Edgar Filing: MOBILEPRO CORP

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 10-QSB

QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2002

COMMISSION FILE NUMBER 002-97869-D

MOBILEPRO CORP.
(Exact name of registrant as specified in charter)

DELAWARE 87-0419571
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

3204 TOWER OAKS BLVD., SUITE 350, ROCKVILLE, MD 20852
----------------------------------------------- -----
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code (301) 230-9125
-------------

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 X No __

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: As of November 20, 2002, the Company
had outstanding 19,516,788 shares of its common stock, par value $0.001.

TABLE OF CONTENTS

ITEM NUMBER AND CAPTION PAGE

PART I

ITEM 1. FINANCIAL STATEMENTS 3
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 6
ITEM 2. MANAGEMENT'S DISCUSSION AND PLAN OF OPERATIONS 12

PART II

ITEM 1. LEGAL PROCEEDINGS 17
ITEM 2. CHANGES IN SECURITIES 17
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 11
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 17
ITEM 5. OTHER INFORMATION 17
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 19

ITEM 1. FINANCIAL STATEMENTS

MOBILEPRO CORP. AND SUBSIDIARY
(FORMERLY CRAFTCLICK.COM, INC.)
(A DEVELOPMENT STAGE COMPANY)
CONDENSED CONSOLIDATED BALANCE SHEETS

ASSETS

SEPTEMBER 30, MARCH 31,
2002 2002
(UNAUDITED) (AUDITED)
---------------- ----------------

CURRENT ASSETS

Cash and cash equivalents $ 1,778 $ 154
Prepaid expenses 57,500 -
---------------- ----------------

TOTAL CURRENT ASSETS 59,278 154

Fixed assets, net of depreciation 46,821 -
---------------- ----------------

TOTAL ASSETS $ 106,099 $ 154
================ ================

LIABILITIES AND STOCKHOLDERS' DEFICIT

SEPTEMBER 30, MARCH 31,
2002 2002
(UNAUDITED) (AUDITED)
----------------- ----------------

LIABILITIES
Current Liabilities:
Due to officer $ 307,263 $ 44,262
Short-term debt 187,000 75,000
Accounts payable and accrued expenses 1,007,469 187,663
----------------- ----------------

TOTAL CURRENT LIABILITIES 1,501,732 306,925
----------------- ----------------

LONG-TERM DEBT 350,000 -
----------------- ----------------

TOTAL LIABILITIES 1,851,732 306,925
----------------- ----------------

STOCKHOLDERS' DEFICIT
Preferred stock, $.001 par value, authorized
5,000,000 shares, and 35,425 shares
issued and outstanding at September 30, 2002 and March 31,
2002, respectively 35 35
Common stock, $.001 par value, authorized 50,000,000
shares at September 30, 2002 and March 31, 2002, and
19,516,788 and 4,175,492 shares issued and
outstanding, respectively 19,517 4,176
Additional paid-in capital 4,189,608 3,596,613
Deficit accumulated during development stage (5,954,793) (3,907,595)
----------------- ----------------

TOTAL STOCKHOLDERS' EQUITY (1,745,633) (306,771)
----------------- ----------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 106,099 $ 154
================= ================

The accompanying notes are and integral part of the condensed consolidated
financial statements.

MOBILEPRO CORP. AND SUBSIDIARY
(FORMERLY CRAFTCLICK.COM, INC.)
(A DEVELOPMENT STAGE COMPANY)
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(WITH CUMULATIVE TOTALS SINCE INCEPTION)

SIX MONTHS ENDED THREE MONTHS ENDED CUMULATIVE
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, TOTALS SINCE
2002 2001 2002 2001 INCEPTION
---- ---- ---- ---- ---------

OPERATING REVENUES
Revenue $ - $ 299,994 $ - $ - $ -

COST OF SALES - - - - -
---------------- ------------- ---------------- -------------- -----------------

GROSS PROFIT - 299,994 - - -
---------------- ------------- ---------------- -------------- -----------------

OPERATING EXPENSES
Professional fees and compensation expenses 1,870,172 685,114 691,213 270,059 1,870,172
Advertising and marketing expenses 2,430 1,346 745 1,038 2,430
Research and development costs 4,996 104,737 500 41,898 4,996
General and administrative expenses 36,679 47,641 10,527 36,075 4,192,991
Office rent and expenses 64,015 98,176 25,578 61,610 64,015
Travel and meals expenses 12,472 50,065 4,763 16,351 12,472
Depreciation and amortization 8,000 6,000 4,000 2,187 8,000
---------------- ------------- ---------------- -------------- -----------------
TOTAL OPERATING EXPENSES 1,998,764 993,079 737,326 429,218 6,155,076
---------------- ------------- ---------------- -------------- -----------------

NET LOSS BEFORE OTHER INCOME (EXPENSE) (1,998,764) (693,085) (737,326) (429,218) (6,155,076)

OTHER INCOME (EXPENSE)
Forgiveness of debt - - - - 276,738
Interest expense - - - - (469)
Other expense (48,434) - 1,794 - (76,042)
Interest income - 1,334 - - 56
---------------- ------------- ---------------- -------------- -----------------
TOTAL OTHER INCOME (EXPENSE) (48,434) 1,334 1,794 - 200,283
---------------- ------------- ---------------- -------------- -----------------

NET LOSS BEFORE PROVISION FOR INCOME TAXES (2,047,198) (691,751) (735,532) (429,218) (5,954,793)
PROVISION FOR INCOME TAXES - - - - -
---------------- ------------- ---------------- -------------- -----------------

NET LOSS APPLICABLE TO COMMON SHARES $ (2,047,198) $ (691,751) $ (735,532) $ (429,218) $ (5,954,793)
================ ============= ================ ============== =================

NET LOSS PER BASIC AND DILUTED SHARES $ (0.12920) $ (0.14330) $ (0.03916) $ (0.08891)
================ ============= ================ ==============

WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 15,844,642 4,827,421 18,784,163 4,827,421
================ ============= ================ ==============

The accompanying notes are an integral part of the condensed consolidated
financial statements.

