##### Table of Contents

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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Form 10-QSB



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(Mark One)

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



For the quarterly period ended March 31, 2005



| ̈ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
|- | ---------------------------------------------------------------



For the transition period from  to



Commission file number: 333-47924



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BLASTGARD INTERNATIONAL, INC.

(Exact name of small business issuer as specified in it charter)



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|                                                               |  |                                  
|-------------------------------------------------------------- |  | ---------------------------------
|Colorado                                                       |  | 84-1506325                       
|(State or other jurisdiction of incorporation or organization) |  | (IRS Employer Identification No.)



12900 Automobile
Blvd., Suite D, Clearwater, Florida 33762

(Address of principal executive offices)



(727) 592-9400

(issuers telephone number)



(Former name, former address and former fiscal year, if changed since last
report)



---



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 such shorter period that the
issuer was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No ̈



APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS



Check whether the issuer filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.    Yes ̈No ̈



APPLICABLE ONLY TO CORPORATE ISSUERS



State the number of shares outstanding of each of the issuers classes of common equity, as of the latest practicable date: As of May
6, 2005, the issuer had 21,856,625 shares of $.001 par value common stock outstanding.



Transitional Small Business Disclosure Format (Check one):    Yes ̈No  x



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##### Table of Contents

INDEX



|                                                                                                                                                                                     |  |     
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ----
|                                                                                                                                                                                     |  | Page
|PART 1  FINANCIAL INFORMATION                                                                                                                                                       |  |     
|                                                                                                                                                                                     | 
|Item 1. Financial Statements                                                                                                                                                         |  |     
|                                                                                                                                                                                     | 
|Condensed balance sheet, March 31, 2005 (unaudited)                                                                                                                                  |  | F-1 
|                                                                                                                                                                                     | 
|Condensed statements of operations, three months ended March 31, 2005 (unaudited), March 31, 2004 (unaudited), and September 26, 2003 (inception) through March 31, 2005 (unaudited) |  | F-2 
|                                                                                                                                                                                     | 
|Condensed statements of cash flows, three months ended March 31, 2005 (unaudited), March 31, 2004 (unaudited), and September 26, 2003 (inception) through March 31, 2005 (unaudited) |  | F-3 
|                                                                                                                                                                                     | 
|Notes to condensed financial statements (unaudited)                                                                                                                                  |  | F-4 
|                                                                                                                                                                                     | 
|Item 2.
Managements Plan of Operation.                                                                                                                                              |  | 1   
|                                                                                                                                                                                     | 
|Item 3.
Controls and Procedures                                                                                                                                                      |  | 3   
|                                                                                                                                                                                     | 
|PART 2 
OTHER INFORMATION                                                                                                                                                           |  |     
|                                                                                                                                                                                     | 
|Item 1.
Legal Proceedings                                                                                                                                                            |  | 4   
|                                                                                                                                                                                     | 
|Item 2.
Changes in Securities and Use of Proceeds                                                                                                                                    |  | 4   
|                                                                                                                                                                                     | 
|Item 3.
Defaults upon Senior Securities                                                                                                                                              |  | 4   
|                                                                                                                                                                                     | 
|Item 4.
Submission of Matters to a Vote of Security Holders                                                                                                                          |  | 4   
|                                                                                                                                                                                     | 
|Item 5.
Other Information                                                                                                                                                            |  | 4   
|                                                                                                                                                                                     | 
|Item 6.
Exhibits and Reports on Form 8-K                                                                                                                                             |  | 4   
|                                                                                                                                                                                     | 
|Signatures                                                                                                                                                                           |  | 5   



i



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##### Table of Contents

BLASTGARD INTERNATIONAL, INC.

(A Development Stage Company)



Condensed Balance Sheet

(Unaudited)



