o	Preliminary Information Statement

o	Confidential, for Use of the Commission Only (as permitted by Rule 14c-5(d) (2))

x	Definitive Information Statement

REMOTE DYNAMICS, INC.

(Name of Registrant As Specified In Its Charter)

Payment of Filing Fee (Check the appropriate box):

x	No fee required

o	Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11

(1)	Title of each class of securities to which transaction applies:

(2)	Aggregate number of securities to which transaction applies:

(3)	Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

(4)	Proposed maximum aggregate value of transaction:

(5)	Total fee paid:

o	Fee paid previously with preliminary materials.

o	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

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(2)	Form, Schedule or Registration Statement No.:
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Common stockholders of record on the close of business on July 11, 2008 are entitled to notice of the consent to action; however, the majority stockholder does not need your vote to effect the changes above. The actions to be taken pursuant to the written consent shall be taken on or about August 5, 2008, 20 days after the mailing of this Information Statement.

This Information Statement is being furnished by the Board of Directors of Remote Dynamics, Inc. (the "Company") to provide notice that our majority stockholder has given its signed written consent to action without a meeting (i) to approve an amendment to the Company's Amended and Restated Certificate of Incorporation to authorize (after giving effect to the reverse stock split described herein) 5,000,000,000 authorized shares of our common stock having a par value of $0.0001 per share; and (ii) to approve a one-for-four hundred reverse stock split of our common stock.

The record date for determining stockholders entitled to receive this Information Statement has been established as the close of business on July 11, 2008 (the "Record Date"). This Information Statement will be first mailed on or about July 16, 2008 to stockholders of record at the close of business on the Record Date. As of the Record Date, there were outstanding 603,073,279 shares of the Company's common stock, 522 shares of the Company’s series B convertible preferred stock (which were convertible into 67,355 shares of common stock) and 5,285 shares of the Company’s series C convertible preferred stock (which were convertible into 20,720,387,444 shares of common stock). Each holder of shares of the Company’s common stock is entitled to one vote per share of common stock registered in their names on the books of the Company at the close of business on the Record Date. The holders of the Company’s series B convertible preferred stock and the Company’s series C convertible preferred stock have the right to vote on all matters before the common stockholders on an as-converted basis voting together with the common stockholders as a single class, provided that the holder of series B convertible preferred stock cannot vote shares which are greater than 9.99% of our outstanding common stock. Thus, as of the Record Date, the total voting power of our common stock was 21,323,528,078 shares. The actions to be taken pursuant to the written consent shall be taken on or about August 5, 2008, 20 days after the mailing of this Information Statement.

Approval of the actions described in this Information Statement requires the approval of holders of a majority of the voting power of our common stock as of the Record Date. Bounce Mobile Systems, Inc. (“BMSI” or the "Majority Stockholder") can vote an aggregate of 21,323,460,723 shares (or 98.6%) of the voting power of our common stock and will be able to approve the matters presented in this Information Statement. The Company is not soliciting your vote as the Majority Stockholder has given its signed written consent to action without meeting, and already has the vote in hand.

The Majority Stockholder’s actions to approve an amendment to our Amended and Restated Certificate of Incorporation to authorize (after giving effect to a one-for-four hundred reverse stock split) 5,000,000,000 authorized shares of our common stock having a par value of $0.0001 per share are intended to permit us to comply with the terms of our existing financing and other contractual arrangements.

Our Majority Stockholder has approved an amendment of our Amended and Restated Certificate of Incorporation to authorize (after giving effect to a one-for-four hundred reverse stock split) 5,000,000,000 authorized shares of our common stock having a par value of $0.0001 per share. The amendment will not alter the number of authorized shares of our preferred stock.

The aggregate number of shares of capital stock which the corporation shall have authority to issue is 5,002,000,000 shares consisting of 5,000,000,000 shares of common stock, par value $0.0001 per share (the “Common Stock”), and 2,000,000 shares of preferred stock, par value $0.01 per share. Each holder of a share of Common Stock shall be entitled to one vote for each share held in any stockholder vote in which any of such holders is entitled to participate.

The Board of Directors of the corporation, by resolution or resolutions, may at any time and from time to time, divide and establish any or all of the unissued shares of Preferred Stock not then allocated to any series of Preferred Stock into one or more series and, without limiting the generality of the foregoing, fix and determine the designation of each such share, the number of shares which shall constitute such series and certain powers, preferences and relative, participating, optional or other special rights and qualifications, limitations and restrictions and voting rights of the shares of each series so establishing.”