MOBILEPRO CORP. AND SUBSIDIARY
(FORMERLY CRAFTCLICK.COM, INC.)
(A DEVELOPMENT STAGE COMPANY)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
(WITH CUMULATIVE TOTALS SINCE INCEPTION)

CUMULATIVE
TOTALS SINCE
2002 2001 INCEPTION
--------------- -------------- ---------------

CASH FLOW FROM OPERATING ACTIVITIES
Net loss $(2,047,198) $(814,080) $ (5,954,793)
--------------- -------------- ---------------
ADJUSTMENTS TO RECONCILE NET LOSS TO NET CASH
USED IN OPERATING ACTIVITIES:
Forgiveness of debt - - (276,738)
Depreciation 8,000 - 8,000
Common stock issued for services 1,208,253 639,660 4,429,912

CHANGES IN ASSETS AND LIABILITIES
(Increase) in accounts receivable - - -
(Increase) in inventory - - -
(Increase) in prepaid expenses and other assets (57,500) (1,900) (57,500)
Increase in accounts payable and
and accrued expenses 265,068 74,530 788,804
--------------- -------------- ---------------
Total adjustments 1,423,821 712,290 4,892,478
--------------- -------------- ---------------

NET CASH (USED IN) OPERATING ACTIVITIES (623,377) (101,790) (1,062,315)
--------------- -------------- ---------------

CASH FLOWS FROM INVESTING ACTIVITIES
Increase in amounts due to related parties 263,001 - 263,001
Acquisitions of fixed assets - (299) -
--------------- -------------- ---------------
-
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 263,001 (299) 263,001
--------------- -------------- ---------------

CUMULATIVE
TOTALS SINCE
2002 2001 INCEPTION
-------------- -------------- ---------------

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from common stock issuances $ - $ - $ 100
Proceeds from borrowings, net - - 394,730
Change in officer loan, net - - 44,262
Net proceeds from issuance of notes payable 362,000 114,516 362,000
-------------- -------------- ---------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 362,000 114,516 801,092
-------------- -------------- ---------------

NET INCREASE IN
CASH AND CASH EQUIVALENTS 1,624 12,427 1,778

CASH AND CASH EQUIVALENTS -
BEGINNING OF PERIOD 154 66 154
-------------- -------------- ---------------

CASH AND CASH EQUIVALENTS - END OF PERIOD $ 1,778 $ 12,493 $ 1,932
============== ============== ===============

SUPPLEMENTAL DISCLOSURE OF NONCASH
ACTIVITIES:
Issuance of common stock for:

Services $ 1,208,253 $639,660 $4,429,912
============== ============== ===============

The accompanying notes are an integral part of the condensed consolidated
financial statements.

MOBILEPRO CORP AND SUBSIDIARY
(FORMERLY CRAFTCLICK.COM)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2002 AND 2001 (UNAUDITED)

NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION

The condensed consolidated unaudited interim financial statements included
herein have been prepared, without audit, pursuant to the rules and regulations
of the Securities and Exchange Commission. The condensed consolidated financial
statements and notes are presented as permitted on Form 10-QSB and do not
contain information included in the Company's annual financial statements and
notes. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with accounting principles generally
accepted in the United States of America have been condensed or omitted pursuant
to such rules and regulations, although the Company believes that the
disclosures are adequate to make the information presented not misleading. It is
suggested that these condensed consolidated financial statements be read in
conjunction with the March 31, 2002 audited financial statements and the
accompanying notes thereto. While management believes the procedures followed in
preparing these condensed consolidated financial statements are reasonable, the
accuracy of the amounts are in some respects dependent upon the facts that will
exist, and procedures that will be accomplished by the Company later in the
year.

These condensed consolidated unaudited financial statements reflect all
adjustments, including normal recurring adjustments which, in the opinion of
management, are necessary to present fairly the consolidated operations and cash
flows for the periods presented.

Mobilepro Corp., formerly Craftclick.com, Inc., was incorporated under the laws
of the State of California in January 1999, as BuyIt.com, Inc. ("BuyIt"). From
inception through March 31, 1999, the Company engaged in preliminary activities
related to the set up of an Internet auction business. On April 16, 1999, the
Company entered into an Agreement and Plan of Reorganization ("Plan") with
Tecon, Inc. ("Tecon"), a Utah Corporation, wherein all of the outstanding shares
and subscriptions of BuyIt were exchanged for 8,500,000 shares (for the
outstanding shares of common stock of Tecon, and 245,997 shares (for the
outstanding subscriptions) of common stock of Tecon. At the conclusion of all
the transactions contemplated in the Plan, BuyIt shareholders and subscribers
owned 8,745,997 shares of total outstanding shares of 12,179,249, or 71.9%. The
survivor in the aforementioned combination was Tecon. However, the name of the
surviving company was changed to BuyIt.com, Inc., simultaneously with the Plan.
The combination of these two entities had been accounted for as a purchase. The
Company changed its name to Craftclick.com, Inc., on January 4, 2000, as a
result of changing its business strategy and focus-which was to become the
premier destination for buyers and sellers of arts and crafts products and
supplies through the use of Internet websites. However, the Company disposed of
substantially all assets in February of 2001 when secured creditors foreclosed
on loans to the Company.

In April 2001, Craftclick.com, Inc. reorganized pursuant to a Plan of Merger
wherein its domicile was changed from Utah to Delaware, and the common stock was
reverse split on the basis of 1 new share for every 100 shares outstanding.

On June 6, 2001, Craftclick.com, Inc. merged with Mobilepro Corp. a Delaware
corporation as of June 1, 2001. Under the merger agreement, Mobilepro Corp.
merged into Craftclick.com, Inc. with Craftclick being the surviving corporation
and the Certificate of Incorporation and By Laws of Craftclick being the
constituent documents of the surviving corporation.

In July 2001, the Company changed its name to Mobilepro Corp.

On March 21, 2002, Mobilepro entered into an Agreement and Plan of Merger with
NeoReach, Inc., a private Delaware company, pursuant to which a newly-formed,
wholly-owned subsidiary of Mobilepro merged into NeoReach in a tax-free
transaction. NeoReach is a development stage company designing state of the art
modem solutions to support third generation (3G) wireless communications systems
The merger was consummated on April 23, 2002. As a result of the merger,
NeoReach is now a wholly-owned subsidiary of Mobilepro. On April 23, 2002,

the Company issued 12,352,129 shares of its common stock in a one-for-one
tax-free stock exchange to the holders of NeoReach's common stock pursuant to
the Agreement. This was a cash-less transaction and there were no payments or
finder's fees involved. The Board of Directors determined the consideration to
be a fair compensation to the NeoReach shareholders. The issuance of the shares
were valued at a fair value of $ 6,546,628, based on the last trading price of
$0.53 and assuming there was actual active trading of our stock at that time.
The Company believes the issuance of the stock to be exempt from registration
under Section 4(2) of the Securities Act. The related parties from both the
Company and Neoreach were Messrs. Daniel Lozinsky, Arne Dunhem, Scott Smith and
Ken Min. Mr. Daniel Lozinsky who was a controlling stockholder of Mobilepro also
owned approximately 32.5% of NeoReach.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION

The condensed consolidated financial statements include the accounts of the
Company and all of its wholly owned subsidiaries. All significant intercompany
accounts and transactions have been eliminated in consolidation.

DEVELOPMENT STAGE COMPANY

Mobilepro Corp. is a development stage company. The Company since April 23, 2002
has devoted substantially all of its efforts to researching and developing
technology for the third generation wireless waves. Before the acquisition of
NeoReach, Inc., Mobilepro Corp. focused on the integration and marketing of
complete mobile information solutions to the business market through strategic
partnership with established firms already delivering information technology
consulting, wireless service and vertical market application products and
services.

