UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q/A

(Amendment No. 1)

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended September 30, 2012

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the transition period from ____________ to ____________

Commission File Number 000-52988

NUVEL HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Florida	27-1230588
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

315 University Avenue, Los Gatos, California 95030

 (Address of principal executive offices)

(408) 899-5981

(Registrant's telephone number)

Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x  No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ¨  No x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer   ¨	Accelerated filer                    ¨
Non-accelerated filer     ¨ Do not check if a smaller reporting company	Smaller reporting company  x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨  No x

As of December 7, 2012 the registrant had 11,838,040 shares of common stock, par value $.001 per share, issued and outstanding.

TABLE OF CONTENTS

		Page
PART I  FINANCIAL INFORMATION
Item 1.	Financial Statements.	F - 1
	Condensed Consolidated Balance Sheets As of September 30, 2012 (Unaudited) and December 31, 2011	F - 1
	Unaudited Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2012 and 2011, and for the Period from January 20, 2010 (inception) to September 30, 2012	F - 2
	Unaudited Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2012 and 2011, and for the Period from January 20, 2010 (inception) to September 30, 2012	F - 3
	Notes to the Unaudited Condensed Consolidated Financial Statements	F - 4 to F - 15
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	8
Item 4.	Controls and Procedures	8
PART II  OTHER INFORMATION
Item 1.	Legal Proceedings	10
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	10
Item 3.	Defaults Upon Senior Securities	10
Item 4.	Mine Safety Disclosures	10
Item 5.	Other Information	10
Item 6.	Exhibits	11
Signatures
Exhibits/Certifications

- 2 -

PART 1.  FINANCIAL INFORMATION

Item 1.   FINANCIAL STATEMENTS.

NUVEL HOLDINGS, INC. AND SUBSIDIARY
(A COMPANY IN THE DEVELOPMENT STAGE)
CONDENSED CONSOLIDATED BALANCE SHEETS
Assets	September 30,			December 31,
	2012			2011
Current assets:	(unaudited)
Cash	$	-		$	34,792
Prepaid expenses		1,000			2,900
Deferred financing costs, net		-			36,666
Total current assets		1,000			74,358
Capitalized software costs		68,560			-
Total assets	$	69,560		$	74,358
Liabilities and Stockholders’ Deficiency
Current liabilities:
Accounts payable	$	490,525		$	246,545
Advances from related party		124,200			-
Cash overdraft		8,010			-
Accrued interest		615,135			306,060
Accrued payroll and related expenses		632,665			375,333
Other accrued expenses		-			25,000
Notes payable, net of debt discount of $0 and $80,500 as of
September 30, 2012 and December 31, 2011, respectively (see notes 2 & 5)		1,015,000			484,500
Convertible notes payable, net of debt discount of $0 and $1,316,849 as of
September 30, 2012 and December 31, 2011, respectively (sees note 2 & 4)		2,820,000			1,383,151
Warrant liabilities		1,206,049			2,331,149
Total current liabilities		6,911,584			5,151,738
Commitments and Contingencies
Stockholders' deficiency:
Preferred stock, $0.001 par value; authorized, 15,000,000 shares; 550,000 and
outstanding in the following class:
Series A Preferred Stock, $0.70 stated value, 7,150,000 shares authorized; 550,000
shares issued and outstanding (aggregate liquidation preferences $385,000 and		550			-
$0 as of September 30, 2012 and December 31, 2011, respectively)
Common stock, $0.001 par value; authorized, 100,000,000 shares;
issued and outstanding, 11,838,040 and 11,764,706 shares as of September 30, 2012 and December 31, 2011		11,838			11,765
Common stock issuable		75,490			-
Additional paid in capital		2,327,492			1,881,115
Deficit accumulated during the development stage		(9,257,394	)		(6,970,260	)
Total stockholders' deficiency		(6,842,024	)		(5,077,380	)
Total liabilities and stockholders' deficiency	$	69,560		$	74,358
The accompanying notes are an integral part of these condensed consolidated financial statements.

F - 1

NUVEL HOLDINGS, INC. AND SUBSIDIARY
(A COMPANY IN THE DEVELOPMENT STAGE)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
	Three Months Ended September 30, 2012			Three Months Ended September 30, 2011			Nine Months Ended September 30, 2012			Nine Months Ended September 30, 2011			Period from January 20, 2010 (Inception) to September 30, 2012
Revenue	$	-		$	-		$	-		$	-		$	-
Operating expenses:
Marketing and promotion		32,425			24,690			63,432			42,263			169,507
Payroll and benefits		310,882			327,663			903,198			734,691			2,832,675
Merger costs		-			-			-			-			2,614,780
General and administrative		108,564			92,348			414,234			222,482			911,603
Research and development		67,521			73,923			209,790			232,411			744,153
		519,392			518,624			1,590,654			1,231,847			7,272,718
Total operating expenses
Operating loss		(519,392	)		(518,624	)		(1,590,654	)		(1,231,847	)		(7,272,718	)
Other income (expense)
Change in fair value of warrant liabilities		527,022			(239,400	)		1,213,700			(224,525	)		1,010,800
Amortization of debt discount		(119,370	)		(73,587	)		(1,561,439	)		(112,608	)		(1,960,338	)
Amortization of deferred financing costs		-			(69,916	)		(39,666	)		(194,083	)		(420,000	)
Interest expense		(108,547	)		(141,036	)		(309,075	)		(300,264	)		(615,138	)
Total other income (expense)		299,105			(523,939	)		(696,480	)		(831,480	)		(1,984,676	)
Net loss		(220,287	)		(1,042,563	)		(2,287,134	)		(2,063,327	)		(9,257,394	)
Preferred stock contractual dividends		13,493			-			13,493			-			13,493
Net loss available to common stock holders	$	(233,780	)	$	(1,042,563	)	$	(2,300,627	)	$	(2,063,327	)	$	(9,270,887	)
Net loss per common share: basic and diluted	$	(0.02	)	$	(0.10	)	$	(0.19	)	$	(0.21	)
Weighted average number of common shares
outstanding: basic and diluted		11,811,735			10,000,000			11,780,497			10,000,000
The accompanying notes are an integral part of these condensed consolidated financial statements.

