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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                        --------------------------------


                                   FORM 10-KSB

                Annual Report Pursuant to Section 13 or 15(d) of
                       The Securities Exchange Act of 1934

For the Year Ended November 30, 2004               Commission File No. 333-64244

                          -----------------------------

                             The Macreport.net, Inc.
              ----------------------------------------------------
             (Exact Name of Registrant as Specified in Its Charter)

        Delaware                                          11-3584538
 ----------------------                      ----------------------------------
(State of Incorporation)                    (I.R.S. Employer Identification No.)

 150 Broadhollow Road, Suite PH11, Melville, New York           11747
       --------------------------------------                  --------
      (Address of principal executive offices)                (Zip Code)
                  (631) 423-4222
          Registrant's Telephone Number

           Securities registered pursuant to Section 12(b) of the Act:
                    Common Stock, $0.0001 par value per share
                                 --------------
                                (Title of Class)

     Indicate by check mark whether the registrant (1) has 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 and (2) has been subject to such filing
requirements for the past 90 days.            Yes  [  X  ]      No  [     ]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ ]

     The aggregate market value of the voting stock held by non-affiliates of
the Registrant as of February 15, 2005 was $804,917 using the closing bid price
of $0.60 on February 14, 2005.

     The number of shares of Common Stock outstanding as of February 15, 2005
was 16,293,041



                      DOCUMENTS INCORPORATED BY REFERENCE:


None.

     A list of Exhibits to this Annual Report on Form 10-KSB begins on page __.

<PAGE>

                             THE MACREPORT.NET, INC.
                             2004 FORM 10-KSB REPORT

                                TABLE OF CONTENTS
                                -----------------

PART I                                                                      Page
------                                                                      ----

Item 1       Description of the Business .................................    2

Item 2       Description of Property .....................................    9

Item 3       Legal Proceedings ...........................................   10

Item 4       Submission of Matters to a Vote of Security Holders..........   10


PART II
-------

Item 5       Market for Registrant's Common Equity and Related
             Stockholder Matters..........................................   10

Item 6       Management's Discussion and Analysis of Financial
             Condition and Results of Operations..........................   12

Item 7       Financial Statements.........................................   15

Item 8       Changes in and Disagreements with Accountants on
             Accounting and Financial Disclosure..........................   16

Item 8A      Controls and Procedures......................................   16

Item 8B      Other Information ...........................................   16


PART III
--------

Item 9.      Directors, Executive Officers, Promoters and Control
             Persons of the Registrant; Compliance with Sect 16(a)
             of the Exchange Act .........................................   17

Item 10.     Executive Compensation.......................................   18

Item 11.     Security Ownership of Certain Beneficial Owners And
             Management and Related Stockholder Matters...................   21

Item 12.     Certain Relationships and Related Transactions ..............   23

Item 13.     Exhibits and Reports On Form 8-K.............................   24

Item 14.     Principal Accountant Fees and Services.......................   26

                              --------------------

                                       i

<PAGE>


Forward-Looking Statements

Certain statements under the caption "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and elsewhere in this Annual
Report constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors which may cause
the actual results, performance or achievements of the Company, or industry
results, to be materially different from any future results, performance, or
achievements expressed or implied by such forward-looking statements. Such
factors include, among others, the Company's ability to attract customers,
general economic and business conditions with respect to the Internet and online
commerce, its ability to generate revenues, changes in government regulations,
competition and the ability of the Company to implement its business strategy
and other risks discussed in this Form 10-KSB.

Forward-looking statements speak only as of the date of this Form 10-KSB.
Moreover, whether or not stated in connection with a forward-looking statement,
the Company undertakes no obligation to correct or update a forward-looking
statement should the Company later become aware that it is not likely to be
achieved. If the Company were to update or correct a forward-looking statement,
investors and others should not conclude that the Company will make additional
updates or corrections thereafter.


PART I
------

ITEM 1.   DESCRIPTION OF THE BUSINESS

Overview


The MacReport.Net, Inc. was incorporated as a Delaware corporation in December
2000. We commenced operations at such time. The Company is an internet
information and media company formed to allow publicly and privately held
companies to communicate relevant corporate information directly with the
investing public. This is done through the use of a web site that provides the
user with key information via management interviews, press releases, and other
information.


General

The Macreport.net, Inc.

We are an information and media company that provides a Web-based forum for
public and private issuers to communicate corporate audio news content to the
business, financial and investing community through our Web site, located at
www.macreport.net. We have built a user friendly, highly effective Web site that
aggregates and disseminates information from multiple sources.

Through content partnerships, we also provide Web-based financial information to
professionals who need quick access to reliable corporate, industry and market
intelligence. By visiting our website, users are able to access comprehensive
and up-to-the minute business and financial information on public and private
companies from several information providers drawing upon multiple sources of
content. Our services enable timely, online access to a wide array of
proprietary and partner content. These sources include both textual information,
such as news, trade press, SEC filings, executive biographies and analyst
reports, and numeric information, such as company financial results, stock
quotes and industry statistics.

We expect that visitors to our Web site use our information for their
professional endeavors, including financial and competitive research, as well as
for their personal activities. We believe that we provide advertisers with a
large, demographically desirable business audience.

                                       2

<PAGE>


We market and sell package services to public and private companies. The
packages range from merely exposure on our web site to a comprehensive service
package, including press release services as well as client exposure on our
website. Also, the Company purchases advertising pages from "Institutional
Investor" magazine and, within these pages, highlights its clients and
information regarding such client' business. The press release services can
range from a set amount of client press releases per month to unlimited.

Industry Background


Providing information, tools and the opportunity to purchase products and
services to financial professionals and business decision makers over the
Internet represents a large and growing market opportunity. Increased Internet
usage and the desire for information by financial professionals and the
companies for which they work are driving growth in the market.

Recent industry growth has been driven by corporations and other enterprises
recognizing that productivity and competitiveness depend on extensive knowledge
of external information, including information about industries, customers,
competitors, prospects, business trends, breaking news and market data. These
organizations have already invested heavily in Internet connectivity and
networked computing infrastructures to manage internal information. These
organizations seek to leverage these infrastructures to access and manage
external information. While the financial markets have been negatively affected
over the past few years, we believe that these growth trends will not reverse.

The task of finding and using external information is often difficult and
cumbersome. Traditional, textual sources such as newspapers and directories can
require hours to search. A centralized library can be costly to establish and
maintain and can be an inefficient and incomplete information source. While the
emergence of the Web has greatly increased access to information, finding
comprehensive, precise, up-to-date, relevant and reliable information on the Web
can still be time-consuming and difficult. While other on-line services can be
useful research tools in certain circumstances, most of these services currently
focus on specific areas of content, such as financial data or news. They do not
provide the full range of data required by professionals. In addition, most
on-line services charge a fee for each search performed.

We believe that traditional sources, the Web and existing on-line services do
not adequately meet the information needs of many professionals who want to
compete effectively in today's fast-paced, global, customer-focused marketplace.
These professionals and their organizations demand external information that is:

     o    easily accessible in a user-friendly format

     o    comprehensive and includes both textual and numeric information

     o    derived from multiple, high quality sources

     o    integrated at a single site

     o    delivered on a platform that allows interpretation, manipulation and
          analysis

     o    delivered in a product easily implemented and supported on a corporate
          network

Additionally, we believe that many companies are looking for alternative service
providers for such tasks as disseminating press releases. With our products, we
offer a range of press release packages from a set amount of client press
releases per month to unlimited for a monthly fee. We believe that many
companies may benefit from this service as it is a fee per month and not a
variable cost.

                                       3

<PAGE>


We are very excited about the productization of our services. We believe that a
market exists for these services and the bundling of such services as we keep
the costs lower that our competitors.

Strategy

Our core strategy is to be a leading Web portal for financial professionals and
business decision makers and worldwide provider of multimedia production and
distribution services to corporations and other organizations. The key
components of our growth strategy include:

Grow Our Customer Base. During the initial stages of our operation, we have
focused on selling our streaming audio interviews, joint marketing ventures, and
public relations and consulting services to public companies with securities
trading on the Nasdaq SmallCap Market and the electronic over-the-counter
bulletin board. We believe there is an opportunity for the packaging of our
services into products which range from merely exposure on our web site to a
comprehensive service package, including press release services as well as
client exposure in "Institutional Investor" magazine. Furthermore, we believe
that we can introduce other services into our products and offer client
companies a full service line of services from press releases, edgar
conversions, printing to financial and investor exposure.