USE OF ESTIMATES

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

REVENUE RECOGNITION

Revenue is recognized when earned. For products which the Company sells, revenue
is recognized when products are shipped. Customer payments for sales are charged
to pre-approved/authorized credit cards. Thus, the sale is not recorded and
product not shipped unless collection is determined to be certain. The Company
records accounts receivable for the sale proceeds during the period of time
between shipping and when cash is posted in the bank.

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid debt instruments and other short-term
investments with an initial maturity of three months or less to be cash
equivalents.

The Company maintains cash and cash equivalent balances at several financial
institutions which are insured by the Federal Deposit Insurance Corporation up
to $100,000.

INCOME TAXES

Effective July 14, 2000, the Company adopted the provisions of Statement of
Financial Accounting Standards No. 109 (the Statement), Accounting for Income
Taxes. The Statement requires an asset and liability approach for financial
accounting and reporting for income taxes, and the recognition of deferred tax
assets and liabilities for the temporary differences between the financial
reporting bases and tax bases of the Company's assets and liabilities at enacted
tax rates expected to be in effect when such amounts are realized or settled.
The cumulative effect of this

change in accounting for income taxes as of September 30, 2002 is $0 due to the
valuation allowance established as described in Note 3.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amounts reported in the balance sheet for cash and cash
equivalents, and accounts payable approximate fair value because of the
immediate or short-term maturity of these financial instruments.

ADVERTISING COSTS

The Company expenses the costs associated with advertising as incurred.
Advertising and promotional expenses were approximately $2,430 and $1,346 for
the six months ended September 30, 2002 and 2001, respectively.

FURNITURE AND EQUIPMENT

Furniture and equipment are stated at cost. Depreciation is computed using the
straight-line method over the estimated useful lives of the assets.

When assets are retired or otherwise disposed of, the costs and related
accumulated depreciation are removed from the accounts, and any resulting gain
or loss is recognized in income for the period. The cost of maintenance and
repairs is charged to income as incurred; significant renewals and betterments
are capitalized. Deduction is made for retirements resulting from renewals or
betterments. Furniture and equipment consist of the following at September 30,
2002:

Office Furniture and Computer Equipment 3 to 5 Years

There was $8,000 and $0 charged to operations for depreciation expense for the
six months ended September 30, 2002 and 2001, respectively.

EARNINGS (LOSS) PER SHARE OF COMMON STOCK

Historical net income (loss) per common share is computed using the weighted
average number of common shares outstanding. Diluted earnings per share (EPS)
includes additional dilution from common stock equivalents, such as stock
issuable pursuant to the exercise of stock options and warrants. Common stock
equivalents were not included in the computation of diluted earnings per share
when the Company reported a loss because to do so would be antidilutive for
periods presented.

The following is a reconciliation of the computation for basic and diluted EPS:

SEPTEMBER 30, SEPTEMBER 30,
2002 2001
------------ ------------

Net Loss $ (2,079,198) $ (691,751)

Weighted-average common shares outstanding
Basic 15,844,642 4,827,421

Weighted-average common shares equivalents:
Stock Options - -
Warrants - -

Weighted-average common shares outstanding
(Diluted) 15,844,642 4,827,421
============ ============

Options and warrants outstanding to purchase stock were not included in the
computation of diluted EPS because inclusion would have been antidilutive.

RECLASSIFICATIONS

Certain amounts for the six months ended September 30, 2001 have been
reclassified to conform with the presentation of the September 30, 2002 amounts.
The reclassifications have no effect on net income for the six months ended
September 30, 2001.

RECENT ACCOUNTING PRONOUNCEMENTS

In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities". SFAS No. 133
requires companies to recognize all derivative contracts as either assets or
liabilities in the balance sheet and to measure them at fair value. If certain
conditions are met, a derivative may be specifically designated as a hedge, the
objective of which is to match the timing of the gain or loss recognition on the
hedging derivative with the recognition of (i) the changes in the fair value of
the hedged asset or liability that are attributable to the hedged risk or (ii)
the earnings effect of the hedged forecasted transaction. For a derivative not
designated as a hedging instrument, the gain or loss is recognized in income in
the period of change. On June 30, 1999, the FASB issued SFAS No. 137,
"Accounting for Derivative Instruments and Hedging Activities - Deferral of the
Effective Date of FASB Statement No. 133". SFAS No. 133 as amended by SFAS No.
137 is effective for all fiscal quarters of fiscal years beginning after June
15, 2000. In June 2000, the FASB issued SFAS No. 138, "Accounting for Certain
Derivative Instruments and Certain Hedging Activities". SFAS No. 133 as amended
by SFAS No. 137 and 138 is effective for all fiscal quarters of fiscal years
beginning after June 15, 2000.

Historically, we have not entered into derivatives contracts to hedge existing
risks or for speculative purposes. Accordingly, we do not expect adoption of the
new standard to have a material effect on our consolidated financial statements.

In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin ("SAB") No. 101, "Revenue Recognition in Financial Statements." SAB 101
provides guidance for revenue recognition under certain circumstances, and is
effective during the first quarter of fiscal year 2001. SAB 101 is not expected
to have a material effect on our consolidated results of operations, financial
position and cash flows.

On March 16, 2000, the Emerging Issues Task Force issued EITF 99-19 "Recording
Revenue as a Principal versus Net as an Agent" which addresses the issue of how
and when revenues should be recognized on a Gross or Net method as the title
implies. The emerging Issues Task Force has not reached a consensus but sites
SEC Staff Accounting Bulletin 101. EITF 99-19 does not affect our consolidated
financial statements.

On July 20, 2000, the Emerging Issues Task Force issued EITF 00-14 "Accounting
For Certain Sales Incentives" which establishes accounting and reporting
requirements for sales incentives such as discounts, coupons, rebates and free
products or services. Generally, reductions in or refunds of a selling price
should be classified as a reduction in revenue. For SEC registrants, the
implementation date is the beginning of the fourth quarter after the
registrant's fiscal year end December 15, 1999. EITF 00-14 does not affect our
consolidated financial statements.

In June 2001, the FASB issued Statement No. 142 "Goodwill and Other Intangible
Assets". This Statement addresses financial accounting and reporting for
acquired goodwill and other intangible assets and supersedes APB Opinion No. 17,
Intangible Assets. It addresses how intangible assets that are acquired
individually or with a group of other assets (but not those acquired in a
business combination) should be accounted for in financial statements upon their
acquisition. This Statement also addresses how goodwill and other intangible
assets should be accounted for after they have been initially recognized in the
financial statements. This statement does not affect our consolidated financial
statements.

NOTE 3- GOING CONCERN

As shown in the accompanying condensed consolidated financial statements the
Company has sustained substantial net operating losses for the year ended March
31, 2002 and the period September 30, 2002 and periods prior. There is no
guarantee that the Company will be able to raise enough capital or generate
revenues to sustain its operations.

Management has received a commitment from Cornell Capital Partners, L.P. to
provide the Company with up to $10 million in financing under certain
conditions.