F - 2

NUVEL HOLDINGS, INC. AND SUBSIDIARY
(A COMPANY IN THE DEVELOPMENT STAGE)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
	Nine Months Ended September 30, 2012			Nine Months Ended September 30, 2011			Period from January 20, 2010 (Inception) to September 30, 2012
Cash flows from operating activities:
Net loss	$	(2,287,134	)	$	(2,063,327	)	$	(9,257,394	)
Adjustments to reconcile net loss to net cash
used in operating activities:
Amortization of debt discount		1,561,439			112,608			1,960,338
Amortization of deferred financing costs		39,666			194,083			420,000
Stock-based compensation		62,000			-			62,000
Change in fair value of warrant liabilities		(1,213,700	)		224,525			(1,010,800	)
Non-cash merger costs		-			-			2,224,780
Changes in operating assets and liabilities:
Accounts payable		243,980			97,556			490,526
Accrued interest		309,075			300,264			615,135
Accrued payroll and related expenses		257,332			70,088			632,665
Other accrued expenses		(25,000	)		-			-
Prepaid expenses		1,900			-			(1,000	)
Net cash used in operating activities		(1,050,442	)		(1,064,203	)		(3,863,750	)
Cash flows from investing activities:
Capitalized Software		(68,560	)		-			(68,560	)
Net cash used in investing activities		(68,560	)		-			(68,560	)
Cash flows from financing activities:
Proceeds from notes payable		450,000			105,000			1,320,000
Repayment of notes payable		-			(105,000	)		(305,000	)
Proceeds from convertible notes payable		120,000			1,475,000			2,820,000
Proceeds from issuance of preferred stock		385,000			-			385,000
Cash overdraft		8,010			-			8,010
Fees paid to third parties in connection with
convertible notes payable		(3,000	)		(217,000	)		(420,000	)
Advance from a related party		124,200			-			124,200
Proceeds from initial capital contribution		-			-			100
Net cash provided by financing activities		1,084,210			1,258,000			3,932,310
Net (decrease) increase in cash		(34,792	)		193,797			-
Cash, beginning of the period		34,792			10,083			-
Cash, end of the period	$	-		$	203,880		$	-
Non-Cash Investing and Financing Activities:
Value of warrants recorded as debt discount in
connection with convertible notes payable	$	56,400		$	270,725		$	1,852,649
Value of warrants recorded as debt discount in
connection with notes payable	$	32,200			-		$	112,700
Reclassification of warrant liability upon
surrender of warrants	$	-		$	102,000		$	588,000
Value of common stock recorded as debt
discount in connection with issuance of
notes payble	$	75,490		$	-		$	75,490
Issuance of founders’ shares	$	-		$	-		$	10,000
The accompanying notes are an integral part of these condensed consolidated financial statements.

F - 3

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1.  Business Organization, Nature of Operations and Basis of Presentation

Nuvel Holdings, Inc. is a Florida corporation incorporated on October 19, 2009.  Nuvel Holdings, Inc. was previously known as Harmony Metals, Inc. prior to its name change effective on April 10, 2012.  On March 20, 2012, Harmony Metals, Inc. acquired the outstanding shares of HRMY Sub, Inc., a newly formed Florida corporation.  On April 10, 2012, Harmony Metals, Inc. merged HRMY Sub, Inc. into itself solely to effect a name change and changed its name to Nuvel Holdings, Inc. (the "Company").

On December 30, 2011, the Company, certain stockholders of the Company (the “Company Stockholders”), Nuvel, Inc., a Delaware Company, (“Nuvel DE”) and all of the stockholders of Nuvel DE (the “Nuvel DE Stockholders”) entered into and consummated transactions pursuant to a Share Exchange Agreement. Following the close of the Share Exchange Agreement, Harmony succeeded to the business of Nuvel DE as its sole line of business. As a result of the Share Exchange Transaction, Nuvel DE became a wholly owned subsidiary of the Company, and the officers of Nuvel DE became officers of the Company.  The transaction was accounted for as a reverse recapitalization, whereby Nuvel DE is deemed to be the acquirer for accounting purposes.  The financial statements set forth in this report for all periods prior to the reverse recapitalization are the historical financial statements of Nuvel DE, and have been retroactively restated to give effect to the Share Exchange Transaction.

The Company previously conducted its operations through a sole operating subsidiary, Harmony Metals Design, Inc., a Florida corporation, which was incorporated on June 17, 2010. On February 1, 2012, the Company assigned to Sahej Holdings, Inc. all of the outstanding shares of Harmony Metals Design, Inc. that it owned pursuant to an Assignment and Assumption Agreement. Harmony Metals Design, Inc. therefore ceased to be a wholly owned subsidiary of the Company.

The Company designs, develops and markets Wide Area Network Acceleration (WANa) Solutions that are built for the purpose of accelerating and optimizing the flow of information over the Internet. The Company’s products are deployed by its customers throughout their network infrastructures to improve the performance of their networks and reduce network costs, while enhancing network security. The Company also develops mobile applications on innovative platforms of smart phones and tablet devices.

The Company has been presented as a "development stage enterprise.” The Company’s primary activities since inception, have been the design and development of its products, negotiating strategic alliances and other agreements, and raising capital.  The Company had not commenced its principal operations, nor had it generated any revenues from its operations through September 30, 2012.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and disclosures required by GAAP for annual financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the condensed consolidated financial statements of the Company as of September 30, 2012, for the three and nine months ended September 30, 2012 and 2011 and for the period from January 20, 2010 (inception) to September 30, 2012. The results of operations for the three and nine months ended September 30, 2012 are not necessarily indicative of the operating results for the full year ending December 31, 2012. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related disclosures of the Company as of December 31, 2011 and for the year then ended, which were filed with the Securities and Exchange Commission on Form 10-K on April 13, 2012.

F - 4

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 2.  Going Concern and Management Plans

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  As of September 30, 2012, the Company had a cash overdraft of $8,010, working capital deficiency of $6,910,584 and stockholders’ deficiency of $6,842,024.  The Company has not generated any revenues and incurred net losses since inception.  These matters raise substantial doubt about the Company’s ability to continue as a going concern.  The unaudited condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset amounts or the classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

The Company's primary source of operating funds since inception has been note financings and equity issuances.  Subsequent to September 30, 2012 and through the date of this report, the Company secured additional financing aggregating $550,000 (See Note 9).  As of the date of this report, management estimates that the Company’s availability of funds will fund its operations only through December 31, 2012.

In November 2012, the Company obtained extensions from certain notes payable and convertible notes payable holders to extend the maturity date of their notes as the notes were in default as of September 30, 2012.  The holders of notes payable in the aggregate amounts of $70,000 and $895,000 extended the due date of their notes to December 31, 2012 and March 31, 2013, respectively.  In connection with the extension, the Company will issue warrants to purchase 56,500 shares of common stock at $0.70 per share.  The holders of convertible notes payable in the aggregate amounts of $728,000 and $1,142,000 extended the due date of their notes to December 31, 2012 and March 31, 2013, respectively.  In connection with the extension, the Company will issue warrants to purchase 187,000 shares of common stock at $0.70 per share. In connection with the extensions of the notes payable and convertible notes payable, the holders of the respective notes agreed to waive all prior events of default (as defined in the respective agreements).  In addition, certain convertible notes payable holders converted their convertible notes aggregating $900,000 to 450,000 shares of common stock.  The Company currently has a convertible note payable aggregating $50,000 that is past maturity and in default.  As a result of this default, the convertible note and interest is due and payable on demand and the interest has been retroactively adjusted to 22% from the issuance date.