The additional shares proposed to be authorized would be part of the existing class of our common stock and, if and when issued, would have the same rights and privileges as the shares of our common stock presently outstanding. The holders of our common stock are entitled to all of the rights and privileges of holders of shares of common stock under the Delaware General Corporation Law. Subject to the preferences applicable to shares of our preferred stock, the holders of our common stock are entitled to receive ratably such dividends, if any, as may be declared from time to time by our board of directors out of legally available funds. In the event of the liquidation, dissolution or winding up of the Company, the holders of our common stock will be entitled to share ratably in all assets remaining after payment of debts and other liabilities, subject to the prior distribution rights of holders of shares of our preferred stock. There are no redemption or sinking fund provisions applicable to our common stock. All of the outstanding shares of our common stock are currently duly authorized, validly issued, fully paid and nonassessable.

The increase in the number of authorized shares of our common stock is necessary for us to comply with the terms of our existing financing and other contractual arrangements, as described below. In general, these arrangements require us to maintain reserved shares of our common stock for issuance upon the conversion of outstanding convertible notes and preferred stock, and upon the exercise of outstanding warrants, in an amount equal to 100-150% of the amount needed at any one time for the conversion and exercise.

The increase in the number of authorized shares of our common stock will also provide our board of directors the necessary flexibility to issue common stock in the future in connection with the raising of capital, the acquisition of new businesses, employee stock benefit plans and other corporate purposes as deemed necessary or appropriate by our board of directors.

As of June 10, 2008 we had $3,768,886 principal amount of our series A secured convertible notes and original issue discount series A secured convertible notes (collectively, “Series A Notes”) outstanding. The Series A Notes matured on February 23, 2008 and are currently due and payable. The Series A Notes are secured by substantially all of our assets. The Series A Notes are convertible at the option of the holder into our common stock at a fixed conversion price of $0.0006 per share, subject to adjustment for stock splits and combinations, certain dividends and distributions, reclassification, exchange or substitution, reorganization, merger, consolidation or sales of assets; issuances of additional shares of common stock, and issuances of common stock equivalents. We may make scheduled principal installment payments in cash or in registered shares of its common stock. If paid in common stock, certain conditions must be satisfied, and the number of registered shares to be paid to the holder must be an amount equal to the principal installment amount divided by eighty percent (80%) of the average of the closing price for the ten (10) trading days immediately preceding the principal payment date.

Upon the occurrence of specified events of default on the Series A Notes, the holders may (a) demand prepayment of the notes as described below, (b) demand that the principal amount of the notes then outstanding be converted into shares of our common stock; and/or (c) exercise any of the holder’s other rights or remedies under the transaction documents or applicable law. If the holders require us to prepay all or a portion of the notes, the prepayment price would equal to 120% of the principal amount of the notes. The holders would also recover all other costs or expenses due in respect of the notes and the other transaction documents.

As of June 23, 2008 we had $7,197,431 principal amount of our series B subordinated secured convertible notes and original issue discount series B subordinated secured convertible notes (collectively, “Series B Notes”) outstanding. The Series B Notes are secured by all of our assets, subject to existing liens, are due December 4, 2009 and began scheduled amortization of principal (in nine quarterly installments) on August 1, 2007. We may make principal installment payments in cash or in registered shares of its common stock. If paid in common stock, certain conditions must be satisfied, and the number of registered shares to be paid to the holder must be an amount equal to the principal installment amount divided by the lesser of (i) $1.00 or (ii) 90% of the average of the volume weighted average trading prices of the common stock for the ten trading days immediately preceding the principal payment. The Series B Notes are convertible into our common stock at a conversion price of $0.0006 per share, subject to adjustment for stock splits and combinations, certain dividends and distributions, reclassification, exchange or substitution, reorganization, merger, consolidation or sales of assets; issuances of additional shares of common stock, and issuances of common stock equivalents.

Upon the occurrence of specified events of default on the Series B Notes, the holders may (a) demand prepayment of the notes as described below, (b) demand that the principal amount of the notes then outstanding be converted into shares of our common stock; and/or (c) exercise any of the holder’s other rights or remedies under the transaction documents or applicable law. If the holders require us to prepay all or a portion of the notes, the prepayment price would equal to 120% of the principal amount of the notes. The holders would also recover all other costs or expenses due in respect of the notes and the other transaction documents.