Additionally, assuming that the Company receives the full $10 million from
Cornell Capital, the Company believes that that amount will be sufficient enough
to implement NeoReach, Inc. its subsidiary's Plan over the next two years.

NOTE 4- STOCKHOLDERS DEFICIT

The following details the stock transactions for the period April 1, 2002
through September 30, 2002.

COMMON STOCK

On April 23, 2002, we issued 12,352,129 shares of our common stock to the
holders of NeoReach's common stock pursuant to an Agreement and Plan of Merger,
dated March 21, 2002. A newly formed, wholly-owned subsidiary of Mobilepro
merged into NeoReach, in a tax-free one-for-one share exchange transaction. The
merger was consummated on April 23, 2002. As a result of the merger, NeoReach is
now a wholly-owned subsidiary of Mobilepro. The issuance of the shares were
valued at a fair value of $6,546,628, based on the last trading price of $0.53
and assuming there was actual active trading of our stock at that time. We
believe the issuance of the stock to be exempt from registration under Section
4(2) of the Securities Act.

On May 31, 2002, e issued a total of 690,000 shares of its common stock to the
following parties: 450,000 shares to INFe, Inc., 150,000 shares to Thomas
Richfield, 60,000 shares to Francine Goodman, and 30,000 shares to Triple Crown
Consulting. These shares were issued for consulting services regarding the
Mobilepro-NeoReach merger. The issuance of the shares were valued at $ 317,400,
the fair value of our stock at that time. We believe the value of the services
provided were commensurate with the value of the stock issued. We believe the
issuance of the stock to be exempt from registration under Section 4(2) of the
Securities Act.

On June 10, 2002, we issued a total of 784,314 shares of its common stock to the
following parties: 764,706 to Cornell Capital Partners, LP and 19,708 to
Westrock Advisors, Inc. These shares were issued pursuant to an equity line of
credit arrangement with Cornell Capital Partners, dated May 31, 2002. The
issuance of the shares were valued at $517,647, the fair value of our stock at
that time. We believe the issuance of the stock to be exempt from registration
under Section 4(2) of the Securities Act.

On July 18, 2002, we issued a total of 305,000 shares of our common stock to
various parties. 160,000 shares of our restricted common stock were issued to
Daniel Lozinsky, a director of the Corporation, in a private sale for an
aggregate cash consideration of $39,000 based on a Board Resolution as of July
17, 2002. In addition, we also issued 20,000 shares of common stock under the
2001 Equity Performance Plan and 100,000 restricted common stock as compensation
to Mark Johnson for various Merger and Acquisition related services and
associated back office services in accordance with a Consulting Agreement dated
July 17, 2002. We also issued 25,000 shares of restricted common stock as
compensation to M. Johnson & Associates, Inc. for certain services in accordance
with an Investor Relations Agreement dated July 17, 2002. The issuance of the
shares was valued at $65,250, the fair value of our stock at that time. We
believe the value of the services provided were commensurate with the value of
the stock issued. We believe the issuance of the stock to be exempt from
registration under Section 4(2) of the Securities Act.

On July 26, 2002, we issued a total of 500,000 shares of our restricted common
stock to Capital Research Group, Inc. for certain investor relations consulting
services in accordance with a Consulting Services Agreement dated July 25, 2002.
The issuance of the shares was valued at $220,000, the fair value of our stock
at that time. We believe the issuance of the stock to be exempt from
registration under Section 4(2) of the Securities Act.

On September 4, 2002, we issued a total of 709,853 of our common stock to
various parties. 100,000 shares were issued to Hee Han Bang, a non-affiliated
and accredited/sophisticated investor in a private sale for an aggregate cash
consideration of $25,000. These shares were issued at $0.25 per share based on a
Board Resolution fixing the value

of the securities on and as of August 09, 2002. 150,000 shares of our common
stock were issued to Daniel Lozinsky, a director of the Corporation, in a
private sale for an aggregate cash consideration of $15,000. These shares were
issued based on a Board Resolution as of August 20, 2002. We issued a total of
209,853 shares of our common stock to shares to INFe, Inc. based on a Board
Resolution as of August 19, 2002. These shares were issued for consulting
services in connection with the Mobilepro NeoReach merger and a Reverse Merger
Engagement Agreement dated January 11, 2002 between NeoReach, Inc. and INFe,
Inc. The issuance of the shares was valued at $62,956, the fair value of our
stock at that time. We also granted a total of 250,000 shares of our restricted
common stock to Parag Sheth, an executive of the Corporation. Parag Sheth was
granted 150,000 shares of our restricted common stock for forgiving a total of
$15,000.00 in salary corresponding to a price of $0.10 per share and he was also
granted 100,000 shares of our restricted common stock as an inducement for
providing services for the Corporation. These shares were issued based on a
Board Resolution as of August 20, 2002 and the issuance of the shares was valued
at $25,000. We believe the value of the services provided were commensurate with
the value of the stock issued. We believe the issuance of the stock to be exempt
from registration under Section 4(2) of the Securities Act.

NOTE 5- PATENTS

As of September 30, 2002, we had filed a total of six patent applications which
were pending with the U.S. Patent and Trademark Office (PTO) in the area of
"Smart Antenna" technology. On April 29, 2002, we announced that two of our six
previously filed patents have been allowed which means that they have been or
are being issued.

One allowed and awaiting issue notification patent application is "Smart Antenna
with Adaptive Convergence Parameter" with PTO Docket #3228-003-64, involves
intellectual property that can enhance the performance of conventional smart
antenna processing technology if used for 3G wireless communications.

A second allowed and issued patent application is "A Smart Antenna With No Phase
Calibration For CDMA Reverse Link" with PTO Docket #3228-004-64, delivers
automatic, low-cost improvements to the smart antenna processing technology.

A third allowed and issued patent application is "PN Code Acquisition With
Adaptive Antenna Array and Adaptive Threshold for DS-CDMA Wireless
Communication" with PTO Docket #3228-002-64, would provide an improvement to the
quality of the communications channel.

The remaining three patent applications, currently still under review at the
PTO, involve innovations that deliver increased capacity in 3G wireless
networks, expansion of the coverage areas, and that maintain high quality of the
communication channels. The patent applications include "New Cellular
Architecture" with PTO Docket # 3228-001-64, "Direction of Arrival Angel
Tracking Algorithm For Smart Antennas" with PTO Docket #3228-005-64, and
"Improvement of PN Code Chip Time Tracking with Smart Antenna" with PTO Docket
#3228-007-64.

In addition, we also have two other patent applications pending which are
referred to as "Wireless Communication System and Method of Providing Wireless
Communication Service" with specific descriptions to include "Device and Method
for Changing the Orientation and Configuration of a Display of an Electronic
Device" and "Electronic Device Having Multiple Service Functionality". Both of
these pending patent applications relate to the business of the Company before
the merger with NeoReach.