Generally, our clients are charged a monthly fee for the service package that
they request. These services may include:

     o    posting of content relating to the client that is in addition to the
          posting of content that we typically offer without charge, which may
          include: statistics, financial information, reports, editorials,
          stories and/or articles relating to the client and prepared by the
          client or by third parties;

     o    links to the client's Web site and to a page or pages of our Web site
          dedicated to providing information about the client;

     o    preparing and making available to our issuer clients one audio
          interview per year with representatives of the client and, at the
          option of our management, additional audios providing current
          newsworthy information about the client;

     o    dissemination of press releases; and

     o    coverage in our advertising pages within "Institutional Investor"
          magazine.

We also produce streaming audio and video profile presentations and textual
profiles of corporations for free. These profiles and presentations are
accessible through our Web site. We believe that by continually adding new
companies and additional sources of information, we will be positioned to become
the premier destination for CEO interviews.

Grow Our Audience. We believe that increasing our brand awareness and our
exposure within the business community will contribute to our future success. To
date, we have successfully built a brand name but plan on continuing to grow our
audience by focusing on online and direct response advertising as well as public
relations to raise awareness of our company and our services. Furthermore, we
plan to partner with high-volume business and consumer Web sites.

Increase Usage By Our Audience. To increase usage, we plan to expand our content
offering in the area of additional companies, industries, people and products
during the upcoming fiscal year. Moreover, we have developed and are developing
offline partnerships that will help to drive brand exposure and traffic to our
site.

                                       4

<PAGE>


Maximize Revenues From Users of our Website. We plan to add e-commerce
opportunities to our Web site in an effort to generate revenues from users of
our Web site. More e-commerce partners will provide more buying opportunities on
the site and we plan to integrate these in the search results and within other
tools and content on the site. We also plan to increase the advertising revenue
per user through customer-targeting capabilities on the site.

Pursue Acquisitions and Strategic Alliances. To further meet the needs of
financial professionals and business decision makers worldwide, we intend to
pursue acquisitions of, and strategic relationships with, companies with
complementary services and technologies and to expand our information and
services to cover more business organizations in international markets.

Increase our Sales Staff. As more companies look for online services to enhance
productivity, we plan to increase our sales staff to gain a greater share of
this growing market.

Technology Advancement. We plan to continuously advance and develop new
technologies that will enhance the user experience. We intend to expand our
technology services through ongoing investment, integration of new technologies,
and through targeted acquisitions.

Sales and Marketing

Subscribers

Subscribers for our service packages will primarily be corporations that are
publicly traded that require services such as press releases and are concerned
about exposure to the financial and investor community. We plan to attract
additional subscribers through direct marketing efforts, media advertising and
referrals.

Advertising and e-Commerce

We plan to offer a variety of advertising options that may be purchased
individually or in packages. This may include banners and button advertisements
on our site, which can be rotated on a run-of-site basis or targeted to a
particular audience. Run-of-site advertisements appeal to advertisers seeking
general brand recognition across our online audience. Banners and buttons are
generally sold under short-term insertion orders based on a price per thousand
impressions served.


We plan to generate e-commerce revenues from advertisers or sponsors that pay
either a fee per transaction or a percentage of sales directly generated by
their placement on our Web site. These fees can originate from buttons, banners
or in-context text links within our site.

Licensing and Syndication

We plan to license and syndicate portions of our proprietary information and
certain tools to third parties for redistribution. We believe potential
customers will range from traditional online service providers to other Web
sites. We plan to provide our customers with either a customized data feed of
our proprietary company information, or a co-branded set of Web pages designed
for the customer. License and syndication fees will be based upon variables,
such as the amount of information and number of tools, the number of seats, the
number of capsules viewed or the number of terminals.

                                       5

<PAGE>


Marketing Relationships

We plan to develop relationships with frequently visited and well-known Web
sites in order to expand our audience. We plan to build customized versions of
our company profiles to be co-branded and integrated into partners' Web sites. A
customized, co-branded company profile may feature links to portions of the
other Web site as well as links back to our Web site for additional information.
By incorporating links back to our Web site, we can introduce our information to
a broader audience while displaying our free advertising-supported company
information within the context of the other Web site.

Our marketing relationships will be important for increasing our brand awareness
and attracting new visitors to our Web site. We will pursue relationships that
increase the value of our brand name and introduce new audiences to our
information.

Competition


Many Web sites compete for the attention and spending of financial
professionals, and advertisers, particularly in the business information area.
We expect this competition to continue to increase. We compete for subscribers,
visitors, advertisers and content providers with many types of companies, such
as:

     o    large, well-established business and financial information providers
          such as Dow Jones, Dialog, Lexis-Nexis, Pearson, Reuters, Thomson,
          Primark and McGraw-Hill;

     o    providers of company information, such as Dun & Bradstreet,
          MarketGuide, a division of Multex, and Standard & Poor's;

     o    on-line information services or Web sites targeted to specific markets
          or applications, such as NewsEdge, Factset and Bloomberg;

     o    Web retrieval, Web "portal" companies and other free or low-cost mass
          market on-line services such as Excite, Infoseek, Lycos, Yahoo! and
          AOL/Netscape;

     o    Web sites focused on subscription business models, such as The Wall
          Street Journal Interactive Edition;

     o    free or low-cost specialized business and financial information Web
          sites such as Hoovers.com, Marketwatch.com, Multex.com, CEOcast.com
          and TheStreet.com; and

     o    other Web sites with a business orientation or a business channel,
          such as Office.com and Business.com.


Our ability to compete depends on many factors, including:

     o    the originality, timeliness, comprehensiveness and trustworthiness of
          our content and that of our competitors;

     o    the cost of our services compared to our competitors;

     o    the ease of use of services developed either by us or our competitors;

     o    the usefulness of our tools;

     o    the attractiveness of the demographic characteristics of our audience;
          and

     o    the effectiveness of our sales and marketing efforts.

                                       6

<PAGE>


Subsidiaries

The Company incorporated Macnetworks, Inc., a Delaware corporation that is
wholly-owned by the Company. In February 2004, Macnetworks was appointed as a
General Partner for Van Pfeiffer, L.P., a New York limited partnership and hedge
fund that primarily invests in private investments in public companies. For its
services, Macnetworks will receive 1.5% of the net assets and 20% of profits, if
any, of Van Pfeiffer. Macnetworks has not, as of November 30, 2004, received any
compensation from Van Pfeiffer. For the fiscal year ended November 30, 2004
MacReport, Inc. has waived any fees owed to it by Van Pfeiffer.

In 2004, the Company incorporated The Marcellus Group, LLC, a New York limited
liability company. As of November 20, 2004, The Marcellus Group purchased three
commercial building properties in Marcellus, New York for the purposes of office
space for the Company. The buildings are currently being renovated for use by
the Company. A certain portion of the property will be rented for retail
commercial use.

In 2004, the Company has also incorporated SpringBay Oil Company, Inc., a New
York corporation. SpringBay Oil Company was formed in 2004 to develop a product
that can be used in the production monitoring of oil wells. As of November 30,
2004, there has been no material activity in this limited liability company. The
Company owns 77% of SpringBay Oil Company.

Subsequent Events
In February 2005, the Company sold 1,000,000 shares of its common stock to one
individual for two million dollars ($2,000,000). The shares of common stock are
restricted. The issuance of the securities in the transaction were deemed to be
exempt from registration under the Securities Act of 1933, as amended, in
reliance on Section 4(2) of the Securities Act and Regulation D promulgated
thereunder as transactions by an issuer not involving any public offering.

In January 2005, the Company moved from one of its offices at 200 Broadhollow,
Melville, New York to 150 Broadhollow, Suite PH11, Melville, New York. The
Company leases its Melville office space pursuant to a lease expiring November
2006, with minimum monthly rent of approximately $1,700, plus annual escalations
of approximately 3%. The Company now has three (3) offices located at Melville,
New York, Marcellus, New York and New York, New York.

Registration Under the Investment Advisors Act


To engage in certain components of our planned operations, we are required to
register with the Securities and Exchange Commission as an investment advisor
under the Investment Advisors Act of 1940, as amended. As an investment adviser,
we will be subject to restrictions against engaging in fraudulent, deceptive or
manipulative acts or practices. We will be subject to remedial sanctions,
including censure, limitations on our operations, suspension for a period not
exceeding 12 months, and revocation for, among other things, willfully violating
or aiding or abetting a violation of the Securities Act, the Exchange Act, the
Investment Company Act, the Investment Advisers Act or any rule or regulation
adopted pursuant to any of such acts.