The Company is currently a development stage enterprise and needs to raise additional capital in order to be able to accomplish its business plan objectives.  The Company is continuing its efforts to secure additional funds through debt and/or equity instruments due to the impending lack of funds.  Management believes that it will be successful in obtaining additional financing based on its history of raising funds; however, no assurance can be provided that the Company will be able to do so. There is no assurance that any funds it raises will be sufficient to enable the Company to attain profitable operations or continue as a going concern. To the extent that the Company is unsuccessful, the Company may need to curtail or cease its operations and implement a plan to extend payables or reduce overhead until sufficient additional capital is raised to support further operations.  There can be no assurance that such a plan will be successful.

F - 5

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3.  Summary of Significant Accounting Policies

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Nuvel, Inc. All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of condensed consolidated 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 disclosure of contingent liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the periods. Actual results could differ from these estimates. The Company’s significant estimates and assumptions include amortization, the fair value of the Company’s stock, debt discounts, warrant liabilities, and the valuation allowance relating to the Company’s deferred tax assets.

Reclassifications

Certain amounts in the prior period condensed consolidated financial statements have been reclassified for comparison purposes to conform to the presentation of the current period condensed consolidated financial statements.  These reclassifications had no effect on the previously reported net loss.

Capitalized Software Costs

Software development costs incurred subsequent to establishing technological feasibility through general release of the software products are capitalized in accordance with Accounting Standards Codification ("ASC") 985 "Software".  Capitalized costs are amortized on a straight-line basis over the economic lives of the related products which is generally three years.  As of September 30, 2012, the Company's Wide Area Network ("WAN") product did not reach technological feasibility and, therefore, no costs associated with its development were capitalized.  The mobile application product reached technological feasibility in October 2011.  The Company has recorded capitalized software costs aggregating $68,560 for the nine months ending September 30, 2012.

F - 6

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3.  Summary of Significant Accounting Policies (continued)

Net Loss Per Share

The Company computes basic net loss per share by dividing net loss per share available to common stockholders by the weighted average number of common shares outstanding for the period and excludes the effects of any potentially dilutive securities. Diluted earnings per share, if presented, would include the dilution that would occur upon the exercise or conversion of all potentially dilutive securities into common stock using the “treasury stock” and/or “if converted” methods as applicable. The computation of basic and diluted loss per share for the three and nine months ended September 30, 2012 and 2011, excludes potentially dilutive securities because their inclusion would be anti-dilutive.  Anti-dilutive securities excluded from the computation of basic and diluted net loss per share are as follows:

	September 30,
	2012		2011
Warrants to purchase common stock		5,532,716		850,000
Series A Convertible Preferred Stock		550,000		-
Totals		6,082,716		850,000

Preferred Stock

The Company applies the guidance enumerated in ASC 480 “Distinguishing Liabilities from Equity” when determining the classification and measurement of preferred stock. Preferred shares subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value. The Company classifies conditionally redeemable preferred shares, which includes preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control, as temporary equity. At all other times, the Company classifies its preferred shares in stockholders’ equity.  Accordingly, as of September 30, 2012, since the Company's preferred shares do not feature any redemption within the holders' control or conditional redemption features not within the Company's control, all issuances of preferred stock are presented as a component of consolidated stockholders’ deficiency.

Convertible Instruments

The Company evaluates and accounts for conversion options embedded in convertible instruments in accordance with ASC 815 “Derivatives and Hedging Activities”.  Applicable Generally Accepted Accounting Principles (“GAAP”) requires companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments according to certain criteria. The criteria includes circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be conventional as that term is described under applicable GAAP.

F - 7

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3.  Summary of Significant Accounting Policies (continued)

Stock-Based Compensation

The Company accounts for equity instruments issued to non-employees at their fair value on the measurement date. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instrument vests or becomes non-forfeitable. Non-employee stock-based compensation charges are amortized over the vesting period or as earned.

Fair Value of Financial Instruments

The Company measures the fair value of financial assets and liabilities based on the guidance of ASC 820, “Fair Value Measurements and Disclosures,” which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.

ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

The carrying amounts of cash, accounts payable, accrued expenses, and notes payable approximate fair value due to the short-term nature of these instruments. The carrying amounts of the Company’s short term credit obligations approximate fair value because the effective yields on these obligations, which include contractual interest rates taken together with other features such as concurrent issuance of warrants and/or embedded conversion options, are comparable to rates of returns for instruments of similar credit risk.

Financial liabilities as of September 30, 2012 and measured at fair value on a recurring basis are summarized below:

	September 30, 2012		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Warrant liabilities	$	1,206,049	$	-	$	-	$	1,206,049

F - 8

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3.  Summary of Significant Accounting Policies (continued)

Level 3 liabilities are valued using unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the warrant liabilities. For fair value measurements categorized within Level 3 of the fair value hierarchy, the Company’s Chief Financial Officer, who reports to the Chief Executive Officer, determine its valuation policies and procedures.  The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company’s Chief Financial Officer and are approved by the Chief Executive Officer. 

Level 3 Valuation Techniques

Level 3 financial liabilities consist of the warrant liabilities for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation.  Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate.

The warrant liabilities are measured at fair value using a compound option model that includes characteristics of both a binomial lattice and Black-Scholes formula and are classified within Level 3 of the valuation hierarchy.

A significant decrease in the volatility or a significant increase in the Company’s stock price, in isolation, would result in a significantly lower fair value measurement. Changes in the values of the derivative liabilities are recorded in Change in Fair Value of Derivative Liabilities within Other Expense on the Company’s Condensed Consolidated Statements of Operations.

As of September 30, 2012, there were no transfers in or out of Level 3 from other levels in the fair value hierarchy.

The significant assumptions and valuation methods that the Company used to determine the fair value of the warrant liabilities at September 30, 2012 are as follows:

Dividend Yield		0	%
Volatility		80.0	%
Risk-free interest rate		0.17	%
Expected lives	1.33 years
Weighted average fair value per warrant	$	0.23

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial liabilities that are measured at fair value on a recurring basis:

	Three Months Ended September 30, 2012			Nine Months Ended September 30, 2012
Balance-beginning of period	$	1,733,071		$	2,331,149
Aggregate fair value of warrant liabilities issued		-			94,100
Reclassification to equity upon reclassification of warrants			-		(5,500	)
Change in fair value of warrant liabilities		(527,022	)		(1,213,700	)
Balance-end of period	$	1,206,049		$	1,206,049

F - 9

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3.  Summary of Significant Accounting Policies (continued)

The significant assumptions and valuation methods that the Company used to determine the grant date fair value of the warrant liabilities are discussed in Notes 4 and 5.