NOTE 6- COMMITMENTS

In April 2002, NeoReach, Inc. established a technology alliance with Prime
Circuits, Inc. Prime Circuits is a privately-held semiconductor developer based
in Greenbelt, MD that specializes in ultra small, ultra low power analog,
digital and hybrid chipsets. Prime Circuits' technology is currently in use in a
number of NASA applications at Goddard Space Flight Center.

As part of the alliance, NeoReach will gain access to technical knowledge,
personnel and low power semiconductor technology that NeoReach believes will
greatly expand its digital modem suite. This solution targets the consumer
handsets and network transmission base stations to support 3G communications.

On May 10, 2002 the Company announced that Arne Dunhem was appointed the
Chairman, President and CEO of Mobilepro Corp. Mr. Dunhem has over 28 years of
experience in the growth of high technology companies, especially in the
telecommunications field.

On May 31, 2002, the Company entered into an equity line of credit arrangement
with Cornell Capital Partners, L.P. The equity line provides generally, that
Cornell will purchase up to $10 million of common stock over a two-year period,
with the time and amount of such purchases, if any, at the Company's discretion.

There are certain conditions applicable to the Company's ability to draw down on
the equity line including the filing and effectiveness of a registration
statement registering the resale of all shares of common stock that may be
issued to Cornell under the equity line and the Company's adherence with certain
covenants.

The Company on May 31, 2002, entered into a Securities Purchase Agreement with
certain investors pursuant to which the Company issued and sold $250,000 of
convertible debentures. The debentures accrue interest at the rate of four
percent (4%) per year. Holders of the debentures have certain registration
rights with respect to the resale of shares of common stock received upon any
conversion of the debentures.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

FORWARD LOOKING STATEMENTS

When used in this Form 10QSB and in future filings by Mobilepro Corp. with the
Securities and Exchange Commission, the words or phrases "will likely result,"
"management expects," or we expect," "will continue," "is anticipated,"
"estimated," or similar expression or use of the future tense, are intended to
identify forward looking statements. Readers are cautioned not to place undue
reliance on any such forward-looking statements, each of which speak only as of
the date made. These statements are subject to risks and uncertainties, some of
which are described below and others are described in other parts of this Form
10QSB. Actual results may differ materially from historical earnings and those
presently anticipated or projected. We have no obligation to publicly release
the result of any revisions that may be made to any forward-looking statements
to reflect anticipated events or circumstances occurring after the date of such
statements.

BUSINESS HISTORY

Mobilepro is a development stage company and currently trades on the Bulletin
Board under the stock symbol "MOBL". The following is a brief history of the
Company.

NeoReach was incorporated in February of 2000 and is focused on designing
state-of-the-art modem solutions to support 3G wireless communications systems.

The Company with which NeoReach merged into April of 2002 was first organized in
June 1988 as Bud Corp. Bud Corp. changed its name to Tecon, Inc. in July 1992,
then to Buyit.com, Inc. in May 1999 to CraftClick.com, Inc. on January 4, 2000,
and finally to Mobilepro Corp. on July 9, 2001. Mobilepro's previous business
strategy and focus was to position itself as a provider of wireless business
solutions for the mobile business professional workforce and the Company
intended to develop complete mobile information solutions that include products
and services such as wireless handheld devices and Web based enterprise
applications. Due to the lack of adequate funding and the lack of generating any
sales, MobilePro was not able to execute its plan.

On March 21, 2002, the Company entered into an Agreement and Plan of Merger with
NeoReach, pursuant to which a newly-formed, wholly-owned subsidiary of the
Company merged into NeoReach in a tax-free transaction. The merger was
consummated on April 23, 2002. As a result of the merger, NeoReach is now a
wholly-owned subsidiary of the Company.

On May 10, 2002, Mr. Arne Dunhem became the Company's President, CEO and
Chairman and Mr. Daniel Lozinsky became our Senior Vice President.

BUSINESS STRATEGY

We are a development stage company and therefore, the following business
strategy contains forward-looking information and we can give no assurances that
we will be able to accomplish these goals, generate sufficient revenues to be
profitable, obtain adequate capital funding or continue as a going concern. Our
independent auditors have issued a going-concern opinion for the year ended
March 31, 2002 (See "Financial Statements and Supplementary Data").

Mobilepro is attempting to develop advanced modem solutions for both the base
stations (also called Node-B) and the handsets to capitalize on the approaching
3G wave. The base station solution targets smaller systems called Micro- and
Pico Cell base stations. The handset modem solution also targets PDA's and
laptop plug-in cards. They will be based on Mobilepro's own, proprietary
technology. Distinguishing design features will include a multi-channel base
station support and multi-mode handset compatibility with W-CDMA and GSM network
standards.

Mobilepro has solved core modem development issues with its architecture without
having to license and pay expensive, ongoing royalties to other vendors. The
core modem technology development is the interpretation and implementation of
the international W-CDMA standards specifications defined by the Third
Generation Partnership Project (3GPP) such that the base station modem will
properly communicate with the corresponding handset modem

over the so called air-interface. The issues range from identifying ways to
enable multi-channel support to solving smart antenna processing problems. This
accomplishment is attributed to the depth and breadth of experience of the
Company in cellular and wireless communications technologies, network operation
and system development, ASIC and handset design and manufacturing, and 3G
network standards.

The modem features that have already been developed for the base station
(Node-B) modem include:

- Node-B Rake Receiver (4 Channels), functions include Finger Correlator,
Channel Estimator & Compensator, Frequency Estimator & Compensator, SIR
Measurement, Tracking Loop, Rake Combiner
- Node-B Symbol Level Processing (Transmitter and Receiver)
- Node-B Preamble and Traffic Searchers
- Node-B Transmitter (4 Channels)
- Completed Functional Tests
- Voice and Image demonstration platforms

Additional features being developed are:

o Node-B Rake Receiver (32 Channels)
o Node-B Transmitter (32 Channels)
o Node-B Physical Layer Procedure
o Node-B Physical Layer Measurements

Mobilepro has filed six patent applications for its W-CDMA smart antenna
processing approaches and will pursue other patents to protect its intellectual
property rights in various chief modem design and implementation areas. Product
research and design was initiated in 2000. A co-development contract with a
customer during 2001 provided important, co-development technical resources and
expertise during the critical design phase. We believe that the four-channel
version of the base station modem will be available for evaluation during the
fourth quarter 2002 with commercial ASIC multi-channel modems mid/end 2003. ASIC
means an Application Specific Integrated Circuit, i.e. a semiconductor chip that
will be designed and developed by the Company but will be manufactured under an
out-source agreement with a plant most likely in Taiwan. This is also called
Fab-less manufacturing of a semiconductor chip. The handset ASIC modem is
planned for end 2003 market availability. NeoReach also intends to develop and
provide the complete radio frequency transceiver as a semiconductor chip, the
RF-CMOS chip.

