Liquidity

On January 28, 2009, the Company executed an engagement letter with Falcon International Consulting Limited ("Falcon") under which Falcon would, on a best efforts basis, raise up to $2 million through the sale of new shares of common stock of the Company at $.10 per share (the "2009 Private Placement"). The Company received proceeds of $836,443 net of placement fees paid to Falcon and others, for the purchase of 9,630,000 shares of common stock, as more fully described in Note 13-Common Stock. The proceeds from the 2009 Private Placement have been used to support the development costs of the Company's new subsidiary, SkyShop Logistics, Inc dba PuntoMio.com ("PuntoMio"). PuntoMio is a cross border shopping facilitator. As of November 16, 2009, the Company has expensed $871,762, in the development of PuntoMio.

On June 26, 2009, the Company's wholly owned subsidiary, PuntoMio, executed a new engagement agreement with Falcon under which Falcon would raise up to $3 million through the sale of units consisting of one PuntoMio preferred share and one warrant to purchase one common share of the Company for $1.00 per unit. The Company received proceeds of $966,021 net of placement fees paid to Falcon, for the purchase of 1,090,000 shares of PuntoMio preferred stock and 1,090,000 warrants for the Company's common stock at an exercise price of $.10 expiring July 1, 2012. At September 30, 2009, the Company has a 75.9% ownership in PuntoMio.

As of September 30, 2009, the Company had no indebtedness, with the exception of two non-compete agreements and put option agreement entered into with shareholders. The Company is current with the LEL non-compete payments, however it has not made $113,404 in payments on one of the shareholder non-compete agreement and $320,000 on the put option agreement for a combined unpaid total of $433,404 at September 30, 2009. The non-compete and put option agreement is described more fully in Note 10-Commitments and Contingencies. The Company believes that because the shareholder has a financial ownership interest in the Company and because we currently have an economically important arms length working relationship we do not believe that the shareholder would enforce his right under the contract to request collection of monies due to him under the non-compete agreement or pursue litigation at this time because his interests are aligned with the success of our Company.

The Company has arranged a line of credit of $1,200,000 with a finance company who was a former lender. Subject to the finance company satisfactorily completing due diligence on the credit worthiness of each accounts receivable, the terms of the line of credit will allow the Company to borrow up to eighty percent of the value of eligible receivables. The cost to the Company for the cash advances on the line of credit is 2% of the advance for the first 30 days the invoice is outstanding and 0.0667% of the advance for each additional day thereafter the invoice is unpaid. As of November 16, 2009, the Company has not utilized this line of credit.

The Company is exploring other alternatives for financing and raising additional equity in the capital markets but there can be no assurances that these efforts will be successful.

Management Plans

The international mail volumes have been greatly affected by the world economy, increase of online banking resulting in a decrease in bank statement delivery and shift of the distribution of publications from hard copy to on-line electronic delivery. The world's postal services have experienced a 15% reduction in mail volumes in the first nine months of 2009 over the same period in 2008. As a result, the Company has not been able to significantly increase its mail volumes.

The Company has repositioned its sales strategy by focusing on the growth of parcel post generated by the growing on-line cross border shopping. The Company has established a subsidiary, SkyShop Logistics, Inc. dba (Punto Mio), to focus on providing cross border shopping facilitation and international "Intelligent Parcel Post" delivery.

Many on-line merchants in the United States ("U.S.") do not accept orders from international customers due to customs clearance challenges, high incidence of parcel post losses and merchandise return difficulties. As the U.S. dollar weakens against other currencies, on-line shopping at U.S. merchant sites by foreigners is increasing. To solve these challenges for the U.S. merchant and overseas buyer, the Company offers foreigners a U.S. address and total cost of delivery, including customs and duties cost, when purchasing from U.S. on-line merchants.

Management is constantly seeking opportunities to lower operating and administrative costs and increase revenue in an effort to reduce the current negative cash flow, including the following initiatives achieved in the nine months ended September 30, 2009:

? Reduction of administrative costs and mail processing staff in Florida.

? Reduction in senior and middle management salaries and health benefit costs.

? Consolidation of service facilities in Florida.

? Establishment of a mail processing and consolidating hub in the customs Free Zone in Bogota, Colombia.

? Increased investment in its "Intelligent Parcel Post" service to foreign shoppers and U.S. on line merchants.

? Re-negotiating of contracts with certain key suppliers for better pricing and/or payment terms.

? Repositioning its sales strategy by focusing efforts on generating higher margin international retail sales from Latin American countries.

The acquisition of LEL made it possible for the Company to consolidate its mail processing facilities in the customs Free Zone in Bogota, Colombia and achieve efficiencies and better economies of scale. This has lead to a reduction of staff and lower sorting costs, greater consolidation of routes leading to lower air transport costs and achieve certain competitive advantages with respect to transit times and pricing to Latin America. The Colombia hub will make it easier for the Company to add new customers, and consequently increase revenues.

