted shares held for at least six months, subject only to the restriction that the Company has made available public information as required by Rule 144.  Affiliates of the Company can sell restricted securities after six months, subject to compliance with the volume limitation, manner of sale, Form 144 filing and

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current public information requirements.  No shares of our common stock are currently eligible for resale under Rule 144.  

Upon completion of this offering, we intend to file a registration statement on Form S-8 under the Securities Act to register shares of common stock reserved for issuance under our Equity Incentive Plan.  Persons who are not affiliates, and who receive shares that are registered under this registration statement, will be able to resell those shares in the public market without restriction under the Securities Act.  This registration statement will become effective immediately upon filing.

No prediction can be made as to the effect, if any, that future sales of restricted shares of common stock, or the availability of such common stock for sale, will have on the market price of the common stock prevailing from time to time. Sales of substantial amounts of such common stock in the public market, or the perception that such sales may occur, could adversely affect the then prevailing market price of the common stock.

If a public trading market for our shares develops, owners of our common stock will be subject to the “penny stock” rules.  

Since our shares are not listed on a national stock exchange or quoted on the Nasdaq Market within the United States, if a public trading market develops, of which there can be no assurance, trading in our shares on the OTC market will be subject, to the extent the market price for our shares is less than $5.00 per share, to a number of regulations known as the "penny stock rules".  The penny stock rules require a broker-dealer to deliver a standardized risk disclosure document prepared by the SEC, to provide the customer with additional information including current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, monthly account statements showing the market value of each penny stock held in the customer's account, and to make a special written determination that the penny stock is a suitable investment for the investor and receive the investor’s written agreement to the transaction.  To the extent these requirements may be applicable they will reduce the level of trading activity in the secondary market for our shares and may severely and adversely affect the ability of broker-dealers to sell our shares, if a publicly traded market develops.

We do not expect to pay cash dividends in the foreseeable future.  Any return on investment may be limited to the value of our stock.

We have never paid any cash dividends on any shares of our capital stock, and we do not anticipate that we will pay any dividends in the foreseeable future.  Our current business plan is to retain any future earnings to finance the expansion of our business.  Any future determination to pay cash dividends will be at the discretion of our Board of Directors, and will be dependent upon our consolidated financial condition, results of operations, capital requirements and other factors as our board of directors may deem relevant at that time.  If we do not pay cash dividends, our stock may be less valuable because a return on your investment will only occur if our stock price appreciates.

Changes in the corporate and securities laws and regulations are likely to increase our costs.

The Sarbanes-Oxley Act of 2002 (SOX), which became law in July 2002, has required changes in some of our corporate governance, securities disclosure and compliance practices. In response to the requirements of SOX, the SEC and major stock exchanges have promulgated new rules and listing

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standards covering a variety of subjects. Compliance with these new rules and listing standards that are likely to increase our general and administrative costs, and we expect these to continue to increase in the future. In particular, we will be required to include the management and auditor reports on internal control as part of our annual report for the year ending December 31, 2007 pursuant to Section 404 of SOX. We are in the process of evaluating our internal control systems in order (i) to allow management to report on, and our independent auditors to attest to our internal controls, as required by these laws, rules and regulations, (ii) to provide reasonable assurance that our public disclosure will be accurate and complete, and (iii) to comply with the other provisions of Section 404 of SOX.  We cannot be certain as to the timing of the completion of our evaluation, testing and remediation actions or the impact these may have on our operations.  Furthermore, there is no precedent available by which to measure compliance adequacy.  If we are not able to implement the requirements relating to internal controls and all other provisions of Section 404 in a timely fashion or achieve adequate compliance with these requirements or other requirements of SOX, we might become subject to sanctions or investigation by regulatory authorities such as the SEC or NASD. Any such action may materially adversely affect our reputation, financial condition and the value of our securities, including our common stock. We expect that SOX and these other laws, rules and regulations will increase legal and financial compliance costs and will make our corporate governance activities more difficult, time-consuming and costly. We also expect that these new requirements will make it more difficult and expensive for us to obtain director and officer liability insurance.

  If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud. As a result, current and potential shareholders could lose confidence in our financial reporting, which would harm our business and the trading price of our stock.

Effective internal controls are necessary for us to provide reliable financial reports and effectively prevent fraud. If we cannot provide financial reports or prevent fraud, our business reputation and operating results could be harmed. Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our stock.

