[X]
|
ANNUAL
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
[
]
|
TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Florida
(State
or other jurisdiction of
incorporation
or organization)
|
33-0961490
(I.R.S.
Employer
Identification
No.)
|
22342
Avenida Empresa, Suite 220
Rancho
Santa Margarita, CA
(Address
of principal executive offices)
|
92688
(Zip
Code)
|
Title
of each class
|
Name
of each exchange on which registered
|
|
None
|
None
|
|
PART
I
|
|
ITEM
1
|
BUSINESS
|
1
|
ITEM
2
|
PROPERTY
|
5
|
ITEM
3
|
LEGAL
PROCEEDINGS
|
5
|
ITEM
4
|
SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS
|
5
|
|
PART
II
|
|
ITEM
5
|
MARKET
FOR REGISTRANT'S COMMON EQUITY, AND RELATED STOCKHOLDER MATTERS
AND ISSUER
PURCHASES OF EQUITY SECURITIES
|
6
|
ITEM
6
|
SELECTED FINANCIAL DATA |
7
|
ITEM
7
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATION
|
7
|
ITEM 7A | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | 12 |
ITEM
8
|
FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA
|
12
|
ITEM 9 | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE | 13 |
ITEM 9A |
CONTROLS
AND PROCEDURES
|
13 |
ITEM 9B | OTHER INFORMATION | 13 |
|
PART
III
|
|
ITEM
10
|
DIRECTORS
AND EXECUTIVE OFFICERS OF THE REGISTRANT
|
14
|
ITEM
11
|
EXECUTIVE
COMPENSATION
|
15
|
ITEM
12
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
|
16
|
ITEM
13
|
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
|
19
|
ITEM
14
|
PRINCIPAL
ACCOUNTING FEES AND SERVICES
|
19
|
|
PART
IV
|
|
ITEM
15
|
EXHIBITS,
FINANCIAL STATEMENTS SCHEDULES
|
20
|
M-GAB Development Corporation |
For
the year ended December 31st
|
||||||||||||
2004
|
2003
|
2002
|
2001(1)
|
||||||||||
Statement
of Operations Data:
|
|||||||||||||
Total
revenues
|
$
|
-
|
-
|
-
|
-
|
||||||||
Income
(loss) from continuing operations
|
57,059
|
(63,253
|
)
|
(37,376
|
)
|
(19,575
|
)
|
||||||
Net
income (loss)
|
57,059
|
(63,253
|
)
|
(37,376
|
)
|
(19,575
|
)
|
||||||
Net
income (loss) per common share from continuing operations
|
0.01
|
(0.01
|
)
|
(0.01
|
)
|
(0.00
|
)
|
||||||
Balance
Sheet Data:
|
|||||||||||||
Current
assets
|
$
|
17,403
|
-
|
6,437
|
-
|
||||||||
Total
assets
|
17,403
|
-
|
6,437
|
-
|
|||||||||
Current
liabilities
|
9,324
|
93,105
|
46,289
|
3,476
|
|||||||||
Total
liabilities
|
9,324
|
103,105
|
46,289
|
3,476
|
|||||||||
Total
stockholders’ equity (deficit)
|
8,079
|
(103,105
|
)
|
(39,852
|
)
|
(3,476
|
)
|
||||||
Total
dividends per common share
|
-
|
-
|
-
|
-
|
|
December
31, 2004
|
September
30, 2004
|
Change
|
|||||||
Cash
|
$
|
17,403
|
$
|
18,653
|
$
|
(1,250
|
)
|
|||
Total
current assets
|
17,403
|
18,653
|
(1,250
|
)
|
||||||
Total
assets
|
17,403
|
18,653
|
(1,250
|
)
|
||||||
Total
current liabilities
|
9,324
|
5,900
|
3,424
|
|||||||
Total
liabilities
|
$ |
9,324
|
$ |
5,900
|
$ |
3,424
|
Index
to Financial Statements
|
|
Report
of Independent Certified Public Accountants
|
F-1
|
Balance
Sheet
|
F-2
|
Statement
of Operations
|
F-3
|
Statement
of Stockholders Equity
|
F-4
|
Statement
of Cash Flows
|
F-5
|
Notes
to Financial Statements
|
F-6
|
Name
|
Age
|
Position(s)
|
||
Carl
M. Berg
|
35
|
Chairman
of the Board, President, Secretary, and Treasurer
(2001)
|
||
Kevin
J. Gadawski
|
37
|
Director
(2003)
|
||
Mark
Stewart
|
37
|
Director
(2003)
|
Annual
Compensation
|
Long
Term Compensation
|
|||||||||
Awards
|
Payouts
|
|||||||||
Name
and
Principal
Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Other
Annual
Compensation
($)
|
Restricted
Stock
Awards
($)
|
Securities
Underlying Options SARs
(#)
|
LTIP
Payouts
($)
|
All
Other
Compensation
($)
|
||
Carl
M. Berg
|
2004
|
-0-
|
-0-
|
$-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
||
Chairman,
President, Secretary, Treasurer
|
2003
|
-0-
|
-0-
|
$6,000
(1)
|
-0-
|
-0-
|
-0-
|
-0-
|
||
Kevin
J. Gadawski
|
2004
|
-0-
|
-0-
|
$5,000
(2)
|
-0-
|
-0-
|
-0-
|
-0-
|
||
Director
|
2003
|
-0-
|
-0-
|
$5,000
|
-0-
|
-0-
|
-0-
|
-0-
|
||
Mark
Stewart
|
2004
|
-0-
|
-0-
|
$-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
||
Director
|
2003
|
-0-
|
-0-
|
$-0-
|
-0-
|
-0-
|
-0-
|
-0-
|
(1) |
This
amount was accrued until March 26, 2004, when Mr. Berg elected
for forgive
all amounts owed to him, as well as any future salary until further
notice.