March 31, 2005



|                                                                                                       |  |   |            |  
|------------------------------------------------------------------------------------------------------ |  | - | ---------- | -
|Assets                                                                                                 |  |   |            |  
|Cash                                                                                                   |  | $ | 1,428,126  |  
|Accounts receivable, net                                                                               |  |   | 259        |  
|Property and equipment, net                                                                            |  |   | 73,604     |  
|Other assets:                                                                                          |  |   |            |  
|Debt issue costs (Note 4)                                                                              |  |   | 142,670    |  
|Deferred costs                                                                                         |  |   | 4,485      |  
|Deposits                                                                                               |  |   | 1,850      |  
|                                                                                                       |  |   |            |  
|                                                                                                       |  | $ | 1,650,994  |  
|                                                                                                       |  |   |            |  
|Liabilities and Shareholders Equity                                                                   |  |   |            |  
|Liabilities:                                                                                           |  |   |            |  
|Indebtedness to related parties (Note 2)                                                               |  | $ | 764        |  
|Accounts payable                                                                                       |  |   | 14,000     |  
|Accrued liabilities                                                                                    |  |   | 1,500      |  
|Accrued interest payable (Note 4)                                                                      |  |   | 37,867     |  
|Convertible notes payable, net of unamortized discount of $294,683 (Note 4)                            |  |   | 1,125,317  |  
|                                                                                                       |  |   |            |  
|Total liabilities                                                                                      |  |   | 1,179,448  |  
|                                                                                                       |  |   |            |  
|Shareholders equity (Note 5):                                                                         |  |   |            |  
|Preferred stock, $.001 par value; 1,000 shares authorized, -0- shares issued and outstanding           |  |   |           |  
|Common stock, $.001 par value; 100,000,000 shares authorized, 21,856,625 shares issued and outstanding |  |   | 21,857     |  
|Additional paid-in capital                                                                             |  |   | 3,458,442  |  
|Deficit accumulated during development stage                                                           |  |   | (3,008,753 | )
|                                                                                                       |  |   |            |  
|Total shareholders equity                                                                             |  |   | 471,546    |  
|                                                                                                       |  |   |            |  
|                                                                                                       |  | $ | 1,650,994  |  
|                                                                                                       |  |   |            |  



See accompanying notes
to condensed financial statements



F-1



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##### Table of Contents

BLASTGARD INTERNATIONAL, INC.

(A Development Stage Company)



Condensed Statements of Operations

(Unaudited)



|                                                             |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|------------------------------------------------------------ |  | ---------------------------- | ---------- | - | ------------------------------------------------ | - | ---------- | - |  | - | ---------- | -
|                                                             |  | Three Months Ended March 31, |            |   | September 26,2003(Inception)ThroughMarch 31,2005 |  
|                                                             |  | 2005                         |            |   | 2004                                             |   |           
|Revenues:                                                    |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Sales                                                        |  | $                            | 259        |   |                                                  | $ |           |   |  | $ | 854        |  
|Licensing fees                                               |  |                              |           |   |                                                  |   |           |   |  |   | 5,000      |  
|                                                             |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Total revenues                                               |  |                              | 259        |   |                                                  |   |           |   |  |   | 5,854      |  
|                                                             |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Operating expenses:                                          |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Stock-based compensation (Note 5):                           |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Officers and directors                                       |  |                              |           |   |                                                  |   |           |   |  |   | 12,500     |  
|Consulting services                                          |  |                              |           |   |                                                  |   | 704,000    |   |  |   | 1,199,750  |  
|Granted stock options                                        |  |                              | 56,312     |   |                                                  |   | 9,400      |   |  |   | 73,524     |  
|General and administrative                                   |  |                              | 323,327    |   |                                                  |   | 203,624    |   |  |   | 1,478,267  |  
|Research and development                                     |  |                              | 32,859     |   |                                                  |   |           |   |  |   | 181,285    |  
|Contract settlement fee                                      |  |                              |           |   |                                                  |   | 16,000     |   |  |   | 16,000     |  
|Depreciation and amortization                                |  |                              | 5,244      |   |                                                  |   | 641        |   |  |   | 9,046      |  
|Gain on settlement of liabilities                            |  |                              |           |   |                                                  |   |           |   |  |   | (123,965   | )
|Loss on disposal of assets                                   |  |                              |           |   |                                                  |   | 1,834      |   |  |   | 1,834      |  
|                                                             |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Total operating expenses                                     |  |                              | 417,742    |   |                                                  |   | 935,499    |   |  |   | 2,848,241  |  
|                                                             |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Operating loss                                               |  |                              | (417,483   | ) |                                                  |   | (935,499   | ) |  |   | (2,842,387 | )
|                                                             |  |                              |           
|Interest income                                              |  |                              | 9,864      |   |                                                  |   |           |   |  |   | 12,936     |  
|Interest expense (Note 4):                                   |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Amortized debt issue costs                                   |  |                              | (13,807    | ) |                                                  |   |           |   |  |   | (18,409    | )
|Amortized debt discount                                      |  |                              | (28,518    | ) |                                                  |   |           |   |  |   | (38,024    | )
|Other                                                        |  |                              | (28,400    | ) |                                                  |   | (42,002    | ) |  |   | (122,869   | )
|                                                             |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Loss before income taxes                                     |  |                              | (478,344   | ) |                                                  |   | (977,501   | ) |  |   | (3,008,753 | )
|                                                             |  |                              |           
|Income tax provision (Note 3)                                |  |                              |           |   |                                                  |   |           |   |  |   |           |  
|                                                             |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Net loss                                                     |  | $                            | (478,344   | ) |                                                  | $ | (977,501   | ) |  |   | (3,008,753 | )
|                                                             |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Basic and diluted loss per share                             |  | $                            | (0.02      | ) |                                                  | $ | (0.05      | ) |  |   |            |  
|                                                             |  |                              |            |   |                                                  |   |            |   |  |   |            |  
|Basic and diluted weighted average common shares outstanding |  |                              | 21,856,625 |   |                                                  |   | 19,452,714 |   |  |   |            |  
|                                                             |  |                              |            |   |                                                  |   |            |   |  |   |            |  



