InCapta Inc (INCT)

[digitick]

10Q Filed:

http://xml.10kwizard.com/filing_raw.php?repo=tenk&ipage=3432747

U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-QSB

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2005

OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
______________ TO ______________


COMMISSION FILE NUMBER: 0-29113


GAMEZNFLIX, INC.
(Exact Name of Registrant as Specified in its Charter)

Nevada 54-1838089
(State or Other Jurisdiction of Incorporation (I.R.S. Employer
or Organization) Identification No.)

1535 Blackjack Road, Franklin, Kentucky 42134
(Address of Principal Executive Offices)

[phone]
(Registrant's Telephone Number)


(Former Name, Former Address, and Former Fiscal Year, if Changed Since
Last Report)

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) been subject to such filing requirements for the past 90 days.
Yes X No .

As of March 31, 2005, the Registrant had 756,801,665 shares of
common stock issued and outstanding.

Transitional Small Business Disclosure Format (check one): Yes No X .

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION PAGE

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

CONSOLIDATED BALANCE SHEET (UNAUDITED)
AS OF MARCH 31, 2005 3

CONSOLIDATED STATEMENTS OF
OPERATIONS (UNAUDITED) FOR
THE THREE MONTHS ENDED
MARCH 31, 2005 AND MARCH 31, 2004 5

CONSOLIDATED STATEMENTS OF
CASH FLOWS (UNAUDITED) FOR
THE THREE MONTHS ENDED
MARCH 31, 2005 AND MARCH 31, 2004 6

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 7

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 10

ITEM 3. CONTROLS AND PROCEDURES 22

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS 23

ITEM 2. UNREGISTERED SALES OF EQUITY
SECURITIES AND USE OF PROCEEDS 23

ITEM 3. DEFAULTS UPON SENIOR SECURITIES 23

ITEM 4. SUBMISSION OF MATTERS TO A VOTE
OF SECURITY HOLDERS 23

ITEM 5. OTHER INFORMATION 23

ITEM 6. EXHIBITS 23

SIGNATURES 24

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCAL STATEMENTS.

GAMEZNFLIX, INC.
CONSOLIDATED BALANCE SHEET
MARCH 31, 2005
(Unaudited)

ASSETS

Current assets
Cash $ 77,657
Accounts receivable 62,500
Inventory 27,828
Prepaid expenses 103,404
Other assets 56,075
Total current assets 327,464

DVD's and video games library, net 436,184
Fixed assets, net 368,621
Other assets --

Total assets 1,132,269

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
Accounts payable 203,198
Accrued expenses 271,483
Notes payable 37,161
Notes payable - related parties 258,370
Customer deposits --
Convertible debenture, net of unamortized debt
discounts of $106,983 43,017

Total current liabilities 813,229

Long-term liabilities --

Total liabilities 813,229

Commitments and contingencies --

Stockholders' equity
Common stock; $0.001 par value; 2,000,000,000
shares authorized, 756,801,665 issued and outstanding 56,802

Additional paid-in capital 19,333,258
Stock subscriptions receivable (394,549)
Prepaid fees paid with common stock (197,633)
Accumulated deficit (19,178,838)

Total stockholders' equity 319,040

Total liabilities and stockholders' equity 1,132,269

See Accompanying Notes to Consolidated Financial Statements


GAMEZNFLIX, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)



<TABLE>
<CAPTION>
For the Three Months Ended For the Three Months Ended
March 31, 2005 March 31, 2004
<S> <C> <C>
Revenues $ 160,773 $ 30,434

Cost of revenues 138,261 4,484

Gross profit 22,512 25,950

Operating expenses
Selling, general and administrative 279,098 375,999
Amortization and depreciation 221,343 2,248
Consulting fees -- 1,320,448
Professional fees 197,906 78,067

Total operating expenses 698,347 1,776,762

Loss from operations (675,835) (1,750,812)

Other income (expense)
Forgiveness of debt -- --
Interest expense -- (3,381)
Interest income 131 362

131 (3,019)

Loss before provision for income taxes (675,704) (1,753,831)

Provision for income taxes -- --

Net loss (675,704) (1,753,831)

Basic loss per common share (0.00) (0.00)
Diluted loss per common share (0.00) (0.00)

Basic weighted average common shares outstanding 633,746,331 516,461,430
</TABLE


See Accompanying Notes to Consolidated Financial Statements


GAMEZNFLIX, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)



<TABLE>
<CAPTION>
For the Three Months Ended For the Three Months Ended
March 31, 2005 March 31, 2004
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (675,704) $ (1,753,831)
Adjustments to reconcile net loss to net
cash used in operating activities:
Stock-based compensation 45,967 1,188,022
Depreciation and amortization 221,343 2,248

Changes in operating assets and liabilities:
Change in accounts receivable 5,744 --
Change in accounts receivable - employees -- 1,892
Change in stock subscription receivable 10,549 20,000
Change in inventory -- (158,131)
Change in prepaid expenses 121,616 (20,000)
Change in other assets 123,410 (3,589)
Change in accounts payable (203,658) 55,740)
Change in accrued expenses (6,600) 258,758
Change in other liabilities -- --

Net cash provided used in operating activities (357,333) (520,371)

Cash flows from investing activities:
Purchase of DVD's & games library (149,937) --
Purchase of fixed assets (75,915) --

Net cash used in investing activities (225,852) --

Cash flows from financing activities:
Payments on notes payable -- (4,800)
Payments on related party notes payable (109,983) --
Proceeds on notes payable 27,079 --
Proceeds from related party notes payable -- 63,411
Proceeds from stock issuances 680,451 972,462

Net cash provided by investing activities 597,547 1,031,073

Net change in cash and cash equivalents 14,362 510,702

Cash, beginning of period 63,295 43,778

Cash, end of period 77,657 554,480
</TABLE>



See Accompanying Notes to Consolidated Financial Statements


GAMEZNFLIX, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

1. BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements of
GameZnFlix, Inc. ("Company") have been prepared in accordance with
Securities and Exchange Commission requirements for interim financial
statements. Therefore, they do not include all of the information and
footnotes required by accounting principles generally accepted in the
United States for complete financial statements. The financial
statements should be read in conjunction with the Form 10-KSB of the
Company for the year ended December 31, 2004.

The interim financial statements present the balance sheet, statements
of operations, stockholders' equity and cash flows of the Company.
The financial statements have been prepared in accordance with
accounting principles generally accepted in the United States.

The interim financial information is unaudited. In the opinion of
management, all adjustments necessary to present fairly the financial
position as of March 31, 2005 and the results of operations,
stockholders' equity and cash flows presented herein have been
included in the financial statements. Interim results are not
necessarily indicative of results of operations for the full year.

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management
to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.

