Xtx Energy, Inc - Atomic Guppy, Inc., formerly known as XTX Energy,...

Xtx Energy, Inc - Recent Material Event

Item 1.		Financial Statements (unaudited)

		Balance Sheets at July 31, 2007 and October 31, 2006

		Statements of Operations for the Three Months and Nine Months Ended July 31, 2007 and 2006

		Statements of Cash Flows for the Nine Months Ended July 31, 2007 and 2006

		Notes to Condensed Financial Statements

Item 2.		Management’s Discussion and Analysis or Plan of Operation

Item 3.		Controls and Procedures


PART II. OTHER INFORMATION

Item 1.		Legal Proceedings

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

Item 3.		Defaults Upon Senior Securities

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

Item 5.		Other Information

Item 6.		Exhibits

SIGNATURES

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

ATOMIC GUPPY, INC.

f/k/a XTX ENERGY, INC

BALANCE SHEETS


	July 31, 2007			October 31, 2006
	(Unaudited)
ASSETS

CURRENT ASSETS
Cash	$	94,126		$	$4,627
Accounts Receivable		1,325			-0-
Loan Receivable		2,280			2,280

Total Current Assets		97,731			6,907

Property and Equipment		1,553			-0-
Other Assets:
Trademarks and Patents		3,711,444			-0-

TOTAL ASSETS	$	3,810,728		$	6,907

LIABILITIES AND STOCKHOLDERS’ EQUITY/(DEFICIENCY)

CURRENT LIABILITIES
Accounts Payable and Accrued Expenses	$	60,074		$	205,159
Convertible debt		392,000			-0-
Notes Payable		-0-			20,000
TOTAL CURRENT LIABILITIES		452,074			225,159


TOTAL LIABILITIES		452,074			225,159

STOCKHOLDERS’ EQUITY/(DEFICIENCY)
Common stock, $0.001 par value; 25,000,000 shares authorized; 8,850,000 and 5,196,461 shares issued and outstanding, in 2007 and 2006 respectively		8,850			5,196
Additional paid in capital		4,275,259			239,878
Accumulated deficit		(925,455	)		(463,326	)

TOTAL STOCKHOLDERS’ EQUITY/(DEFICIENCY)		3,358,654			(218,252	)

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY/(DEFICIENCY)	$	3,810,728		$	6,907

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

ATOMIC GUPPY, INC.

f/k/a XTX ENERGY, INC

STATEMENTS OF OPERATIONS

(UNAUDITED)



	For the Three Months Ended July 31,						For the Nine Months Ended July 31,
	2007			2006			2007			2006
Revenues:	$	-0-		$	6,569		$	-0-		$	47,474

Expenses:
Amortization and depreciation		78,324			5,219			104,432			15,740
Production		-0-			689			-0-			11,613
Management and consulting fees		118,025			86,367			175,862			200,316
Professional fees		32,197			-0-			103,984			-0-
Travel and entertainment		11,250			-0-			16,851			-0-
Other office expense		47,117			-0-			61,000			-0-

TOTAL OPERATING EXPENSES		286,913			92,275			462,129			227,669

NET ORDINARY LOSS		(286,913	)		(85,706	)		(462,129	)		(180,195	)
Loss on sale of oil and gas lease		-0-			(3,465	)		-0-			(9,965	)
NET LOSS	$	(286,913	)	$	(89,171	)	$	(462,129	)	$	(190,160	)

NET LOSS PER COMMON SHARE—BASIC AND DILUTED		(0.04	)		(0.02	)		(0.05	)		(0.03	)

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING— BASIC AND DILUTED		7,674,145			5,196,461			8,850,000			5,934,500

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

ATOMIC GUPPY, INC.

f/k/a XTX ENERGY, INC

STATEMENTS OF CASH FLOWS

(UNAUDITED)



	For the Nine Months Ended July 31,
	2007			2006
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(462,129	)	$	(190,160	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Amortization		104,432			14,454
Depreciation		-0-			1,286
Issuance of stock for services		-0-			75,642
Loss on sale of oil and gas lease		-0-			3,465
Changes in operating assets and liabilities:
Increase in accounts receivable		(1,325	)		410
Increase in Loan Receivable		(2,000	)		-0-
Increase in accounts payable and accrued expenses		60,074			98,183
		161,181			193,440

NET CASH USED BY OPERATING ACTIVITIES		(300,948	)		3,280

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property & equipment		(1,553	)		(932	)
Proceeds received from sale of oil and gas lease		-0-			16,500
Deposit on oil and gas lease		-0-			(5,000	)
Intangible drilling costs incurred		-0-			(5,421	)