See accompanying notes
to condensed financial statements



F-2



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##### Table of Contents

BLASTGARD INTERNATIONAL, INC.

(A Development Stage Company)



Condensed Statements of Cash Flows

(Unaudited)



|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|------------------------------------------------------- |  | --------------------------- | --------- | - | ------------------------------------------------- | - | -------- | - |  | - | ---------- | -
|                                                        |  | Three Months EndedMarch 31, |           |   | September 26,2003 (Inception)ThroughMarch 31,2005 |  
|                                                        |  | 2005                        |           |   | 2004                                              |   |         
|Net cash provided by (used in) operating activities     |  | $                           | (354,273  | ) |                                                   | $ | (186,852 | ) |  | $ | (2,017,390 | )
|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Cash flows from investing activities:                   |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Payments for deferred costs                             |  |                             |          |   |                                                   |   |         |   |  |   | (4,485     | )
|Purchases of property and equipment                     |  |                             | (38,889   | ) |                                                   |   | (10,329  | ) |  |   | (82,650    | )
|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Net cash used in investing activities                   |  |                             | (38,889   | ) |                                                   |   | (10,329  | ) |  |   | (87,135    | )
|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Cash flows from financing activities:                   |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Proceeds from the sale of common stock                  |  |                             |          |   |                                                   |   | 200,320  |   |  |   | 2,357,621  |  
|Proceeds from issuance of convertible debt              |  |                             |          |   |                                                   |   |         |   |  |   | 1,420,000  |  
|Stock offering costs                                    |  |                             |          |   |                                                   |   |         |   |  |   | (132,600   | )
|Payments for debt issue costs                           |  |                             |          |   |                                                   |   |         |   |  |   | (112,370   | )
|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Net cash provided by financing activities               |  |                             |          |   |                                                   |   | 200,320  |   |  |   | 3,532,651  |  
|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Net change in cash                                      |  |                             | (393,162  | ) |                                                   |   | 3,139    |   |  |   | 1,428,126  |  
|                                                        |  |                             |          
|Cash, beginning of period                               |  |                             | 1,821,288 |   |                                                   |   |         |   |  |   |           |  
|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Cash, end of period                                     |  | $                           | 1,428,126 |   |                                                   | $ | 3,139    |   |  | $ | 1,428,126  |  
|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Supplemental disclosure of cash flow information:       |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Cash paid during the period for:                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Interest                                                |  | $                           |          |   |                                                   | $ |         |   |  | $ | 11,072     |  
|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Income taxes                                            |  | $                           |          |   |                                                   | $ |         |   |  | $ |           |  
|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Noncash investing and financing transactions:           |  |                             |           |   |                                                   |   |          |   |  |   |            |  
|Common stock issued in exchange for debt extinguishment |  | $                           |          |   |                                                   | $ |         |   |  | $ | 178,500    |  
|                                                        |  |                             |           |   |                                                   |   |          |   |  |   |            |  



See accompanying notes
to condensed financial statements



F-3



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##### Table of Contents

BLASTGARD INTERNATIONAL, INC.

(A Development Stage Company)



Notes to Condensed Financial Statements

(Unaudited)



Note 1: Basis of presentation



The financial statements presented herein have been prepared by the Company in accordance with the accounting policies in its Form 10-KSB dated December 31, 2004, and should be read in conjunction with the notes thereto.



In the opinion of management, all adjustments (consisting only of normal recurring
adjustments) which are necessary to provide a fair presentation of operating results for the interim periods presented have been made. The results of operations for the periods presented are not necessarily indicative of the results to be expected
for the year.



The Company is in the development stage in accordance with
Statements of Financial Accounting Standards (SFAS) No. 7 Accounting and Reporting by Development Stage Enterprises. As of March 31, 2005, the Company has devoted substantially all of its efforts to financial planning, raising capital
and developing markets.



Financial data presented herein are unaudited.