No broker or dealer has committed to create or maintain a market in our stock.

We have no agreement with any broker or dealer to act as a marketmaker for our securities and there is no assurance that we will be successful in obtaining any marketmakers.  Thus, no broker or dealer will have an incentive to make a market for our stock.  The lack of a marketmaker for our securities could adversely influence the market for and price of our securities, as well as your ability to dispose of, or to obtain accurate information about, and/or quotations as to the price of, our securities.

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Delaware law and our by-laws protect our directors from certain types of lawsuits.

Delaware law provides that our directors will not be liable to us or our stockholders for monetary damages for all but certain types of conduct as directors.  Our by-laws require us to indemnify our directors and officers against all damages incurred in connection with our business to the fullest extent provided or allowed by law.  The exculpation provisions may have the effect of preventing stockholders from recovering damages against our directors caused by their negligence, poor judgment or other circumstances.  The indemnification provisions may require us to use our assets to defend our directors and officers against claims, including claims arising out of their negligence, poor judgment, or other circumstances.  

Risks Related to Our Business

We are subject to risks associated with a small, undercapitalized business

Our operations are subject to all of the risks inherent in a small, undercapitalized business enterprise.  These risks include the absence of a substantial operating history, shortage of cash,  and lack of experience in our chosen industry.  We expect to encounter various problems, expenses, complications and delays in connection with the growth of our business.  The profit potential of our business model is unproven and there can be no assurance that our magazine will achieve commercial acceptance.

We have a history of operating losses and may never be profitable.  

For the nine months ended September 30, 2007, we had $155,643 in sales, and we recorded a net loss of approximately $(109,780). Since our inception, we have consistently sustained losses from operations.  We expect to incur additional losses in the future.  There can be no assurance that our future revenues will ever be significant or that our operations will ever be profitable.

We may not be able to finance the development of our business, or the terms of future financings could be disadvantageous to our shareholders.

Our ability to satisfy our future capital requirements and implement our expansion plans will depend upon many factors, including the financial resources available to us, the expansion of our sales and marketing efforts and the status of competition. There will be no proceeds to the Company from the spin-off. The exact amount of funds that we will require will depend upon many factors, and it is possible that we will require additional financing prior to such time.  There can be no assurance that additional financing will be available to us on acceptable terms, or at all.  If additional funds are raised by issuing equity securities, further dilution to the existing stockholders will result.  If adequate funds are not available, we may be required to delay, reduce or eliminate our programs or obtain funds through arrangements with partners or others that may require us to relinquish rights to certain of our products, technologies or other assets.  Accordingly, the inability to obtain such financing could have a material adverse effect on our business, financial condition and results of operations.

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We are dependent on one product.

Although we plan to develop publications in addition to Image Magazine, there can be no assurance that these development efforts will be successful or, if successful, that resulting products will receive market acceptance, generate significant sales or result in gross profits.  Because all of our current sales are derived from our sole regional Image Magazine, failure to achieve broad market acceptance of the Image Magazine as a result of competition or other factors or the failure to successfully market any new magazines would have a material adverse effect on our business, operating results and financial condition.

We face significant competition in the markets where we operate from competitors with greater financial resources and established operations and revenues, which make it difficult to attract customers and obtain a market share and there can be no assurance that we will be able to compete effectively.

We compete for advertising and circulation revenues with publishers of other special-interest consumer magazines.  The monthly guide and entertainment magazine for local markets is very competitive, competition is likely to increase, and there can be no assurance that we will be able to compete effectively.  Increased competition may result in price cuts, reduced gross margins and loss of market share, any of which could seriously harm our business.  Many of our competitors have, and potential competitors may possess, longer operating histories and significantly greater financial, technical, personnel and other resources than us.  

Competitors and potential competitors may also have greater name and brand recognition than we currently possess.  These greater resources may permit them to implement extensive advertising, sales, promotions and programs that we may not be able to match. Other competitors are smaller and may be capable of quickly identifying a niche publication that could compete for our readers and advertisers. As these competitors enter the field, our sales growth may fail to increase.  There can be no assurance that we will have the ability to compete successfully in this environment.  If we are unable to compete successfully, our business will be seriously harmed.

Our magazine business is also subject to competition from the rapidly increasing market for internet and new media products and services.

The increased availability of information on the internet and other new media products and services subjects our magazine business to increased competition, which may adversely affect our future operating results.