We have filed with NASD, Regulation entitlement forms for access to the
Investment Advisor Registration Depository (IARD) and have established an IARD
User Account. We have delayed the filing of Form ADV as our business model has
been modified and the components of our plans that require registration have not
been implemented and are not an integral part of our operations. However, until
such time as we file Form ADV, we will not be able to commence certain of our

                                       7

<PAGE>


planned operations. The requirement to register as an investment advisor with
the Securities and Exchange Commission will cause us to incur additional costs
and expenses, will result in delays in certain operations and the execution of
certain plans.

Government Regulation

We are subject, both directly and indirectly, to various laws and governmental
regulations relating to our business. There are currently few laws or
regulations directly applicable to commercial online services or the Internet.
However, due to increasing popularity and use of commercial online services and
the Internet, it is possible that a number of laws and regulations may be
adopted with respect to commercial online services and the Internet. These laws
and regulations may cover issues including, for example, user privacy, pricing
and characteristics, and quality of products and services. Moreover, the
applicability to commercial online services and the Internet of existing laws
governing issues including, for example, property ownership, libel and personal
privacy, is uncertain and could expose us to substantial liability. Any new
legislation or regulation or the application of existing laws and regulations to
the Internet could have a material and adverse effect on our business, results
or operations and financial condition. In certain states, legislation has been
introduced to tax the sales of goods over the Internet the same as sales of
personal property through traditional channels.

As our services are available over the Internet anywhere in the world, multiple
jurisdictions may claim that we are required to qualify to do business as a
foreign corporation in each of those jurisdictions. Our failure to qualify as a
foreign corporation in a jurisdiction where we are required to do so could
subject us to taxes and penalties for the failure to qualify. It is possible
that state and foreign governments might also attempt to regulate our
transmissions of content on our Web site or on the Web sites of others or
prosecute us for violations of their laws. We cannot assure you that violations
of local laws will not be alleged or charged by state or foreign governments,
that we might not unintentionally violate these laws or that these laws will not
be modified, or new laws enacted, in the future.

We are aware of the sensitive regulatory climate in which we plan to operate. In
March 2000, the Securities and Exchange Commission announced that it had a
special operation to target fraudulent and manipulative practices relating to
the promotion of securities on the Internet. We are also aware that Regulation
F-D, adopted by the Securities and Exchange Commission during 2000, somewhat
restricts the ability to obtain information from issuers.

Part of our business will include posting profiles of private and public
issuers. We may be subject to liability under the Securities Act of 1933 and/or
the Securities Exchange Act of 1934, each as amended, in the event that these
issuers commence a public or private offering of their securities. In
particular, with respect to private issuers relying on certain exemptions from
the registration requirements of the Securities Act, the information we post on
our Web site about issuers that engage in a private offering may be deemed to be
a public offer of securities. Similarly, with respect to issuers that intend to
commence a public offering of their securities, information that we post on our
Web site about these issuers may be deemed to be a prospectus. To avoid making
public offerings of securities that are intended to be privately placed and to
avoid information about public issuers posted on our Web site being deemed a
"prospectus" with respect to issuers that are engaging in a public offering,
before engaging our services, issuers will be required to represent to us in
their engagement agreement with us that, prior to engaging in any public or
private offering, they will advise us of such intention. Further, such issuer
will acknowledge in the engagement agreement that any information regarding an
issuer will be removed from the Company's Web site prior to such issuer
commencing any offering.

                                       8

<PAGE>


Management expects to observe regulatory/compliance standards, however, we
cannot assure you that we will avoid regulatory inquiries, the costs of
responding to regulatory inquiries, or the imposition of sanctions, fines or
other penalties which it may incur.

Intellectual Property


Our proprietary database of company information is copyrighted. To protect our
rights to intellectual property, we rely on a combination of copyright law,
trademark, trade secret protection, confidentiality agreements and other
contractual arrangements with our customers and strategic partners. The
protective steps we have taken may be inadequate to deter misappropriation of
our proprietary information. We may be unable to detect the unauthorized use of,
or take appropriate steps to enforce, our intellectual property rights. We have
registered a number of our trademarks in the United States, and we have pending
U.S. applications for other trademarks. Effective trademark, copyright and trade
secret protection may not be available in every country in which we offer or
intend to offer our services. In addition, although we believe that our
proprietary rights do not infringe on the intellectual property rights of
others, other parties may assert infringement claims against us or claim that we
have violated a patent or infringed a copyright, trademark or other proprietary
right belonging to them. These claims, even if not meritorious, could result in
the expenditure of significant financial and managerial resources on our part,
which could materially and adversely affect our business, results of operations
and financial condition. We incorporate licensed third-party technology in some
of our services. In these license agreements, the licensors have generally
agreed to defend, indemnify and hold us harmless with respect to any claim by a
third party that the licensed software infringes any patent or other proprietary
right. We cannot assure you that these provisions will be adequate to protect us
from infringement claims. The loss or inability to obtain or maintain any of
these technology licenses could result in delays in the introduction of new
services.

Employees

As of the date of this Form 10KSB, we have 20 full time employees and 20 part
time employees. All employees are retained pursuant to agreements that can be
terminated by us at-will. As we continue to grow and execute our strategic plan,
we expect to hire additional personnel, particularly in the areas of sales and
marketing, product development and technology. None of our staff is represented
by a labor union. We believe that our relationship with our employees is good.
Competition for qualified personnel in our industry is intense.


ITEM 2.   DESCRIPTION OF PROPERTY

Our corporate headquarters are located in an approximately 1600 square foot
rented facility in Melville, New York, under a lease expiring November 2006,
with minimum monthly rent of approximately $1,700, plus annual escalations of
approximately 3%. We also lease an approximately 2,200 square foot office and
executive residential facility in New York, New York under a month to month
lease with minimum monthly rent of $5,800.

We believe our present office space is suitable for our current operations.
Total rental expense approximated $184,000 and $230,000 for the years ended
November 30, 2004 and 2003, respectively.

Marcellus Group LLC purchased three commercial buildings in Marcellus, New York.
One of the buildings is being used by Marcellus Group as its corporate office.
The other two buildings are currently being renovated for use by the Company.

                                       9

<PAGE>


ITEM 3.   LEGAL PROCEEDINGS

The Company is involved in various legal proceedings and claims incident to the
normal conduct of its business. The Company believes that such legal proceedings
and claims, individually and in the aggregate, are not likely to have a material
adverse effect on its financial position or results of operations.


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

During the fourth quarter of the year ended November 30, 2004, no matters were
submitted by the Company to a vote of its stockholders.


                                     PART II
                                     -------

ITEM 5.   MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Company's Common Stock currently trades under the symbol "MRPT."

As of November 30, 2004, there were 16,293,041 shares of common stock issued and
outstanding and no shares of preferred stock issued or outstanding.

Since July 2, 2002, the Company's Common Stock has traded on the
over-the-counter electronic bulletin board. The price ranges presented below
represent the highest and lowest quoted bid prices during each quarter for 2004
and 2003 reported by Nasdaq. The quotes represent prices between dealers and do
not reflect mark-ups, markdowns or commissions and therefore may not necessarily
represent actual transactions.


Common Stock

Year               Period                           Bid Information
----               ------                           ---------------
                                              High                    Low
                                              ----                    ---
2004               1st Quarter               $0.65                   $0.31
                   2nd Quarter               $0.65                   $0.32
                   3rd Quarter               $1.01                   $0.37
                   4th Quarter               $0.90                   $0.55
2003               1st Quarter               $7.50                   $2.86
                   2nd Quarter               $5.00                   $2.50
                   3rd Quarter               $8.00                   $2.50
                   4th Quarter               $7.00                   $0.53



As reported by the Nasdaq OTC Bulletin Board, on February 15, 2005 the closing
bid price of the Common Stock was $0.60 per share.


Holders
As of February 15, 2005, there were approximately 328 holders of record of the
Company's common stock as determined from the Company's transfer agent's list.
Such list does not include beneficial owners of securities whose shares are held
in the names of various dealers and clearing agencies.

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<PAGE>


Dividends
The Company has never declared nor paid any cash dividends on its common stock
and does not anticipate paying dividends in respect of its common stock in the
foreseeable future. Any payment of cash dividends in the future will be at the
discretion of the Company's Board of Directors and will depend upon, among other
things, its earnings (if any), financial condition, cash flows, capital
requirements and other relevant considerations, including applicable contractual
restrictions and governmental regulations with respect to the payment of
dividends.

Conversions - Settlement of Convertible Promissory Notes
In November 2004, the Company converted five (5) convertible promissory notes
dated October 2002 - April 2003 (aggregate principal amount of $45,000) into
16,213 shares of common stock of the Company pursuant to a conversion agreement
wherein the holders of such notes have agreed to: (i) convert the notes into
shares of common stock of the Company at a conversion price which is $0.05 less
than the conversion price set forth in the respective notes ($2.50 - $3.50); and
(ii) not sell or transfer the shares received in conversion of the notes for a
period of one (1) year from the date of such conversion.

