Siti-sites Com (SITN) 10-Q 2007 Q2 Quarterly report

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2006
OR
o	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 0-15596
SITI-SITES.COM, INC.
(Exact name of registrant as specified in its charter)
Delaware	75-1940923
(State of incorporation)	(I.R.S. Employer Identification No.)
47 Beech Road, Englewood, New Jersey	07631
(Address of Chairman and Chief Executive Officer)	(Zip Code)
111 Lake Avenue, Tuckahoe, New York	10707
(Address of Chief Financial Officer)	(Zip Code)
(212) 925-1181
(Registrant’s telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
YES xNO o
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.
YES xNO o
As of November 13, 2006, the registrant had outstanding 30,078,178 shares of its Common Stock, par value $.001 per share.
The following documents are incorporated herein by reference:

(1)	Proxy Statement dated October 20, 2006 on Plan of Final Liquidation and Dissolution sent to security holders (“October 2006 Proxy Statement”)
(2)	Quarterly Report to security holders on Form 10-Q for the quarter ended June 30, 2006 (“June 2006 10-Q”);
(3)	Annual Report to security holders on Form 10-K for the year ended March 31, 2006 (the “Form 10-K for 2006”);
(4)	Annual Report to security holders on Form 10-K for the year ended March 31, 2005 (the “Form 10-K for 2005”);
(5)	Annual Report to security holders on Form 10-K for the year ended March 31, 2004 (the “Form 10-K for 2004”);
(6)	Annual Report to security holders on Form 10-K for the year ended March 31, 2003 (the “Form 10-K for 2003”);

SITI-SITES.COM, INC.

FORM 10-Q

SEPTEMBER 30, 2006

PART I.  FINANCIAL INFORMATION	Page No.
Material Current Event – Plan of Final Liquidation and Dissolution	1
Item 1. Financial Information
Statement of Net Assets in Liquidation at September 30, 2006 (Unaudited) and March 31, 2005	2
Statement of Changes in Net Assets (Liabilities) in Liquidation (Unaudited) for the Three and Six Months Ended September 30, 2006 and September 30, 2005	3
Notes to Condensed Financial Statements (Unaudited)	4
Item 2. Management’s Discussion and Analysis of Financial Condition and Status of Liquidation	7
Item 3. Quantitative and Qualitative Disclosures About Market Risk	9
Item 4. Controls and Procedures	9
PART II.  OTHER INFORMATION	9
Item 1. Legal Proceedings	9
Item 6. Exhibits and Reports on Form 8-K	9

PART I.             FINANCIAL INFORMATION

Material Recent Event – Plan of Final Liquidation and Dissolution

                On November 14, 2006 (the date of filing this Form 10-Q), shareholders of Siti-Sites.com, Inc, (the “Company”) are being asked to consider and act upon a formal Plan of Final Liquidation and Dissolution (the “Plan”) to be effectuated under Delaware law. The Company has been in liquidation continuously since December 2001, described in annual reports on Form 10-K and quarterly reports since that date.

                The October 2006 Proxy Statement sent to stockholders is incorporated by reference into this Form 10-Q, and contains information on the Plan together with financial statements of the Company throughout 2006. It is readily available on the Internet as filed with the SEC in definitive form, and some 11,600 printed copies of the October 2006 Proxy Statement have been mailed to stockholders of record and representative brokerage firms, institutional holders and trustee holders of the Company’s stock. The stockholders of record were 3,602 individuals and firms. Representatives of stockholders received 9,500 copies of such Proxy Statement to be distributed through their representatives.

                Voting by Proxy  A majority vote by stockholders of record as of October 20, 2006 is required for approval. While the meeting of stockholders is occurring on the date this Form 10-Q is filed, substantial results of the voting have been tallied by the Company’s Stock Transfer Agent and Inspector of Elections (American Stock Transfer & Trust Company) from proxies received from stockholders. Notwithstanding the right of any stockholder to cancel, amend or withdraw his proxy before or at the special meeting of the stockholders, the voting results known through November 13, 2006 are material information and will be announced at the meeting, as amended by proxies received through November 14, 2006 or by votes at the meeting.