History - The Company provides online movie (also referred to as
"DVD") and video game rentals to subscribers through its Internet
website www.gameznflix.com. Aside from having a comprehensive movie
library of titles, the Company also provides subscribers with access
to a comprehensive games library of Xbox, Playstation 2, Playstation,
and Nintendo Gamecube titles. Subscribers of the Company are located
within the United States of America. The Company maintains its
headquarters in Franklin, Kentucky and its movie and games rental
shipping facilities in California, Colorado, Kentucky, and Pennsylvania.

Going concern - The accompanying financial statements have been
prepared assuming that the Company will continue as a going concern,
which contemplates the recoverability of assets and the satisfaction
of liabilities in the normal course of business. The ability of the
Company to continue as a going concern is dependent upon its ability
to raise additional capital from the sale of common stock and,
ultimately, the achievement of significant operating results. The
accompanying financial statements do not include any adjustments that
might be required should the Company be unable to recover the value of
its assets or satisfy its liabilities. As of March 31, 2005, the
Company had an accumulated deficit of approximately $19,179,000. In
addition, the Company had excess current liabilities over current
assets of approximately $486,000. The Company has a substantial need
for working capital. These factors, among others, raise substantial
doubt about the Company's ability to continue as a going concern.

In March 2004, the Company launched its website,
http://www.gameznflix.com, and began operating in the online DVD and
video game rental industry. In conjunction with the website launch,
the company also launched a national television ad campaign designed
to create awareness among the Company's target consumers and to
generate traffic to the website.

In addition, the Company has generated over $680,000 in working
capital during the first three months of 2005 through the issuance of
common stock from options exercised.

As a result of these actions and estimates of revenues that will be
generated from its online presence, management feels that there is
sufficient evidence they will be able to generate any additional
working capital needed to allow the Company to continue as a going concern.

2. SIGNIFICANT ACCOUNTING POLICIES

Use of estimates - The preparation of consolidated financial
statements in conformity with accounting principles generally accepted
in the United States requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the
consolidated financial statements and the reported amounts of revenue
and expenses during the reporting period. Actual results could differ
from those estimates.

DVD's and video games library - DVD's and video games are recorded at
historical cost and depreciated using the straight-line method over a
twelve-month period. The Company has no immediate plans to have any
part of its DVD's and video games library sold and accordingly no
salvage value is provided. However if the Company does sell any of
its DVD's and video games library, the Company will re-evaluate its
depreciation policy in terms of the salvage value.

Because of the nature of the business, the Company experiences a
certain amount of loss, damage, or theft of its DVD's and video games.
This loss is shown in the cost of sales section of the accompanying
consolidated statement of operations. Any accumulated depreciation
associated with this item is accounted for on a first-in-first-out
basis and treated as a reduction to depreciation expense in the month
the loss is recognized.

Inventory - Inventory consists of DVD and video game products for
sale. All inventory items are stated at the lower of cost (first-in,
first-out) or market value.

Revenue recognition and cost of revenue - Subscription revenues are
recognized ratably during each subscriber's monthly subscription
period. Refunds to subscribers are recorded as a reduction of
revenues. Revenues from sales of DVD's and video games are recorded
upon shipment.

Cost of subscription revenues consists of referral expenses,
fulfillment expenses, and postage and packaging expenses related to
DVD's and video games provided to paying subscribers. Revenue sharing
expenses are recorded as DVD's subject to revenue sharing agreements
are shipped to subscribers. Cost of DVD sales include the net book
value of the DVD's sold and, where applicable, a contractually
specified percentage of the sales value for the DVD's that are subject
to revenue share agreements.

Revenue from proprietary software sales that does not require further
commitment from the Company is recognized upon shipment. Consulting
revenue is recognized when the services are rendered. License revenue
is recognized ratably over the term of the license.

The cost of services, consisting of staff payroll, outside services,
equipment rental, communication costs and supplies, is expensed as incurred.

3. PREPAID FEES PAID WITH COMMON STOCK

For the three months ended March 31, 2005, the Company entered into
various consulting agreements extending over a twelve-month period
that were compensated through issuance of common stock. The Company
issued a total of 15,800,000 of common stock related to these
consulting agreements with total value of $216,000 based upon the fair
value of such stock that will be expensed over the twelve-month term
of such agreements. Accordingly, the Company has incurred
approximately $18,000 in expenses during the three months ended March
31, 2005 related to these new consulting agreements. As a result, the
Company's remaining prepaid consulting expenses as of March 31, 2005
totals $198,000.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.

The following management's discussion and analysis of financial
condition and results of operations is based upon, and should be read
in conjunction with, its unaudited financial statements and related
notes included elsewhere in this Form 10-QSB, which have been prepared
in accordance with accounting principles generally accepted in the
United States.

Overview.

The Company, through its website www.gameznflix.com, is an online
DVD movie and video game rental business dedicated to providing
subscribers a quality rental experience. We offer subscribers a
reliable, web-based alternative to traditional store-based DVD and
video game rentals on a national scale. Our standard subscription plan
of $17.25 per month allows subscribers to have up to three DVD and
video game titles out at the same time with no due dates, late fees or
shipping charges. Subscribers select titles at our website which are
then sent via U.S mail with a prepaid return mailer. Our service is
an alternative to store- based video game rentals as we offer a high
level of customer service, quality titles, and superior product availability.

In March 2004, we launched our website,
http://www.gameznflix.com, however, did not fully commence our
operations in the online DVD and video game rental until September
2004. In conjunction with the website launch, we also launched a
national television ad campaign designed to create awareness among our
target consumers and to generate traffic to the website.

We believe that our planned growth and profitability will depend
in large part on our ability to promote our services, gain subscribers
and expand our relationship with current subscribers. Accordingly, we
intends to focus our attention and investment of resources in
marketing, strategic partnerships and development of our subscriber
base. If we are not successful in promoting our services and expanding
our subscriber base, this may have a material adverse effect on our
financial condition and the ability to continue to operate the business.

Results of Operations.

Since our DVD and video game rentals operations did not fully
commence until late fiscal year 2004, which is our business focus,
discussions regarding comparative results between the three months
March 31, 2005 compared to March 31, 2004 may not always be
meaningful. Accordingly, discussions related to revenue and cost of
revenue will be limited to the current period.

(a) Revenues.

The Company reported gross revenues of $160,773 for the three
months ended March 31, 2005 of which substantially all of our gross
revenues were derived from monthly subscription fees. During the
three months ended March 31, 2005, our subscriber base averaged
approximately 3,800 subscribers per month. We continue to focus on
growing our subscriber base through marketing and affiliate
partnership program whereby a referral fee is paid for each new
subscriber signed. Since our DVD and video games rental activities
have a limited history, we are unable to provide any meaningful churn
figures. Churn is a monthly measure defined as customer cancellations
in the quarter derived by the sum of beginning subscribers and gross
subscriber additions, then divided by three months. Customer
cancellations in the quarter include cancellations from gross
subscriber additions, which is included in the gross subscriber
additions in the denominator. Once we have more operational activity
history, management will use churn as a measure to evaluate whether we
are obtaining new subscribers while retaining our existing subscribers
in accordance to our business plans.