|
(2) | As of December 31, 2004, Mr. Gadawski received $2,500 of this amount. The other $2,500 has been accrued. |
OPTION/SAR
GRANTS IN LAST FISCAL YEAR
(Individual
Grants)
|
||||
Name
|
Number
of Securities
Underlying
Options/SARs
Granted
(#)
|
Percent
of Total
Options/SARs
Granted
to
Employees In Fiscal
Year
|
Exercise
or Base Price
($/Sh)
|
Expiration
Date
|
Carl
M. Berg
|
-0-
|
N/A
|
N/A
|
N/A
|
Kevin
J. Gadawski
|
-0-
|
N/A
|
N/A
|
N/A
|
Mark
Stewart
|
-0-
|
N/A
|
N/A
|
N/A
|
AGGREGATED
OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND
FY-END OPTION/SAR VALUES
|
||||
Name
|
Shares
Acquired On
Exercise
(#)
|
Value
Realized
($)
|
Number
of Unexercised
Securities
Underlying
Options/SARs
at FY-End
(#)
Exercisable/Unexercisable
|
Value
of Unexercised
In-The-Money
Option/SARs
at
FY-End
($)
Exercisable/Unexercisable
|
Carl
M. Berg
|
N/A
|
N/A
|
N/A
|
N/A
|
Kevin
J. Gadawski
|
N/A
|
N/A
|
N/A
|
N/A
|
Mark
Stewart
|
N/A
|
N/A
|
N/A
|
N/A
|
Name
and Address (1)
|
Nature
of Affiliation
|
Common
Stock Ownership
|
Percentage
of Common Stock Ownership (2)
|
|||
Carl
M. Berg
|
Chairman
of the Board, President, Secretary and Treasurer
|
5,550,000
(3)
|
86.9%
|
|||
Brian
A. Lebrecht (4)
|
5%
Shareholder
|
450,000
|
7.0%
|
|||
Kevin
J. Gadawski
|
Independent
Director
|
300,500
(5)(6)
|
4.4%
(5)
|
|||
Mark
Stewart
|
Independent
Director
|
300,000
(5)
|
4.4%
(5)
|
|||
All
Officers and Directors as a Group
(3
Persons)
|
6,150,500
(3)(5)(6)
|
88%
(5)
|
(1)
|
Unless
stated otherwise, the address of each affiliate is c/o M-GAB Development
Corporation, 22342 Avenida Empresa, Suite 220, Rancho Santa Margarita,
CA
92688.
|
(2)
|
Unless
otherwise indicated, based on 6,383,845 shares of common stock
issued and
outstanding. Shares of common stock subject to options or warrants
currently exercisable, or exercisable within 60 days, are deemed
outstanding for purposes of computing the percentage of the person
holding
such options or warrants, but are not deemed outstanding for purposes
of
computing the percentage of any other person.
|
(3)
|
Includes
3,000,000 shares held of record by Sadie, LLC, an entity wholly-owned
and
controlled by Mr. Berg. Mr. Berg is our sole
officer.
|
(4)
|
Mr.