In October 2004, the Company entered into a settlement agreement with respect to
one (1) convertible promissory note dated April 2003 (principal amount of
$10,000) to an employee of the Company wherein the Company paid $10,000 to the
employee - noteholder in complete satisfaction of the Company's obligations with
respect to such convertible promissory note.

Recent Sales of Unregistered Securities

In November 2004, the Company converted five (5) convertible promissory notes
dated October 2002 - April 2003 (aggregate principal amount of $45,000) into
16,213 shares of common stock of the Company pursuant to a conversion agreement
wherein the holders of such notes have agreed to: (i) convert the notes into
shares of common stock of the Company at a conversion price which is $0.05 less
than the conversion price set forth in the respective notes ($2.50 - $3.50); and
(ii) not sell or transfer the shares received in conversion of the notes for a
period of one (1) year from the date of such conversion.

The issuance of the securities in the transactions described above were deemed
to be exempt from registration under the Securities Act of 1933, as amended, in
reliance on Section 4(2) of the Securities Act and Regulation D promulgated
thereunder as transactions by an issuer not involving any public offering.

Debt

In October 2004, Marcellus Group, LLC, the Company's wholly owned subsidiary,
borrowed one million dollars ($1,000,000) from Crown Mill Restoration
Development LLC, a New York limited liability company wholly owned by V. William
Lucchetti, Jr., the Company's Chief Executive Officer, Chairman of the Board of
Directors and 92% shareholder of the Company, whereby Marcellus Group, LLC
pursuant to a promissory note. The terms of the promissory note provide that
interest accrues at a rate of eight percent (8%) and the principal and interest
is payable as follows: (i) monthly installments of $25,946.98 (representing
accrued interest and $500,000 of principal) up to and including November 1,
2006; and (ii) $500,000 payment due on November 1, 2006.

Spring Bay Oil Company, Inc., a 77% owned subsidiary of the Company entered into
a loan agreement with a hedge fund. A wholly owned subsidiary of the Company was
appointed as a General Partner of this hedge fund in February 2004. Accrued
interest on the outstanding principal amount of these notes together with the
principal amount is due and payable on the maturity date.

Convertible notes payable
During March, April and May 2003, pursuant to a loan restructuring of the
$100,000 February 28, 2003 six month promissory note, the $100,000 January 14,
2002 120-day promissory note (as amended), the $100,000 November 16, 2001 60-day

                                       11

<PAGE>


promissory note (as amended), and other notes (as included below) with an
aggregate principal amount of $97,997, the Company received an additional
$355,000 from the holder of the notes who is also a shareholder of the Company.
Pursuant to the restructuring, the Company issued this shareholder (the holder
of the notes) a convertible promissory note with an aggregate principal amount
of $752,997 plus interest accrued pursuant to the terminated notes. In addition,
pursuant to the loan restructuring, the holder of the note is entitled to be
issued warrants to purchase common stock of the Company in an amount to be
agreed upon between the Company and such holder. The convertible note bears
interest at a rate of 8% per annum with a maturity date of May 30, 2004.
Pursuant to the terms of the convertible note, prior to May 30, 2004, we may
convert the balance due together with accrued interest into shares of common
stock. The conversion ratio is 2.50. Each of the prior notes, the $100,000
February 28, 2003 six month promissory note, the $100,000 January 14, 2002
10-day promissory note (as amended), the $100,000 November 16, 2001 60-day
promissory note (as amended), and the other notes with an aggregate principal
amount of $97,997, have been cancelled. As of November 30, 2004, the note has
not been repaid, but the Company is in the process of restructuring the note
with the individual.

Convertible promissory notes totaling $174,059 bear interest at a rate of 8% per
annum with maturity dates that have expired. Pursuant to the terms of the
convertible notes, if the Company does not prepay the notes prior to their
expiration, on the expiration date, the Company may convert the balance due
together with accrued interest into shares of the Company's common stock. The
conversion ratio for these notes is the greater of : (i) the amount that is
equal to the product of the closing bid price per share for the Common Stock, as
reported on the over-the-counter electronic bulletin board, or such other public
market that the Company's Common Stock is then traded and seventy-five percent
(75%); and (ii) 3.50. The Company is currently in negotiations with these note
holders with respect to the conversion of notes into common stock and expects to
convert the notes within 30 days.


ITEM 6.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION

The following discussion should be read in conjunction with the financial
statements contained in Item 8 of Part IV of this Form 10-KSB.

Introduction and Nature of Business

Our core strategy is to be a leading Web portal for financial professionals and
business decision makers and worldwide provider of multimedia production and
distribution services to corporations and other organizations. Our revenues have
been generated from the sale of package services to public and private
companies. The packages range from merely exposure on our web site to a
comprehensive service package, including press release services and in certain
cases, client exposure in "Institutional Investor" magazine.

                                       12

<PAGE>
<TABLE>
<CAPTION>


Selected Financial Data


                                                          Year Ended November 30,
                                                          -----------------------
RESULTS OF OPERATIONS:                                      2004            2003
                                                            ----            ----
<S>                                                     <C>            <C>
Total revenues                                          $  2,122,069   $    390,682

Net income (loss)                                       $  1,244,997   $ (1,036,875)

Net income (loss) attributable to common stockholders   $  1,244,997   $ (1,036,875)

Basic income (loss) per common share                    $       0.08   $      (0.06)

Diluted income (loss) per common share                  $       0.07   $      (0.06)

Weighted average common shares outstanding                16,285,948     16,046,077

Diluted common shares outstanding                         16,646,363     16,046,077


YEAR-END FINANCIAL POSITION:

Working capital deficit                                 $   (636,569)

Total assets                                            $  2,471,994

Total liabilities                                       $  2,675,325

Stockholders' deficiency                                $   (203,331)


Year Ended November 30, 2004, as compared to the year ended November 30, 2003

Overall Financial Situation. The Company had revenues of $2,122,069 for the
fiscal year ended November 30, 2004, an increase of $1,731,387 or 443% from the
fiscal year ended November 30, 2003. The Company's revenues consisted mainly of
the selling of the packages of its services. The Company has cost of revenues of
$330,161 for the fiscal year ended November 30, 2004, an increase of $163,115 or
98% from the fiscal year ended November 30, 2003. The Company's cost of revenues
includes the costs and expenses of its vendors and subcontractors that provide
services on behalf of the Company in connection with its packages of services.
The Company had a stockholders' deficiency at November 30, 2004 in the amount of
$203,331, a decrease of $1,296,188 from the stockholders' deficiency at November
30, 2003 of $1,499,519. This decrease is primarily due to the net income of
$2,122,069 for the fiscal year ended November 30, 2004. Selling general and
administrative expenses decreased from the fiscal year ended November 30, 2003
by $27,840 or 2.4% resulting in income from operations of $671,987 for the
fiscal year ended November 30, 2004. These expenses consist primarily of
professional fees and other corporate expenses, including business development
and general legal activities. Interest expense decreased by $11,887 for the
fiscal year ended November 30, 2004 from $107,875 for the fiscal year ended
November 30, 2003 primarily due to the conversion of the convertible notes. The
Company had a unrealized gain on marketable securities of $646,064 for the
fiscal year ended November 30, 2004. This gain is primarily a result of the
Company's receipt of restricted stock in lieu of payment in cash for certain of
its services.

Summary of Critical Accounting Policies; Significant Judgments and Estimates


Our discussion and analysis of our financial condition and results of operations
are based upon our Consolidated Financial Statements, which have been prepared
in accordance with accounting principles generally accepted in the United
States. The preparation of these financial statements requires us to make
significant estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities. These items are regularly monitored and analyzed by management
for changes in facts and circumstances, and material changes in these estimates
could occur in the future. Changes in estimates are recorded in the period in

                                       13
</TABLE>

<PAGE>

which they become known. We base our estimates on historical experience and
various other assumptions that we believe to be reasonable under the
circumstances. Actual results may differ from our estimates if past experience
or other assumptions do not turn out to be substantially accurate.

A summary of those accounting policies that we believe are most critical to
fully understanding and evaluating our financial results is set forth below.
This summary should be read in conjunction with our Consolidated Financial
Statements and the related Notes included elsewhere in this Annual Report.

Revenue Recognition and Allowance for Doubtful Accounts. Revenues from fee-based
contracts with terms greater than one month are recognized ratably over the life
of the contract. Advertising revenues are recognized over the period of the
related ad.