(b) Cost of Revenues.

The Company reported cost of revenues of $138,261 for the three
months ended March 31, 2005. The cost of revenues was primarily
attributable to fulfillment expenses and mail delivery. We anticipate
these two expenses to continue to comprise a significant portion of
our overall cost of revenues. In March 2005, the Company changed its
fulfillment services from an external provider to internally providing
such services. We believe we can reduce the overall percentage of
fulfillment expense in relation to gross revenues and better
maintaining overall fulfillment services.

(c) Selling, General and Administrative Expenses.

The Company reported selling, general and administrative expenses
of $279,098 for the three months ended March 31, 2005 compared to
$375,999 for the same period in prior year, an overall decrease of
$96,901 or approximately 26%. Selling, general and administrative
expenses comprised primarily of related payroll expenses of
approximately $117,000, advertising expenses of approximately $35,000,
certain repairs and maintenance expenses of approximately $22,000 that
we do not anticipate as being a recurring expense, and Internet
connectivity fees of approximately $19,000. We believe that the
current level of selling, general and administrative expenses will
tend to fluctuate by about 20% in the next twelve months.

(d) Amortization and Depreciation Expenses.

The Company reported amortization and depreciation expenses of
$221,343 for the three months ended March 31, 2005 compared to $2,248
for the same period in prior year, an overall increase of $219,095.
Amortization and depreciation expenses comprised mainly of
amortization expense of approximately $198,000 related to our DVD and
game library. The library is amortized over twelve months based on
the month of purchase of new additions to the library. As our
overall DVD and game library increases in future periods, such
increase will impact our amortization and depreciation expense.

(e) Consulting and Professional Fees.

The Company reported consulting and professional fees of $197,906
for the three months ended March 31, 2005 compared to $1,398,515 for
the same period in the prior year, an overall decrease of $1,200,609
or approximately 86%. Consulting and professional fees in 2004 were
primarily related to hiring of business consultants to develop our
business model for the launching of the DVD and video game rental
business that approximate 88% of overall consulting and professional
fees. Accordingly, we will continue to continue consulting and
professional fees but not at such levels as in prior periods. We
believe that the current level of consulting and professional fees
will tend to fluctuate by about 25% in the next twelve months.

(f) Net Loss.

The Company reported a net loss of $675,704 for the three months
ended March 31, 2005 as result of the foregoing factors mentioned
above. We anticipate having a recurring net loss for the next eight
months in 2005.

Factors That May Affect Operating Results.

The operating results of the Registrant can vary significantly
depending upon a number of factors, many of which are outside its
control. General factors that may affect the Registrant's operating
results include:

- market acceptance of and changes in demand for services;

- a small number of customers account for, and may in future
periods account for, substantial portions of the Registrant's
revenue, and revenue could decline because of delays of customer
orders or the failure to retain customers;

- gain or loss of clients or strategic relationships;

- announcement or introduction of new services by the Registrant or
by its competitors;

- price competition;

- the ability to upgrade and develop systems and infrastructure to
accommodate growth;

- the ability to introduce and market services in accordance with
market demand;

- changes in governmental regulation; and

- reduction in or delay of capital spending by clients due to the
effects of terrorism, war and political instability.

The Company believes that its planned growth and profitability
will depend in large part on the ability to promote its services, gain
clients and expand its relationship with current clients.
Accordingly, we intend to invest in marketing, strategic partnerships,
and development of our customer base. If the Company is not
successful in promoting its services and expanding its customer base,
this may have a material adverse effect on its financial condition and
its ability to continue to operate its business.

The Company is also subject to the following specific factors
that may affect our operations:

(a) Ability to Attract and Retain Subscribers.

The Company must continue to attract and retain subscribers. To
succeed, we must continue to attract subscribers who have
traditionally used video and game retailers, video and game rental
outlets, cable channels, such as HBO and Showtime and pay-per-view.
The Company's ability to attract and retain subscribers will depend in
part on its ability to consistently provide its subscribers a high
quality experience for selecting, viewing or playing, receiving and
returning titles. If consumers do not perceive the service offering
to be of quality, or if the Company introduces new services that are
not favorably received by them, we may not be able to attract or
retain subscribers. If the efforts to satisfy its existing
subscribers are not successful, we may not be able to attract new
subscribers, and as a result, revenues will be affected adversely.

The Company must minimize the rate of loss of existing
subscribers while adding new subscribers. Subscribers cancel their
subscription to our service for many reasons, including a perception
that they do not use the service sufficiently, delivery takes too
long, the service is a poor value and customer service issues are not
satisfactorily resolved. The Company must continually add new
subscribers both to replace subscribers who cancel and to grow the
business beyond the current subscriber base. If too many of
subscribers cancel the Company's service, or if the Company is unable
to attract new subscribers in numbers sufficient to grow the business,
operating results will be adversely affected. Further, if excessive
numbers of subscribers cancel the service, we may be required to incur
significantly higher marketing expenditures than currently anticipated
to replace these subscribers with new subscribers.

Subscribers to the service can view as many titles and/or play
games as they want every month and, depending on the service plan, may
have out between three and eight titles at a time. With the Company's
use of three shipping centers and the associated software and
procedural upgrades, we have reduced the transit time of DVD's and
games. As a result, our subscribers have been able to exchange more
titles each month, which has increased operating costs. As the
Company established additional planned shipping centers or further
refines its distribution process, it may see a continued increase in
usage by subscribers. If subscriber retention does not increase or
operating margins do not improve to an extent necessary to offset the
effect of increased operating costs, operating results will be
adversely affected.

Subscriber demand for titles may increase for a variety of other
reasons beyond the Company's control, including promotion by studios
and seasonal variations in movie watching. Subscriber growth and
retention may be affected adversely if the company attempts to
increase monthly subscription fees to offset any increased costs of
acquiring or delivering titles and games.

The Company may not be able to continue to support the marketing
of its service by current means if such activities are no longer
available or are adverse to its business. In addition, the Company
may be foreclosed from certain channels due to competitive reasons.
If companies that currently promote the Company's service decide to
enter its business or a similar business, we may no longer be given
access to such channels. If the available marketing channels are
curtailed, the ability to attract new subscribers may be affected
adversely.

The GameZnFlix brand is young, and the Company must continue to
build strong brand identity. To succeed, we must continue to attract
and retain a number of owners of DVD and video game players who have
traditionally relied on store-based rental outlets and persuade them
to subscribe to its service through its website. The Company may be
required to incur significantly higher advertising and promotional
expenditures than currently anticipated to attract numbers of new
subscribers. The Company believes that the importance of brand
loyalty will increase with a proliferation of DVD and game
subscription services and other means of distributing titles. If our
efforts to promote and maintain its brand are not successful, our
operating results and ability to attract and retain subscribers will
be affected adversely.

(b) Selection of Certain Titles by Subscribers.