NET CASH FLOW USED IN INVESTING ACTIVITIES		(1,553	)		5,147

CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of advance received from joint venture		-0-			(10,773	)
Proceeds (Payments) from/to convertible notes		392,000			(35,032	)
Proceeds from notes payable					30,000

NET CASH FLOW FROM FINANCING ACTIVITIES		392,000			(15,805	)


NET (DECREASE) INCREASE IN CASH		89,499			(7,378	)

CASH – Beginning of period		4,627			18,694

CASH– End of period	$	94,126		$	11,316

SUPPLEMENTAL DISCLOSURES
Noncash financing transactions:
Issuance of common stock for accrued expenses and principal/ interest payment on notes payable – related party	$	-0-		$	75,532

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

ATOMIC GUPPY, INC.

f/k/a XTX ENERGY, INC

NOTES TO CONDENSED FINANCIAL STATEMENTS

(UNAUDITED)

Note 1 - Nature of Operations and Basis of Presentation

Business

Atomic Guppy, Inc., formerly known as XTX Energy, Inc. and Glen Manor Resources Inc., was incorporated on November 16, 1999 under the laws of the State of Nevada as a mining exploration company. The Company has no subsidiaries or affiliated companies. The Company has not been in bankruptcy, receivership or similar proceedings since its inception. The Company's Articles of Incorporation currently provide that the Company is authorized to issue 200,000,000 shares of common stock with a par value of $0.001 per share. At July 31, 2007, there were 8,850,000 shares outstanding.

In 2003, the Company decided to forego mining and focused its attention on the acquisition of income producing oil and gas properties in the United States. The Company changed its name to XTX Energy, Inc. on June 1, 2006 to reflect this change in its business description.

As of October 31, 2006, all remaining assets and income producing properties of the Company were sold to a related party for cash at a loss to the Company. The Company has not realized revenue since the sale of the remaining assets and income producing properties in October 2006. Following the sale of the remaining assets and income producing properties, the directors and majority shareholder determined it to be in the best interests of the Company to abandon its business of acquiring oil and gas properties and pursue an alternative business plan.

On March 6, 2007, the Company entered into an asset purchase agreement (the "Purchase Agreement") with Rothschild Trust Holdings, LLC., a Florida limited liability company, Leigh Rothschild, Adam Bauman and Neal Lenarsky (Rothschild Trust Holdings, LLC., Leigh Rothschild, Adam Bauman and Neal Lenarsky, collectively referred to as the "Sellers"). In consideration of the acquisition of the Assets (hereafter defined), the Company issued 142,000,000 shares of its restricted common stock (the "Shares") to the Sellers and their designees. The closing of the Purchase Agreement was subject to certain conditions, which are described below. The assets ("Assets") to be acquired by the Company under the Purchase Agreement are described below.

The Purchase Agreement contains customary representations, warranties, covenants, indemnification provisions and conditions to closing. These conditions include, but are not limited to, the Company’s receipt of private financing in the gross aggregate amount of $400,000, less commissions and expenses, the cancellation of certain shares of outstanding common stock of the Company and waiver of accrued salary for Mr. Burden of approximately $187,500.

Upon the closing on March 16, 2007, of the transaction completed by the Purchase Agreement, Jerrold Burden, the Company's Chief Executive Officer, President and director and Albert Folsom, the Company's Chief Financial Officer, Secretary and director, each resigned as officers and director and appointed Seller's designees, Adam Bauman and Leigh Rothschild as directors. The Company also entered into employment agreements with Adam Bauman, Neal Lenarsky and Leigh Rothschild following the closing of the transaction completed by the Purchase Agreement. The resignations and appointments were subject to the closing of the transaction completed by the Purchase Agreement and effectiveness of an Information Statement filed by the Company pursuant to Section 14(c) of the Securities Act of 1934 (the "Information Statement") and SEC Rule 14f-1 for Notice of Change in the Composition of the Board of Directors and shall be deemed effective upon the tenth day following the mailing by the Company to its shareholders of the Information Statement which shall also be filed with the Securities and Exchange Commission.