Certain agreements with customers provide for payment in the form of restricted
equity securities of publicly traded companies. In accordance with Financial
Accounting Standards Board Statement No. 123(R), "Accounting for Stock Based
Compensation", revenue recognized from these transactions is based on the value
of similar services rendered to other customers for whom the Company receives
payment in cash.

If we do not accurately estimate the resources required or the scope of work to
be performed for a contract or we do not manage the project properly within the
planned time period, then we may recognize a loss on the contract. Provisions
for estimated losses on uncompleted contracts are made on a contract-by-contract
basis and are recognized in the period in which such losses are determined. We
have committed unanticipated additional resources to complete projects in the
past, which has resulted in lower than anticipated profitability or losses on
those contracts. We expect that we will experience similar situations in the
future. In addition, we may fix the price for some projects at an early stage of
the process, which could result in a fixed price that turns out to be too low
and, therefore, could adversely affect our business, financial condition and
results of operations.

In some instances during 2004, we provided services to clients in exchange for
equity instruments of the client. We measure the fair value of the equity
instrument on the date the parties come to a mutual understanding of the terms
of the arrangement and a commitment for performance by us to earn the equity
instruments is reached, or when the equity is earned, whichever occurs earlier.

Liquidity and Capital Resources

In October 2004, Marcellus Group, LLC, the Company's wholly owned subsidiary,
borrowed one million dollars ($1,000,000) from Crown Mill Restoration
Development LLC, a New York limited liability company wholly owned by V. William
Lucchetti, Jr., the Company's Chief Executive Officer, Chairman of the Board of
Directors and 92% shareholder of the Company, whereby Marcellus Group, LLC
pursuant to a promissory note. The terms of the promissory note provide that
interest accrues at a rate of eight percent (8%) and the principal and interest
is payable as follows: (i) monthly installments of $25,946.98 (representing
accrued interest and $500,000 of principal) up to and including November 1,
2006; and (ii) $500,000 payment due on November 1, 2006.

During March, April and May 2003, pursuant to a loan restructuring of the
$100,000 February 28, 2003 six month promissory note, the $100,000 January 14,
2002 120-day promissory note (as amended), the $100,000 November 16, 2001 60-day
promissory note (as amended), and other notes (as included below) with an
aggregate principal amount of $97,997, the Company received an additional
$355,000 from the holder of the notes who is also a shareholder of the Company.
Pursuant to the restructuring, the Company issued this shareholder (the holder
of the notes) a convertible promissory note with an aggregate principal amount
of $752,997 plus interest accrued pursuant to the terminated notes. In addition,
pursuant to the loan restructuring, the holder of the note is entitled to be
issued warrants to purchase common stock of the Company in an amount to be
agreed upon between the Company and such holder. The convertible note bears
interest at a rate of 8% per annum with a maturity date of May 30, 2004.
Pursuant to the terms of the convertible note, prior to May 30, 2004, we may

                                       14

<PAGE>


convert the balance due together with accrued interest into shares of common
stock. The conversion ratio is 2.50. Each of the prior notes, the $100,000
February 28, 2003 six month promissory note, the $100,000 January 14, 2002
10-day promissory note (as amended), the $100,000 November 16, 2001 60-day
promissory note (as amended), and the other notes with an aggregate principal
amount of $97,997, have been cancelled. As of November 30, 2004, the note has
not been repaid, but the Company is in the process of restructuring the note
with the individual.

Convertible promissory notes totaling $174,059 bear interest at a rate of 8% per
annum with maturity dates that have expired. Pursuant to the terms of the
convertible notes, if the Company does not prepay the notes prior to their
expiration, the Company may convert the balance due together with accrued
interest into shares of the Company's common stock. The conversion ratio for
these notes is the greater of : (i) the amount that is equal to the product of
the closing bid price per share for the Common Stock, as reported on the
over-the-counter electronic bulletin board, or such other public market that the
Company's Common Stock is then traded and seventy-five percent (75%); and (ii)
3.50. The Company is currently in negotiations with these note holders with
respect to the conversion of notes into common stock and expects to convert the
notes within 30 days.

As of November 30, 2004, we had $851,034 in cash and cash equivalents.

Current and Future Financing Needs

We have spent, and expect to continue to spend, substantial amounts in
connection with growing our customer base. We have 20 full time employees and 20
part time employees. We do not engage any consultants.

Based on our current plans, we believe that our cash and cash equivalents and
cash flows (from increasing revenues) will be sufficient to enable us to meet
our planned operating needs. However, the actual amount of funds we may need to
operate is subject to many factors, some of which are beyond our control.

These factors include the following:

costs associated with any acquisitions targets;

costs associated with marketing our services; and

our ability to grow our customer base and retain our current customers.

We have based our belief of not requiring any additional funds on assumptions
that may prove to be wrong.

Inflation

Since the inception of the Company in December 2000, the rate of inflation has
remained low and the cost of the Company's operations has not been significantly
affected by inflationary trends in the economy.


ITEM 7.   FINANCIAL STATEMENTS

The report of the Company's Independent Auditors, the Company's financial
statements and notes to financial statements appear herein commencing on Page
F-1.

                                       15

<PAGE>


ITEM 8.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL

None

ITEM 8A.  CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures.

Based on evaluation as of a date within 90 days of the filing date of this
Annual Report on Form 10-KSB, The Macreport.net, Inc.'s principal executive
officer/principal accounting officer have concluded that The Macreport.net,
Inc.'s disclosure controls and procedures (as defined in Rules 13a-14(c) and
15d-14(c) under the Securities Exchange Act of 1934 (the "Exchange Act")) are
effective to ensure that information required to be disclosed by the Company in
reports that it files or submits under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in Securities and
Exchange Commission rules and forms.

(b) Changes in internal controls.

There were no significant changes in The Macreport.net, Inc 's internal controls
or in other factors that could significantly affect these controls subsequent to
the date of their evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.

In accordance with the requirements of Section 13 or 15(d) of the Exchange Act,
the registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


ITEM 8B.  OTHER INFORMATION

None

                                       16

<PAGE>


                                    PART III
                                    --------
ITEM 9.   DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS OF THE
REGISTRANT; AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth information, as of December 31, 2004, concerning
each director and executive officer of the Company.

                                        Positions with               Position
Name                            Age     the Company                  Held Since
----                            ---     -----------                  ----------


V. William Lucchetti, Jr.       39      Chairman of the Board of        2000
                                        Directors, Chief Executive
                                        Officer and President

Adam J. Reznikoff               33      Vice President-North            2000
                                        American Sales and Director

Kenneth T. Hutchinson           53      Director                        2003

The business address for each of our officers and directors is 150 Broadhollow
Road, Suite PH11, Melville, New York 11747.
The following sets forth the business experience of each director, executive
officer, including principal occupations, at present and for at least the past
five years.

     V. William Lucchetti, Jr. Mr. Lucchetti has been our Chairman, Chief
Executive Officer and President since our inception in December 2000. Also,
since August 1999, Mr. Lucchetti has served as the Chief Executive Officer,
President and a director of Michael Adams Consulting, Inc. From August 1998 to
April 1999, Mr. Lucchetti served as the Vice President-Sales, Recruiting and
Training of Kirlin Securities, Inc.

     Adam J. Reznikoff Mr. Reznikoff has been our Vice President-North American
Sales and a director since our inception in December 2000. From May 2000 to
November 2000, Mr. Reznikoff served as the Vice President Marketing and Sales
for Michael Adams Consulting, Inc. From August 1998 to May 2000, Mr. Reznikoff
was an Account Executive at Kirlin Securities, Inc.

     Kenneth T. Hutchinson Mr. Hutchinson has been a director since July 2003.
Mr. Hutchinson is a Vice President of Finance at National Australia Bank (since
June 2003). Mr. Hutchinson also was employed by National Australia Bank as an
Associate Vice President of Finance & Compliance from March 1997 to June 2001.
From February 2003 to May 2003, Mr. Hutchinson was President of TH Consulting
Group, Inc., a financial consulting concern. From July 2001 to February 2002,
Mr. Hutchinson was a Senior Banking Consultant with Temenos USA Inc.

The Company's directors are elected for a period of one year and until their
successors are duly elected and qualified. There are currently three members of
the Board of Directors. During July 2003, James Favia resigned as a member of
the Board of Directors due to personal reasons. On July 16, 2003, the Company
appointed Kenneth T. Hutchinson to serve as a non-executive member of the board
of directors of Company and chairman of the audit committee.

                                      17

<PAGE>
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<CAPTION>


To the knowledge of management of the Company, except as set forth above, no
director of the Company holds any directorship in any other company with a class
of securities registered pursuant to Section 12, or subject to the requirements
of Section 15(d), of the Securities Exchange Act of 1934 or in any company
registered as an investment company under the Investment Company Act of 1940.