Lebrecht is President of The Lebrecht Group, APLC, which serves
as our
securities counsel.
|
(5)
|
Includes
options to acquire 300,000 shares of common stock which will be
granted to
each of Mr. Gadawski and Mr. Stewart upon approval by the Commission
in
compliance with the Investment Company Act of
1940.
|
(6)
|
Includes
500 shares held by Mr. Gadawski’s
spouse.
|
3.1
(1)
|
Articles
of Incorporation of M-GAB Development Corporation
|
|
3.2
(1)
|
Bylaws
of M-GAB Development Corporation
|
|
10.1(2)
|
M-GAB
Development Corporation Amended and Restated 2001 Omnibus Securities
Plan
|
|
10.2(2)
|
M-GAB
Development Corporation 2004 Omnibus Securities Plan
|
|
31.1
|
Rule
13a-14(a)/15d-14(a) Certification of Chief Executive
Officer
|
|
31.2
|
Rule
13a-14(a)/15d-14(a) Certification of Chief Financial
Officer
|
|
32.1
|
Chief
Executive Officer Certification Pursuant to 18 USC, Section 1350,
as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
32.2
|
Chief
Financial Officer Certification Pursuant to 18 USC, Section 1350,
as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
(1)
|
Incorporated
by reference from our Registration Statement on Form SB-2 filed
with the
Commission on August 31, 2001.
|
(2) | Incorporated by reference from our annual Form 10-KSB dated December 31, 2004 as filed with the Commission on March 25, 2005. |
M-GAB
Development Corporation
|
|
Dated: July
22, 2005
|
/s/
Carl M. Berg
|
By: Carl
M. Berg
|
|
Its: President,
Chief Executive
Officer,
|
|
Chief Financial
Officer
|
Dated: July
22, 2005
|
/s/
Carl M. Berg
|
By: Carl
M. Berg, Director
|
|
Dated: July
22, 2005
|
/s/
Kevin J. Gadawski
|
By: Kevin
J. Gadawski, Director
|
|
Dated: July
22, 2005
|
/s/
Mark Stewart
|
By: Mark
Stewart, Director
|
2004
|
2003
|
||||||
ASSETS
|
|||||||
Current
assets
|
|||||||
Cash
|
$
|
17,403
|
$
|
-
|
|||
Total
assets
|
$
|
17,403
|
$
|
-
|
|||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|||||||
Current
liabilities
|
|||||||
Accounts
payable and accrued liabilities
|
$
|
9,324
|
$
|
93,105
|
|||
Payable
to stockholder
|
-
|
10,000
|
|||||
Total
current liabilities
|
9,324
|
103,105
|
|||||
Commitments
and contingencies
|
-
|
-
|
|||||
Stockholders'
equity:
|
|||||||
Preferred
stock, $0.001 par value;
|
|||||||
5,000,000
shares authorized; No shares issued or outstanding
|
- | - | |||||
Common
stock, $0.001 par value; 100,000,000
|
|||||||
shares
authorized; 6,383,845 and 6,023,000 shares issued
|
|||||||
and
outstanding in 2004 and 2003, respectively
|
6,384
|
6,023
|
|||||
Additional
paid in capital
|
64,840
|
11,076
|
|||||
Deficit
accumulated during the development stage
|
(63,145
|
)
|
(120,204
|
)
|
|||
Total
stockholders' equity
|
8,079
|
(103,105
|
)
|
||||
Total
liabilities and stockholders' equity
|
$
|
17,403
|
$
|
-
|
|||
|
Cumulative
from inception (March 27, 2001) through December
31, 2004
|
Year
ended December 31, 2004
|
Year
ended December 31, 2003
|
|||||||
Revenue
|
$
|
-
|
$
|
-
|
$
|
-
|
||||
General
and administrative expenses
|
146,500
|
26,296
|
63,253
|
|||||||
Other
income (expense)
|
83,355
|
83,355
|
-
|
|||||||
Net
income (loss)
|
$
|
(63,145
|
)
|
$
|
57,059
|
$
|
(63,253
|
)
|
||
Basic
and diluted net income (loss) per share
|
$
|
0.01
|
$
|
(0.01
|
)
|
|||||
Weighted
average shares outstanding
|
6,321,699
|
6,023,000