	11/13/06
Shares Information:  Proxy Shares Outstanding:   30,000,143 shares

	Shares Voted	Percentage Voted
Individuals	25,838,712
Brokers (60 firms)	642,322
Total Shares Voted	26,481,034	88.27	%

Proposal for Plan of Final Liquidation and Dissolution

Votes For	Votes Against	Votes Abstain	Percentage Votes For
26,347,790	41,185	92,059	87.83	%

                It appears that the Plan of Final Liquidation and Dissolution is likely to be approved as of November 14, 2006 by a majority of stockholders. Various steps under Delaware law to implement such Plan will follow thereafter.

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SITI-Sites.com, Inc.
Statement of Net Assets in Liquidation
(Amounts in thousands)

	September 30, 2006 (Unaudited)		March 31, 2006
Assets
Current assets:
Cash and cash equivalents	$	266	$	4,925
Receivables and other assets		1		1
Total current assets		267		4,926
Total assets	$	267	$	27
Liabilities
Current Liabilities
Dividend Payable	$	—	$	4,504
Accounts payable and accrued liabilities		12		20
Total current liabilities		12		4,574
Total liabilities		12		4,574
Commitments and contingencies		—		—
Net Assets in Liquidation	$	255	$	352

See accompanying notes to consolidated financial statements.  

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SITI-Sites.com, Inc.
Statement of Changes in Net Assets in Liquidation

Three months ended	September 30, 2006 (Unaudited)			September 30, 2005 (Unaudited)
(Amounts in thousands)
Net (liabilities) assets in liquidation beginning of period	$	316		$	(75	)
Additions to net assets in liquidation:
Contribution of management’s services and rent		39			38
Interest Income		3			—
Other Income		4			—
Reductions to net assets in liquidation:
Operating expenses and accrual of estimated costs		(107	)		(83	)
Net (liabilities) assets in liquidation at end of period	$	(255	)	$	(115	)

SITI-Sites.com, Inc.
Statement of Changes in Net Assets in Liquidation

Six months ended	September 30, 2006 (Unaudited)			September 30, 2005 (Unaudited)
(Amounts in thousands)
Net assets in liquidation beginning of period	$	352		$	8
Additions to net assets in liquidation:
Contribution of management’s services and rent		77			76
Interest Income		11			—
Other Income		4			—
Issuance of common stock		—			180
Reductions to net assets in liquidation:
Operating expenses and accrual of estimated costs		(189	)		(379	)
Net assets in liquidation at end of period	$	(255	)	$	(115	)

See accompanying notes to consolidated financial statements.

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NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)

1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

                Siti-Sites.com, Inc., a Delaware corporation (referred to as “SITI” or the “Company”) previously operated as an Internet media company with three websites for the marketing of news and services. The Company’s websites related entirely to the music industry. SITI incurred losses continuously since their inception in 1999. As a result, the Company commenced procedures to prepare to liquidate its assets effective January 1, 2002.

Asset Liquidation.  For a full discussion on Management’s plan for liquidation, refer to the Form 10-K for 2005, incorporated herein by reference. A liquidating dividend was paid to shareholders in April, 2006 as a result of certain litigation described at Item 3 hereof, amounting to $4.5 million at $.15 per share to each shareholder. On September 13, 2006, the Company’s board of directors adopted a formal Plan of Final Liquidation and Dissolution, to be effected under Delaware law, subject to approval of the Company’s stockholders. In October, 2006, SITI prepared and filed a preliminary form of Proxy Statement under Section 14 (a) of the Securities Exchange Act of 1934 with the SEC. The preliminary Proxy Statement contemplates a special meeting of stockholders and a vote on a Plan of Final Liquidation and Dissolution (the “Plan”) being held November 14, 2006.

Financing.  For a full discussion on the Company’s financing up to and including the fiscal year ended March 31, 2006, refer to the Form 10-K for 2005 and 10-K for 2006, incorporated herein by reference.

          The several other business risks to the stockholders providing financing described in all prior filings, are also continuing. Those risks were increased by the ongoing cash costs of the patent recovery litigation, which were paid in full from settlement proceeds and prior financings. Some legal expenses will continue for a substantial period to monitor the settlement, and to cover legal costs of special corporate activity and attempts to create additional value in the patent rights where the Company has become a creditor under the settlement. See Item 3. below. The future risks to all shareholders further include a “one-third contingent fee agreement”, based solely on results achieved, with Special Litigation Counsel, Green, Schaaf & Jacobson for handling the litigation through trial and appeal. This arrangement, while currently advantageous to the Company, will necessarily reduce any net proceeds to the Company from the litigation. See “Litigation” and “Subsequent Event” regarding recent settlement.