The Company also intends to seek out future acquisitions in order to achieve operating income sufficient to cover other expenses and achieve net income. To complete such acquisitions the Company may require additional financing for which the Company has no financing commitments and for which management believes no assurances can be given that such financing commitments will be obtained. The Company also plans to seek out new customers and to increase business with existing customers as additional means to increase tonnage and reach profitability. The Company has entered into an agreement with the Colombian National Post office and has installed the post's franking machines in its Bogota hub. This allows our Bogota hub to process mail destined to delivery areas in the Latin American and Caribbean region not serviced by the Company's hand delivery network, at much lower costs.

Note 3 Summary of Significant Accounting Policies

The accompanying unaudited condensed consolidated financial statements include the accounts of SkyPostal Networks, Inc and all entities in which SkyPostal Networks, Inc. has a controlling voting interest ("subsidiaries") required to be consolidated in accordance with U.S. GAAP (collectively referred to as "the Company"). All significant intercompany accounts and transactions between have been eliminated in consolidation.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the accounting policies described in the 2008 Annual Report on Form 10K and amended on Form 10-K/A filed on April 24, 2009 and should be read in conjunction with the consolidated financial statements and notes thereto. These statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included and the disclosures herein are adequate. The operating results for interim periods are unaudited and are not necessarily indicative of the results that can be expected for a full year.

Reclassification

Certain reclassifications of amounts previously reported have been made to the accompanying unaudited condensed consolidated financial statements in order to maintain consistency and comparability between periods presented.

Business Combinations

Effective March 1, 2009, the Company acquired 70% of the outstanding common stock of LEL. The acquisition was accounted for using the acquisition method. The acquisition method is required to be used on all events where a business obtains control over another business. The acquisition method establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any noncontrolling interests in the acquiree, and goodwill acquired in a business combination or a gain from a bargain purchase. The consolidated financial information presented includes the accounts of LEL as of March 1, 2009. See Note 7- Business Combinations. See Non-controlling Interest accounting policy below.

Loss Per Share

Basic loss per share is presented on the face of the unaudited condensed consolidated statements of operations. Basic earnings or loss per share "EPS" is calculated as the loss attributable to common stockholders divided by the weighted average number of shares outstanding during each period. Basic net income (loss) per share is computed using the weighted average number of shares outstanding during the period. Due to the Company's losses from continuing operations, dilutive potential common shares in the form of warrants were excluded from the computation of diluted loss per share, as inclusion would be anti-dilutive for the periods presented.

Use of Estimates

The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Such estimates and assumptions impact, among others, the following: the amount of uncollectible accounts receivable, the amount to be paid for the settlement of liabilities related to cost of sales, the estimated useful lives for property and equipment, value assigned to the warrants granted in connection with the various financing arrangements and calculation for stock compensation expense. Actual results could differ from those estimates.

Fair Value Measurements

The Company has determined the estimated fair value amounts presented in these unaudited consolidated financial statements using available market information and appropriate methodologies. However, considerable judgment is required in interpreting market data to develop the estimates of fair value. The estimates presented in the unaudited consolidated financial statements are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. See Note 12- Fair Value Measurements.

Non-controlling Interest

In December 2007, the Financial Accounting Standards Board (FASB) issued guidance that changed the accounting and reporting for noncontrolling interests, which is the portion of equity in a subsidiary not attributable, directly or indirectly, to a parent. The guidance was effective for the quarter ended March 31, 2009 for the Company and requires retroactive adoption of its presentation and disclosure requirements. The guidance requires the Company to report net income attributable to the noncontrolling interests separately on the face of the condensed consolidated statements of operation. Additionally, the guidance requires that the portion of equity in the entity not attributable to the Company be reported within equity, separately from the Company's equity on the condensed consolidated balance sheet. The adoption did not have any impact on the Company's financial position, results of operations or cash flow.

Effective February 27, 2009, the Company acquired 70% of the outstanding common stock of LEL. The acquisition was accounted for using the acquisition method. The 30% non-controlling interest in the LEL was accounted for in accordance with the acquisition method. The Company reported the non-controlling interest in the condensed consolidated financial statements as required by U.S. GAAP. The determination of the fair value of the non-controlling interest due to the acquisition of LEL is described in Note 7 Business Combinations.

Effective September 30, 2009, the Company sold 24.1% interest in its wholly owned subsidiary SkyShop Logigistics dba "PuntoMio". The 24.1% non-controlling interest in PuntoMio was accounted for in accordance with the relevant guidance. The Company reported the non-controlling interest in the consolidated financial statements as required by U.S. GAAP.