The series B convertible preferred stock has a face amount of $10,000 per share ($5,220,000 in the aggregate), ranks senior to our series C convertible preferred stock and our common stock with respect to payment of amounts upon any liquidation, dissolution or winding up of the Company, and is entitled to receive non-cumulative dividends in an amount equal to 3% per year when, as and if declared by our Board of Directors.

We provide written notice (or otherwise indicate) to any holder of Series B convertible preferred stock, or state by way of public announcement distributed via a press release, at any time, of our intention not to issue, or otherwise refuse to issue, shares of common stock to any holder of Series B convertible preferred stock upon conversion in accordance with the terms of the certificate of designation for our Series B convertible preferred stock;

The series B convertible preferred stock generally has the right to vote on all matters before the common stockholders on an as-converted basis voting together with the common stockholders as a single class. In addition, the holders of a majority of the Series B convertible preferred stock, voting as a separate class, have the right to appoint one member of our Board of Directors and one observer to meetings of our Board of Directors and its committees. Although the holder of our Series B convertible preferred stock retains the right to do so in the future, it has not yet exercised its right to appoint a board member.

The series C convertible preferred stock has a face amount of $1,000 per share ($5,285,000 in the aggregate), ranks junior to our series B convertible preferred stock and senior to our common stock with respect to payment of dividends and amounts upon any liquidation, dissolution or winding up of the Company, and is entitled to receive cumulative dividends in an amount equal to 8% per year (payable at the election of the holder in cash or additional shares).

Shares of common stock issuable upon conversion, exercise or exchange of any convertible security or purchase right outstanding on the date of issuance (including, without limitation, the series C convertible preferred stock, our series B convertible preferred stock, the Series A Notes, the Series B Notes and outstanding warrants);

Shares of common stock issuable upon conversion, exercise or exchange of any convertible security or purchase right issued after the issuance date of the series C convertible preferred stock in conversion, exercise or exchange of securities outstanding as of the issuance date or as a dividend, interest payment, liquidated damages, penalty, compromise, settlement or other payment of certain securities or pursuant to or in connection with any agreement, indebtedness or other obligation of the Company existing as of the issuance date, or with respect to any amendment, waiver or modification thereto or extension thereof;

Shares of common stock issued after the issuance date of the series C convertible preferred stock as a dividend, interest payment, liquidated damages, penalty, compromise, settlement or other payment of certain securities or pursuant to or in connection with any agreement, indebtedness or other obligation of the Company existing as of the issuance date, or with respect to any amendment, waiver or modification thereto or extension thereof; and

We merge or consolidate with or into, or engage in any other business combination with, any other person or entity, in any case which results in either (i) the holders of our voting securities immediately prior to such transaction holding or having the right to direct the voting of fifty percent (50%) or less of our total outstanding voting securities of or such other surviving or acquiring person or entity immediately following such transaction or (ii) the members of our board of directors comprising fifty percent (50%) or less of the members of our board of directors or such other surviving or acquiring person or entity immediately following such transaction;

The series C convertible preferred stock generally has the right to vote on all matters before the common stockholders on an as-converted basis voting together with the common stockholders as a single class. In addition, the holders of a majority of the Series C convertible preferred stock, voting as a separate class, have the right to appoint a majority of the members of our Board of Directors.

Series A-7 warrants to purchase 412,500 shares of common stock at an exercise price of $0.0006 per share subject to adjustment for stock splits and combinations, certain dividends and distributions, reclassification, exchange or substitution, reorganization, merger, consolidation or sales of assets; issuances of additional shares of common stock, and issuances of common stock equivalents. The series A-7 warrants can be exercised on a cashless basis beginning one year after issuance if (i) the per share market value of a share of our common stock (either the volume the weighted average price or the fair market value as determined by an independent appraiser) is greater than the warrant price; and (ii) a registration statement for the warrant stock is not then in effect. The series A-7 warrants are exercisable for a seven-year period from the date of issuance (38,000 of these warrants are exercisable over 5 years).