Certain titles cost the Company more to acquire depending on the
source from whom they are acquired and the terms on which they are
acquired. If subscribers select these titles more often on a
proportional basis compared to all titles selected, DVD or game
acquisition expenses could increase, and gross margins could be
adversely affected.

(c) Mix of Acquisition Sources May Affect Subscriber Levels.

The Company utilizes a mix of incentive-based and fixed-cost
marketing programs to promote its service to potential new
subscribers. We obtain a portion of its new subscribers through
online marketing efforts, including third party banner ads, direct
links and an active affiliate program. While the Company
opportunistically adjusts its mix of incentive-based and fixed-cost
marketing programs, it attempts to manage the marketing expenses to
come within a prescribed range of acquisition cost per subscriber. To
date, the Company has been able to manage its acquisition cost per
subscriber; however, if we are unable to maintain or replace sources
of subscribers with similarly effective sources, or if the cost of
existing sources increases, subscriber levels may be affected
adversely and the cost of marketing may increase.

(d) Competition.

The market for on-line rental of DVD's and games is
competitive and the Company expects competition to continue to
increase. In addition, the companies with whom we have relationships
could develop products or services, which compete with the Company's
products or services. Also, some competitors in our market have
longer operating histories, significantly greater financial,
technical, marketing and other resources, and greater brand
recognition than we do. The Company also expects to face additional
competition as other established and emerging companies enter the
market for on-line rentals. To be competitive, we believe that we
must, among other things, invest resources in developing new products,
improving its current products and maintaining customer satisfaction.
Such investment will increase the Company's expenses and affect its
profitability. In addition, if it fails to make this investment, the
Company may not be able to compete successfully with its competitors,
which could have a material adverse effect on its revenue and future
profitability.

(e) Potential Delivery Issues Could Result in the Loss of Subscribers.

The Company relies exclusively on the U.S. Postal Service to
deliver DVD's and games from its shipping centers and to return DVD's
and games from subscribers. We are subject to risks associated with
using the public mail system to meet its shipping needs, including
delays caused by bioterrorism, potential labor activism and inclement
weather. The Company's DVD's and games are also subject to risks of
breakage during delivery and handling by the U.S. Postal Service. The
risk of breakage is also impacted by the materials and methods used to
replicate DVD's and games. If the entities replicating DVD's and
games use materials and methods more likely to break during delivery
and handling or the company fails to timely deliver DVD's and games to
subscribers, subscribers could become dissatisfied and cancel the
service, which could adversely affect operating results. In addition,
increased breakage rates for DVD's and games will increase the
company's cost of acquiring titles.

(f) Limitations on Liability and Indemnification.

The Company's bylaws include provisions to the effect that we may
indemnify any director, officer, or employee. In addition, provisions
of Nevada law provide for such indemnification, as well as for a
limitation of liability of our directors and officers for monetary
damages arising from a breach of their fiduciary duties. Any
limitation on the liability of any director or officer, or
indemnification of any director, officer, or employee, could result in
substantial expenditures being made by the Company in covering any
liability of such persons or in indemnifying them.

(g) Adjustable Conversion Price Feature of Debentures Could Require
the Issuance of Greater Number of Shares.

The Company's obligation to issue shares upon conversion of the
convertible debentures to Golden Gate Investors, Inc. (see Liquidity
and Capital Resources, below) is essentially limitless. The following
is an example of the amount of shares of GameZnFlix common stock that
are issuable upon conversion of the convertible debentures (excluding
accrued interest), based on market prices 25%, 50% and 75% below the
market price as of April 26, 2005 of $0.01:

Price Number % of
% Below Price Per With Discount of Shares Outstanding
Market Share at 18% Issuable Stock

25% $0.0075 $0.0062 2,720,000,000 78.23%

50% $0.0050 $0.0041 4,095,000,000 73.01%

75% $0.0025 $0.0021 8,220,000,000 84.45%

As illustrated, the number of shares of common stock issuable
upon conversion of the convertible debentures will increase if the
market price of the stock declines, which will cause dilution to the
existing stockholders.

(h) Adjustable Conversion Price Feature of Debentures May Encourage
Short Sales.

The convertible debentures issued to Golden Gate Investors, Inc.
are convertible into shares of Company common stock at an 18% discount
to the trading price of the common stock prior to the conversion. The
significant downward pressure on the price of the common stock as the
selling stockholder converts and sells material amounts of common
stock could encourage short sales by investors. This could place
further downward pressure on the price of the common stock. The
selling stockholder could sell common stock into the market in
anticipation of covering the short sale by converting their
securities, which could cause the further downward pressure on the
stock price. In addition, not only the sale of shares issued upon
conversion or exercise of debentures, warrants and options, but also
the mere perception that these sales could occur, may adversely affect
the market price of the common stock.

(i) Issuance of Shares upon Conversion of Debentures and Exercise of
Warrants.

The issuance of shares upon conversion of the convertible
debentures issued to Golden Gate Investors, Inc. and exercise of
warrants may result in substantial dilution to the interests of other
stockholders since the selling stockholder may ultimately convert and
sell the full amount issuable on conversion. Although the selling
stockholder may not convert their convertible debentures and/or
exercise its warrants if such conversion or exercise would cause them
to own more than 9.9% of Company outstanding common stock, this
restriction does not prevent the selling stockholder from converting
and/or exercising some of its holdings and then converting the rest of
its holdings. In this way, the selling stockholder could sell more
than this limit while never holding more than this limit. There is no
upper limit on the number of shares that may be issued which may have
the effect of further diluting the proportionate equity interest and
voting power of holders of the common stock.

(j) If Stock Price Declines, the Company May Be Required to File A
Subsequent Registration.

Based on the Company's current market price and the potential
decrease in its market price as a result of the issuance of shares
upon conversion of the convertible debentures issued to Golden Gate
Investors, Inc., the Company has made a good faith estimate as to the
amount of shares of common stock that it is required to register and
allocate for conversion of the convertible debentures. In the event
that the Company's stock price decreases, the shares of common stock
the company has allocated for conversion of the convertible debentures
and are registering hereunder may not be adequate. If our shares
allocated to the registration statement are not adequate and the
company is required to file an additional registration statement, we
may incur substantial costs in connection with the preparation and
filing of such registration statement.

(k) Repayment of Debentures, If Required, Would Deplete Available
Capital.

The convertible debentures issued to Golden Gate Investors, Inc,
are due and payable, with 4 3/4% interest, three years from the date
of issuance, unless sooner converted into shares of common stock. In
addition, any event of default could require the early repayment of
the convertible debentures at a price equal to 125% of the amount due
under the debentures. The Company anticipates that the full amount of
the convertible debentures, together with accrued interest, will be
converted into shares of its common stock, in accordance with the
terms of the convertible debentures. If Company is required to repay
the convertible debentures, we would be required to use its limited
working capital and/or raise additional funds. If Company were unable
to repay the debentures when required, the debenture holders could
commence legal action against the company and foreclose on assets to
recover the amounts due. Any such action may require the Company to
curtail or cease operations.