Software Product Development Costs

Software product development costs incurred prior to reaching technological feasibility are expensed. We have determined that technological feasibility of the software is not established until substantially all product development is complete.

Translation Policy

The local currency is the functional currency for LEL, the Company's recently acquired operation located in Colombia. For local currency functional locations, assets and liabilities are translated at end-of-period rates while revenues and expenses are translated at average rates in effect during the period. Equity is translated at historical rates and the resulting cumulative translation adjustments are included as a component of accumulated other comprehensive income.

Subsequent Events

In May 2009, the FASB issued guidance that establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. This guidance is effective for interim and annual financial periods ending after June 15, 2009. The Company adopted this guidance during the three months ended June 30, 2009 and evaluated subsequent events through the issuance date of the condensed consolidated financial statements. The adoption of this guidance did not have any impact on the Company's financial position, results of operations or cash flows. The Company evaluated subsequent events through the time of filing this Quarterly Report on Form 10-Q on November 16, 2009 and there were no reportable events to report.

Note 4 Recent Accounting Pronouncements

In June 2009, the FASB issued guidance that establishes the FASB Accounting Standards Codification as the source of authoritative U.S. GAAP recognized by the FASB to be applied by nongovernmental entities. The Company adopted this guidance during the nine months ended September 30, 2009 and its adoption did not have an impact on the Company's financial position, results of operations or cash flow.

Note 5 Concentration of Credit Risk

In the normal course of business, the Company incurs credit risk from accounts receivable and transactions with financial institutions. The Company has a credit policy which is used to manage this risk. As part of this policy, limits on exposure with counterparties have been set and are monitored on a regular basis. Anticipated bad debt losses have been provided for in the allowance for doubtful accounts.

During the three months ended September 30, 2009 and 2008 approximately 28% and 13% of the Company's revenues were generated from two customers and one customer, respectively. During the three months ended September 30, 2009 and 2008 approximately 6% and 11% of the Company's cost of sales was purchased from one vendor, respectively. During the nine months ended September 30, 2009 and 2008, approximately 31% and 12% of the Company's revenues were generated from three customers and one customer, respectively. During the nine months ended September 30, 2009 and 2008, approximately 13% and 14% of the Company's cost of sales was purchased from one vendor, respectively.

Note 6  Geographic Information

The following schedule highlights the Company's international sales which also
include the revenues of LEL, the Company's foreign operation at September 30,
2009. The Company's geographic statements of operations disclosures are as
follows:

U.S. and Foreign revenues are shown below:

              Three Months Ended September 30           Nine Months Ended September 30
Region          2009                   2008                 2009                 2008

U.S.      $        736,331       $      1,635,485     $      3,585,104       $  4,997,399
Foreign            933,344                531,054            2,830,002          1,701,253
Total     $      1,669,675       $      2,166,539     $      6,415,106       $  6,698,652

The long-lived assets of LEL at September 30, 2009 were insignificant.

Note 7 Business Combinations

On February 27, 2009, the Company acquired 70 percent of the outstanding common stock of LEL. The purchase consideration of $100,000 was comprised of 400,000 shares of common stock in the Company with a fair value of $100,000 ($.25 per share). The purchase price was allocated to the tangible assets acquired and the liabilities assumed based on their respective fair values and any excess was allocated to the fair values of identifiable intangible assets, identified as LEL's customer list. The effective date of the acquisition was determined to be March 1, 2009. The allocation of the purchase price as of March 1, 2009 is shown below:

                       Cash                       $  11,753
                       Accounts receivable          112,455
                       Other assets                  13,791
                       Customer List-LEL             81,020
                       Accounts payable             (31,994 )
                       Other liabilities            (78,956 )
                       Non-controlling interest      (8,069 )
                       Net assets acquired        $ 100,000

The fair value determination of non-controlling interest is shown below:

                       LEL net asset value           26,897
                       Non-controlling percentage        30 %
                       Non-controlling interest     $ 8,069

Note 8 Intangible Assets, net

Intangible assets, net as of September 30, 2009 and December 31, 2008 are shown
below:

                                    2009            2008       Life (yrs)

Trade Mark                       $    89,044     $    79,248   Indefinite
Customer List-LEL                     81,020               -        Three
Non-Compete-LEL                      100,000               -        Three
Non-Compete-Shareholder              735,000         735,000        Seven
GPS PDA Investment                   231,295         231,295        Three
License Agreement                    142,800         142,800         Five
Subtotal                           1,379,159       1,188,343
Less: Accumulated Amortization      (247,174 )      (116,830 )
Intangible Assets, net           $ 1,131,985     $ 1,071,513

On February 27, 2009, the Company acquired 70 percent of the outstanding common stock of LEL. The purchase price was allocated to the tangible assets acquired and the liabilities assumed based on their respective fair values and any excess was allocated to the fair value of identifiable intangible assets, identified as LEL's customer list, amounting to $81,020. The Company also entered into a non-compete agreement, with a shareholder of LEL, which includes payments totaling $100,000, comprised of 25 payments of $4,000 payable on a monthly basis. The non-compete agreement was recorded as an intangible asset and will be amortized on a straight line basis over three years. At September 30, 2009, the Customer List-LEL, net and the Non-Compete-LEL, net amounted to $67,514, and $83,332, respectively.