          The Company’s Chairman/CEO Powers, who is also General Counsel to the Company, was active in the lengthy investigation in the suit. He spent substantial time working closely with litigation counsel as this matter continued into motions, trial preparation and settlement. Mr. Powers decided that he would not seek or receive any attorneys’ fees for his work in the litigation at its conclusion by a settlement in January 2006, although entitled to do so. He concluded this waiver of any attorney fees through such date would serve the best interests of the corporation. He will be charging reasonable attorney fees for his legal work since the settlement, and $35,000 was charged through September 30, 2006.

Audited Financial Statements.As a result of the asset liquidation and reasons discussed below, the Company’s management has determined that it is an “inactive entity” under SEC accounting rules (See also “Form 10-K for 2004, Item 1. Business – Inactive Entity”), and is not therefore required to file audited financial statements. This step conserves working capital. The Company meets all of the criteria as set forth below except as noted:

                 (a) Gross receipts from all sources for the fiscal years ended March 31, 2006 and 2005 were not in excess of $100,000, except for a one-time settlement of litigation described at Item 3 below resulting in a liquidating dividend;

                 (b) For fiscal 2005 and 2006, the registrant has not purchased or sold any of its own stock, granted options therefore, or levied assessments upon outstanding stock; (1)

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                 (c) Expenditures for all purposes for the fiscal years ended March 31, 2006 and 2005 were not in excess of $100,000, except for litigation expenses recovered in the litigation settlement described in Item 3 below.;

                 (d) No material change in the business has occurred during the 2005 and 2006 fiscal years, including any bankruptcy, reorganization, readjustment or succession or any material acquisition or disposition of plants, mines, mining equipment, mine rights or leases; and

                 (e) No exchange upon which the shares are listed, or governmental authority having jurisdiction, requires the furnishing to it or the publication of audited financial statements.

          (1) During the last two fiscal years, the Company had no source of funding to cover its expenses which were almost entirely audit, stock transfer expenses and litigation expenses. Chairman/CEO Powers, who may be deemed to beneficially own approximately 46% of the Company’s outstanding stock, and other existing investors provided funding to the Company. All of the shares issued are legended and none of the investors, has any intention of selling the stock publicly in the foreseeable future. (See also “Form 10-K for 2005, Item 1. Business – Inactive Entity”)

(b) CHANGE TO LIQUIDATION BASIS OF ACCOUNTING

                During the quarter ended December 31, 2001, the Company decided to liquidate its operations and adopted the liquidation basis of accounting effective January 1, 2002. Under the liquidation basis of accounting, assets are stated at their estimated net realizable values and liabilities are stated at their estimated settlement amounts, which estimates will be periodically reviewed and adjusted. Since the Company is in liquidation without continuing operations, the need to present quarterly Statements of Operations and Comprehensive Loss as well as a Statement of Cash Flows, is eliminated. However, the prior year’s financial statements for the comparable quarter are presented, since the Company did not adopt this method of accounting until January 1, 2002.

                 The valuation of assets at their net realizable value and liabilities at their anticipated settlement amounts necessarily requires many estimates and assumptions. In addition, there are substantial risks and uncertainties associated with carrying out the liquidation of the Corporation’s existing operations. The valuations presented in the accompanying Statement of Net Assets in Liquidation represent estimates, based on present facts and circumstances, of the net realizable values of assets and costs associated with carrying out the dissolution and liquidation plan based on the assumptions set forth below. The actual values and costs are expected to differ from the amounts shown herein and could be greater or lesser than the amounts recorded. Accordingly, it is not possible to predict the aggregate amount that will ultimately be distributable to shareholders and no assurance can be given that the amount to be received in liquidation will equal or exceed the net assets in liquidation per share in the accompanying Statement of Net assets in Liquidation or the price or prices at which the Common Stock has generally traded or is expected to trade in the future. The cautionary statements regarding estimates of net assets in liquidation set forth in the Forward-Looking Statements portion of this report are incorporated herein by reference.

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(c) RECENT HISTORY

                The accompanying financial statements reflect all adjustments which, in the opinion of management, are necessary for a fair presentation of the results of operations for the periods shown.