Series B-4 warrants to purchase 275,000 shares of common stock at an exercise price of $0.0006 per share subject to adjustment for stock splits and combinations, certain dividends and distributions, reclassification, exchange or substitution, reorganization, merger, consolidation or sales of assets; issuances of additional shares of common stock, and issuances of common stock equivalents. The series B-4 warrants can be exercised on a cashless basis beginning one year after issuance if (i) the per share market value of a share of our common stock (either the volume the weighted average price or the fair market value as determined by an independent appraiser) is greater than the warrant price; and (ii) a registration statement for the warrant stock is not then in effect. The series B-4 warrants are exercisable for a four-year period beginning on the date a resale registration statement for the shares underlying the warrants is declared effective by the Securities and Exchange Commission (26,000 of these warrants are exercisable over 5 years).

Series C-3 warrants to purchase 550,000 shares of common stock at an exercise price of $0.0006 per share subject to adjustment for stock splits and combinations, certain dividends and distributions, reclassification, exchange or substitution, reorganization, merger, consolidation or sales of assets; issuances of additional shares of common stock, and issuances of common stock equivalents. The series C-3 warrants can be exercised on a cashless basis beginning one year after issuance if (i) the per share market value of a share of our common stock (either the volume the weighted average price or the fair market value as determined by an independent appraiser) is greater than the warrant price; and (ii) a registration statement for the warrant stock is not then in effect. The series C-3 warrants are exercisable for a three-year period from the date of issuance. 50,000 of these warrants are exercisable over 5 years.

Series D-1 warrants (callable only at our option) to purchase 385,000 shares in the aggregate of common stock at an exercise price per share equal to the lesser of: (a) $17.50 or (b) 90% of the average of the 5 day volume weighted average price of our common stock on the OTC Bulletin Board preceding the call notice, as defined in the warrant.

Series E-7 Warrants to purchase 125,935,679 shares of common stock at an exercise price of $1.00 per share, subject to adjustment for stock splits and combinations, certain dividends and distributions, reclassification, exchange or substitution, reorganization, merger, consolidation or sales of assets; issuances of additional shares of common stock, and issuances of common stock equivalents. The series E-7 warrants are exercisable for a seven-year period from the date of issuance.

Series F-4 Warrants to purchase 125,935,679 shares of common stock at an exercise price of $1.50 per share, subject to adjustment for stock splits and combinations, certain dividends and distributions, reclassification, exchange or substitution, reorganization, merger, consolidation or sales of assets; issuances of additional shares of common stock, and issuances of common stock equivalents. The series F-4 warrants are exercisable for a four-year period beginning on the date a resale registration statement for the shares underlying the warrants is declared effective by the Securities and Exchange Commission.

The following warrants issued in connection with our 2005 financings: (i) a common stock purchase warrant with a 5-year term to purchase 33,000 shares of common stock at an exercise price of $0.50 per share and (ii) a common stock purchase warrant with a 5-year term to purchase 40,000 shares at an exercise price of $87.50 per share.

As of June 23, 2008, approximately $2,259,785 in principal amount of our outstanding Series A Notes has reached their maturity date and is due and payable. We have failed to comply with certain of our other obligations relating to the Series A and Series B Notes, including our failure to make scheduled principal payments and to register for resale the shares of common stock underlying the notes and warrants issued in the related private placements. The notes provide for a default interest rate of 10% per annum on the outstanding principal amount of the notes for periods in which certain specified events of default occur and are continuing and for liquidated damages for non-compliance with our registration obligations. Our non-compliance with the terms of the notes also exposes to the risk that our note holders could seek to exercise prepayment or other remedies under the notes.

We do not currently have the cash on hand to repay amounts due under our secured convertible notes if the note holders elect to exercise their repayment or other remedies. If our efforts to restructure or otherwise satisfy our obligations under the notes are unsuccessful, and we are unable to raise enough money to cover the amounts payable under the notes, we may be forced to restructure, file for bankruptcy, sell assets or cease operations.

In March, 2008, we resumed making payments to certain of our note holders of amounts due under the notes by issuing shares of our common stock under the terms of the notes. In 2008, through the Record Date, these payments were in the form of 301,230,726 shares of our common stock in satisfaction of $628,323 of obligations due under the notes. These represent issuance prices ranging from $0.0006 to $0.0043 per share (for the Series A Notes) and from $0.0007 to $0.0049 per share (for the Series B Notes). In general, the shares issued are available for immediate resale by the holders in accordance with Rule 144 under the Securities Act of 1933, as amended.

We expect to continue to issue additional shares of our common stock in payment of amounts due under our secured convertible notes and convertible preferred stock during the remainder of 2008 and thereafter. In general, the shares issued are available for immediate resale by the holders in accordance with Rule 144 under the Securities Act of 1933, as amended.