Note 2: Related party transactions



During the three months ended March 31, 2005, officers paid expenses on behalf of the
Company totaling $764, which were not repaid as of March 31, 2005. The balance owed the officers is included in the accompanying condensed financial statements as Indebtedness to related parties.



Note 3: Income taxes



The Company records its income taxes in accordance with Statement of Financial Accounting
Standard No. 109, Accounting for Income Taxes. The Company incurred net operating losses during all periods presented resulting in a deferred tax asset, which was fully allowed for; therefore, the net benefit and expense resulted in no
income taxes.



F-4



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##### Table of Contents

Note 4: Notes payable



The Companys convertible promissory notes payable consist of the following at March 31, 2005:



|                                                                                                                                                          |  |   |          
|--------------------------------------------------------------------------------------------------------------------------------------------------------- |  | - | ---------
|$1,000,000 convertible promissory note issued December 2, 2004, due on October 31, 2007, 8% annual interest rate, net of unamortized discount
of $207,523 |  | $ | 792,477  
|$200,000 convertible promissory note issued December 2, 2004, due on October 31, 2007, 8% annual interest rate, net of unamortized discount of
$41,505    |  |   | 158,495  
|$100,000 convertible promissory note issued December 2, 2004, due on October 31, 2007, 8% annual interest rate, net of unamortized discount of
$20,752    |  |   | 79,248   
|$100,000 convertible promissory note issued December 2, 2004, due on October 31, 2007, 8% annual interest rate, net of unamortized discount of
$20,752    |  |   | 79,248   
|$20,000 convertible promissory note issued December 2, 2004, due on October 31, 2007, 8% annual interest rate, net of unamortized discount of
$4,151      |  |   | 15,849   
|                                                                                                                                                          |  |   |          
|                                                                                                                                                          |  | $ | 1,125,317
|                                                                                                                                                          |  |   |          



Accrued interest payable on the note
totaled $37,867 at March 31, 2005.



The fair value of detachable warrants
issued with the convertible notes was charged to additional paid-in capital with a corresponding discount on the convertible notes payable. The discount is amortized over the life of the debt. As the discount is amortized, the outstanding principal
balance of the notes will approach their face value of $1,420,000. Amortization resulting from the discount is charged to interest expense, resulting in effective interest rate of approximately 16% on the convertible notes. Accumulated amortization
and amortization expense on the debt discount totaled $38,024 and $28,518 as of and for the three months ended March 31, 2005, respectively.



The Company paid its debt placement agent and its attorney a total of $112,370 and issued detachable warrants in connection with the issuance of the convertible
promissory notes. The fair value of the warrants totaled $48,709, which, when added to the $112,370 paid to the placement agent and attorney, resulted in total debt issue costs of $161,079. Amortization resulting from the debt issue costs is charged
to interest expense. Accumulated amortization and amortization expense of the debt issue costs totaled $18,409 and $13,807 as of and for the three months ended March 31, 2005, respectively.



Note 5: Shareholders equity



Options granted to non-employees, accounted for under the fair value method



On March 22, 2005, the Company granted consultants options to
purchase an aggregate of 125,000 shares of the Companys common stock at an exercise price of $2.00 per share. All of the options vested on the date of grant. The options expire on March 31, 2009. The quoted market price of the stock was $1.53
per share on the grant date. The Company valued the options at $.322 per share, or $40,250, which is recorded as stock-based compensation in the accompanying condensed financial statements.



The fair value of the options was estimated at the date of grant using the Black-Scholes
option-pricing model with the following assumptions:



|                               |  |         |  
|------------------------------ |  | ------- | -
|Risk-free interest rate        |  | 2.77    | %
|Dividend yield                 |  | 0.00    | %
|Volatility factor              |  | 33.97   | %
|Weighted average expected life |  | 4 years |  



F-5



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##### Table of Contents

An additional 22,250 stock options granted to non-employees in prior years, vested during the three months ended March
31, 2005. Compensation related to the vested options totaled $16,062 and has been recorded as stock-based compensation in the accompanying condensed financial statements