Compliance with Section 16(a) of the Securities Exchange Act of 1934

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the
Company's executive officers, directors and persons who own more than ten
percent of a registered class of the Company's equity securities to file certain
reports regarding ownership of, and transactions in, the Company's securities
with the Securities and Exchange Commission (the "SEC"). These officers,
directors and stockholders are also required by SEC rules to furnish the Company
with copies of all Section 16(a) reports that are filed with the SEC. Based
solely on a review of copies of such forms received by the Company, and written
representations received by the Company from certain reporting persons, the
Company believes that for the year ended November 30, 2004 all Section 16(a)
reports required to be filed by the Company's executive officers, directors and
10% stockholders were filed on a timely basis.


ITEM 10.      EXECUTIVE COMPENSATION

The following table summarizes all compensation earned by or paid to the
Company's Chief Executive Officer for services rendered in all capacities to the
Company for the period beginning on December 13, 2000 (Inception) to November
30, 2004 and all officers who earned over $100,000 (the "Named Executive
Officers"). One of our executive officers was compensated in excess of $100,000
when advances of expenses are included as set forth below.

                           SUMMARY COMPENSATION TABLE
                           --------------------------
                                                                                                         Long-Term
                                                            Annual Compensation                        Compensation
                                         -------------------------------------------------------     ---------------
                                                                                                       Securities
                                                                                 Other Annual          Underlying
Name and Principal Position               Year   Salary ($)      Bonus ($)       Compensation ($)    Options/SARs(#)
---------------------------               ----   ----------      ---------       ----------------    ---------------

<S>                                        <C>       <C>               <C>            <C>                        <C>
V. Willam Lucchetti, Jr.                   2004      $   --                           $234,834 1                  --
  Chairman, President, Chief Executive     2003      $ 35,534           --            $155,757 1                  --
  and Operating Officer and Treasurer      2002      $ 31,846           --             $68,300 2                  --
                                           2001            --           --                   --                   --


Adam J. Reznikoff                          2004      $ 78,130           --                   --                   --
  Secretary and                            2003      $ 39,594           --                   --                   --
  Director                                 2002      $ 17,423           --                   --                   --
                                           2001      $ 28,770           --                   --                   --
                                                           --

-------------------
1    Advance of expenses of Mr. Lucchetti by the Company.
2    Compensation paid to Michael Adam Consulting, Inc. which is wholly owned by
     Mr. Lucchetti.

                                       18

</TABLE>

<PAGE>


We have not granted any stock options to the named executive officer. None of
our employees are employed pursuant to employment agreements.

Director's Compensation

Directors who are not employees of the Company are compensated at a rate of
$1,000 for each meeting of the full Board of Directors which they attend in
person, up to a maximum of $5,000 in any one year, plus expenses for attending
such meetings. Officers are appointed annually by the Board of Directors and
serve at the discretion of the Board.



                           OPTIONS/SAR GRANTS IN 2004
                           --------------------------

There were no option grants 2004.



                     AGGREGATE OPTION EXERCISES IN 2004 AND
                     --------------------------------------
                       2004 FISCAL YEAR-END OPTION VALUES
                       ----------------------------------

There were no option exercises in 2004.



Compensation Committee Interlocks and Insider Participation

The Board of Directors of the Company does not have a compensation committee or
audit committee. The Board of Directors determines executive compensation, based
on corporate performance and market conditions.

Employment Agreements

The Company has confidentiality agreements with each employee of the Company
that sets forth confidentiality obligations and intellectual property ownership.
Pursuant to each of the employment agreements, each employee is an employee at
will which may be terminated by the Company at any time for any reason.


Stock Option Plan


In April 2001, we adopted the 2001 Stock Option Plan, referred to as the 2001
Plan. The 2001 Plan will expire in April 2011, unless terminated earlier by our
board of directors at their discretion. The 2001 Plan provides for the grant of
options to purchase shares of our common stock, including:

incentive stock options, as defined by Section 422 of the Internal Revenue Code,
that may be granted solely to employees, including officers,

non-qualified stock options, being stock options other than incentive stock
options, that may be granted to employees, including officers, and

non-employee directors and individuals with whom we have consulting agreements.


Share Reserve. We authorized the issuance of 1,000,000 shares of our common
stock pursuant to the 2001 Plan. As of November 30, 2004, we have not granted
any options under the 2001 Plan. Shares subject to awards under the 2001 Plan
that have expired or otherwise terminated without having been exercised in full

                                       19

<PAGE>


again become available for the grant of awards under the 2001 Plan. Shares
issued under the 2001 Plan may be previously unissued shares or reacquired
shares of common stock.

Awards. Stock options may be granted under the 2001 Plan to our employees,
non-employee directors and individuals with whom we have consulting agreements.
The stock options granted will be either incentive stock options or
non-qualified stock options.

An incentive stock option is a stock option that has met the requirements of
Section 422 of the Internal Revenue Code and, except as set forth below, must be
granted with an exercise price of at least 100% of the fair market value at the
date of grant.

No incentive stock option, and, prior to our stock being publicly traded, no
non-qualified stock option, may be granted to any person, who, at the time of
the grant, owns or is deemed to own stock possessing more than 10% of the total
combined voting power of our company or any affiliate, unless the following
conditions are satisfied:

the option exercise price must be at least 110% of the fair market value of the
stock subject to the option on the date of grant; and

the term of any incentive stock option award must not exceed five years from the
date of grant.

Plan Administration. The 2001 Plan is administered by our board of directors.
Our board of directors interprets all questions relating to the 2001 Plan and
its decisions are final and binding on all participants. Any determination by a
majority of the members of the board of directors at any meeting, or by written
consent in lieu of a meeting, shall be deemed to have been made by the whole
board of directors. Under the 2001 Plan, the board of directors may, at any time
or from time to time, appoint a committee of at least two members of the board
of directors and delegate to the committee the authority of the board of
directors to administer the 2001 Plan. Upon such appointment and delegation,
such committee shall have all the powers, privileges and duties of the board of
directors, and shall be substituted for the board of directors, in the
administration of the 2001 Plan, subject to certain limitations.

Term of Awards. In general, the term of stock options granted under the 2001
Plan is ten years. In the event an awardee's service relationship with us ends,
other than upon the awardee's death or disability, the award may be exercised
within a period of 90 days following termination, provided that the award has
already vested. If the awardee's termination of service is for cause, such
period will not exceed thirty days. Any award not already vested, or not
exercised within these periods shall terminate. If the awardee dies, any vested
award may be exercised within the time period specified in the award agreement,
being at least six months, or if no time is specified, twelvemonths.

Payment of Exercise Price. Awardees may pay the exercise price of their awards,
if any, as determined by the compensation committee, and acceptable
consideration includes cash, checks, and promissory notes. Generally, an option
holder may not transfer a stock option to any entity other than a spouse or
descendants or to a trust, or other entity owned by such a trust, for the
primary benefit of the option holder, his spouse and/or his descendants.

Option Adjustments. The aggregate number and class of shares as to which options
may be granted under the 2001 Plan, the number and class shares covered by each
outstanding option and the exercise price per share of each outstanding option,
but not the total price, and all such options, shall each be proportionately
adjusted for any increase decrease in the number of issued common stock
resulting from split-up, spin-off or consolidation of shares or any like capital
adjustment or the payment of any stock dividend. Generally, any option granted

                                       20

<PAGE>


shall terminate in the event of a merger, consolidation, acquisition of property
or stock, separation, reorganization or liquidation. However, the optionee shall
have the right immediately prior to any such transaction to exercise his or her
option in whole or in part.

Additional Provisions. The board of directors may, in their sole discretion,
include additional provisions in any option or award granted or made under the
2001 Plan that are not inconsistent with the 2001 Plan or applicable law. The
board of directors may also, in its sole discretion, accelerate or extend the
date or dates on which all or any particular award or awards granted under the
2001 Plan may be exercised.

Limitation of Liability and Indemnification Matters

Article eighth of our certificate of incorporation provides that the personal
liability of our directors will be eliminated to the fullest extent permitted by
the provisions of paragraph (7) of subsection (b) of ss. 102 of the General
Corporation Law of the State of Delaware, as the same may be amended and
supplemented. Article sixth of our certificate of incorporation provides that we
will, to the fullest extent permitted by the provisions of the General
Corporation Law of the State of Delaware, indemnify all persons whom we may
indemnify under such provisions. The indemnification provided by this section
shall not limit or exclude any rights, indemnities or limitations of liability
to which any person may be entitled, whether as a matter of law, under our
bylaws, by agreement, vote of our stockholders or disinterested directors, or
otherwise. Except as specifically required by the General Corporation Law of the
State of Delaware, as the same exists or may be amended, none of our directors
of will be liable to us or our stockholders for monetary damages for breach of
his or her fiduciary duty as a director. No amendment to or repeal of this
provision of our certificate of incorporation will apply to or have any effect
on the liability or alleged liability of any director for or with respect to any
acts or omissions of that director occurring prior to the amendment or repeal.