(d)  USE OF ESTIMATES

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

                (e) CASH AND CASH EQUIVALENTS

                Cash and cash equivalents include the Company’s cash balances and short-term investments that mature in 90 days or less from the original date of maturity. Cash and cash equivalents are carried at cost plus accrued interest, which approximates market.

2.   LITIGATION

                Siti had a civil suit pending since April, 2004 through March, 2006 in New York State Supreme Court in New York County, described in earlier filings under the Securities Exchange Act of 1934 on Forms 10-K and 10-Q. The case was settled on the eve of trial on January 20, 2006 and settlement documents completed by March, 2006. A summary of the terms of settlement follows:

                Siti’s 2004 complaint alleged that certain defendants wrongfully purchased its portfolio of patents on cell-phone and vehicular wireless technology. In response, each defendant denied all liability to Siti as to all claims, and there has been no admission of liability by any defendant. The settlement is a relinquishment of all claims by Siti in exchange for cash in the amount of $7,750,000, and an assignment of a percentage of future gross proceeds, if any, derived from Siti’s former patent portfolio, as enhanced since the purchase. These amounts will be reduced by one-third to cover the contingent fees earned by Siti’s Special Litigation Counsel, Green, Bush and Jacobson of Clayton, Missouri. Siti’s initial net cash recovery was approximately $5,150,000. This net sum was received upon closing of the settlement agreement in March 2006. Loan advances by certain shareholders of $225,000 were repaid, taking the net sum down to $4.9 million.

                All proceeds from the settlement are “non-recurring” in nature. Siti has remained in liquidation since 2002, has no other business and completed a liquidating dividend distribution to shareholders on 87% of the initial cash proceeds as soon as practicable. The net amount available was $4.5 million, after a provision for remaining litigation costs and working capital. The dividend was allocated pro-rata among shareholders holding approximately 30 million shares, for $.15 per share distributed in this continuing liquidation of Siti.

Future Proceeds. The assignment to Siti of future Gross Proceeds (if any, and as defined), that are received by the defendant patent holding company (the “Patent Holding Company”) after January 19, 2006, will consist of 15% of the first $10 million in Gross Proceeds, 20% of the next $10 million, and 25% of all Gross Proceeds in excess of $20 million. “Gross Proceeds” means all proceeds received by defendant Patent Holding Company from the entire patent portfolio, before any deduction for defendants’ own counsel fees, costs and expenses of operations, salaries or other distributions to members of defendant Patent Holding Company. Siti is a senior creditor thereof, and claims no ownership interest in the patent portfolio or such Patent Holding Company.

                The portfolio consists of 19 patents and pending applications that cover data and voice connections between computers and cell phones, and roaming across the U.S. and elsewhere with cell phones, personal digital assistants and wireless equipment in vehicles. The latest patents in the portfolio also cover spectrum sharing among various wireless communication networks. The Company’s senior creditor position in future proceeds is documented in filings in the Patent and Trademark Office and in several states under the Uniform Commercial Code. The Company is monitoring its

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creditor position and endeavoring to work cooperatively with the Patent Holding Company to maximize future proceeds from the portfolio

                Risk Factors *Siti does not know how much, if any, in future Gross Proceeds are still obtainable from this patent portfolio, and ultimate results are very speculative. *Current or future changes in technology may affect the patent properties adversely. * Infringement litigation is costly, involves risk to the patent portfolio, and such Patent Holding Company must obtain its own financing. *Siti’s share of future Gross Proceeds is subject to these and other business risks in such Patent Holding Company. *The settlement has been reached after protracted litigation, and requires ongoing monitoring under its disclosure terms by Siti as a creditor. *Under the settlement, Siti cannot exercise any control over licensing or other decisions that could generate or otherwise impact Gross Proceeds. *No assurance can be given that anything more than the initial net cash value in this settlement will be received by Siti. *Future proceeds to Siti are also subject to one-third fees payable to Siti’s Special Litigation Counsel. *There will be accounting, legal collection and shareholder distribution costs in the future. Reserves will be established as Siti’s liquidation continues.

As of the date of this report the Company knows of no pending or threatened legal actions against the Company that would have a material impact on the operations or financial condition of the Company.