The assets include a pending patent titled Leigh-10 (U.S. Appl. No. 11/373,322; filed March 10, 2006) together with any intellectual property progeny of Leigh-10 and associated trademarks, including but not limited to codes; and the domain names: publoot.com, publoot.biz, publoot.info, publoot.name, publoot.mobi, publoot.net, publoot.org, publoot.tv, publoot.us, publoot.ws, squiglee.name, squiglee.us, squiglee.tv; squiglee.ws; pubmine.com, pubmine.net, pubmine.org, pubmine.biz, pubmine.info, pubmine.us, pubmine.mobi, pubmine.tv, pubmine .ws, pubmine.name, pubminers.com, publute .com, publewt. com, moolapub.com, atomicguppy. com, atomicguppy.biz, atomicguppy.net, atomicguppy.org; atomicguppie.com; atomicguppy.info, atomicguppy.us, atomicguppy.mobi, atomicguppy.tv, atomicguppy.ws; and atomicguppy.name. The Assets further include all proprietary information, documents and records relating to the creation of the Assets and all copyright, copyrightable subject matter (including software) and registrations otherwise material to the use of the Assets. The Company intends to use the Assets, including the Leigh-10 pending patent Internet Rewards algorithm, to build and launch an interactive incentive community to address a marketplace of nearly 1.1 billion Internet users worldwide, or 16.6% of the global

6.5 billion population. Within this new web site, members can upload personal videos, audio recordings, multicasts or any other uploadable intellectual property and set their own sale price. Each time a member’s content is purchased for download or multicast viewing, the member receives a royalty.

In addition to pre-recorded content, the Company plans to use Internet video broadcasting technology to create a marketplace for the sale of live event multicasts. When not viewing multicasts, members will be able to relax in private interactive rooms, where they can “add in” their webcam-equipped friends and conduct a personal live videoconference with them, or purchase a movie or other licensed content to view together in a virtual living room setting. Multiple languages support — English, Spanish, French, Italian, Chinese, Japanese, German and many more — will be phased in over time to embrace the global nature of the Internet.

The Company will also benefit from sustainable financial models that will drive multiple sources of revenue, and will monetize pre-recorded and live content by creating super-viral markets with the Leigh-10 pending patent Internet Rewards algorithm. Although the Company does not plan to depend solely on advertising, it does anticipate selling media advertising (banners, flash video ads or 30 second TV spots) and sponsorships within certain areas of its web site.

We anticipate that additional revenue sources will include: sales of User Generated Content (books, recipes, poems, class notes, pre-recorded videos & music, etc.); premium licensed content sales (popular libraries of motion pictures, DVDs, CDs, MP3s, etc.); live multicast event sales, tiered levels of subscription fees (for premium service private shared content interactive rooms) and paid search return fees.

On June 25, 2007, Atomic Guppy, Inc. (the “Company”), formerly XTX Energy, Inc., effected a reverse split (the “Reverse Split”) of its common stock on the basis of one (1) post-Reverse Split share for twenty (20) pre-Reverse Split shares. As previously reported in the information Statement on Schedule 14C as filed with the SEC on May 29, 2007, shareholders who were entitled to vote approximately seventy-nine percent (79%) of our issued and outstanding common stock ratified and joined the written consent of out Board of Directors with respect to Reverse Split. New certificates representing one share of the Company’s common stock post-Reverse Split. New certificates representing one share of the Company’s common stock post-Reverse Split will be issued by the Company’s transfer agent for the surrender of every certificate representing twenty shares of the Company’s common stock pre-Reverse Split.

After the Reverse Split, also on June 25, 2007, the Company’s authorized capital stock was increased to twenty-five (25) million post-Reverse Split shares and the name of the Company was changed from “XTX Energy, Inc.” to “Atomic Guppy, Inc.” to more closely identify with the Company’s business plan to build and launch a live web based e-commerce video platform to support an interactive incentive community. The Company’s new ticker symbol on the over-the-counter Bulletin Board is ATGU.OB.

Over the next 12 months, the Company intends to utilize its Assets, including the Leigh-10 pending patent Internet Rewards algorithm, to build a live web-based E-Commerce video rewards platform to support an interactive incentive community. Within this new web site, members may choose to upload personal videos, audio recordings, multicasts or any other uploadable intellectual property and set their own sale price. When a member’s content is purchased for download or multicast viewing, the member will receive a royalty payment. To accomplish this, the Company will retain software programming resources, complete open source code development, endeavor to acquire key components (off-the-shelf collaborative video, E-Commerce and payment processing engines), launch viral marketing campaigns and establish a web site in an effort to reduce time to market our products. In general, the Company estimates it will release a Beta version of its web site within the first nine months, with a final 1.0 or “first release” version ready within five months thereafter.