Options granted to employees, accounted for under the intrinsic value method



An additional 630,000 stock options granted to employees in prior years, vested during the
three months ended March 31, 2005. Had compensation expense been recorded based on the fair value at the grant date, and charged to expense over vesting periods, the Companys net loss and net loss per share would have increased to the pro
forma amounts indicated below:



|                                       |  |                             |          |   |      |   |          |  
|-------------------------------------- |  | --------------------------- | -------- | - | ---- | - | -------- | -
|                                       |  | Three Months EndedMarch 31, |         
|                                       |  | 2005                        |          |   | 2004 |  
|Net loss, as reported                  |  | $                           | (464,344 | ) |      | $ | (977,501 | )
|Decrease due to:                       |  |                             |          |   |      |   |          |  
|Employee stock options                 |  |                             | (445,380 | ) |      |   |         |  
|                                       |  |                             |          |   |      |   |          |  
|Pro forma net loss                     |  | $                           | (909,724 | ) |      | $ | (977,501 | )
|                                       |  |                             |          |   |      |   |          |  
|As reported:                           |  |                             |          |   |      |   |          |  
|Net loss per share - basic and diluted |  | $                           | (0.02    | ) |      | $ | (0.05    | )
|                                       |  |                             |          |   |      |   |          |  
|Pro Forma:                             |  |                             |          |   |      |   |          |  
|Net loss per share - basic and diluted |  | $                           | (0.04    | ) |      | $ | (0.05    | )
|                                       |  |                             |          |   |      |   |          |  



The following schedule discloses the
calculation of the pro forma compensation expense on employee stock options:



|              |  |                         |  |                  |           |                                     |           |                                          |   |        
|------------- |  | ----------------------- |  | ---------------- | --------- | ----------------------------------- | --------- | ---------------------------------------- | - | -------
|Date of Grant |  | Number ofOptionsGranted |  | Total Fair Value |           | Options VestedThroughMarch 31, 2005 |           | Fair ValueIncurred ThroughMarch 31, 2005
|2/23/2004     |  | 100,000                 |  | $                | 32,600    |                                     | 70,000    |                                          | $ | 22,820 
|1/31/2004     |  | 300,000                 |  |                  | 217,800   |                                     | 200,000   |                                          |   | 145,200
|1/31/2004     |  | 300,000                 |  |                  | 217,800   |                                     | 200,000   |                                          |   | 145,200
|1/31/2004     |  | 580,000                 |  |                  | 421,080   |                                     | 400,000   |                                          |   | 290,400
|1/31/2004     |  | 580,000                 |  |                  | 421,080   |                                     | 400,000   |                                          |   | 290,400
|              |  |                         |  |                  |           |                                     |           |                                          |   |        
|              |  | 1,860,000               |  | $                | 1,310,360 |                                     | 1,270,000 |                                          | $ | 894,020
|              |  |                         |  |                  |           |                                     |           |                                          |   |        



$448,640 of the stock options
total fair value ($894,020) would have been recognized during the year ended December 31, 2004.



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##### Table of Contents

Following is a schedule of changes in common stock options and warrants for the three months ended March 31, 2005:



|                               |  |                    |   |  |                         |   |                                         |   |                                           |  |   |      |  |           
|------------------------------ |  | ------------------ | - |  | ----------------------- | - | --------------------------------------- | - | ----------------------------------------- |  | - | ---- |  | ----------
|                               |  | Awards Outstanding |   |  | Exercise Price PerShare |   | WeightedAverageExercise Price Per Share |   | WeightedAverageRemaining Contractual Life
|                               |  | Options            |   |  | Warrants                |   |                                         |   |                                          
|Outstanding at January 1, 2005 |  | 1,943,925          |   |  | 1,016,955               |   |                                         | $ | .25 - $5.00                               |  | $ | 2.22 |  | 3.39 years
|Granted                        |  | 125,000            |   |  |                        |   |                                         | $ | 2.00                                      |  | $ | 2.00 |  | 4 years   
|Exercised                      |  |                   |   |  |                        |   |                                         |   |                                          |  | $ |     |  | N/A       
|Expired                        |  | (28,175            | ) |  | (30,000                 | ) |                                         | $ | .25 - $1.50                               |  | $ | 1.05 |  | N/A       
|                               |  |                    |   |  |                         |   |                                         |   |                                           |  |   |      |  |           
|Outstanding at March 31, 2005  |  | 2,040,750          |   |  | 986,955                 |   |                                         | $ | .50 - $5.00                               |  | $ | 2.23 |  | 3.21 years
|                               |  |                    |   |  |                         |   |                                         |   |                                           |  |   |      |  |           



Note 6: Concentration of credit
risk for cash



The Company has concentrated its credit risk for cash
by maintaining deposits in a financial institution, which may at times exceed the amounts covered by insurance provided by the United States Federal Deposit Insurance Corporation (FDIC). The loss that would have resulted from that risk
totaled $1,364,198 at March 31, 2005, for the excess of the deposit liabilities reported by the financial institution over the amount that would have been covered by FDIC. The Company has not experienced any losses in such accounts and believes it
is not exposed to any significant credit risk to cash.