Except for the issuance of the additional shares of common stock in connection with the payment of amounts due under or the conversion of our outstanding convertible securities and the exercise of our outstanding warrants as described above, the Company has no plans or arrangements for the issuance of additional shares of common stock for any specific purpose, including but not limited to rendering more difficult or discouraging a change of control of the Company.

Mr. David Walters, our Chairman, is the Chairman and Chief Executive Officer of BMSI and also Managing Member of Monarch Bay Capital Group, LLC (the majority stockholder of BMSI). As of the Record Date, BMSI held 5,285 shares of our series C convertible preferred stock, 300,110,259 shares of our common stock, $2,163,000 principal amount of Series B Notes, our series E-7 warrants to purchase 88,002,964 shares of our common stock, and our series F-4 warrants to purchase 88,002,964 shares of our common stock.

No other director, executive officer, nominee for election as a director, associate of any director, executive officer, or nominee, or any other person has any substantial interest, direct or indirect, by security holdings or otherwise, in the proposed authorization of 5,000,000,000 shares of our common stock that is not shared by all other stockholders.

Our Board of Directors has unanimously approved the amendment to our Amended and Restated Certificate of Incorporation to authorize (after giving effect to the reverse stock split described herein) 5,000,000,000 shares of our common stock having a par value of $0.0001 per share. Our Majority Stockholder has given its signed written consent to action without a meeting to approve the amendment to our Amended and Restated Certificate of Incorporation. Therefore, we are not asking for your proxy, and we request that you do not send a proxy, as no further stockholder approval is either required or sought.

Our Majority Stockholder has approved a reverse stock split of our common stock such that each four hundred (400) shares of our issued and outstanding common stock, par value $0.01 per share (the "Pre-Split Common Stock"), shall automatically be reclassified and continued as one share of common stock, par value $0.0001 per share (the "Reverse Stock Split"). We will not issue fractional shares on account of the Reverse Stock Split. Holders of Pre-Split Common Stock who would otherwise be entitled to a fraction of a share on account of the Reverse Stock Split shall be entitled to receive in lieu of such fractional share, one full share of common stock. After giving effect to the Reverse Split, the number of shares of authorized common stock will be 5,000,000,000 and the par value of common stock will remain $0.0001.

The Reverse Stock Split (and authorization of 5,000,000,000 shares of our common stock) is necessary for us to comply with the terms of our existing financing and other contractual arrangements, as described above under “Proposal 1”. In general, these arrangements require us to maintain reserved shares of our common stock for issuance upon the conversion of outstanding notes and preferred stock, and upon the exercise of outstanding warrants, in an amount equal to 100-150% of the amount needed at any one time for the conversion and exercise.

We also believe that the Reverse Stock Split will provide the Company with a capital structure more typical of companies at its stage of development and will provide greater flexibility for the Company, without further stockholder approval, to issue shares of the Company's common stock from time to time as may be required for proper business purposes, such as raising additional capital for ongoing operations, business and asset acquisitions, establishing strategic relationships with corporate partners, stock splits and dividends, present and future employee benefit programs and other corporate purposes.

We anticipate that the Reverse Stock Split will have the effect of increasing, proportionately, the per share trading price of our common stock. There can be no assurances, however, that the market price of our common stock immediately after the Reverse Stock Split will be maintained for any period of time. Moreover, there can be no assurance that the market price of our common Stock after the Reverse Stock Split will adjust to reflect the conversion ratio (e.g., if the market price is $0.0003 before the Reverse Stock Split and the ratio is one (1) share for every four hundred (400) shares outstanding there can be no assurance that the market price for such share immediately after the reverse split will be $0.12 (400 x $0.0003)); or that the market price following the Reverse Stock Split will either exceed or remain in excess of the then current market price.