Operating Activities.

The net cash used in operating activities was $357,333 for the
three months ended March 31, 2005 compared to $520,371 for the same
period in prior year, a decrease of $163,038 or approximately 31%.
This decrease is attributed to many changes from period to period,
including the payment of stock based compensation.

Investing Activities.

Net cash used in investing activities increased to $225,852
during the three months ended March 31, 2005 as compared to zero for
the same period in prior year as a result of the purchase of DVD and
game library.

Liquidity and Capital Resources.

As of March 31, 2005, the Company had total current assets of
$327,464 and total current liabilities of $813,229, resulting in a
working capital deficit of $485,765; as of that date, the Company had
cash of $77,657. During the three months ended March 31, 2005 and
2004, the Company incurred losses of $675,704 and $1,753,831,
respectively, and the Company had an accumulated deficit of
$19,178,838 as of March 31, 2005. These factors raise substantial
doubt as to the Company's ability to continue as a going concern.

The accompanying financial statements have been prepared assuming
that the Company continues as a going concern that contemplates the
realization of assets and the satisfaction of liabilities in the
normal course of business assuming the Company will continue as a
going concern. However, the ability of the Company to continue as a
going concern on a longer-term basis will be dependent upon its
ability to generate sufficient cash flow from operations to meet its
obligations on a timely basis, to retain its current financing, to
obtain additional financing, and ultimately attain profitability.
Our current cash flow from operations will not be sufficient to
maintain our capital requirements for the next twelve months.
Accordingly, we will need to continue raising capital through either
debt or equity instruments. We believe we will need to raise at least
$5,000,000 within the next twelve months so we may continue executing
our business plans. Whereas the Company has been successful in the
past in raising capital, no assurance can be given that these sources
of financing will continue to be available to us and/or that demand
for our equity/debt instruments will be sufficient to meet its capital
needs, or that financing will be available on terms favorable to the
Company. The financial statements do not include any adjustments
relating to the recoverability and classification of liabilities that
might be necessary should the Company be unable to continue as a going
concern.

If funding is insufficient at any time in the future, we may not
be able to take advantage of business opportunities or respond to
competitive pressures, or may be required to reduce the scope of our
planned product development and marketing efforts, any of which could
have a negative impact on its business and operating results. In
addition, insufficient funding may have a material adverse effect on
our financial condition, which could require us to:

- curtail operations significantly;

- sell significant assets;

- seek arrangements with strategic partners or other parties that
may require the company to relinquish significant rights to
products, technologies or markets; or

- explore other strategic alternatives including a merger or sale
of the Company.

To the extent that we raise additional capital through the sale
of equity or convertible debt securities, the issuance of such
securities may result in dilution to existing stockholders. If
additional funds are raised through the issuance of debt securities,
these securities may have rights, preferences and privileges senior to
holders of common stock and the terms of such debt could impose
restrictions on our operations. Regardless of whether our cash assets
prove to be inadequate to meet our operational needs, we may seek to
compensate providers of services by issuance of stock in lieu of cash,
which may also result in dilution to existing shareholders.

The Company has been successful in obtaining the required cash
resources through private placements, convertible debentures and notes
payable to service the Company through to the end of 2005. In
addition, the Company entered into a Securities Purchase Agreement with
Golden Gate Investors, Inc. on November 11, 2004 for the sale of (i)
$150,000 in convertible debentures and (ii) warrants to buy 15,000,000
shares of our common stock (see Exhibits 4.20 to 4.24). This summary
relates to the resale of the common stock underlying these convertible
debentures and warrants. The investor provided us with an aggregate of
$150,000 as follows:

- $100,000 was disbursed to us on November 11, 2004; and;

- $50,000 has been retained for services provided to our company by
various professionals, which shall be disbursed upon effectiveness
of the Form SB-2 registration statement.

The debentures bear interest at 4 3/4%, mature three years from
the date of issuance, and are convertible into our common stock, at
the selling stockholder's option. The convertible debentures are
convertible into the number of our shares of common stock equal to the
principal amount of the debentures being converted multiplied by 110,
less the product of the conversion price multiplied by 100 times the
dollar amount of the debenture. The conversion price for the
convertible debentures is the lesser of (i) $0.20, (ii) 82% of the
average of the three lowest volume weighted average prices during the
twenty trading days prior to the conversion or (iii) 82% of the volume
weighted average price on the trading day prior to the conversion.
Accordingly, there is in fact no limit on the number of shares into
which the debenture may be converted. However, in the event that our
market price is less than $0.015, we will have the option to prepay
the debenture at 150% rather than have the debenture converted. If we
elect to prepay the debenture, Golden Gate may withdraw its conversion
notice. In addition, the selling stockholder is obligated to exercise
the warrant concurrently with the submission of a conversion notice by
the selling stockholder. The warrant is exercisable into 15,000,000
shares of common stock at an exercise price of $1.09 per share.

The selling stockholder has contractually agreed to restrict its
ability to convert or exercise its warrants and receive shares of our
common stock such that the number of shares of common stock held by
them and their affiliates after such conversion or exercise does not
exceed 9.9% of the then issued and outstanding shares of common stock.

Inflation.

The impact of inflation on our costs and the ability to pass on
cost increases to its customers over time is dependent upon market
conditions. We are not aware of any inflationary pressures that have
had any significant impact on our operations over the past quarter,
and the company does not anticipate that inflationary factors will
have a significant impact on future operations.

Other.

The Registrant does not provide post-retirement or post-
employment benefits requiring charges under Statements of Financial
Accounting Standards No. 106 and No. 112.

Critical Accounting Policies

The SEC has issued Financial Reporting Release No. 60,
"Cautionary Advice Regarding Disclosure About Critical Accounting
Policies" ("FRR 60"), suggesting companies provide additional
disclosure and commentary on their most critical accounting policies.
In FRR 60, the SEC has defined the most critical accounting policies
as the ones that are most important to the portrayal of a company's
financial condition and operating results, and require management to
make its most difficult and subjective judgments, often as a result of
the need to make estimates of matters that are inherently uncertain.
Based on this definition, the Registrant's most critical accounting
policies include: (a) use of estimates in the preparation of financial
statements; (b) impairment of long-lived assets; (c) DVD's and video
games library; (d) revenue recognition and cost of revenue; and (e)
non-cash compensation valuation. The methods, estimates and judgments
the Registrant uses in applying these most critical accounting
policies have a significant impact on the results the Registrant
reports in its financial statements.

(a) Use of Estimates in the Preparation of Financial Statements.

The preparation of these financial statements requires our
company to make estimates and judgments that affect the reported
amounts of assets, liabilities, revenues and expenses, and related
disclosure of contingent assets and liabilities. On an on-going basis,
we evaluate these estimates, including those related to revenue
recognition and concentration of credit risk. We base our estimates on
historical experience and on various other assumptions that are
believed to be reasonable under the circumstances, the results of
which form the basis for making judgments about the carrying values of
assets and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates under
different assumptions or conditions.