NeoReach intends to use third-party manufacturing for its products. Because of
this approach, the Company does not expect to make any significant purchase of
plants or equipment. The Company has initiated some preliminary discussions with
contract manufacturers for product development, prototyping and production
agreements for its planned ASIC chips and modems systems. None of these
agreements have been finalized as of this date and no assurances can be given
that any agreements will be forthcoming.

The RF-CMOS chip is a highly complex and integrated complete receiver and
transmitter system, also called a transceiver, for a handset or other user
devices such as PDA's and laptops and for the smaller Pico-Cell base stations.
The various handsets in existence today has a radio frequency transceiver built
with many individual components such as integrated circuits, transistors,
capacitors, resistors, and coils. Most of these various components with be
integrated into the single RF-CMOS chip of a size approximately 1/4 inch by 1/4
inch. The RF-CMOS chip is initially intended for the W-CDMA and GSM standards.

NeoReach has signed an MOU with RF Microelectronics Laboratory, part of the
Information and Communications University (ICU) of the Republic of Korea to
cooperate in research, particularly in RF-CMOS ASICs development for RF
transceiver of the 3G W-CDMA standard. This specific ASIC chipset, which will
support the W-CDMA standard, is also a required component in the consumer
handsets and base stations managed by the mobile operators to support 3G
wireless services. This co-development initiative has the potential to expand
the NeoReach product suite beyond the Company's modem solutions currently in
development and testing.

The long-term product vision is founded on product line extensions that leverage
the current technology and expertise in 3G. We intend to add new products to the
development schedule if market success with the modem solutions is demonstrated
and based on the market timing and future competitive landscape.

Mobilepro believes it can be successful in the 3G wireless modem market for two
key reasons: 1) capitalizing on an early-to-market advantage with advanced
capabilities; and, 2) maintaining narrowly focused product and market strategy
on its two core solutions. We believe that other vendors must rationalize 3G
development, sales and marketing resources among a larger product line and among
an installed base of customers utilizing other products for which upgrades are
expected and required.

We have many competitors, many of whom are well-recognized brand names and are
well financed. Qualcomm is the leading provider of wireless modem technology,
marketing a wide variety of products worldwide. Qualcomm products were initially
designed for the CDMA standard and only recently has the company announced it
will now also build to the W-CDMA standard. Other companies developing modems
include Nokia, Ericsson, Siemens, Motorola and Samsung. A large number of
smaller companies around the world specialize in various niche technologies
addressing the wireless market to include the modems for the handsets. These
include PrairieComm and InterDigital in the U.S., Yozan in Japan, Sierra
Wireless in Canada and Xircom in Germany. We may not be able to overcome the
strengths of our competitors.

FINANCIAL CONDITION AND CHANGES IN FINANCIAL CONDITION

OVERALL OPERATING RESULTS:

We had no revenues for the quarter ended September 30, 2002.

Our operating expenses for the quarter ended September 30, 2002 were
approximately $769,236. Our primary expense was incurred for Professional fees
and compensation expenses of $723,213 compared with $270,059 for the three
months ended September 30, 2001. Of this amount, $405,206 of common stock in
lieu of cash was issued in connection with consulting fees and expenses for
services rendered as a part of the reverse triangular merger with NeoReach and
the establishment of the equity line of credit with Cornell Capital. These
consulting fees and expenses are not anticipated to be recurring. Approximately
$300,000 in expenses was for on-going compensation expenses.

OPERATING LOSSES

Our net operating loss for the quarter ended September 30, 2002 was
approximately $1,745,633. These losses were incurred primarily as a result of
the aforementioned incurred expenses.

We have accumulated approximately $5,954,793 of net operating loss carryforwards
as of September 30, 2002, that may be offset against future taxable income.
There will be limitations on the amount of net operating loss carryforwards that
can be used due to the change in the control of the management of the Company.
No tax benefit has been reported in the financial statements, because we believe
there is a 50% or greater chance the carryforwards will expire unused.
Accordingly, the potential tax benefits of the loss carryforwards is offset by a
valuation allowance of the same amount.

LIQUIDITY AND CAPITAL RESOURCES:

As of September 30, 2002, we had a total Stockholders' Deficit of approximately
$1,745,633 and do not currently have any revenues, liquidity or capital
resources as we move forward with our business plan and our independent auditors
have issued an audit opinion as of March 31, 2002 that raises substantial doubt
as to our ability to continue as a going concern. We will need additional
financing in order to implement our business plan and continue business. The
traditional markets for raising capital have become extremely more difficult in
the last year due to a depressed economy, large well-known business failures and
the events of September 11, 2001.

The Company will need additional financing and may use a private placement
offering or debt financing to raise such additional funds, to be used for the
following:

- Investment in laboratory facilities including test and simulation
equipment;
- Acquisition or licensing of certain intellectual property related to the
development of modems and communications semiconductor and component
technology;
- Pay-down certain debt, such as a convertible debenture from Cornell
Capital. We intend to pay-off debt owed to Mr. Daniel Lozinsky, a Director,
and Mr. Arne Dunhem, an officer and Director, during 2003; and
- General working capital purposes.

We are in the process of establishing a source for additional financing and we
cannot give any assurances that we will be able to secure any financing.

On May 31, 2002, the Company entered into an equity line of credit arrangement
(the "Equity Line") with Cornell Capital Partners, LP ("Cornell"). The Equity
Line provides, generally, that Cornell will purchase up to $10 million of Common
Stock over a two-year period, with the timing and amount of such purchases, if
any, at the Company's discretion. Any shares of Common Stock sold under the
Equity Line will be priced at a 9% discount to the lowest closing bid price of
the Common Stock during the five-day period following the Company's notification
to Cornell that it is drawing down on the Equity Line. The Company is not
permitted to draw down more than $450,000 in any 30-day calendar period. In
addition, there are certain other conditions applicable to the Company's ability
to draw down on the Equity Line including the filing and effectiveness of a
registration statement registering the resale of all shares of Common Stock that
may be issued to Cornell under the Equity Line and the Company's adherence with
certain covenants. At the time of each draw down, the Company is obligated to
pay Cornell a fee equal to three percent of amount of each draw down.

In addition, on May 31, 2002, the Company entered into a Securities Purchase
Agreement with certain investors pursuant to which the Company issued and sold
$250,000 of convertible debentures (the "Debentures"). The Securities Purchase
Agreement contemplates the sale of up to an additional $250,000 of Debentures.
The Debentures accrue interest at the rate of four percent per year. The
Debentures must be repaid two years following their issuance or, at the
Company's election, converted into shares of Common Stock. In addition, at any
time, the holders of the Debentures may elect to convert their debt into Common
Stock. If, at the time of conversion, the Common Stock is listed on the Nasdaq
Bulletin Board System, Nasdaq SmallCap Market, or American Stock Exchange, the
conversion price will be 120% of the closing bid price. If, at the time of
conversion, the Common Stock is not listed on any of the foregoing markets, the
conversion price will be 80% of the closing bid price of the Common Stock as
furnished by the National Association of Securities Dealers, Inc. The Debentures
also provide the Company with certain redemption rights which, if exercised,
will require the Company to issue Common Stock warrants to the Debenture
holders. Holders of the Debentures have certain registration rights with respect
to the resale of shares of Common Stock received upon any conversion of the
Debentures.