The Company is developing proprietary software which would be used by the Company to enhance the delivery of mail to its customers. The Company capitalizes the costs until the point at which the software project is substantially complete and ready for its intended use, that is, after all substantial testing is completed. Once the software is placed into service the Company will amortize the asset over a three year period.

Simultaneous with the Redemption Agreement, see Note 10 - Commitments and Contingencies, entered into on April 1, 2007, the Company also entered into a non-compete agreement with a shareholder. Under the non-compete agreement the shareholder receives quarterly payments totaling $ 735,000 starting April 1, 2008 ending January 1, 2013. The non-compete agreement was recorded as an intangible asset on the balance sheet with an offsetting liability to recognize the cumulative future payments. The non-compete is amortized on a straight line basis over the term of the agreement and for a period of two years thereafter as stated in the agreement for a total of seven years. At September 30, 2009 and December 31, 2008, the net balance of the non-compete agreement amounted to $577,500 and $656,750, respectively.

In September 2007, the Company entered into a license agreement with a vendor for exclusive service in certain markets of Latin America. The license agreement was recorded as an intangible asset and is amortized on a straight line basis over five years. At September 30, 2009 and December 31, 2008, the net balance of the License Agreement amounted to $83,300 and $104,720, respectively.

Note 9 Other Assets

Other Assets as of September 30, 2009 and December 31, 2008 are shown below:

Other Assets           2009         2008

Escrow Deposit (a)   $      -     $ 376,975
Security Deposit       79,269        78,093
Other Assets, net    $ 79,269     $ 455,068

In June 2009, the Company was advised that Crosscheck Media filed for protection under the U.S. Bankruptcy laws. Upon further review, the Company determined the recoverability of the deposit was unlikely and the deposit of $149,975 was fully reserved during the three months ended June 30, 2009. There has not been any change to the recoverability of the deposit and the balance remains fully reserved at September 30, 2009.

Note 10 Commitments and Contingencies

Put Option

In May 2006, the Company had a $3,200,000 note payable due to a bank which was assumed by a shareholder in exchange for 3,144,608 shares of common stock at $1.00 per share, the estimated fair value of the share at date of the conversion. The conversion of the note payable into equity was a pre-condition of a convertible debt raise of approximately $4,000,000 undertaken by the Company in 2006 as part of an attempt to do an IPO on the AIM Market of the London Stock Exchange in October 2006. The IPO was aborted in November 2006.

On April 1, 2007, the Company and the aforementioned shareholder entered into a Sale Option Agreement, (the "Redemption Agreement"), whereby 3,200,000 options (the "Option") were issued to the shareholder which could be put to the Company and obligate the Company to purchase and redeem at any time up to 3,200,000 shares of the Company's common stock at the cash exercise price of $1.00. The shareholder may exercise in whole or in part up to 3,200,000 shares in quarterly increments of up to 160,000 common shares beginning with the quarter ended April 1, 2008. The Option expires on January 2, 2013. There is no requirement for the shareholder to put the Option to the Company.

The Company accounted for the Option as a liability at inception since the Option (a) embodies an obligation to repurchase the issuer's equity shares, or is indexed to such an obligation, and (b) requires or may require the issuer to settle the obligation by transferring assets. The Option was measured initially at the fair value of the shares at inception, adjusted for any consideration or unstated rights or privileges. The fair value was determined by the amount of cash that would be paid under the conditions specified in the contract if the shares were repurchased immediately. The Company initially recorded a liability and made subsequent fair value adjustments at each reporting period to reflect the fair market value of the shares to be received in the market if the Company were to sell the redeemed shares in the market.

Through September 30, 2009, the shareholder has put 640,000 shares to be redeemed by the Company at an exercise price of $1.00. The Company made payments totaling $320,000 to the shareholder and has a current liability due the shareholder of $1,088,000 and $616,000 at September 30, 2009 and December 31, 2008, respectively. The Company believes that the shareholder will continue to exercise the Option until such time as the Company's stock is trading above $1 per share.

The Company recorded the following fair value adjustments to the Put Option:

                                      Market              Liability Per            Shares             Put
                                       Share                  Share              Subject to         Option             (Gain)/
                                    Share Price        ($1 exercise price)       Put Option        Liability             Loss
Three months ended September
30, 2009                           $        0.15      $                0.85        2,880,000      $ 2,448,000        $   (144,000 )
. . .