(b) Impairment of Long-Lived Assets.

Long-lived assets such as property and equipment and intangible
assets subject to amortization, are reviewed for impairment whenever
events or changes in circumstances indicate that the carrying amount
of an asset group may not be recoverable. Recoverability of assets
groups to be held and used is measured by a comparison of the carrying
amount of an asset group to estimated undiscounted future cash flows
expected to be generated by the asset group. If the carrying amount
of an asset group exceeds its estimated future cash flows, an
impairment charge is recognized by the amount by which the carrying
amount of an asset group exceeds fair value of the asset group. The
Company evaluated its long-lived assets and no impairment charges were
recorded for any of the years presented.

(c) DVD's and Video Games Library.

DVD's and video games are recorded at historical cost and
depreciated using the straight-line method over a twelve-month period.
The Company has no immediate plans to have any part of its DVD's and
video games library sold and accordingly no salvage value is provided.
However if the Company does sell any of its DVD's and video games
library, the Company will re-evaluate its depreciation policy in terms
of the salvage value.

Because of the nature of the business, the Company experiences a
certain amount of loss, damage, or theft of its DVD's and video games.
This loss is shown in the cost of sales section of the Income
Statement. Any accumulated depreciation associated with this item is
accounted for on a first-in-first-out basis and treated as a reduction
to depreciation expense in the month the loss is recognized.

(d) Revenue Recognition and Cost of Revenue.

Subscription revenues are recognized ratably during each
subscriber's monthly subscription period. Refunds to subscribers are
recorded as a reduction of revenues. Revenues from sales of DVD's and
video games are recorded upon shipment.

Cost of subscription revenues consists of referral expenses,
fulfillment expenses, and postage and packaging expenses related to
DVD's and video games provided to paying subscribers. Revenue sharing
expenses are recorded as DVD's subject to revenue sharing agreements
are shipped to subscribers. Cost of DVD sales include the net book
value of the DVD's sold and, where applicable, a contractually
specified percentage of the sales value for the DVD's that are subject
to revenue share agreements.

Revenue from proprietary software sales that does not require
further commitment from the Company is recognized upon shipment.
Consulting revenue is recognized when the services are rendered.
License revenue is recognized ratably over the term of the license.

The cost of services, consisting of staff payroll, outside
services, equipment rental, communication costs and supplies, is
expensed as incurred.

(e) Non-Cash Compensation Valuation.

The Company intends to issue shares of common stock to various
individuals and entities for management, legal, consulting and
marketing services. These issuances are valued at the fair market
value of the services provided and the number of shares issued is
determined, based upon the open market closing price of common stock
as of the date of each respective transaction. These transactions will
be reflected as a component of selling, general and administrative
expenses in our statement of operations.

Forward Looking Statements.

Information in this Form 10-QSB contains "forward looking
statements" within the meaning of Rule 175 of the Securities Act of
1933, as amended, and Rule 3b-6 of the Securities Act of 1934, as
amended. When used in this Form 10-KSB, the words "expects,"
"anticipates," "believes," "plans," "will" and similar expressions are
intended to identify forward-looking statements. These are statements
that relate to future periods and include, but are not limited to,
statements regarding our adequacy of cash, expectations regarding net
losses and cash flow, statements regarding our growth, our need for
future financing, our dependence on personnel, and our operating
expenses.

Forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially
from those projected. These risks and uncertainties include, but are
not limited to, those discussed below, as well as risks related to our
ability to manage market fluctuations and our ability to obtain future
financing, and the risks set forth below under "Factors That May
Affect Our Results." These forward-looking statements speak only as
of the date hereof. The Company expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change in
its expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based.

ITEM 3. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures.

The Company maintains disclosure controls and procedures (as
defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities
Exchange Act of 1934, as amended) that are designed to ensure that
information required to be disclosed in our periodic reports filed
under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the SEC's rules and forms, and
that such information is accumulated and communicated to our
management, including our chief executive officer and chief financial
officer, as appropriate, to allow timely decisions regarding required
disclosure.

As of the end of the period covered by this report, our
management carried out an evaluation, under the supervision and with
the participation of our principal (chief) executive officer and
principal (chief) financial officer, of our disclosure controls and
procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the
Exchange Act). Based upon the evaluation, our principal (chief)
executive officer and principal (chief) financial officer concluded
that our disclosure controls and procedures are effective to ensure
that information required to be disclosed by us in the reports that we
file or submit under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the
Commission's rules and forms.

Because of the inherent limitations in all control systems,
no evaluation of controls can provide absolute assurance that all
control issues and instances of fraud, if any, will be or have been
detected. These inherent limitations include the realities that
judgments in decision-making can be faulty, and that breakdowns can
occur because of simple error or mistake. Additionally, controls can
be circumvented by the individual acts of some persons, by collusion
of two or more people, and/or by management override of the control.
The design of any system of controls also is based in part upon
certain assumptions about the likelihood of future events, and there
can be no assurance that any design will succeed in achieving its
stated goals under all potential future conditions; over time,
controls may become inadequate because of changes in conditions,
and/or the degree of compliance with the policies and procedures may
deteriorate. Because of the inherent limitations in a cost-effective
internal control system, misstatements due to error or fraud may occur
and not be detected.

Changes in Disclosure Controls and Procedures.

There were no significant changes in the Company's disclosure
controls and procedures, or in factors that could significantly affect
those controls and procedures, since their most recent evaluation.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

From time to time, the Company become party to litigation or
other legal proceedings that we consider to be a part of the ordinary
course of our business. There are no material legal proceedings to
report.

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

The Company made the following sales of unregistered (restricted)
securities during the quarter ended on March 31, 2005:

From January 24, 2005 to March 17, 2005, the Company issued
options to purchase a total of 60,000,000 shares of common stock under
our Stock Incentive Plan to one employee and one consultant of the
Company. These options, which are exercisable into free trading
shares of common stock under that plan, are exercisable for a period
of ten years after the grant at $0.01 per share.

No commissions were paid in connection with any of these sales.
These sales were undertaken under Rule 506 of Regulation D under the
Securities Act of 1933. Each of the transactions did not involve a
public offering and each of the investors represented that he/she was
a "sophisticated" or "accredited" investor as defined in Rule 502 of
Regulation D.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

Not Applicable.

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

None.

ITEM 5. OTHER INFORMATION.

Subsequent Event.

On April 15, 2005, the Company adopted Amendment No. 3 to its
Stock Incentive Plan, which increased the number of authorized shares
under this plan by 200,000,000 to 400,000,000. The additional shares
were registered under a Form S-8 POS filed with the SEC on April 18, 2005.

ITEM 6. EXHIBITS.

Exhibits included or incorporated by reference herein are set
forth in the Exhibit Index.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.

GameZnFlix, Inc.