EMPLOYEES

We currently employ seven people. Mr. Arne Dunhem is our President, Chief
Executive Officer and Chairman. We anticipate that we will need additional
persons to fill administrative, sales and technical positions if we are
successful in raising the capital to implement our business plan.

NEW ACCOUNTING PRONOUNCEMENTS

We have adopted FASB Statement 128. It is not expected that we will be impacted
by other recently issued standards. FASB Statement 128 presents new standards
for computing and presenting earnings per share (EPS). The Statement is
effective for financial statements for both interim and annual periods ending
after December 15, 1997.

FASB Statement 131 presents news standards for disclosures about segment
reporting. We do not believe that this accounting standard applies to us as all
of our operations are integrated for financial reporting and decision-making
purposes.

INFLATION

The Company's results of operations have not been affected by inflation and
management does not expect inflation to have a significant effect on its
operations in the future.

RECENT EVENTS

On July 18, 2002, the Company issued a total of 160,000 shares of its common
stock for the forgiveness of $39,000 of advances from an officer of the Company.
The Company believes the issuance of the stock to be exempt from registration
under Section 4(2) of the Securities Act.

On July 18, 2002, the Company issued a total of 645,000 shares of its common
stock for consulting services to be performed. The Company believes the issuance
of the stock to be exempt from registration under Section 4(2) of the Securities
Act.

On August 6, 2002, the Company announced that it has signed a Memorandum of
Understanding (MOU) with the RF Microelectronics Laboratory (RFME Lab) at the
Information and Communications University in South Korea to cooperate in
research, particularly in RF-CMOS ASICs development for RF transceiver of the 3G
W-CDMA standard. Under the MOU, engineering teams from NeoReach and RFME Lab
will devote joint research and design expertise, staffing, facilities resources,
project management, and testing for the development of an RF CMOS -- a radio
frequency ASIC chipset. This specific chipset, which will support the W-CDMA
standard, is also a required component in the consumer handsets and base
stations managed by the mobile operators to support 3G wireless services. This
co-development initiative has the potential to expand the NeoReach product suite
beyond the Company's modem solutions currently in development and testing

ITEM 3. CONTROLS AND PROCEDURES

As of September 30, 2002, an evaluation was performed under the supervision
and with the participation of the Company's management, including the Chief
Executive Officer and the Chief Financial Officer, of the effectiveness of the
design and operation of the Company's disclosure controls and procedures. Based
on that evaluation, the Company's management, including the Chief Executive
Officer and the Chief Financial Officer, concluded that the Company's disclosure
controls and procedures were effective as of September 30, 2002. There have been
no significant changes in the Company's internal controls or in other factors
that could significantly affect internal controls subsequent to September 30,
2002.

PART II OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None

ITEM 2. CHANGES IN SECURITIES

On April 23, 2002, the Company issued 12,352,129 shares of its common stock to
the holders of NeoReach's common stock pursuant to an Agreement and Plan of
Merger, dated March 21, 2002. A newly formed, wholly-owned subsidiary of
Mobilepro merged into NeoReach, in a tax-free one-for-one share exchange
transaction. The merger was consummated on April 23, 2002. As a result of the
merger, NeoReach is now a wholly-owned subsidiary of Mobilepro. The issuance of
the shares were valued at a fair value of $ 6,546,628, based on the last trading
price of $0.53 and assuming there was actual active trading of our stock at that
time. The Company believes the issuance of the stock to be exempt from
registration under Section 4(2) of the Securities Act.

On May 31, 2002, the Company issued a total of 690,000 shares of its common
stock to the following parties: 450,000 shares to INFe, Inc., 150,000 shares to
Thomas Richfield, 60,000 shares to Francene Goodman, and 30,000 shares to Triple
Crown Consulting. These shares were issued for consulting services regarding the
Mobilepro-NeoReach merger. The issuance of the shares were valued at $ 317,400,
the fair value of our stock at that time. We believe the value of the services
provided were commensurate with the value of the stock issued. The Company
believes the issuance of the stock to be exempt from registration under Section
4(2) of the Securities Act.

On June 10, 2002, the Company issued a total of 784,314 shares of its common
stock to the following parties: 764,706 to Cornell Capital Partners and 19,708
to West Rock Advisors, Inc. These shares were issued pursuant to an equity line
of credit arrangement with Cornell Capital Partners, dated May 31, 2002. The
issuance of the shares were valued at $517,647, the fair value of our stock at
that time. The Company believes the issuance of the stock to be exempt from
registration under Section 4(2) of the Securities Act.

In addition, on May 31, 2002, the Company entered into a Securities Purchase
Agreement with certain investors pursuant to which the Company issued and sold
$250,000 of convertible debentures (the "Debentures"). The Debentures accrue
interest at the rate of four percent per year. The Debentures must be repaid two
years following their issuance or, at the Company's election, converted into
shares of Common Stock. In addition, at any time, the holders of the Debentures
may elect to convert their debt into Common Stock. If, at the time of
conversion, the Common Stock is listed on the Nasdaq Bulletin Board System,
Nasdaq SmallCap Market, or American Stock Exchange, the conversion price will be
120% of the closing bid price or an amount equal to eighty percent of the
average of the four lowest closing bid prices of the common stock for the five
trading days immediately preceding the conversion date. If, at the time of
conversion, the Common Stock is not listed on any of the foregoing markets, the
conversion price will be 80% of the closing bid price of the Common Stock as
furnished by the National Association of Securities Dealers, Inc. The Debentures
also provide the Company with certain redemption rights which, if exercised,
will require the Company to issue Common Stock warrants to the Debenture
holders. Holders of the Debentures have certain registration rights with respect
to the resale of shares of Common Stock received upon any conversion of the
Debentures. As of August 15, 2002, the Debentures can be converted into
1,041,667 shares of the Company's common stock.

the stock issued. We believe the issuance of the stock to be exempt from
registration under Section 4(2) of the Securities Act.