Note 2 - Asset Purchase and Valuation of Patents and Trademarks

As described in Note 1 above the Company issued 142,000,000 shares of its restricted common stock (the "Shares") to purchase the assets which include, without limitation (a) pending patent titled Leigh-10 (U.S. Appl. No. 11/373,322; filed March 10, 2006) together with any intellectual property progeny of Leigh-10 and associated trademarks, including but not limited to codes; and (b) various domain names The Assets further include all proprietary information, documents and records relating to the creation of the Assets and all copyright, copyrightable subject matter (including software) and registrations otherwise material to the use of the Assets.

The Purchase Agreement contains customary representations, warranties, covenants, indemnification provisions and conditions to closing. These conditions include, the cancellation of certain shares of outstanding common stock of the Company and waiver of accrued salary for Mr. Burden of approximately $187,500. After the inclusion of the additional shares issued and the cancellation of shares the company added net approximately 73,079,780 shares and cancelled debt totaling approximately $220,000. The assets were valued based on a discounted stock price due to a blockage of stock issued. The company valued the discount of the blockage of shares at approximately 54%. The valuation of assets purchased is distributed as follows:



Assets Acquired:
	Technology Patent	2,765,876
	Trademarks	500,000
	Website Domains	250,000
	Employment and Non-Compete	300,000

Note 3 – Subsequent Events

On August 17, 2007 (the “Signing Date”), Atomic Guppy, Inc. (the “Company”) entered into an Equity Contribution Agreement (“Contribution Agreement”) with Yabbly, LLC (“Yabbly”), a Florida limited liability company, and its parent company, Yabbly Holdings, LLC (“YHI”). Pursuant to the Contribution Agreement, the Company (i) issued toYHI 150,000 shares of its common stock (the “Signing Shares”), (ii) agreed to contribute to Yabbly at closing 976,921 shares of the Company’s common stock (the “Closing Shares”) in exchange for 6.9375% of the membership interests in Yabbly outstanding as of the Signing Date and (iii) issued to YHI warrants (the “Warrants”) to purchase an aggregate of 993,924 shares of the Company’s common stock at an exercise price of $1.72 per share, which Warrants will become exercisable in the event that the Contribution Agreement closes and Land Shark Holdings, LLC, an affiliate of Yabbly and YHI (the “Developer”) develops certain software and provides related services to the Company pursuant to a Development Agreement executed between the Company and the Developer on the Signing Date (the “Development Agreement”). In the event that the Warrants become exercisable and YHI exercises the Warrants, Yabbly is obligated to issue to the Company additional equity in Yabbly in the form of profits interests.

The closing of the Contribution Agreement is conditioned, among other things, on whether the Company and the Developer agree on specifications for the software development and testing project that is the subject of the Development Agreement. In addition, the Company will separately offer up to 130 units, each unit consisting of 10,000 shares of the Company’s common stock and warrants to purchase 5,000 shares of the Company’s common stock in a private placement transaction pursuant to Rule 506 of Regulation D under the Securities Act of 1933, as amended (the “Private Placement”). Either the Company or Yabbly may terminate the Contribution Agreement prior to closing if the share price of the Company’s common stock sold in the Private Placement is less than $1.75 per share or in the event that the gross proceeds received by the Company in the Private Placement are less than $3,000,000 (prior to deducting commissions and other costs related to the Private Placement). Although the Company’s obligation to issue the Closing Shares and YHI’s ability to exercise the Warrants would terminate if the Contribution Agreement were terminated, YHI would be entitled to retain the Signing Shares.

Upon the closing of the Contribution Agreement, Mr. Adam Bauman will be appointed as a member of the board of directors of Yabbly, and Mr. Michael Egan, the controlling shareholder of YHI, will be appointed chairman of the Company’s Advisory Board. Furthermore, in the event Mr. Egan joins the Company’s Board of Directors within six (6) months following the closing of the Contribution Agreement, the Company will be required to issue to YHI or its designee 732,500 shares of the Company’s common stock.

Interim Financial Statements

The interim financial statements presented herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. The interim financial statements should be read in conjunction with the Company's annual financial statements, notes and accounting policies included in the Company's annual report on Form 10-KSB for the year ended October 31, 2006 as filed with the SEC. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) which are necessary to provide a fair presentation of financial position as of July 31, 2007 and the related operating results and cash flows for the interim period presented have been made. The results of operations, for the period presented are not necessarily indicative of the results to be expected for the year.