Note 7:
Litigation



The Company is involved in various legal actions and
claims arising from the normal course of business. After taking into consideration legal counsels evaluation of such actions, management is of the opinion that their outcome will not have a significant effect on the Companys financial
statements.



F-7



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##### Table of Contents

Item 2. Plan of operation



Statements contained
herein that are not historical facts are forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are reasonable, the forward-looking statements are subject to risks and uncertainties that
could cause actual results to differ from those projected. We caution investors that any forward-looking statements made by us are not guarantees of future performance and that actual results may differ materially from those in the forward-looking
statements. Such risks and uncertainties include, without limitation: well-established competitors who have substantially greater financial resources and longer operating histories, regulatory delays or denials, ability to compete as a start-up
company in a highly competitive market, and access to sources of capital.



The
following discussion and analysis should be read in conjunction with our financial statements and notes thereto included elsewhere in this Form 10-QSB. Except for the historical information contained herein, the discussion in this Form 10-QSB
contains certain forward-looking statements that involve risks and uncertainties, such as statements of our plans, objectives, expectations and intentions. The cautionary statements made in this Form 10-QSB should be read as being applicable to all
related forward-looking statements wherever they appear in this Form 10-QSB. Our actual results could differ materially from those discussed here.



The financial information furnished herein has not been audited by an independent accountant; however, in the opinion of management, all adjustments (only consisting of
normal recurring accruals) necessary for a fair presentation of the results of operations for the period ended March 31, 2005, have been included.



Introduction



On January 31, 2004, pursuant to an Agreement and Plan of Reorganization (Reorganization Agreement), we acquired 100% of the issued and outstanding common
stock of BlastGard Technologies, Inc. (BTI), a Florida corporation, from BTIs shareholders, in exchange for an aggregate of 18,200,000 (adjusted to reflect subsequent stock split) shares of our common stock. BTI is a development
stage company that was created to develop, design, manufacture, and market proprietary blast mitigation materials. BTIs patent-pending BlastWrap technology is designed to effectively mitigate blasts and suppress fires resulting from explosions. As a result of the Reorganization
Agreement, a change in control and change in management of the Company occurred and BTI became a wholly-owned subsidiary of the Company. The Reorganization Agreement also provided that the Company hold a shareholders meeting to (i) change the name
of the corporation to BlastGard International, Inc., and (ii) approve a reverse split of the outstanding common stock on a 5:1 basis. A Special Shareholder meeting was held on March 12, 2004, and both proposals were approved. The name change and the
reverse split of the outstanding common stock became effective on March 31, 2004.



We intend to focus exclusively on the business plan of BTI. BTI was formed on September 26, 2003, and is a development stage company. Pursuant to the Reorganization Agreement, BTI became a wholly-owned subsidiary of our Company. However,
for accounting purposes, the acquisition was treated as a recapitalization of BTI, with our Company the legal surviving entity.



Financial Results



We are considered a development stage company and have recorded only nominal revenues from inception to date. At March 31, 2005, we had an accumulated deficit of
approximately $3.0 million and cash on hand of approximately $1.4 million.



For
the quarter ended March 31, 2005, we expended $393,162 in cash. Our primary expenses were general and administrative of $323,327, research and development of $32,859, and stock based compensation for the granting of stock options to consultants of
$56,312. We also spent $38,889 for the purchase of equipment.



As of March 31,
2005, the accrued interest payable on the outstanding convertible notes payable was $37,867.



1



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##### Table of Contents

Plan of Operation



To date, we have relied on managements ability to raise capital through debt and equity private placement financings to fund our
operations.



Our monthly cash needs are budgeted to average approximately
$120,000 per month, with the following approximate breakdown:



|                                 |  |   |        
|-------------------------------- |  | - | -------
|salaries and benefits            |  | $ | 60,000 
|consulting and professional fees |  | $ | 28,000 
|office overhead                  |  | $ | 3,000  
|travel                           |  | $ | 9,000  
|research and development         |  | $ | 20,000 
|                                 |  |   |        
|total                            |  | $ | 120,000



We do not anticipate making any
significant purchases of assets such as plant or equipment.



We anticipate that
we may need to hire up to four additional sales and marketing personnel in the next 12 months, if our sales efforts justify such additional personnel.



We plan to continue our research and development efforts over the next 12 months. Our core product, BlastWrap, is a finished product that we are currently manufacturing
for R&D testing by third-parties. The primary application for BlastWrap is to further customize it for different applications and uses. We have two products that we consider to be completed and finished products, the First Responder and the
BlastGard MTR (mitigated trash receptacle), which we are manufacturing and marketing as of March 1, 2005.