3.   ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Accounts payable and accrued liabilities were comprised of the following:

	September 30, 2006		March 31, 2006
	(Amounts in thousands)
Accrued professional fees	$	—	$	50
Accounts payable and accrued Expenses		12		20
	$	12	$	70

4.   SUBSEQUENT EVENT

On October 20, 2006, the Company began mailing of the October 2006 Proxy Statement, incorporated herein by reference. The Proxy Statement contemplates a special meeting of stockholders and a vote on a Plan of Final Liquidation and Dissolution (the “Plan”) as of November 14, 2006. See Material Recent Event at page 1 hereof.

ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND STATUS OF LIQUIDATION

          THIS QUARTERLY REPORT ON FORM 10-Q CONTAINS FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995, INCLUDING, BUT NOT LIMITED TO STATEMENTS RELATED TO BUSINESS OBJECTIVES AND STRATEGY OF THE COMPANY. SUCH FORWARD-LOOKING STATEMENTS ARE BASED ON CURRENT EXPECTATIONS, ESTIMATES AND PROJECTIONS ABOUT THE COMPANY’S INDUSTRY, MANAGEMENT’S BELIEFS AND CERTAIN ASSUMPTIONS MADE BY THE COMPANY’S MANAGEMENT. WORDS SUCH AS “ANTICIPATES,” “EXPECTS,” “INTENDS,” “PLANS,” “BELIEVES,” “SEEKS,” “ESTIMATES,” VARIATIONS OF SUCH WORDS AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY SUCH FORWARD-LOOKING STATEMENTS. THESE STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE AND ARE SUBJECT TO CERTAIN RISKS, UNCERTAINTIES AND ASSUMPTIONS THAT ARE DIFFICULT TO PREDICT; THEREFORE, ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE EXPRESSED, FORECASTED, OR CONTEMPLATED BY ANY SUCH FORWARD-LOOKING STATEMENTS. FACTORS THAT COULD CAUSE ACTUAL EVENTS OR RESULTS TO DIFFER MATERIALLY INCLUDE, AMONG OTHERS, THOSE RISK FACTORS SET FORTH IN THE COMPANY’S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED MARCH 31, 2006. GIVEN THESE UNCERTAINTIES, INVESTORS

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ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON ANY SUCH FORWARD-LOOKING STATEMENTS. UNLESS REQUIRED BY LAW, THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE PUBLICLY ANY FORWARD-LOOKING STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE. HOWEVER, READERS SHOULD CAREFULLY REVIEW THE RISK FACTORS SET FORTH IN OTHER REPORTS OR DOCUMENTS THE COMPANY FILES FROM TIME TO TIME WITH THE SECURITIES AND EXCHANGE COMMISSION, PARTICULARLY THE ANNUAL REPORTS ON FORM 10-K, OTHER QUARTERLY REPORTS ON FORM 10-Q, ANY CURRENT REPORTS ON FORM 8-K AND THE OCTOBER 2006 PROXY STATEMENT.

Overview                              

          All of the Company’s operations prior to January 1, 2002 are discontinued operations and the Company adopted the liquidation basis of accounting, effective January 1, 2002. (See Status of Liquidation).

LIQUIDITY AND CAPITAL RESOURCES

          As of September 30, 2006 the Company had net assets of approximately $255,000. As of September 30, 2006 the Company’s total assets were $267,000, represented solely by cash. During the six months ended September 30, 2006, the Company incurred approximately $189,000 in operating expenses consisting primarily of management’s contribution of services and officer’s salaries of approximately $72,000 as well as approximately $42,000 in legal fees associated with the Company’s recent litigation. Other costs included transfer agent fees of approximately $23,000. The Company recorded a charge of approximately $15,000 for management’s contribution of rent. SITI incurred approximately $19,000 in taxes for the six months ended September 30, 2006. The remaining other fees of approximately $18,000 pertained to costs incurred for the preparation of the Company’s tax returns as well as miscellaneous costs associated with Company’s SEC filings for the six months ended September 30, 2006.

          As of September 30, 2005 the Company had net liabilities of approximately $115,000.

          As of September 30, 2005 the Company’s total assets were $7,000, represented solely by cash. During the six months ended September 30, 2005, the Company paid approximately $379,000 in operating expenses consisting primarily of legal costs of approximately $279,000 associated with the Company’s then current litigation. (See “Litigation”). Furthermore, management’s contribution of their services and rent totaled approximately $76,000. Other costs included transfer agent fees and salaries to one employee of approximately $10,000 each, respectively. The remaining other fees of approximately $4,000 pertained primarily to general office expenses for the six months ended September 30, 2005.