Item 2. Management’s Discussion and Analysis or Plan of Operation

The Company had revenue from its two oil and gas lease working interests in the prior year comparable quarter ended, July 31, 2006. The company has sold its interest in all of its oil and gas properties to a related party. The properties were sold for cash considerations and a loss was taken on the statement of operations. Due to the sale of the properties prior to the quarter ended July 31, 2007 the company did not realize any revenue for the current quarter.

Management’s Discussion and Analysis contains various “forward looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, regarding future events or the future financial performance of the Company that involve risks and uncertainties. Certain statements included in this Form 10-QSB, including, without limitation, statements related to anticipated cash flow sources and uses, and words including but not limited to “anticipates”, “believes”, “plans”, “expects”, “future” and similar statements or expressions, identify forward looking statements. Any forward-looking statements herein are subject to certain risks and uncertainties in the Company’s business, including but not limited to, reliance on key customers and competition in its markets, market demand, product performance, technological developments, maintenance of relationships with key suppliers, difficulties of hiring or retaining key personnel and any changes in current accounting rules, all of which may be beyond the control of the Company. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth therein.

Management’s Discussion and Analysis of Consolidated Results of Financial Condition or Plan of Operation (“MD&A”) should be read in conjunction with the financial statements included herein. Further, this quarterly report on Form 10-QSB should be read in conjunction with the Company’s Consolidated Financial Statements and Notes to Consolidated Financial Statements included in its 2006 Annual Report on Form 10-KSB. In addition, you are urged to read this report in conjunction with the risk factors described.

Summary Overview and Overall Business Strategy

The Company's plan of operation in the quarter ended July 31, 2006 was to obtain funding to secure more working interests and oil and gas interests for the Company. As noted in Note 1 to the Condensed Financial Statements included herein, the Company’s strategy has changed to build a live web-based ecommerce video rewards platform and entered into discussions to purchase the assets necessary to implement and develop the platform.

The Company has sold its interest in its last remaining oil and gas properties to a related party for $16,500. The properties were sold and a loss was taken on the statement of operations. Due to the sale of the properties prior to the quarter ended July 31, 2007 the Company did not realize any revenue for the current period.

Recent Developments

Company’s obligation to issue the Closing Shares and YHI’s ability to exercise the Warrants would terminate if the Contribution Agreement were terminated, YHI would be entitled to retain the Signing Shares.

Results of Operations- Nine Months Ended July 31, 2007 Compared to the Nine Months Ended July 31, 2006

Gross Revenues and Costs of Operations

The Company’s revenues for the nine months ended July 31, 2006 year arose from the working interest in oil and gas projects. The Company had revenues of $47,474 for the nine months ended July 31, 2006 compared to $0 for the nine months ended July 31, 2007.

Operating expenses for the nine months ended July 31, 2006 of $227,669 consisted of production expenses relating to oil and gas leases of $11,613, amortization and depreciation of $15,740, management fees, consulting fees, professional fees, and other administrative expenses of $200,316. For the nine months ended July 31, 2007, operating expenses of $462,129 consisted of management and consulting fees of $175,862, professional fees of $103,987, amortization of patents and trademarks of $104,432 and other administrative expenses of $77,851.

Net Loss

There was a net loss of $462,129 and $190,160 for the nine months ended July 31, 2007 and 2006, respectively due mainly to the above management and discuss analysis.

Results of Operations- Three Months Ended July 31, 2007 Compared to the Three Months Ended July 31, 2006

Gross Revenues and Costs of Operations

The Company’s revenues for the three months ended July 31, 2006 year arose from the working interest in oil and gas projects. The Company had revenues of $6,569 for the three months ended July 31, 2006 compared to $-0- for the three months ended July 31, 007.

Operating expenses for the three months ended July 31, 2006 of $92,275, amortization and depreciation of $5,219, management fees, consulting fees, professional fees, and other administrative expenses of $86,367. For the three months ended July 31, 2007, operating expenses of $286,913 consisted of management and consulting fees of $118,025, professional fees of $32,917, amortization of patents and trademarks of $78,324 and other expenses of $59,056.

Net Loss

There was a net loss of $286,913 and $89,171 for the three months ended July 31, 2007 and 2006, respectively due mainly to the above management and discuss analysis.

Liquidity and Capital Resources

Since its inception, the Company has continued to sustain losses. The Company’s operations and growth has been funded by the sale of common stock, and loans from related and unrelated parties.

At July 31, 2007, the Company had cash on hand of $94,126,