	Prior to Reverse Stock Split		After Reverse Stock Split

Authorized Shares of Common Stock		750,000,000		5,000,000,000

Outstanding Shares of Common Stock		603,073,279		1,507,683

Shares Reserved for Issuance Pursuant to Series B Preferred (1)		67,355		168

Shares Reserved for Issuance Pursuant to Series C Preferred (2)		insufficient		51,800,969

Shares Reserved for Issuance Pursuant to Series A Notes (3)		insufficient		23,555,537

Shares Reserved for Issuance Pursuant to Series B Notes (4)		insufficient		44,983,941

Shares Reserved for Issuance Pursuant to Warrants (5)		insufficient		953,246

(1) Represents shares reserved for issuance pursuant to our series B convertible preferred stock. Under the terms of the series B convertible preferred stock, we are obligated to reserve for issuance 100% of the shares issuable upon conversion of the series B convertible preferred stock. As of the Record Date, a total of 67,355 shares of our Pre-Split Common Stock were issuable upon conversion of the series B convertible preferred stock.

(2) Represents shares reserved for issuance pursuant to our series C convertible preferred stock. Under the terms of the series C convertible preferred stock, we are obligated to reserve for issuance 100% of the shares issuable upon conversion of the series C convertible preferred stock. As of the Record Date, a total of 20,720,387,444 shares of our Pre-Split Common Stock were issuable upon conversion of the series C convertible preferred stock.

(3) Represents shares reserved for issuance pursuant our series A senior secured convertible notes (including original issue discount notes) issued pursuant to financing arrangements entered into by the Company in February 2006. Under the financing arrangements, we are obligated to reserve for issuance 150% of the shares issuable upon conversion of the principal amount of the notes. As of the Record Date, a total of 6,281,476,467 shares of our Pre-Split Common Stock were issuable upon conversion of all of the notes.

(4) Represents shares reserved for issuance pursuant our series B senior secured convertible notes (including original issue discount notes) issued pursuant to a share exchange agreement with BMSI and financing arrangements entered into by the Company in November 2006. Under the financing arrangements and the agreement with BMSI, we are obligated to reserve for issuance 150% of the shares issuable upon conversion of the principal amount of the notes. As of the Record Date, a total of 11,995,717,500 shares of our Pre-Split Common Stock were issuable upon conversion of all of the notes.

(5) Represents shares reserved for issuance pursuant our common stock purchase warrants issued pursuant to a share exchange agreement with BMSI and financing arrangements entered into by the Company in 2005 and 2006. Under the financing arrangements and the agreement with BMSI, we are obligated to reserve for issuance 100-150% of the shares issuable upon exercise of the warrants. As of the Record Date, a total of 254,403,169 shares of our Pre-Split Common Stock were issuable upon exercise of all of the warrants.

As a result of the Reverse Stock Split, each four hundred (400) shares of our Pre-Split Common Stock shall automatically be reclassified and continued as one share of common stock, par value $0.0001 per share. We will not issue fractional shares on account of the Reverse Stock Split. Holders of Pre-Split Common Stock who would otherwise be entitled to a fraction of a share on account of the Reverse Stock Split shall be entitled to receive, in lieu of such fractional share, one full share of common stock.

As soon as practicable after the effective date of the Reverse Stock Split, we will request all stockholders to return their stock certificates representing shares of Pre-Split Common Stock outstanding on the effective date in exchange for certificates representing the number of whole shares of new common stock into which the shares of Pre-Split Common Stock have been converted as a result of the Reverse Stock Split. Each stockholder will receive a letter of transmittal from our transfer agent containing instructions on how to exchange certificates. STOCKHOLDERS SHOULD NOT SUBMIT THEIR OLD CERTIFICATES TO THE TRANSFER AGENT UNTIL THEY RECEIVE THESE INSTRUCTIONS. In order to receive new certificates, stockholders must surrender their old certificates in accordance with the transfer agent's instructions, together with the properly executed and completed letter of transmittal.

Beginning with the effective date of the Reverse Stock Split, each old certificate, until surrendered and exchanged as described above, will be deemed for all purposes to evidence ownership of the number of whole shares of new common stock into which the shares evidenced by the old certificates have been converted.

The par value and the relative rights and limitations of the common stock after the Reverse Stock Split will be identical to those of the Pre-Split Common Stock. However, following the Reverse Stock Split, the Company will have the ability to issue additional shares of common stock from time to time without further stockholder approval. Since holders of common stock have no preemptive rights to purchase or subscribe for any of our unissued stock, the issuance of additional shares of common stock will reduce the current stockholders' percentage ownership interest in the total outstanding shares of common stock.