Recent Accounting Pronouncements

In May 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2011-04, Fair Value Measurement (Topic 820). This updated accounting guidance establishes common requirements for measuring fair value and for disclosing information about fair value measurements in accordance with U.S. generally accepted accounting principles (GAAP) and International Financial Reporting Standards (IFRS). This guidance includes amendments that clarify the intent about the application of existing fair value measurements and disclosures, while other amendments change a principle or requirement for fair value measurements or disclosures. This ASU is effective for interim and annual periods beginning after December 15, 2011.  The adoption of this standard did not have a material impact on the Company’s condensed consolidated financial position and results of operations.

Subsequent Events

Management has evaluated subsequent events or transactions occurring through the date on which the condensed consolidated financial statements were issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements, except as disclosed in Note 9.

Note 4.  Secured Convertible Promissory Notes

On December 30, 2011, the Company entered into an agreement amending certain convertible notes (the “Third Amendment”) totaling $2,700,000.  Under the Third Amendment, the maturity date of the notes were extended until the later of (i) two (2) months from the Maturity Date of each individual Investor’s Note (after giving effect to any extension options exercised by the Company) and (ii) February 28, 2012 to grant the Company additional time necessary to complete the Qualified Financing. A Qualified Financing is defined as the sale for cash by the Company or any company with which it completes a reverse merger or any business combination of debt or equity securities generating aggregate gross proceeds of at least $1,500,000. In connection with the Third Amendment, the investors received an aggregate of 2,862,716 warrants to purchase the Company’s common stock exercisable at $0.54 per share (the “Third Amendment Warrants”).  The Company determined that the Third Amendment Warrants did not contain fixed settlement provisions because the exercise price can be adjusted based on new issuances. As such, the Company was required to record the Third Amendment Warrants as liabilities and mark to market all such derivatives to fair value each reporting period.  

During the nine months ended September 30, 2012, the Company issued convertible notes payable under the terms of the Third Amendment aggregating $120,000. The notes bear interest at the rate of 12% per annum.  Through September 30, 2012, the Company evaluated the conversion option in these instruments and determined that the instruments are contingently convertible since the Third Amendment notes could not be converted to equity, as a Qualified Financing (as defined above) did not occur.

F - 10

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 4.  Secured Convertible Promissory Notes (continued)

In connection with the Third Amendment convertible notes payable issued during the nine months ended September 30, 2012, the Company issued these note holders an aggregate of 120,000 warrants to purchase common stock with an exercise price of $0.54.  These Third Amendment warrants expire on the earlier of seven years from the grant date or the closing of a sale or merger transaction (as defined).   The aggregate grant date fair value of $56,400 was applied to the principal amount of the convertible notes payable to determine the debt discount.  Accordingly, the Company allocated $56,400 of the offering proceeds to the fair value of the warrants on their respective dates of issuance and recorded them as liabilities in the accompanying condensed consolidated balance sheet.  Such debt discount was amortized through May 2012, when the notes matured.  

During the three and nine months ended September 30, 2012, the Company recognized $43,880 and $1,373,249 in amortization of the deferred debt discount relating these Third Amendment convertible notes payable.

The fair value of the warrants was calculated on the issuance date using a compound option model that includes characteristics of both a binomial lattice and the Black-Scholes formula valued with the following weighted average assumptions:

Dividend Yield			0	%
Volatility			80.00	%
Risk-free interest rate			0.22	%
Expected lives	2 years
Weighted average fair value per warrant		$	0.47
Warrants issued			120,000
Aggregate grant date fair value		$	56,400

During the three and nine months ended September 30, 2012, the Company marked the Third Amendment warrants to fair value and recorded a gain of $298,272 and $687,225, respectively, relating to the change in fair value of warrant liabilities issued in connection with the Third Amendment convertible notes.

The Company currently has a convertible note payable aggregating $50,000 that is past maturity and in default.  As a result of this default, the convertible note and interest is due and payable on demand and the interest has been retroactively adjusted to 22% from the issuance date.

Note 5.  Notes Payable

During the third quarter of 2012, the Company issued certain notes payable aggregating $350,000.  These notes bear interest at the rate of 12% per annum and matured 30 days from the issuance date (See Note 9).  In connection with these notes, the Company granted the note holders an aggregate 175,000 shares of common stock with a grant date fair value of $96,250.  The aggregate grant date fair value of the common stock was applied to the principal amount of these notes payable to determine the debt discount.  Accordingly, the Company allocated $75,490 of the offering proceeds to the relative fair value of the common stock on their respective grant dates and recorded them as Common Stock Issuable in the accompanying condensed consolidated balance sheet, as the shares were not issued as of September 30, 2012 due to the delays in issuing the stock certificates.  During the three and nine months ended September 30, 2012, the Company recognized $75,490 in amortization of the deferred debt discount relating to these notes payable.

During the first quarter of 2012, the Company issued certain notes payable aggregating $100,000. The notes bear interest at the rate of 12% per annum and matured on March 7, 2012 (See Note 9).  In connection with these notes payable, the Company issued the note holders an aggregate of 70,000 warrants to purchase common stock with an exercise price of $0.54.  These warrants expire on the earlier of seven years from the grant date or the closing of a sale or merger transaction (as defined).   The aggregate grant date fair value of $32,200 was applied to the principal amount of the notes payable to determine the debt discount.  Accordingly, the Company allocated $32,200 of the offering proceeds to the fair value of the warrants on their respective dates of issuance and recorded them as liabilities in the accompanying condensed consolidated balance sheet.  Such debt discount was being amortized through May 2012 when the notes matured.  During the three and nine months ended September 30, 2012, the Company recognized $0 and $112,700, respectively, in amortization of the deferred debt discount relating to these notes payable.

F - 11

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 5.  Notes Payable (continued)

The Company determined that the warrants did not contain fixed settlement provisions because the exercise price can be adjusted based on new issuances. As such, the Company was required to record the warrants as liabilities and mark to market all such derivatives to fair value each reporting period through September 30, 2012.  The fair value of the warrants on the issuance date was calculated using a compound option model that includes characteristics of both a binomial lattice and the Black-Scholes formula valued with the following weighted average assumptions:

Dividend Yield			0	%
Volatility			80.00	%
Risk-free interest rate			0.30	%
Expected lives	2 years
Weighted average fair value per warrant		$	0.46
Warrants issued			70,000
Aggregate grant date fair value		$	32,200

During the three and nine months ended September 30, 2012, the Company marked these warrants to fair value and recorded a gain of $228,750 and $526,475, respectively, relating to the change in fair value of warrants issued in connection with notes payable.