We have limited human resources; we need to attract and retain highly skilled personnel and consultants; and we may be unable to manage our growth with our limited resources effectively.

We expect that the expansion of our business may place a strain on our limited managerial, operational, and financial resources.  We will be required to expand our operational and financial systems significantly and to expand, train and manage our work force in order to manage the expansion of our operations.  Our future success will depend in large part on our ability to attract, train, and retain additional highly skilled executive level management, logistics, and sales personnel.  We may not be successful in attracting and retaining qualified personnel on a timely basis, on

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competitive terms or at all.  Further, our ability to manage our growth effectively will require us to continue to improve our operational, financial and management controls, reporting systems and procedures, to install new management information and control systems and to train, motivate and manage employees.  If we are unable to manage growth effectively, our operating results will suffer.  

Our founder and President has limited experience in operating a magazine, and the Magazine may not be able to attract the necessary high level executive with the appropriate skills and background to increase the Magazine’s revenue.

Historically, we have depended upon the efforts and abilities of Gregory Bloom, our President and member of the Board of Directors.  While the loss of the services of Mr. Bloom would have a material adverse effect on our operations, we also recognize that in order to materially improve our results of operations, we must attract and retain a high level executive with experience and expertise in the publishing industry.  Our limited circulation and shortage of working capital substantially impair our ability to attract such a person.  

Our revenue, expenses and operating results have fluctuated in the past and may do so in the future due to a variety of factors, which precludes our ability to guarantee future revenue streams.

The Company’s business is to publish Image Magazine.  This business is subject to fluctuations in operating results, which could negatively impact the price of its stock.  Revenue, expense and operating results have varied in the past and may fluctuate significantly in the future due to a variety of factors, many of which are outside of our control.  These factors include, among others:

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the timing of orders from advertisers and the possibility that these advertisers may change or cancel their orders with little or no advance notice to the Company;

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the uncertainty regarding the adoption of the Company’s current and any future publishing products; and

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the rate of growth of the markets for the Company’s publishing products.

We rely primarily on freelance journalists and independent contractors for our magazine feature articles and other content.  As we do not control those persons or the source of content, we are at risk at being unable to generate interesting and attractive features and other material content for our future publications.

We rely primarily on freelance journalists and other independent writers and photographers for the feature articles, photographs and other content of our magazines.  While we have ongoing relationships with several independent artists and journalists, we have no written agreements with these persons and no ability to control their future performance.  As a result, we cannot be assured that we will have either the quality or quantity of future content necessary to fulfill the demands of future publications.

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Because we rely on freelance journalists and independent photographers for much of our magazine content, we have an increased risk that our content  may infringe upon the copyrights of third parties.

As we rely on the work product of freelance journalists and independent photographers, we cannot control the source of the materials that they present to us for publication in our magazine.  As a result, we are at increased risk that materials that we are provided by independent contractors may infringe upon the copyright or other intellectual property rights of third parties.  This lack of control puts us at increased risk of violating the intellectual property rights of others, which could result in substantial liability in the future should we be found to have infringed on those rights.

The name of our magazine, “Image Magazine”, may infringe upon the trademark rights of a third party.

It has recently been brought to our attention that a third party in Orange County, CA  publishes a regional magazine under the name “Image Magazine”.  The publisher of the California-based Image Magazine has registered the trademark “Image Magazine” with the Unites States Patent and Trademark Office, which trademark registration was issued in 2006, and also owns and uses the domain name “imagemagazine.com”.  While we believe that our date of first use of the name “Image Magazine” pre-dates the date of first use of the California-based magazine as declared in their trademark registration application, the process of filing a petition to cancel their registration would be extremely protracted, costly and may not be successful.  We have made preliminary contact with the principals of the California-based magazine in an effort to resolve our conflicting uses of the same trademark; however, no assurance can be given that we will be able to resolve this conflict amicably and to our satisfaction.  Should we be unsuccessful in our efforts to resolve this trademark conflict, we may have to rebrand our magazine altogether and forfeit all of the goodwill which we have developed over the years in connection with our magazine.  This would result in substantial economic losses.

We could become subject to copyright infringement claims by third-parties which could impair our limited capital resources and potentially result in substantial adverse judgment.  