Under Section 145 of the Delaware General Corporation Law, we have the power,
under certain circumstances, to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or contemplated action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that he is or was a director, officer, employee or agent of
ours, or is or was serving at our request as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses, including attorneys' fees, and judgments against,
fines and amounts paid in settlement actually and reasonably incurred by him in
connection with the action, suit or proceeding.

Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers, or persons controlling us pursuant
to the foregoing provisions, we have been informed that, in the opinion of the
SEC, that type of indemnification is against public policy as expressed in the
Act and is therefore unenforceable.

There is no pending litigation or proceeding involving any of our directors or
officers as to which indemnification is being sought, nor are we aware of any
pending or threatened litigation that may result in claims for indemnification
by any director or officer.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS

The following table sets forth certain information known to us with respect to
the beneficial ownership of our common stock as of November 30, 2004 by:

                                       21

<PAGE>


all persons who are beneficial owners of five percent (5%) or more of our common
stock;

each of our directors;

each of our executive officers; and

all current directors and executive officers as a group.

Except as otherwise indicated, and subject to applicable community property
laws, the persons named in the table below have sole voting and investment power
with respect to all shares of common stock held by them.

Applicable percentage ownership in the following table is based on 16,304,509
shares of common stock outstanding as of November 30, 2004.

Beneficial ownership is determined in accordance with the rules of the SEC. No
shares of common stock of the Company are subject to options held by any
persons.

                                                                    Approximate
                                                 Number            Percentage of
Name and Address of Beneficial Holder           of Shares              Class
-------------------------------------           ---------              -----
V. William Lucchetti, Jr....................
c/o The Macreport.net, Inc.
150 Broadhollow Road
Melville, New York 11747                       14,962,980                92%

Adam J. Reznikoff...........................
c/o The Macreport.net, Inc.
150 Broadhollow Road
Melville, New York 11747                             --                  --

Kenneth T. Hutchinson......................
c/o The Macreport.net, Inc.
150 Broadhollow Road
Melville, New York 11747                            4,000                 *

All executive officers and directors
as a group (3 persons)                         14,966,980                92%
------------------------

* less than 1%

                                       22

<PAGE>


ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

In October 2004, Marcellus Group, LLC, the Company's wholly owned subsidiary,
borrowed one million dollars ($1,000,000) from Crown Mill Restoration
Development LLC, a New York limited liability company wholly owned by V. William
Lucchetti, Jr., the Company's Chief Executive Officer, Chairman of the Board of
Directors and 92% shareholder of the Company, whereby Marcellus Group, LLC
pursuant to a promissory note. The terms of the promissory note provide that
interest accrues at a rate of eight percent (8%) and the principal and interest
is payable as follows: (i) monthly installments of $25,946.98 (representing
accrued interest and $500,000 of principal) up to and including November 1,
2006; and (ii) $500,000 payment due on November 1, 2006.

We lease an executive residence and office facility for $5,800 in monthly rent.
The lease is on a month-to-month term. Mr. Lucchetti has the exclusive personal
use of the executive residence facility at no cost. The lease cost associated
with the executive residence is not included as compensation to Mr. Lucchetti.

We believe that all of the transactions discussed above were made on terms no
less favorable to us than could have been obtained from unaffiliated third
parties.

                                       23

<PAGE>
<TABLE>
<CAPTION>


ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K

                    The following exhibits of the Company are filed herewith,
                    unless otherwise indicated:
     Exhibit                                                                     Filed             Incorporated by
     Number         Description                                                  Herewith            Reference to
     ------         -----------                                                  --------            ------------

      <S>           <C>                                                           <C>        <C>
      3.1           Certificate of Incorporation                                             The Registrant's Registration
                                                                                             Statement on Form SB-2 (No.
                                                                                             333-64244)

      3.2           By-laws                                                                  The Registrant's Registration
                                                                                             Statement on Form SB-2 (No.
                                                                                             333-64244)

      4.1           Specimen common stock certificate                                        The Registrant's Registration
                                                                                             Statement on Form SB-2 (No.
                                                                                             333-64244)

      4.2           2001 Stock Option Plan                                                   The Registrant's Registration
                                                                                             Statement on Form SB-2 (No.
                                                                                             333-64244)

      5.1           Opinion of Stephen J. Czarnik, Esq.                                      The Registrant's Registration
                                                                                             Statement on Form SB-2 (No.
                                                                                             333-64244)

     10.1           Consulting Agreement, dated January 1, 2001, between                     The Registrant's Registration
                    Michael Adams Consulting, Inc.                                           Statement on Form SB-2 (No.
                                                                                             333-64244)

     10.2           Office Service Agreement, dated July 7, 2000, with                       The Registrant's Registration
                    VANTAS Long Island, LLC                                                  Statement on Form SB-2 (No.
                                                                                             333-64244)

     10.3           Lease, dated March 30, 2001, with 25 Broad Street                        The Registrant's Registration
                    LLC                                                                      Statement on Form SB-2 (No.
                                                                                             333-64244)

     10.4           Form of Subscription Agreement executed by                               The Registrant's Registration
                    investors in  the private offering or our common                         Statement on Form SB-2 (No.
                    stock that closed on May 15, 2001                                        333-64244)

     10.5           Promissory Note issued to Sherman Winski                                 The Registrant's Registration
                    November 16, 2001                                                        Statement on Form SB-2 (No.
                                                                                             333-64244)

     10.6           Amended and Restated Promissory Note issued to Sherman                   The Registrant's Registration
                    Winski January 8, 2002                                                   Statement on Form SB-2 (No.
                                                                                             333-64244)

     10.7           Promissory Note issued to Sherman Winski dated January                   The Registrant's Registration
                    14, 2002                                                                 Statement on Form SB-2 (No.
                                                                                             333-64244)

                                                             24
</TABLE>

<PAGE>
<TABLE>
<CAPTION>


     <S>           <C>                                                             <C>       <C>
     10.8           Form of Convertible Promissory Note (May 2002)                           The Registrant's Quarterly
                                                                                             Report on Form 10-QSB for the
                                                                                             quarter ended May 31, 2002

     10.9           Office Service Agreement, dated as of January 1,                         The Registrant's Annual
                     2003, with HQ Global Workplaces                                         Report on Form 10-KSB for the
                                                                                             year ended November 30, 2002

     10.10          Form of Convertible Promissory Note (September -                         The Registrant's Annual
                    November 2002)                                                           Report on Form 10-KSB for the
                                                                                             year ended November 30, 2002

     10.11          Form of Convertible Promissory Note (November                            The Registrant's Annual
                    2002)                                                                    Report on Form 10-KSB for the
                                                                                             year ended November 30, 2002

     10.12          Form of Convertible Promissory Note (July 2002)                          The Registrant's Annual
                                                                                             Report on Form 10-KSB for the
                                                                                             year ended November 30, 2002

     10.13          Form of Convertible Promissory Note (June 2002)                          The Registrant's Annual
                                                                                             Report on Form 10-KSB for the
                                                                                             year ended November 30, 2002

     10.14          Amendment No. 1 to the Amended and Restated                              The Registrant's Annual
                    Promissory Note issued to Sherman Winski dated                           Report on Form 10-KSB for the
                    March 9, 2002                                                            year ended November 30, 2002

     10.15          Amendment No. 2 to the Amended and Restated                              The Registrant's Annual
                    Promissory Note issued to Sherman Winski dated                           Report on Form 10-KSB for the
                    September 9, 2002                                                        year ended November 30, 2002

     10.16          Amendment No. 3 to the Amended and Restated                              The Registrant's Annual
                    Promissory Note issued to Sherman Winski dated                           Report on Form 10-KSB for the
                    November 14, 2002                                                        year ended November 30, 2002

     10.17          Amendment No. 1 to the Promissory Note issued to                         The Registrant's Annual
                    Sherman Winski dated April 10, 2002                                      Report on Form 10-KSB for the
                                                                                             year ended November 30, 2002

     10.18          Amendment No. 2 to the Promissory Note issued to                         The Registrant's Annual
                    Sherman Winski dated September 9, 2002                                   Report on Form 10-KSB for the
                                                                                             year ended November 30, 2002