On September 9, 2002, we issued a total of 709,853 of our common stock to
various parties. 100,000 shares were issued to Hee Han Bang, a non-affiliated
and accredited/sophisticated investor in a private sale for an aggregate cash
consideration of $25,000. These shares were issued at $0.25 per share based on a
Board Resolution fixing the value of the securities on and as of August 09,
2002. 150,000 shares of our common stock were issued to Daniel Lozinsky, a
director of the Corporation, in a private sale for an aggregate cash
consideration of $15,000. These shares were issued based on a Board Resolution
as of August 20, 2002. We issued a total of 209,853 shares of our common stock
to shares to INFe, Inc. based on a Board Resolution as of August 19, 2002. These
shares were issued for consulting services in connection with the Mobilepro
NeoReach merger and a Reverse Merger Engagement Agreement dated January 11, 2002
between NeoReach, Inc. and INFe, Inc. The issuance of the shares was valued at
$62,956, the fair value of our stock at that time. We also granted a total of
250,000 shares of our restricted common stock to Parag Sheth, an executive of
the Corporation. Parag Sheth was granted 150,000 shares of our restricted common
stock for forgiving a total of $15,000.00 in salary corresponding to a price of
$0.10 per share and he was also granted 100,000 shares of our restricted common
stock as an inducement for providing services for the Corporation. These shares
were issued based on a Board Resolution as of August 20, 2002 and the issuance
of the shares was valued at $25,000. We believe the value of the services
provided were commensurate with the value of the stock issued. We believe the
issuance of the stock to be exempt from registration under Section 4(2) of the
Securities Act.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

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

None

ITEM 5. OTHER INFORMATION
None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

a) Exhibits

2.1 Articles of Merger of CraftClick.com, Inc. (a Utah corporation)
and CraftClick.com, Inc. (a Delaware corporation) (incorporated by
reference to the Company's Form S-8 Registration Statement as
filed with the Securities and Exchange Commission on May 11, 2001
(File No. 333-60726))

2.2 Plan of Merger of CraftClick.com, Inc. (a Utah corporation) with
and into CraftClick.com, Inc. (a Delaware corporation)
(incorporated by reference to the Company's Form S-8 Registration
Statement as filed with the Securities and Exchange Commission on
May 11, 2001 (File No. 333-60726))

2.3 Agreement and Plan of Merger dated as of June 1, 2001, between
CraftClick.Com, Inc. a Delaware corporation, and Mobilepro Corp.,
a Delaware corporation, (incorporated by reference to the
Company's Form 8-K Current Report as filed with the Securities and
Exchange Commission on June 20, 2001 (File No. 002-97869-D))

2.4 Agreement and Plan of Merger dated March 21, 2002, consummated
April 23, 2002, between NeoReach, Inc., a Delaware company and
Mobilepro. (incorporated by reference to the Company's Form 8-K
Current Report as filed with the Securities and Exchange
Commission on April 5, 2002 (File No. 002-97869-D)

3.1 Certificate of Incorporation of CraftClick.com, Inc. (a Delaware
corporation) (incorporated by reference to the Company's Form S-8
Registration Statement as filed with the Securities and Exchange
Commission on May 11, 2001 (File No. 333-60726))

3.2 By-Laws of CraftClick.com, Inc. (a Delaware corporation)
(incorporated by reference to the Company's Form S-8 Registration
Statement as filed with the Securities and Exchange Commission on
May 11, 2001 (File No. 333-60726))

3.3 Certificate of Amendment of Certificate of Incorporation of
Mobilepro Corp. (a Delaware corporation) (incorporated by
reference to the Company's Form S-8 Registration Statement as
filed with the Securities and Exchange Commission on December 4,
2001 (File No. 333-74492))

4.1 2001 Performance Equity Plan (incorporated by reference to the
Company's Form S-8 Registration Statement as filed with the
Securities and Exchange Commission on May 11, 2001 (File No.
333-60726))

4.2 2001 Equity Performance Plan (incorporated by reference to the
Company's Form S-8 Registration Statement as filed with the
Securities and Exchange Commission on December 4, 2001 (File No.
333-74492))

10.1 Stock Purchase Agreement dated February 19, 2002 with Mr. Daniel
Lozinsky and Dungavel, Inc., and another Stock Purchase Agreement
dated February 19, 2002 with Mr. Daniel Lozinsky, Ms. Joann Smith
and Mr. Scott Smith. (incorporated by reference to the Company's
Form 8-K Current Report as filed with the Securities and Exchange
Commission on March 6, 2002 (File No. 002-97869-D))

10.2 Memorandum of Understanding between Neoreach, Inc., and RF
Microelectronics Laboratory dated July 31, 2002 for opportunities
to cooperate in research, particularly in RF-CMOS ASICs
development for RF transceiver of 3G W-CDMA standard. The ASICs
will be fabricated in CMOS processes. (incorporated by reference
to the Company's Form 10QSB/A Quarterly Report as filed with the
Securities and Exchange Commission on October 4, 2002 (File No.
002-97869-D))

99.1 Certification by Arne Dunhem, Chief Executive Officer and Chief
Financial Officer 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 a Current Report on Form 8-K dated April 5, 2002 with the
Securities and Exchange Commission on March 21, 2002, consummated April 23,
2002. On March 21, 2002, NeoReach, Inc., a Delaware company and Mobilepro
entered into an Agreement and Plan of Merger pursuant to which a newly formed,
wholly-owned subsidiary of Mobilepro would merge into NeoReach, in a tax-free
transaction. The merger was effective on April 23, 2002. As a result of the
merger, NeoReach is now a wholly-owned subsidiary of Mobilepro. Prior to the
merger, Mr. Daniel Lozinsky who was a controlling stockholder of Mobilepro also
owned approximately 32.5% of NeoReach.

The Company filed a Current Report on Form 8-K dated May 10, 2002 with the
Securities and Exchange Commission on June 20, 2002. Effective June 6, 2002, the
Board of Directors of Mobilepro Corp. (the "Company") dismissed its independent
auditors, Mantyla, McReynolds LLC ("Mantyla"), and engaged the services of
Bagell, Josephs & Company, L.L.C. ("Bagell"), as its new independent auditors.
Bagell will audit the Company's financial statements for the fiscal year ended
March 31, 2002.

Also included in the Current Report dated May 10, 2002, on May 13, 2002, the
Company announced in a press release that Mr. Daniel Lozinsky had resigned as
the President, Chief Executive Officer and Chairman of the Board of the Company
and that Mr. Arne Dunhem had been appointed to serve as the President, Chief
Executive Officer and Chairman of the Board of the Company, effective as of May
10, 2002. Mr. Lozinsky was also appointed to serve as a Senior Vice President of
the Company, effective as of May 10, 2002.

The Company filed an amended Current Report on Form 8-K/A dated May 10, 2002
with the Securities and Exchange Commission on June 25, 2002.

Subsequent to the period of this report, the Company filed two amended Current
Reports of Form 8-K, dated June 6, 2001 and March 21, 2002 with the Securities
and Exchange Commission on July 5, 2002.

SIGNATURES

In accordance with the requirements of the Exchange Act, the Company caused this
Quarterly Report to be signed on its behalf by the undersigned, thereunto duly
authorized.

MobilePro Corp.

By /s/ Arne Dunhem
------------------------------
Arne Dunhem,
President and Chief Executive Officer
(Principal executive and financial officer)

Date November 20, 2002

CERTIFICATION

I, Arne Dunhem, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of Mobilepro Corp.;

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

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

4. I am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and have:

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and

c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;

5. I have disclosed, based on our most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of directors (or persons
performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and

6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

November 20, 2002

/s/ Arne Dunhem
Arne Dunhem
Chief Executive Officer
Chief Financial Officer