Dated: May 2, 2005 By: /s/ John Fleming
John Fleming, President


Dated: May 2, 2005 By: /s/ Arthur de Joya
Arthur de Joya,
Chief Financial Officer


EXHIBIT INDEX

Number Description

2.1 Agreement and Plan of Merger between GameZnFlix and
Syconet.com, Inc., a Delaware corporation, dated December 1,
2001 (incorporated by reference to Exhibit 2.1 of the Form
10-KSB filed on April 15, 2003).

2.2 Acquisition Agreement between GameZnFlix and shareholders of
AmCorp Group, Inc., dated September 13, 2002 (incorporated
by reference to Exhibit 2 of the Form 8-K filed on September
23, 2002).

2.3 Acquisition Agreement between GameZnFlix and shareholders of
Naturally Safe Technologies, Inc., dated October 31, 2002
(incorporated by reference to Exhibit 2 of the Form 8-K
filed on November 13, 2002).

2.4 Acquisition Agreement between GameZnFlix and shareholders of
Veegeez.com, LLC, dated September 25, 2003 (incorporated by
reference to Exhibit 2 of the Form 8-K filed on October 9,
2003).

3.1 Articles of Incorporation, dated December 19, 2001
(incorporated by reference to Exhibit 3.1 of the Form 10-KSB
filed on April 15, 2003).

3.2 Certificate of Amendment to Articles of Incorporation,
dated November 21, 2002 (incorporated by reference to
Exhibit 3.2 of the Form 10-KSB filed on April 15, 2003).

3.3 Certificate of Amendment to Articles of Incorporation,
dated March 5, 2003 (incorporated by reference to Exhibit
3.3 of the Form 10-KSB filed on April 15, 2003).

3.4 Certificate of Amendment to Articles of Incorporation, dated
July 11, 2003 (incorporated by reference to Exhibit 3.4 of
the Form 10-QSB filed on August 20, 2003).

3.5 Certificate of Amendment to Articles of Incorporation, dated
January 26, 2004 (incorporated by reference to Exhibit 3.5
of the Form 10-KSB filed on April 19, 2004).

3.6 Certificate of Amendment to Articles of Incorporation, dated
December 16, 2004 (incorporated by reference to Exhibit 3 of
the Form 8-K filed on December 21, 2004)

3.7 Bylaws (incorporated by reference to Exhibit 3.2 of the Form
10-SB filed on January 25, 2000).

4.1 Specimen Common Stock Certificate (incorporated by reference
to Exhibit 4 of the Form 10-SB/A filed on March 21, 2000).

4.2 1997 Incentive Compensation Program, as amended
(incorporated by reference to Exhibit 10.1 of the Form SB-2
POS filed on August 28, 2000).

4.3 Common Stock Purchase Warrant issued to Alliance Equities,
Inc., dated May 21, 2000 (incorporated by reference to
Exhibit 4.1 to the Form SB-2 filed on June 2, 2000).

4.4 Form of Redeemable Common Stock Purchase Warrant to be
issued to investors in the private placement offering, dated
January 27, 2000 (incorporated by reference to Exhibit 4.2
to the Form SB-2/A filed on June 27, 2000).

4.5 Redeemable Common Stock Purchase Warrant issued to
Diversified Leasing Inc., dated May 1, 2000 (incorporated by
reference to Exhibit 4.3 of the Form SB-2/A filed on June
27, 2000).

4.6 Redeemable Common Stock Purchase Warrant issued to
John P. Kelly, dated August 14, 2000 (incorporated by
reference to Exhibit 4.4 of the Form SB-2 POS filed on
August 28, 2000).

4.7 Redeemable Common Stock Purchase Warrant for Frank
N. Jenkins, dated August 14, 2000 (incorporated by reference
to Exhibit 4.5 of the Form SB-2 POS filed on August 28, 2000).

4.8 Redeemable Common Stock Purchase Warrant for
Ronald Jenkins, dated August 14, 2000 (incorporated by
reference to Exhibit 4.6 of the Form SB-2 POS filed on
August 28, 2000).

4.9 Non-Employee Directors and Consultants Retainer Stock Plan,
dated July 1, 2001 (incorporated by reference to Exhibit 4.1
of the Form S-8 filed on February 6, 2002).

4.10 Consulting Services Agreement between GameZnFlix and Richard
Nuthmann, dated July 11, 2001 (incorporated by reference to
Exhibit 4.2 of the Form S-8 filed on February 6, 2002).

4.11 Consulting Services Agreement between GameZnFlix and Gary
Borglund, dated July 11, 2001 (incorporated by reference to
Exhibit 4.3 of the Form S-8 filed on February 6, 2002).

4.12 Consulting Services Agreement between GameZnFlix and Richard
Epstein, dated July 11, 2001 (incorporated by reference to
Exhibit 4.4 of the Form S-8 filed on February 6, 2002).

4.13 Amended and Restated Non-Employee Directors and Consultants
Retainer Stock Plan, dated July 1, 2002 (incorporated by
reference to Exhibit 4 of the Form S-8 filed on July 30, 2002).

4.14 Amended and Restated Non-Employee Directors and Consultants
Retainer Stock Plan (Amendment No. 2), dated April 25, 2003
(incorporated by reference to Exhibit 4.1 of the Form S-8
filed on May 12, 2003).

4.15 Stock Incentive Plan, dated April 25, 2003 (incorporated by
reference to Exhibit 4.2 of the Form S-8 filed on May 12, 2003).

4.16 Amended and Restated Non-Employee Directors and Consultants
Retainer Stock Plan (Amendment No. 3), dated August 17, 2003
(incorporated by reference to Exhibit 4 of the Form S-8 POS
filed on September 3, 2003).

4.17 Amended and Restated Non-Employee Directors and Consultants
Retainer Stock Plan (Amendment No. 4), dated November 17,
2003 (incorporated by reference to Exhibit 4 of the Form S-8
POS filed on December 9, 2003).

4.18 Amended and Restated Non-Employee Directors and Consultants
Retainer Stock Plan (Amendment No. 5), dated May 20, 2004
(incorporated by reference to Exhibit 4 of the Form S-8 POS
filed on May 25, 2004).

4.19 Amended and Restated Stock Incentive Plan, dated August 23,
2004 (incorporated by reference to Exhibit 4 of the Form S-8
POS filed on August 31, 2004).

4.20 Securities Purchase Agreement between GameZnFlix and Golden
Gate Investors, Inc., dated November 11, 2004 (incorporated
by reference to Exhibit 4.1 of the Form 8-K filed on
November 30, 2004).

4.21 Warrant to Purchase Common Stock issued by GameZnFlix in
favor of Golden Gate Investors, Inc., dated November 11,
2004 (incorporated by reference to Exhibit 4.2 of the Form
8-K filed on November 30, 2004).

4.22 Registration Rights Agreement between GameZnFlix and Golden
Gate Investors, Inc., dated November 11, 2004 (incorporated
by reference to Exhibit 4.3 of the Form 8-K filed on
November 30, 2004).