          As of September 30, 2005, the Company’s had approximately $122,000 in liabilities. Approximately $110,000 of such liabilities were to the Company’s Chairman/CEO for advances to the Company to cover its legal costs. Approximately $12,000 were accrued as of September 30, 2005 for the Company’s attorney. Management, primarily the Chairman/CEO, continued to work without any cash compensation. Management further continued to use personal offices to continue its plan. As a result, of this contribution, the Company charged-off approximately $78,000 to compensation and rent for the six months ended September 30, 2005.

LIQUIDATION BASIS OF ACCOUNTING

          The condensed consolidated financial statements for the three and six months ended September 30, 2006 were prepared on the liquidation basis of accounting. Under the liquidation basis of accounting, assets are stated at their estimated net realizable values and liabilities are stated at their estimated settlement amounts, which estimates will be periodically reviewed and adjusted. Since the Company is in liquidation without continuing operations, the need to present quarterly Statements of Operations and Comprehensive Loss as well as a Statement of Cash Flows is eliminated.

          The valuation of assets at their net realizable value and liabilities at their anticipated settlement amounts necessarily requires many estimates and assumptions. In addition, there are substantial risks and uncertainties associated with carrying out the liquidation of the Corporation’s existing operations. The valuations presented in the accompanying Statement of Net Assets in Liquidation represent estimates, based on present facts and circumstances, of the net realizable values of assets and costs associated with carrying out the dissolution and liquidation plan based on the assumptions set forth below. The actual values and costs are expected to differ from the amounts shown herein and could be greater or lesser than the amounts recorded. Accordingly, it is not possible to predict the aggregate amount that will ultimately be distributable to shareholders and no assurance can be given that the amount to be received in liquidation will equal or

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exceed the net assets in liquidation per share in the accompanying Statement of Net assets in Liquidation or the price or prices at which the Common Stock has generally traded or is expected to trade in the future. The cautionary statements regarding estimates of net assets in liquidation set forth in the Forward-Looking Statements portion of this report are incorporated herein by reference.

RISK FACTORS

          See the Company’s Annual Report on Form 10-K , “Item 1 - Risk Factors That May Affect the Company’s Business, Future Operating Results and Financial Condition.” See further the October 2006 Proxy Statement incorporated by reference herein, which describes future risks during the Company’s Plan of Final Liquidation and Dissolution.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

          The Company’s market risk disclosures set forth in its fiscal 2006 Annual Report filed on Form 10-K have not changed significantly. But trading in its common stock will terminate in the next several weeks as the Plan of Final Liquidation and Dissolution goes forward after November 14, 2006, as described in the October 2006 Proxy Statement.

ITEM 4. CONTROLS AND PROCEDURES

          (a) The Company’s principal executive officer and its principal financial officer, based on their evaluation of the Company’s disclosure controls and procedures (as defined in Exchange Act Rules 13a -14 (c)) as of a date within 90 days prior to the filing of this Quarterly Report on Form 10-Q, have concluded that the Company’s disclosure controls and procedures are adequate and effective for the purposes set forth in the definition in Exchange Act rules.

          (b) There were no significant changes in the Company’s internal controls or in other factors that could significantly affect the Company’s internal controls subsequent to the date of their evaluation.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

                Reference is made to “Part I. Financial Information” in the June 2006 10-Q, Item 2 “Litigation” as to a civil suit pending until March, 2006 and earlier matters.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

A.	Exhibits
	Exhibit 31  Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	Exhibit 32  Certification Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 Of The Sarbanes-Oxley Act of 2002
B.	Reports on Form 8-K
	The Company filed Form 8-K announcing the Company’s filing of a Proxy Statement under Section 14 (a) of the Securities Exchange Act of 1934 with the SEC now incorporated herein in definitive form by reference as the October 2006 Proxy Statement.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereto duly authorized.

Dated:    November 14, 2006

SITI-SITES.COM, INC.
By	/s/   Lawrence M. Powers
Lawrence M. Powers     Chief Executive Officer and     Chairman of the Board of Directors

By	/s/   Toni Ann Tantillo
Toni Ann Tantillo     Chief Financial Officer,     Vice President, Secretary and Treasurer

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