|
||||||||
|
Deficit
|
|||||||||||||||||||||
|
Additional
|
Accumulated During | ||||||||||||||||||||
|
Common
Stock
|
Paid-in
|
the
Development
|
|||||||||||||||||||
|
Shares
|
Amount
|
Capital
|
Stage
|
Total
|
|||||||||||||||||
Issuance
of common stock to
|
||||||||||||||||||||||
founders
on April 20, 2001
|
6,000,000
|
$
|
6,000
|
$
|
(5,400
|
)
|
$
|
-
|
$
|
600
|
||||||||||||
Issuance
of common stock for
|
||||||||||||||||||||||
cash
in August 2001
|
13,000
|
13
|
1,287
|
-
|
1,300
|
|||||||||||||||||
Contributed
capital-services
|
-
|
-
|
14,199
|
-
|
14,199
|
|||||||||||||||||
Net
loss
|
-
|
-
|
-
|
(19,575
|
)
|
(19,575
|
)
|
|||||||||||||||
Balance,
December 31, 2001
|
6,013,000
|
6,013
|
10,086
|
(19,575
|
)
|
(3,476
|
)
|
|||||||||||||||
Issuance
of common stock for
|
||||||||||||||||||||||
cash
in September 2002
|
10,000
|
10
|
990
|
-
|
1,000
|
|||||||||||||||||
Net
loss
|
-
|
-
|
-
|
(37,376
|
)
|
(37,376
|
)
|
|||||||||||||||
Balance,
December 31, 2002
|
6,023,000
|
6,023
|
11,076
|
(56,951
|
)
|
(39,852
|
)
|
|||||||||||||||
Net
loss
|
-
|
-
|
-
|
(63,253
|
)
|
(63,253
|
)
|
|||||||||||||||
Balance,
December 31, 2003
|
6,023,000
|
$
|
6,023
|
$
|
11,076
|
$
|
(120,204
|
)
|
$
|
(103,105
|
)
|
|||||||||||
Issuance
of common stock for cash
in March 2004
|
360,845
|
361
|
46,547
|
-
|
54,125
|
|||||||||||||||||
Issuance
of stock warrants in
|
||||||||||||||||||||||
connection
with sale of stock
|
-
|
-
|
7,217
|
-
|
||||||||||||||||||
Net
income
|
-
|
-
|
-
|
57,059
|
57,059
|
|||||||||||||||||
Balance,
December 31, 2004
|
6,383,845
|
$
|
6,384
|
$
|
64,840
|
$
|
(63,145
|
)
|
$
|
8,079
|
|
Cumulative
from inception (March 27, 2001) to December 31,
2004
|
Year
ended December 31, 2004
|
Year
ended December 31, 2003
|
|||||||
Cash
flows from operating activities:
|
||||||||||
Net
income (loss)
|
$
|
(63,145
|
)
|
$
|
57,059
|
$
|
(63,253
|
)
|
||
Adjustments
to reconcile net loss to cash used in
|
||||||||||
operating
activities:
|
||||||||||
Contributed
capital for services rendered
|
14,199
|
-
|
-
|
|||||||
Forgiveness
of debt
|
(83,355
|
)
|
(83,355
|
)
|
-
|
|||||
Increase
(decrease) in accounts payable and
|
||||||||||
accrued
liabilities
|
82,679
|
(10,426
|
)
|
56,816
|
||||||
Net
cash used by operating activities
|
(49,622
|
)
|
(36,722
|
)
|
(6,437
|
)
|
||||
Cash
flows from financing activities:
|
||||||||||
Proceeds
from issuance of stock
|
57,025
|
54,125
|
-
|
|||||||
Advance
from shareholder
|
10,000
|
-
|
-
|
|||||||
Net
cash provided by financing activities
|
67,025
|
54,125
|
-
|
|||||||
Net
increase (decrease) in cash
|
17,403
|
17,403
|
(6,437
|
)
|
||||||
Cash
and cash equivalents, beginning of period
|
-
|
-
|
6,437
|
|||||||
Cash
and cash equivalents, end of period
|
$
|
17,403
|
$
|
17,403
|
$
|
-
|
||||
1.
|
NATURE
OF OPERATIONS AND ACCOUNTING
POLICIES
|
3.
|
STOCKHOLDERS'
EQUITY
|
|
For
the Years Ended
|
||||||
|
December
31,
|
||||||
2004
|
2003
|
||||||
Income
(loss) from continuing operations
|
|||||||
available
to common
|
|||||||
shareholders
(numerator)
|
$
|
57,059
|
|
$
|
(63,253
|
)
|
|
Weighted
average number of
|
|||||||
common
shares outstanding
|
|||||||
used
in loss per share during
|
|||||||
the
period (denominator)
|
6,321,699
|
6,023,000
|
|||||
5. |
INCOME
TAXES
|
6.
|
RELATED
PARTY TRANSACTIONS
|