4.23 Addendum to Convertible Debenture and Securities Purchase
Agreement between GameZnFlix and Golden Gate Investors,
Inc., dated November 17, 2004 (incorporated by reference to
Exhibit 4.4 of the Form 8-K filed on November 30, 2004).

4.24 Addendum to Convertible Debenture and Securities Purchase
Agreement between GameZnFlix and Golden Gate Investors,
Inc., dated December 17, 2004 (incorporated by reference to
Exhibit 4.5 of the Form 8-K/A filed on January 18, 2005).

4.25 Amended and Restated Non-Employee Directors and Consultants
Retainer Stock Plan (Amendment No. 6), dated January 28,
2005 (incorporated by reference to Exhibit 4.1 of the Form
S-8 POS filed on February 2, 2005).

4.26 Amended and Restated Stock Incentive Plan (Amendment No. 2),
dated January 28, 2005 (incorporated by reference to Exhibit
4.2 of the Form S-8 POS filed on February 2, 2005).

16.1 Letter on Change in Certifying Accountant (incorporated by
reference to Exhibit 16 of the Form 8-K/A filed on August
24, 2001).

16.2 Letter on Change in Certifying Accountant (incorporated by
reference to Exhibit 16 of the Form 8-K/A filed on March 7, 2002).

16.3 Letter on Change in Certifying Accountant (incorporated by
reference to Exhibit 16 of the Form 8-K/A filed on November 5, 2002).

16.4 Letter on Change in Certifying Accountant (incorporated by
reference to Exhibit 16 of the Form 8-K/A filed on April 29, 2003).

16.5 Letter on Change in Certifying Accountant (incorporated by
reference to Exhibit 16 of the Form 8-K/A filed on January 21, 2004).

21 Subsidiaries of GameZnFlix (incorporated by reference to
Exhibit 21 of the Form 10-KSB filed on April 1, 2005).

23 Consent of independent registered public accounting firm
(incorporated by reference to Exhibit 23 of the Form 10-KSB
filed on April 1, 2005).

31.1 Rule 13a-14(a)/15d-14(a) Certification of John Fleming
(filed herewith).

31.2 Rule 13a-14(a)/15d-14(a) Certification of Arthur DeJoya
(filed herewith).

32 Section 1350 Certification of John Fleming and Arthur DeJoya
(filed herewith).

99.1 Patent issued to Donald V. Duffy, Jr., dated October 17,
2000 (incorporated by reference to Exhibit 99.2 of the Form
10-KSB filed on April 15, 2003).

99.2 Text of Press Release Issued by GameZnFlix, dated September
30, 2004 (incorporated by reference to Exhibit 99 of the
Form 8-K filed on October 8, 2004).

99.3 Text of Press Release Issued by GameZnFlix, dated February
4, 2005 (incorporated by reference to Exhibit 99 of the Form
8-K filed on February 7, 2005).

</TEXT>
</DOCUMENT>

EX-31.1
RULE 13a-14(a)/15d-14(a) CERTIFICATION OF JOHN FLEMING

RULE 13a-14(a)/15d-14(a) CERTIFICATION

I, John Fleming, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of
GameZnFlix, Inc.;

2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this report;

3. Based on my knowledge, the financial statements, and other
financial information included in this report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the small business issuer as of, and for, the periods
presented in this report;

4. The small business issuer's other certifying officer and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
[omitted pursuant to extended compliance period] for the small
business issuer and have:

(a) Designed such disclosure controls and procedures, or caused
such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
small business issuer, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly
during the period in which this report is being prepared;

(b) [omitted pursuant to extended compliance period]

(c) Evaluated the effectiveness of the small business issuer's
disclosure controls and procedures and presented in this report
our conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered by
this report based on such evaluation; and

(d) Disclosed in this report any change in the small business
issuer's internal control over financial reporting that occurred
during the small business issuer's most recent fiscal quarter
(the small business issuer's fourth fiscal quarter in the case of
an annual report) that has materially affected, or is reasonably
likely to materially affect, the small business issuer's internal
control over financial reporting; and

5. The small business issuer's other certifying officer and I have
disclosed, based on our most recent evaluation of internal control
over financial reporting, to the small business issuer's auditors and
the audit committee of the small business issuer's board of directors
(or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the small
business issuer's ability to record, process, summarize and
report financial information; and

(b) Any fraud, whether or not material, that involves management
or other employees who have a significant role in the small
business issuer's internal control over financial reporting.

Dated: May 2, 2005 By: /s/ John Fleming
John Fleming, President


</TEXT>
</DOCUMENT>

EX-31.2
RULE 13a-14(a)/15d-14(a) CERTIFICATION OF ARTHUR DE JOYA

RULE 13a-14(a)/15d-14(a) CERTIFICATION

I, Arthur de Joya, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of
GameZnFlix, Inc.;

2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this report;

3. Based on my knowledge, the financial statements, and other
financial information included in this report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the small business issuer as of, and for, the periods
presented in this report;

4. The small business issuer's other certifying officer and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
[omitted pursuant to extended compliance period] for the small
business issuer and have:

(a) Designed such disclosure controls and procedures, or caused
such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
small business issuer, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly
during the period in which this report is being prepared;

(b) [omitted pursuant to extended compliance period]

(c) Evaluated the effectiveness of the small business issuer's
disclosure controls and procedures and presented in this report
our conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered by
this report based on such evaluation; and

(d) Disclosed in this report any change in the small business
issuer's internal control over financial reporting that occurred
during the small business issuer's most recent fiscal quarter
(the small business issuer's fourth fiscal quarter in the case of
an annual report) that has materially affected, or is reasonably
likely to materially affect, the small business issuer's internal
control over financial reporting; and

5. The small business issuer's other certifying officer and I have
disclosed, based on our most recent evaluation of internal control
over financial reporting, to the small business issuer's auditors and
the audit committee of the small business issuer's board of directors
(or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the small
business issuer's ability to record, process, summarize and
report financial information; and

(b) Any fraud, whether or not material, that involves management
or other employees who have a significant role in the small
business issuer's internal control over financial reporting.

Dated: May 2, 2005 By: /s/ Arthur de Joya
Arthur de Joya.,
Chief Financial Officer


</TEXT>
</DOCUMENT>

EX-32
SECTION 1350 CERTIFICATION OF JOHN FLEMING AND ARTHUR DE JOYA

SECTION 1350 CERTIFICATION

In connection with the quarterly report of GameZnFlix, Inc.
("Company") on Form 10-QSB for the quarter ended March 31, 2005 as
filed with the Securities and Exchange Commission ("Report"), the
undersigned, in the capacities and on the dates indicated below,
hereby certify pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 (18 U.S.C. Section 1350), that to their knowledge:

1. The Report fully complies with the requirements of Section 13(a)
or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Company.


Dated: May 2, 2005 By: /s/ John Fleming
John Fleming, President


Dated: May 2, 2005 By: /s/ Arthur de Joya
Arthur de Joya,
Chief Financial Officer