Note 6.  Commitments and Contingencies

Litigations, Claims and Assessments

In the normal course of business, the Company may be involved in legal proceedings, claims and assessments arising in the ordinary course of business. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. There are no such matters that are deemed material to the condensed consolidated financial statements as of September 30, 2012. 

As of September 30, 2012, the Company has not filed certain federal and state income and payroll tax returns.  Amounts due under these returns have been accrued as a component of accrued payroll and related expenses as of September 30, 2012.  The Company has estimated that any potential interest and penalties due related to these liabilities are inmaterial to the consolidated financial statements as of September 30, 2012.        

F - 12

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 7.  Stockholders’ Deficiency 

Common Stock

During the nine months ended September 30, 2012, the Company entered into an agreement with a consultant to provide social and digital media strategy services to the Company for a period of one year. Pursuant to the agreement, the Company agreed to issue the consultant 50,000 shares of common stock as compensation for services provided.  The Company determined that the estimated fair value of the common stock was more readily determinable than the fair value of the services rendered. Pursuant to the agreement, the shares were fully vested and non-forfeitable at the time of issuance.  Accordingly, during the three and nine months ended September 30, 2012, the Company recorded $35,000 of stock compensation expense related to this agreement, which was recorded as general and administrative expense in the accompanying condensed consolidated statement of operations.

During the nine months ended September 30, 2012, the Company entered into an agreement with a consultant to provide investment banking services to the Company for a period of nine months. Pursuant to the agreement, the Company agreed to pay the consultant a one-time non-fundable retainer of 10,000 shares of common stock.  The Company determined that the estimated fair value of the common stock was more readily determinable than the fair value of the services rendered. Pursuant to the agreement, the shares were fully vested and non-forfeitable at the time of issuance.  Accordingly, during the three and nine months ended September 30, 2012, the Company recorded $7,000 of stock compensation expense related to this agreement, which was recorded as general and administrative expense in the accompanying condensed consolidated statement of operations.

During the nine months ended September 30, 2012, the Company entered into an agreement with a consultant to provide product marketing services to the Company for a period of twelve months. Pursuant to the agreement, the Company agreed to pay the consultant a fee of $20,000 in shares of common stock at $1.50 per share.  Pursuant to the agreement, the shares were fully vested and non-forfeitable at the time of issuance.  Accordingly, during the three and nine months ended September 30, 2012, the Company issued 13,334 shares of common stock and recorded $20,000 of stock compensation expense related to this agreement, which was recorded as marketing and promotion expense in the accompanying condensed consolidated statement of operations.

Preferred Stock Subscription Agreement

The Company has designated 7,150,000 shares of its authorized preferred stock with par value of $.001 per share as Series A Preferred Stock (“Series A Preferred”).  The holders of the Series A Preferred shall be entitled to cumulative dividends at the rate of 8% of the Original Purchase Price per annum (as defined below).  In the event of any liquidation, dissolution or winding-up of the Company, the assets of the Company shall be distributed first to the holders of Series A Preferred an amount per share of Series A Preferred equal the sum of (i) two times the original purchase price and (ii) any declared and unpaid dividends, which shall be paid in cash. Each holder of shares of Series A Preferred shall be entitled to one vote for each whole share of Common Stock into which such shares of Series A Preferred could be converted.  At the option of the holder, the outstanding shares of Series A Preferred are convertible into shares of Common Stock at the rate which is calculated by dividing the Original Purchase Price by the Conversion Price of $0.70 per share within thirty six months after the original issue date (the “Conversion Rate”).  The Series A Preferred Stock will automatically convert into shares of the Company's common stock at the Conversion Rate (1) on the third anniversary of the original issuance date or (2) if the Company's average stock price is $1.20 for 20 consecutive trading days and trading volume is at least $150,000.

F - 13

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

During the nine months ended September 30, 2012, the Company entered into a subscription agreement with certain investors for an aggregate of 550,000 shares of the Company's Series A Preferred Stock and Warrants to purchase 50% of the shares of Common Stock that the Series A Preferred Stock would be converted into at a conversion price of $0.70 per share. The Company received proceeds of $385,000 ($0.70 per unit, which shall be referred to as the “Original Purchase Price”) in connection with the subscription agreement.  The warrants have a five year term, an exercise price of $0.80 per share, and a grant date fair value of $98,286. Such warrants are subject to customary anti-dilution adjustments.  On August 20, 2012, the Company issued the 550,000 shares to the investors.

Warrants

Details of warrants outstanding as of September 30, 2012 are as follows:

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
Warrants outstanding at January 1, 2012		5,067,716	$	0.54	5.87
Granted		465,000	$	0.69		4.99
Expired		-		-
Exercised		-		-
Warrants outstanding at September 30, 2012		5,532,716	$	0.55		5.11		-
Exercisable		5,532,716	$	0.55		5.11		-

Note 8.  Related Party Transactions

During the three and nine months ended September 30, 2012, the Company received advances from a former director aggregating approximately $0 and $124,200.  These advances are non-interest bearing and are due on demand.

Note 9. Subsequent Events

On October 10, 2012, the Company issued a note payable aggregating $50,000.  This note bears interest at the rate of 12% per annum and matured 30 days from the issuance date.  In connection with this note, the Company granted the note holders an aggregate 25,000 shares of common stock.

On November 21, 2012, the Company entered into the Subscription Agreement (the “Subscription Agreement”) of Secured Convertible Promissory Notes (the “Notes”) due May 21, 2014 in the aggregate principal amount of $500,000 with a conversion price of $0.54 per share.  The noteholders also received warrants to purchase 462,963 shares of its common stock at an exercise price of $0.70 per share. The aggregate grant date fair value of the warrants of $106,481 was recorded as a debt discount. The conversion price of the Note and the exercise price of the Warrants are subject to adjustment for certain events, including the dividends, distributions or split of common stock, the Company’s consolidation, merger or reorganization, or in the event of the Company’s issuance of securities at a price lower than the per share conversion price or exercise price then in effect.

F - 14

NUVEL HOLDINGS, INC. AND SUBSIDIARY

(A COMPANY IN THE DEVELOPMENT STAGE)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

In connection with the sale of the Notes and Warrants, the Company paid to the investor and its designee a due diligence fee in cash equal to 4% of the gross proceeds of the offering and issued to the investor’s designee an unsecured note substantially in the same form as the Note in the principal amount of $20,000.

In accordance with ASC 470, “Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios,” the Notes are considered to have an embedded beneficial conversion feature because the effective conversion price is less than the estimated fair value of the Company’s common stock at the issuance date. This beneficial conversion feature is calculated after the warrants have been valued with proceeds allocated on a fair value basis. The value of the beneficial conversion feature was calculated using, among other factors, the Company’s estimated stock price of $0.55 resulting in the recognition of an additional debt discount of approximately $97,000 at the time of issuance.