In recent years, there has been significant litigation in the United States and elsewhere involving copyright and other intellectual property rights.  Third parties may assert copyright and other intellectual property rights to information included in our magazine. Any infringement claims, with or without merit, could be time consuming, result in costly litigation, and divert the efforts of our technical and management personnel.  If we are unsuccessful in defending against these types of claims, we may be required to do one or more of the following:

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stop selling those magazines that use or incorporate the challenged intellectual property;

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attempt to obtain a license to sell or use the relevant protected material or substitute other material, which license may not be available on reasonable terms or at all;

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redesign those magazines that use the protected material, which we may not be able to do on a timely or cost effective basis, or at all; or,

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·

pay substantial damages.

In the event a claim against us is successful our business will be significantly harmed.  A substantial uninsured judgment could force us to cease operations altogether.

We rely on third parties to print our magazine and our reputation and operating results could be harmed if they fail to produce a quality magazine in a timely and cost-effective manner and in sufficient quantities.  

We do not currently have printing facilities or personnel to independently print the magazine.  We depend on third-party printers to produce the magazine in a timely fashion, at satisfactory quality and cost levels.  If our printers fail to produce quality finished magazines on time, at expected cost targets and in sufficient quantities, our reputation and operating results would suffer.  In addition, as we have no long-term agreements with our printers, we do not have firm commitments on the timing, pricing and quality of the printing process, and, the printer may stop printing for us at any time, with little or no notice.  

Cost increases for our printing services, whether resulting from shortages of materials, labor or otherwise, including, but not limited to rising cost of materials, transportation, services, labor, and commodity price increases could negatively impact our gross margins.  Because of market condition and other factors, we may not be able to offset any such increased costs by adjusting the price of our magazine.  If for any reason we are unable to obtain or retain third party printers on commercially acceptable terms, we may not be able to distribute the magazine, or other future products, as planned.  If we encounter delays or difficulties with contract printing, the distribution, marketing and subsequent sales of the magazine will be adversely affected.  

Because paper and printing costs fluctuate, and increases in labor are unpredictable, such changes could occur and adversely affect our financial results .

Paper, ink, and supplements are major components of our printing costs. Historically, paper and, therefore, printing prices have fluctuated substantially. Accordingly, our earnings are sensitive to changes in paper and printing prices.  We have no long-term supply contracts and we have not attempted to hedge fluctuations in the normal purchases of paper or printing or enter into contracts with embedded derivatives for the purchase of paper.  If the price of paper increases materially, our operating results could be adversely affected.  In addition, substantial increases in labor or health care costs could also affect our operating results.

If general economic trends degrade, trends in advertising spending may fall and reduce our circulation and advertising revenue, which would have a materially negative impact on our business.

Our advertising and circulation revenues are subject to the risks arising from adverse changes in domestic and global market conditions (i.e., increases in gas prices and interest rates) and possible shifting of advertising spending amongst media.  Extraordinary weather conditions or other events, such as hurricanes, earthquakes, war and terrorist attacks can impact advertising revenues.  Any adverse impact of economic conditions on us is difficult to predict but it may result in reductions in

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circulation and advertising revenue.  Additionally, if geopolitical events negatively impact the economy, our results of operations may be adversely affected.

Our circulation impacts our revenue in that advertisers are willing to pay more to place ads in a publication that has a larger number of readers who have requested to be placed on a circulation list.  Our circulation is affected by: competition from other publications and other forms of media available in our various markets; changing consumer lifestyles resulting in decreasing amounts of free time; declining frequency of regular magazine reading among young people; and increasing costs of circulation acquisition.

If we are unable to generate revenues from advertising and sponsorships, or if we were to lose our large advertisers or sponsors, our business would be harmed.

If companies perceive Image Magazine to be a limited or ineffective advertising medium, they may be reluctant to advertise in the magazine. Our ability to generate significant advertising and sponsorship revenues depends upon several factors, including, among others, the following:

• our ability to maintain a large, demographically attractive reader base for Image Magazine;

• our ability to maintain attractive advertising rates;

• our ability to attract and retain advertisers and sponsors; and

• our ability to provide effective advertising delivery and measurement systems.

Our advertising revenues are also dependent on the level of spending by advertisers, which is impacted by a number of factors beyond our control, including general economic conditions, changes in consumer purchasing and viewing habits and changes in the retail sales environment.  Our existing competitors, as well as potential new competitors, may have significantly greater financial, technical and marketing resources than we do. These companies may be able to undertake more extensive marketing campaigns, adopt aggressive advertising pricing policies and devote substantially more resources to attracting advertising customers.

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