We intend to continue to work to improve our existing prototypes for each of the 13 product lines described in the Description of Business section, until they can be released as finished and marketable products. We
also intend to research new applications and markets and to develop new prototypes for them. Most R&D costs that we will incur will relate to the development and testing of prototypes.



Business Prospects



Although we are a development stage company and have recorded only nominal revenues to date,
we believe that BlastWrapis a unique blast-mitigating technology that will be desirable
to end-users who will find it to be more effective, more flexible and lower-priced than the products currently offered by other companies that offer blast solutions.



BlastWrap has been and continues to be tested and evaluated by many potential customers, including the following:



| |  |  | US Army Test Center  Aberdeen
| | - |  | ------------------------------



| |  |  | Armor Systems International
| | - |  | ---------------------------



| |  |  | NYPD, Atlanta and LACS Bomb Squads
| | - |  | ----------------------------------



| |  |  | Boeing Phantom Works  FCS
| | - |  | ----------------------------



| |  |  | US Marines HMMWV Retrofit
| | - |  | -------------------------



| |  |  | Georgia Tech Applied Research Corp. - New Tactical Wheeled Vehicle Design
| | - |  | -------------------------------------------------------------------------



| |  |  | UK Ministry of Defence
| | - |  | ----------------------



| |  |  | Lockheed Martin Corporation
| | - |  | ---------------------------



| |  |  | Rapid Mat LLC
| | - |  | -------------



| |  |  | Sandia National Laboratory
| | - |  | --------------------------



The process of evaluating and testing can be time consuming and costly, but each of the potential customers have done so at their own expense. We have received positive feedback from everyone who has been evaluating
and testing BlastWrap, and reasonably expect to generate sales within the next 12
months.



2



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##### Table of Contents

Item 3. Controls and Procedures



Based on their
most recent evaluation, which was completed as of the end of the period covered by this periodic report on Form 10-QSB, the Companys Chief Executive Officer and Chief Financial Officer believe the Companys disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) are effective to ensure that information required to be disclosed by the Company in this report is accumulated and communicated to the Companys management, including its principal
executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. During the fiscal quarter to which this report relates, there were no significant changes in the Companys internal
controls or other factors that could significantly affect these controls subsequent to the date of their evaluation and there were no corrective actions with regard to significant deficiencies and material weaknesses.





3



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##### Table of Contents

PART II  OTHER INFORMATION



Item 1. Legal Proceedings.



There have been no
material developments in the pending legal proceeding previously described in the Companys periodic reports.



Item 2. Changes in Securities and Use of Proceeds. None



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



|              |  |                                                                                                                                                                                                                                                                            
|------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ExhibitNumber |  | Description                                                                                                                                                                                                                                                                
|2.4           |  | Agreement and Plan of Reorganization dated January 31, 2004, by and among the Registrant, BlastGard Technologies, Inc., (BTI) and the shareholders of BTI. (Incorporated by
reference to Exhibit 2.4 to the Companys current report on Form 8-K dated January 31, 2004.)
|              | 
|3.7           |  | The Companys Articles of Incorporation, as amended and currently in effect. (Incorporated by reference to Exhibit 3.5 of the Companys Quarterly Report on Form 10-QSB for the
period ended September 30, 2003.)                                                          
|              | 
|3.8           |  | The Companys Bylaws, as amended and currently in effect. (Incorporated by reference to Exhibit 3.6 of the Companys Quarterly Report on Form 10-QSB for the period ended September
30, 2003.)                                                                             
|              | 
|10.9          |  | IDMedical.com, Inc. 2002 Stock Plan (Incorporated by reference to Exhibit 10.9 of the Companys Registration Statement on Form S-8, SEC File No. 333-84002, filed March 8,
2002).                                                                                          
|              | 
|10.12         |  | Amendment dated March 24, 2004, to the IDMedical.com, Inc. 2002 Stock Plan. (Incorporated by reference to Exhibit 10.12 of the Companys Registration Statement on Form S-8, SEC File No.
333-113994 filed March 29, 2004.)                                                
|              | 
|10.13         |  | Employment Agreement with James F. Gordon dated January 31, 2004. (Incorporated by reference to Exhibit 10.13 to the Companys quarterly report on Form 10-QSB dated March 31,
2004.)                                                                                      
|              | 
|10.14         |  | Employment Agreement with Michael J. Gordon dated January 31, 2004. (Incorporated by reference to Exhibit 10.13 to the Companys quarterly report on Form 10-QSB dated March 31,
2004.)                                                                                    
|              | 
|10.15         |  | Employment Agreement with John L. Waddell, Jr. dated January 31, 2004. (Incorporated by reference to Exhibit 10.13 to the Companys quarterly report on Form 10-QSB dated March 31,
2004.)                                                                                 
|              | 
|10.16         |  | Employment Agreement with Kevin J. Sharpe dated January 31, 2004. (Incorporated by reference to Exhibit 10.16 to the Companys registration statement on Form SB-2, pre-effective
amendment no. 3 (File No. 333-121455).)                                                  
|              | 
|31.1          |  | Section 302 Certification by the Corporations Chief Executive Officer. (Filed herewith).                                                                                                                                                                                  
|              | 
|31.2          |  | Section 302 Certification by the Corporations Chief Financial Officer. (Filed herewith).                                                                                                                                                                                  
|              | 
|32.1          |  | Section 906 Certification by the Corporations Chief Executive Officer. (Filed herewith).                                                                                                                                                                                  
|              | 
|32.2          |  | Section 906 Certification by the Corporations Chief Financial Officer. (Filed herewith).                                                                                                                                                                                  