On November 23, 2012, the Company repaid a note payable in the aggregate amount of $100,000.

In November 2012, the Company obtained extensions from certain notes payable and convertible notes payable holders to extend the maturity date of their notes as the notes were in default as of September 30, 2012.  The holders of notes payable in the aggregate amounts of $70,000 and $895,000 extended the due date of their notes to December 31, 2012 and March 31, 2013, respectively.  In connection with the extension, the Company will issue warrants to purchase 56,500 shares of common stock at $0.70 per share.  The holders of convertible notes payable in the aggregate amounts of $728,000 and $1,142,000 extended the due date of their notes to December 31, 2012 and March 31, 2013, respectively.  In connection with the extension, the Company will issue warrants to purchase 187,000 shares of common stock at $0.70 per share.  In addition, certain convertible notes payable holders converted their convertible notes aggregating $900,000 to 450,000 shares of common stock.  In connection with the extensions of the notes payable and convertible notes payable, the holders of the respective notes agreed to waive all prior events of default (as defined in the respective agreements).

Subsequent to September 30, 2012, the Company received advances from a former director aggregating approximately $83,260.  These advances are non-interest bearing and are due on demand.

F - 15

Item  2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the notes to those financial statements appearing elsewhere in this Report.

Certain statements in this Report constitute forward-looking statements. These forward-looking statements include statements, which involve risks and uncertainties, regarding, among other things, (a) our projected sales, profitability, and cash flows, (b) our growth strategy, (c) anticipated trends in our industry, (d) our future financing plans, and (e) our anticipated needs for, and use of, working capital. They are generally identifiable by use of the words “may,” “will,” “should,” “anticipate,” “estimate,” “plan,” “potential,” “project,” “continuing,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend,” or the negative of these words or other variations on these words or comparable terminology. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this filing will in fact occur. You should not place undue reliance on these forward-looking statements.

The forward-looking statements speak only as of the date on which they are made, and, except to the extent required by federal securities laws, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the statements are made or to reflect the occurrence of unanticipated events.

The "Company", "we," "us," and "our," refer to (i) Nuvel Holdings, Inc., a Florida corporation, and (ii) Nuvel, Inc., a Delaware corporation, which is a wholly-owned subsidiary of Nuvel Holdings, Inc.

Overview

The Company, through its wholly-owned subsidiary, engages in the business of designing, developing and selling a family of proxy and other appliances, and related software and services that secure, accelerate and optimize the delivery of business applications, Web content and other information to distributed users over a Wide Area Network (“WAN”), or across an enterprise’s gateway to the public Internet (also known as the "Web"). Our products provide our end user customers with information about the applications and Web traffic running on their networks, including the ability to discover, classify, manage and control communications between users and applications across internal networks, the WAN and the Internet. Our products are also designed to accelerate and optimize the performance of our end users’ business applications and content, whether used internally or hosted by external providers. We have also developed and designed personal safety applications that are accessible via various mobile and tablet platforms.

We are a development stage enterprise. Our primary activities have been the design and development of our products, negotiating strategic alliances and other agreements and raising capital. We have not commenced our principal operations, nor have we generated any revenues.

Since inception, we have incurred substantial losses. As of September 30, 2012 and December 31, 2011, our accumulated deficit was $9,257,394 and $6,970,260, respectively, and as of September 30, 2012 our working capital and stockholders’ deficiency was $6,910,584 and $6,842,024, respectively.  We have not yet generated revenues and our losses have principally been operating expenses incurred in design, development, marketing and promotional activities in order to commercialize our products.  We expect to continue to incur additional costs for operating and marketing activities over at least the next year.

- 3 -

Based upon our working capital deficiency as of September 30, 2012 and December 31, 2011, and the lack of any revenues, we require equity and/or debt financing to continue our operations.  Subsequent to September 30, 2012 and through the date of this report, the Company secured additional financing aggregating $550,000.  The Company currently has a convertible note payable aggregating $50,000 that is past maturity and in default.  As a result of this default, the convertible note and interest is due and payable on demand and the interest has been retroactively adjusted to 22% from the issuance date.As of the date of this report, management estimates that the Company’s availability of funds will fund its operations only through December 31, 2012.  Due to the impending lack of funds, we are currently considering several different financing alternatives to support our operations thereafter. If we are unable to obtain such additional financing on a timely basis and, notwithstanding any request we may make, our debt holders do not agree to convert their notes into equity or extend the maturity dates of their notes, we may have to curtail our development, marketing and promotions activities, which would have a material adverse effect on our business, financial condition and results of operations, and ultimately we could be forced to discontinue our operations and liquidate.  See “Liquidity and Capital Resources” and “Availability of Additional Funds” below.

Three months ended September 30, 2012 compared with the three months ended September 30, 2011

Marketing and promotion expenses

Marketing and promotion expenses include costs related to the advertising, marketing, and promotion of our products.  For the three months ended September 30, 2012, marketing and promotion expenses increased by $7,735, or 31%, as compared to the three months ended September 30, 2011. The increase resulted primarily from the increase in the advertising fees for internet search words in 2012 as well as stock-based compensation in connection with common stock issued to a sales consultant.

We expect that marketing and promotion expenses will continue to increase in the future as we increase our marketing activities following full commercialization of our products and services.

Payroll and benefits

Payroll and benefits consist primarily of salaries and benefits to employees.  For the three months ended September 30, 2012, payroll and benefits decreased by $16,781 as compared to the three months ended September 30, 2011. The Company currently has 7 full time employees.

General and administrative expenses

General and administrative expenses consist primarily of corporate support expenses such as legal and professional fees, investor relations and telecommunications expenses.  For the three months ended September 30, 2012, general and administrative expenses increased by $16,216, or 18%, as compared to the three months ended September 30, 2011.  The increase resulted primarily from stock-based compensation in connection with common stock issued to investor relations consultants.

We expect that our general and administrative expenses will continue to increase as we incur additional costs to support the growth in our business.

Research and development expenses

Research and development expenses consist primarily of consulting fees paid to develop our software products.  Research and development expenses are expensed as they are incurred. For the three months ended September 30, 2012, research and development expenses decreased by $6,402, or 9%, as compared to the three months ended September 30, 2011.  The decrease resulted primarily from a change to a more cost effective development firm in the second quarter of 2012 and the capitalization of software costs as our mobile application product reached technological feasibility in 2012.