Our ability to issue additional shares of common stock without further stockholder approval could have a number of effects on our stockholders depending upon the exact nature and circumstances of any actual issuances of authorized but unissued shares. The ability to issue additional shares could have an anti-takeover effect, in that additional shares could be issued (within the limits imposed by applicable law) in one or more transactions that could make a change in control or takeover more difficult. For example, additional shares could be issued by the Company so as to dilute the stock ownership or voting rights of persons seeking to obtain control of the Company, even if the persons seeking to obtain control offer an above-market premium that is favored by a majority of the independent stockholders. Similarly, the issuance of additional shares to certain persons allied with the Company's management could have the effect of making it more difficult to remove current management by diluting the stock ownership or voting rights of persons seeking to cause such removal. The Board of Directors is not aware of any attempt, or contemplated attempt, to acquire control of the Company, and this proposal is not being presented with the intent that it be utilized as a type of anti-takeover device.

No other director, executive officer, nominee for election as a director, associate of any director, executive officer, or nominee, or any other person has any substantial interest, direct or indirect, by security holdings or otherwise, in the proposed Reverse Stock Split that is not shared by all other stockholders.

Our Board of Directors has unanimously approved the Reverse Stock Split. The Majority Stockholder has given its signed written consent to action without a meeting to the Reverse Stock Split. The Reverse Stock Split will become effective on or about August 5, 2008. Therefore, we are not asking for your proxy, and we request that you do not send a proxy, as no further stockholder approval is either required or sought.

			Beneficial Ownership
			Number of Shares
Name and Address of	Nature of		Series B	Series C			Percent of
Beneficial Owner (1)	Beneficial Owner (1)	Common Stock	Preferred Stock	Preferred Stock	Total		Total (2)
Bounce Mobile Systems, Inc.	Stockholder	4,081,116,186	-	20,720,387,444	24,801,503,630	(3)	62.23	%
30950 Rancho Viejo Rd. #120
San Juan Capistrano, CA 92675

Dennis Ackerman	Director	12,164,127	-		12,164,127	(4)	*

Keith Moore	Director	338,710,000	-		338,710,000	(5)	*

Thomas Friedberg	Director	-	-		-		-

David Walters	Chairman and Director	4,419,826,186	-	20,720,387,444	25,140,213,630	(6)	63.08	%

Gary Hallgren	Chief Executive Officer	-	-		-		-

Greg Jones	Senior VP, Operations	-	-		-		-

All executive officers and
directors as a group (6 persons)		4,770,700,313	-	20,720,387,444	25,491,087,757		63.96	%

(1) Beneficial ownership is determined in accordance with the rules of the Commission and generally includes voting or investment power with respect to securities. In accordance with Commission rules, shares of the Company's common stock which may be acquired upon exercise of stock options or warrants which are currently exercisable or which become exercisable within 60 days of the date of the table are deemed beneficially owned by the optionees. Subject to community property laws, where applicable, the persons or entities named in the table above have sole voting and investment power with respect to all shares of the Company's common stock indicated as beneficially owned by them.

(2) Based upon the following outstanding securities: (a) 603,073,279 shares of common stock, (b) 522 shares of our series B convertible preferred stock (which were convertible into 67,355 shares of common stock), (c) 5,285 shares of our series C convertible preferred stock (which were convertible into 20,720,387,444 shares of common stock), (d) $3,768,886 principal amount of our series A senior secured convertible promissory notes (which were convertible into 6,281,476,467 shares of common stock), (e) $7,197,431 principal amount of our series B subordinated secured convertible promissory notes (which were convertible into 11,995,717,500 shares of common stock), (f) series A-7 warrants exercisable for 412,500 shares of common stock, (g) series B-4 warrants exercisable for 275,000 shares of common stock, (h) series C-3 warrants exercisable for 550,000 shares of common stock, (i) series D-1 warrants exercisable for 385,000 shares of common stock, (j) series E-7 warrants exercisable for 125,935,679 shares of common stock, (k) series F-4 warrants exercisable for 125,935,679 shares of common stock, and (l) other warrants exercisable for 909,310 shares of common stock.

(3) Consists of shares of common stock issuable upon conversion or exercise of the following outstanding securities held by BMSI: (a) 5,285 shares of our series C convertible preferred stock, (b) 300,110,259 shares of our common stock, (c) $2,163,000 principal amount of series B subordinated secured convertible notes (including original issue discount series B subordinated secured convertible notes), (c) our series E-7 warrants to purchase 86,554,526 shares of our common stock, and (d) our series F-4 warrants to purchase 86,554,526 shares of our common stock.