4



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##### Table of Contents

SIGNATURES



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



|                    |  |                               |  |                                           
|------------------- |  | ----------------------------- |  | ------------------------------------------
|                    |  | BLASTGARD INTERNATIONAL, INC.
|                    |  |                              
|Dated: May 11, 2005 |  | By:                           |  | /s/ James F. Gordon                       
|                    |  |                               |  | James F. Gordon, Chief Executive Officer  
|                    |  |                              
|Dated: May 11, 2005 |  | By:                           |  | /s/ Michael J. Gordon                     
|                    |  |                               |  | Michael J. Gordon, Chief Financial Officer





5



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##### Table of Contents

EXHIBIT INDEX



|              |  |                                                                                                                                                                                                                                                                            
|------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ExhibitNumber |  | Description                                                                                                                                                                                                                                                                
|2.4           |  | Agreement and Plan of Reorganization dated January 31, 2004, by and among the Registrant, BlastGard Technologies, Inc., (BTI) and the shareholders of BTI. (Incorporated by
reference to Exhibit 2.4 to the Companys current report on Form 8-K dated January 31, 2004.)
|              | 
|3.7           |  | The Companys Articles of Incorporation, as amended and currently in effect. (Incorporated by reference to Exhibit 3.5 of the Companys Quarterly Report on Form 10-QSB for the
period ended September 30, 2003.)                                                          
|              | 
|3.8           |  | The Companys Bylaws, as amended and currently in effect. (Incorporated by reference to Exhibit 3.6 of the Companys Quarterly Report on Form 10-QSB for the period ended September
30, 2003.)                                                                             
|              | 
|10.9          |  | IDMedical.com, Inc. 2002 Stock Plan (Incorporated by reference to Exhibit 10.9 of the Companys Registration Statement on Form S-8, SEC File No. 333-84002, filed March 8,
2002).                                                                                          
|              | 
|10.12         |  | Amendment dated March 24, 2004, to the IDMedical.com, Inc. 2002 Stock Plan. (Incorporated by reference to Exhibit 10.12 of the Companys Registration Statement on Form S-8, SEC File No.
333-113994 filed March 29, 2004.)                                                
|              | 
|10.13         |  | Employment Agreement with James F. Gordon dated January 31, 2004. (Incorporated by reference to Exhibit 10.13 to the Companys quarterly report on Form 10-QSB dated March 31,
2004.)                                                                                      
|              | 
|10.14         |  | Employment Agreement with Michael J. Gordon dated January 31, 2004. (Incorporated by reference to Exhibit 10.13 to the Companys quarterly report on Form 10-QSB dated March 31,
2004.)                                                                                    
|              | 
|10.15         |  | Employment Agreement with John L. Waddell, Jr. dated January 31, 2004. (Incorporated by reference to Exhibit 10.13 to the Companys quarterly report on Form 10-QSB dated March 31,
2004.)                                                                                 
|              | 
|10.16         |  | Employment Agreement with Kevin J. Sharpe dated January 31, 2004. (Incorporated by reference to Exhibit 10.16 to the Companys registration statement on Form SB-2, pre-effective
amendment no. 3 (File No. 333-121455).)                                                  
|              | 
|31.1          |  | Section 302 Certification by the Corporations Chief Executive Officer. (Filed herewith).                                                                                                                                                                                  
|              | 
|31.2          |  | Section 302 Certification by the Corporations Chief Financial Officer. (Filed herewith).                                                                                                                                                                                  
|              | 
|32.1          |  | Section 906 Certification by the Corporations Chief Executive Officer. (Filed herewith).                                                                                                                                                                                  
|              | 
|32.2          |  | Section 906 Certification by the Corporations Chief Financial Officer. (Filed herewith).