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Other income

Other expense represents the change in fair value of warrant liabilities, amortization of debt discount and deferred financing charges, and interest expense.  For the three months ended September 30, 2012, other expense decreased by $823,404, or 157%, as compared to the three months ended September 30, 2011.  The Company marked certain warrants to fair value which accounted for a gain of $527,022 relating to the change in fair value of warrant liabilities for the three months ended September 30, 2012 as a result of decreases in the Company’s estimated stock price and in the remaining term of the warrants. This compared to a loss of $239,400 in the prior year period resulting from a modification of the terms of the warrant, specifically a reduction in the exercise price of the warrants. The amortization of the debt discount increased by $45,783 as additional notes payable and convertible notes were issued in the period. The amortization of deferred financing costs also decreased by $69,619 as our notes payable and convertible notes began to reach their initial maturity dates in late 2011 and early 2012.    Interest expense increased by $32,489 as additional notes were issued and the maturity dates of certain outstanding notes which were at or past maturity were extended.

Nine months ended September 30, 2012 compared with the nine months ended September 30, 2011

Marketing and promotion expenses

Marketing and promotion expenses include costs related to the advertising, marketing, and promotion of our products.  For the nine months ended September 30, 2012, marketing and promotion expenses increased by $21,169, or 50%, as compared to the nine months ended September 30, 2011. The increase resulted primarily from the increase in the advertising fees for internet search words in 2012 as well as stock-based compensation in connection with common stock issued to a sales consultant.

We expect that marketing and promotion expenses will continue to increase in the future as we increase our marketing activities following full commercialization of our products and services.

Payroll and benefits

Payroll and benefits consist primarily of salaries and benefits to employees.  For the nine months ended September 30, 2012, payroll and benefits increased by $168,507 as compared to the nine months ended September 30, 2011. The Company currently has 7 full time employees.

General and administrative expenses

General and administrative expenses consist primarily of corporate support expenses such as legal and professional fees, investor relations and telecommunications expenses.  For the nine months ended September 30, 2012, general and administrative expenses increased by $191,752, or 86%, as compared to the nine months ended September 30, 2011.  The increase resulted primarily from an increase in professional fees related to our initial SEC filings as well as stock-based compensation issued in connection with common stock issued to investor relations consultants.

We expect that our general and administrative expenses will continue to increase as we incur additional costs to support the growth in our business.

Research and development expenses

Research and development expenses consist primarily of consulting fees paid to develop our software products.  Research and development expenses are expensed as they are incurred. For the nine months ended September 30, 2012, research and development expenses decreased by $22,621, or 10%, as compared to the nine months ended September 30, 2011.  The decrease resulted primarily from maintaining two developers at the same time during the first quarter of 2012 as we transitioned to a more cost effective developer offset by the capitalization of software costs during the nine months ended September 30, 2012 as our mobile application product reached technological feasibility in October 2011.

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Other expense

Other expense represents the change in fair value of warrants liabilities, amortization of debt discount and deferred financing charges, and interest expense.  For the nine months ended September 30, 2012, other expenses decreased by $135,000, or 16%, as compared to the nine months ended September 30, 2011.  The Company marked certain warrants to fair value which accounted for a gain of $1,213,700 relating to the change in fair value of warrant liabilities for the nine months ended September 30, 2012 as a result of decreases in the Company’s estimated stock price and in the remaining term of the warrants.  This  compared to a loss of $224,525 in the prior year period resulting from a modification of the terms of the warrant, specifically a reduction in the exercise price of the warrants. The amortization of the debt discount increased by $1,448,831 as additional convertible notes were issued and the acceleration of the debt discount from the cancellation of notes and warrants.  The amortization of deferred financing costs decreased by $154,417 as less costs related to raising funds were incurred.    Interest expense increased by $8,811 as additional notes were issued and the certain maturity dates of notes which were at or past maturity were extended.

Liquidity and Capital Resources

We measure our liquidity in a number of ways, including the following:

	September 30, 2012			December 31, 2011
Cash	$	-		$	34,792
Working Capital Deficiency	$	(6,910,584	)	$	(5,077,380	)
Debt (Current)	$	3,835,000		$	3,265,000

From January 20, 2010 (inception) through September 30, 2012, we raised a total of $4,140,000 from the issuance of notes payable and convertible notes (of which $305,000 was repaid) and $385,000 in equity issuances.  As of September 30, 2012, we had a cash overdraft of $8,010, and a working capital deficiency of $6,910,584. Subsequent to September 30, 2012 and through the date of this report, the Company secured additional debt financing aggregating $550,000.

Net Cash Used in Operating Activities

We experienced negative cash flow from operating activities for the nine months ended September 30, 2012 and 2011 in the amounts of $1,050,442 and $1,064,203, respectively.

The cash used in operating activities in the nine months ended September 30, 2012 was due to cash used to fund a net loss of $2,287,134, adjusted for non-cash expenses related to amortization of debt discount, amortization of deferred financing costs, stock compensation and the change in fair value of warrant liabilities in the aggregate amount of $449,405 as well as a change in operating assets and liabilities of $787,287. The Company has been required to extend payables in order to conserve cash balances.

The cash used in operating activities for the nine months ended September 30, 2011 was due to cash used to fund a net loss of $2,063,327, adjusted for non-cash expenses related to amortization of debt discount, amortization of deferred financing costs, and the change in fair value of warrant liabilities in the aggregate amount of $531,216 as well as a change in operating assets and liabilities of $467,908. The Company has been required to extend payables in order to conserve cash balances.

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Net Cash Used in Investing Activities

The cash used in investing activities for the nine months ended September 30, 2012 was for the capitalization of software costs, as the Company’s mobile application product reached technological feasibility.

Net Cash Provided by Financing Activities

Cash provided by financing activities for the nine months ended September 30, 2012 and 2011 was $1,084,210 and $1,258,000, respectively, primarily from the issuance of notes payable, convertible notes, preferred stock, and advances from a former director.

Availability of Additional Funds

Based upon our working capital deficiency as of September 30, 2012 and the lack of any revenues, we require equity and/or debt financing to continue our operations.  Subsequent to September 30, 2012 and through the date of this report, the Company secured additional financing aggregating $550,000.  The Company currently has a convertible note payable aggregating $50,000 that is past maturity and in default.  As a result of this default, the convertible note and interest is due and payable on demand and the interest has been retroactively adjusted to 22% from the issuance date.  As of the date of this report, management estimates that the Company’s availability of funds will fund its operations only through December 31, 2012.  Due to the impending lack of funds, we will need to raise further capital, through the sale of additional equity securities or otherwise, to support our future operations and to repay our debt (unless, if requested, the debt holders agree to convert their notes into equity or extend the maturity dates of their notes).  Our operating needs include the planned costs to operate our business, including amounts required to fund working capital and capital expenditures.  Our future capital requirements and the adequacy of our available funds will depend on many factors, including our ability to successfully commercialize our products and services, and competing technological and market developments.

We may be unable to raise sufficient additional capital when we need it or to raise capital on favorable terms. Debt financing may require us to pledge certain assets and enter into covenants that could restrict certain business activities or our ability to incur further indebtedness, and may contain other terms that are not favorable to our stockholders or us. If we are unable to obtain adequate funds on reasonable terms, we may be required to significantly curtail or discontinue operations or to obtain funds by entering into financing agreements on unattractive terms.

These matters raise substantial doubt about our ability to continue as a going concern. Our condensed consolidated financial statements included elsewhere in this quarterly report have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate our continuation as a going concern and the realization of assets and satisfaction of liabilities in the normal course of business.  The carrying amounts of assets and liabilities presented in the condensed consolidated financial statements do not necessarily purport to represent realizable or settlement values.  The condensed consolidated financial statements do not include any adjustment that might result from the outcome of this uncertainty.

Critical Accounting Policies and Estimates

Use of Estimates

The preparation of condensed consolidated 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 disclosure of contingent liabilities at dates of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the periods. Actual results could differ from these estimates. Our significant estimates and assumptions include amortization, the fair value of our stock, debt discounts, warrant liabilities, and the valuation allowance relating to the Company’s deferred tax assets.

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Recently Issued Accounting Pronouncements

Reference is made to the “Recent Accounting Pronouncements” in Note 3 to the condensed consolidated financial statements included in this Quarterly Report for information related to new accounting pronouncements, none of which had a material impact on our consolidated financial statements.

Off Balance Sheet Arrangements

As of September 30, 2012, there were no off balance sheet arrangements.

Contractual Obligations

The following is a summary of our contractual obligations and their respective maturity dates as of September 30, 2012:

Contractual Obligations	Total		2012		2013		2014		2015
Short-term debt obligations	$	3,835,000	$	3,835,000	$	-	$	-	$	-
Interest obligations (1)		615,135		615,135		-		-		-
Operating lease obligations (2)		2,100		2,100		-		-		-
	$	4,452,235	$	4,452,235	$	-	$	-	$	-

_______________

(1) Interest rate obligations are presented through the maturity dates of each component of short-term debt.

(2) Operating lease obligations represent payment obligations under non-cancelable lease agreements classified as operating leases and disclosed pursuant to ASC 840 “Accounting for Leases,” as may be modified or supplemented. These amounts are not recorded as liabilities as of the current balance sheet date.

Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Pursuant to Item 305(e) of Regulation S-K (§ 229.305(e)), the Company is not required to provide the information required by this Item as it is a “smaller reporting company,” as defined by Rule 229.10(f)(1).

Item 4.  CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the end of the period covered by this Quarterly Report on Form 10-Q/A, the Company carried out an evaluation by the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on that evaluation, our management concluded that the Company’s disclosure controls and procedures were not effective at a reasonable assurance level such that the information relating to us and our consolidated subsidiary required to be disclosed in our Exchange Act reports (i) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (ii) is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure as of September 30, 2012.

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As of December 31, 2011, we had identified certain matters that constituted a material weakness in our internal controls over financial reporting that continued to exist as of September 30, 2012. Specifically, we have limited segregation of duties within our accounting and financial reporting functions. Segregation of duties within our company is limited due to the small number of employees that are assigned to positions that involve the processing of financial information. Although we are aware that segregation of duties within our company is limited, we believe (based on our current roster of employees and certain control mechanisms we have in place), that the risks associated with having limited segregation of duties are currently insignificant. We have taken steps to address this matter, including the hiring of a Chief Financial Officer in December 2011. We believe that we have made significant progress towards remediating this weakness; however, we must still complete the process of design-specific control procedures and testing them for effectiveness before we can report that this weakness has been fully remediated.  Although we believe that these steps have enabled us to improve our internal controls, additional time is still required to fully document our systems, implement control procedures and test their operating effectiveness before we can definitively conclude that we have remediated our material weakness.

Changes in Internal Controls

There were no changes in the Company’s internal control over financial reporting that occurred during the nine months ended September 30, 2012 that has materially affected or is reasonably likely to materially affect our internal control over financial reporting.

Limitations of the Effectiveness of Control

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations of any control system, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected.

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PART II OTHER INFORMATION

Item 1.  LEGAL PROCEDINGS

None.

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

During the second quarter of 2012, the Company received investments from accredited investors for the sales of 550,000 shares of its Series A Preferred Stock, par value $.001 (“Series A Preferred Stock”) and warrants to purchase 50% of the shares of Common Stock that the Series A Preferred Stock such Investors purchased would be able to be converted into at an exercise price of $0.80 per share (the “Series A Warrants”). The Company closed the first round of the offering of its Series A Preferred Stock and the Series A Warrants on August 20, 2012.

On August 3, 2012, the Company issued a total of 73,334 shares of Common Stock to three consultants in consideration of their consulting services.

Between July and October 2012, the Company issued secured convertible promissory notes (the “Notes”) in the aggregate amount of $400,000 pursuant to certain accredited investors. The Notes bear interest at the rate of 12% per annum and have a term of 30 days. On November 19, 2012, the Company and the noteholders agreed to extend the maturity date of the Notes to March 31, 2013.

The above issuances were effectuated pursuant to the exemption from the registration requirements of the Securities Act of 1933 (the “Act”), as amended, provided by Section 4(2) of the Act and/or Regulation D promulgated thereunder.

Item 3. DEFAULTS UPON SENIOR SECURITIES.

On or about March 15, 2011, the Company issued Leon Frenkel a 12% secured convertible promissory note (the "Frenkel Note") in the principal amount of $50,000, which was due on April 18, 2012. As of the date hereof, the Company has not repaid any principal or accrued but unpaid interest that has become due under the Frenkel Note. The Company has attempted to obtain extension on the Frenkel Note but has been unable to achieve agreement with Mr. Frenkel.

Item 4. MINE SAFETY DISCLOSURES.

Not applicable.

Item 5. OTHER INFORMATION.

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers.

On October 23, 2012, Mr. Charles Resnick resigned his position as the Chairman of the Board. Simultaneously, Mr. Jay Elliot was appointed to serve as the new Chairman of the Board. Mr. Resnick will remain as a Director.

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Item 6.  EXHIBITS

(a)   Exhibits

Exhibit Number	Description
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

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SIGNATURES

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

	NUVEL HOLDINGS, INC.
Date: December 7, 2012	By:	/s/  Jay Elliot
		Jay Elliot
		President and Chief Executive Officer
		(principal executive officer)
Date: December 7, 2012	By:	/s/  Jorge Fernandez
		Jorge Fernandez
		Chief Financial Officer
		(principal financial officer and accounting officer)

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