     10.19          Amendment No. 3 to the Promissory Note issued to                         The Registrant's Annual
                    Sherman Winski dated January 10, 2003                                    Report on Form 10-KSB for the
                                                                                             year ended November 30, 2002

     10.20          Promissory Note issued to Crown Mill Development               *
                    LLC

     14.1           Code of Ethics                                                           The Registrant's Annual
                                                                                             Report on Form 10-KSB for the
                                                                                             year ended November 30, 2003

                                                             25
</TABLE>

<PAGE>
<TABLE>
<CAPTION>


     <S>            <C>                                                            <C>       <C>
     16.1           Letter from Capraro Centofranchi Kramer & Co.                            The Registrant's Current
                                                                                             Report on Form 8-KA dated
                                                                                             January 21, 2003

     21.1           Subsidiaries                                                   *

     23.1           Consent of Capraro Centofranchi Kramer & Co.,                            The Registrant's Registration
                    P.C.                                                                     Statement on Form SB-2 (No.
                                                                                             333-64244)

     23.2           Consent of Stephen J. Czarnik, Esq. (included in                         The Registrant's Registration
                    Exhibit 5.1 hereof)                                                      Statement on Form SB-2 (No.
                                                                                             333-64244)

     24.1           Power of attorney                                                        The Registrant's Registration
                                                                                             Statement on Form SB-2 (No.
                                                                                             333-64244)

     31.1           Certification of V. William Lucchetti pursuant to               *
                    Rule 13-14(a) and Item 307 of Regulation SB
                    32.1

     32.1           Certification by V. William Lucchetti Pursuant to               *
                    the 18  U.S.C. Section 1350, as Adopted Pursuant to
                    Section 906 of the Sarbanes-Oxley Act of 2002

------------------
           *Filed herewith.

     Reports on Form 8-K

          None

ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES

Aggregate fees for professional services rendered for us by Holtz Rubenstein
Reminick, LLP, for fiscal years ended November 30, 2004 and 2003, are set
forth below. The aggregate fees included in the Audit category are fees billed
for the fiscal years for the audit of our annual financial statements and review
of financial statements and statutory and regulatory filings or engagements. The
aggregate fees included in each of the other categories are billed in the fiscal
years.

                                 FISCAL YEAR 2004            FISCAL YEAR 2003
   AUDIT FEES                    $ 45,000                    $ 38,900
   AUDIT-RELATED FEES            $   -                       $   -
   TAX FEES                      $   -                       $   -
   ALL OTHER FEES                $   -                       $   -
                                 -----------                 ------------
         TOTAL                   $ 45,000                    $ 38,900

Audit fees for the fiscal years ended November 30, 2004 and 2003, were for
professional services rendered for the audits of the consolidated financial
statements of the Company, quarterly review of the financial statements included
in Quarterly Reports on Form 10-QSB, and other assistance required to complete
the year end audit of the consolidated financial statements.

As we do not have a formal audit committee (see end of Item 9 above), the
services described above were not approved by the audit committee under the de
minimus exception provided by Rule 2-01(c)(7)(i)(C) under Regulation S-X.
Further, as we do not have a formal audit committee, we do not have audit
committee pre-approval policies and procedures.

                                       26
</TABLE>

<PAGE>


                                   SIGNATURES

         In accordance with Section 13 or 15(d) of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized, on February 28, 2005.

                                            THE MACREPORT.NET, INC.


                                            By:  /s/  V. William Lucchetti, Jr.
                                               ---------------------------------
                                                      V. William Lucchetti, Jr.
                                                      Chairman,
                                                      Chief Executive Officer
                                                      and President




In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the capacities and
on the dates stated.



/s/  V. William Lucchetti, Jr.     Chairman, Chief Executive   February 28, 2005
--------------------------------   Officer and President
     V. William Lucchetti, Jr.     (Principal Executive
                                   Officer and Principal
                                   Accounting and Financial
                                   Officer)


/s/  Adam J. Reznikoff             Vice President-North        February 28, 2005
--------------------------------   American Sales and
     Adam J. Reznikoff             Director


/s/  Kenneth T. Hutchinson         Director                    February 28, 2005
--------------------------------
     Kenneth T. Hutchinson

                                       27

<PAGE>


                   Index to Consolidated Financial Statements


                                                                       Page

     A.   Report of Independent Registered Public Accounting
          Firm                                                          F-1

     B.   Consolidated Balance Sheet for the year ended
          November 30, 2004                                             F-2

     C.   Consolidated Statements of Operations for the years
          ended November 30, 2004 and 2003                              F-3

     D.   Consolidated Statement of Stockholders' Deficiency
          for the year ended November 30, 2004                          F-4

     E.   Consolidated Statements of Cash Flows for the years
          ended November 30, 2004 and 2003                              F-5

     F.   Notes to Consolidated Financial Statements                 F-6 to F-13

<PAGE>


             Report of Independent Registered Public Accounting Firm
             -------------------------------------------------------

To the Board of Directors and Stockholders of
The Macreport.Net, Inc.
Melville, New York

We have audited the accompanying consolidated balance sheet of The
Macreport.Net, Inc. and Subsidiaries, as of November 30, 2004, and the related
consolidated statements of operations, stockholders' deficiency and cash flows
for the years ended November 30, 2004 and 2003. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audit.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States of America). Those standards require
that we plan and perform the audits to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of The Macreport.Net,
Inc. and Subsidiaries as of November 30, 2004 and the results of their
operations and their cash flows for the years ended November 30, 2004 and 2003
in conformity with accounting principles generally accepted in the United States
of America.





                                             /s/  HOLTZ RUBENSTEIN REMINICK, LLP
                                             ----------------------------------
                                                  HOLTZ RUBENSTEIN REMINICK, LLP


Melville, New York
February 8, 2005

                                      F-1

<PAGE>


                    THE MACREPORT.NET, INC. AND SUBSIDIARIES
                    ----------------------------------------

                           CONSOLIDATED BALANCE SHEET
                           --------------------------

                                November 30, 2004
                                -----------------

                      ASSETS
                      ------
CURRENT ASSETS:
Cash and cash equivalents                                           $   851,034
Marketable securities                                                 1,169,014
Accounts receivable                                                      14,708
Other current assets                                                      4,000
                                                                    -----------
Total current assets                                                  2,038,756

EQUIPMENT, net                                                          425,667

OTHER ASSETS                                                              7,571

Total assets                                                        $ 2,471,994
                                                                    ===========

     LIABILITIES AND STOCKHOLDERS' DEFICIENCY
     ----------------------------------------

CURRENT LIABILITIES:
Accounts payable and accrued expenses                               $   276,979
Notes payable                                                         1,047,055
Current Potion of Loan Payable - Related Party                          248,177
Deferred revenue                                                        364,033
                                                                    -----------
Total current liabilities                                             1,936,244

Loan Payable - Related Party                                            739,081
                                                                    -----------
Total Liabilities                                                     2,675,325

COMMITMENTS

STOCKHOLDERS' DEFICIENCY:
Preferred stock $.0001 par value, authorized 5,000,000
shares, no shares issued                                                   --
Common stock $.0001 par value, authorized 25,000,000
shares, 16,293,041 shares issued and outstanding                          1,629
Additional paid-in-capital                                            1,731,973
Deficit                                                              (1,936,933)
                                                                    -----------
Total stockholders' deficiency                                         (203,331)
                                                                    -----------
Total liabilities and stockholders' deficiency                      $ 2,471,994
                                                                    ===========

                 See notes to consolidated financials statement

                                      F-2

<PAGE>


                    THE MACREPORT.NET, INC. AND SUBSIDIARIES
                    ----------------------------------------

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      -------------------------------------


                                                    Year Ended      Year Ended
                                                   November 30,    November 30,
                                                       2004            2003
                                                   ------------    ------------

REVENUES                                           $  2,122,069    $    390,682

COST OF REVENUES                                        330,161         167,046
                                                   ------------    ------------
GROSS PROFIT                                          1,791,908         223,636

SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES                               1,119,921       1,148,216
                                                   ------------    ------------
INCOME (LOSS) BEFORE OTHER INCOME (EXPENSE)             671,987        (924,580)
                                                   ------------    ------------
OTHER INCOME (EXPENSE):
 Unrealized gain (loss) on marketable securities        646,064          (4,000)
 Gain (loss) on sale of marketable securities            21,047            (420)
 Interest expense                                       (95,988)       (107,875)
 Interest income                                          1,887            --
                                                   ------------    ------------
                                                        573,010        (112,295)
                                                   ------------    ------------
Income Taxes                                               --              --

NET INCOME (LOSS)                                  $  1,244,997    $ (1,036,875)
                                                   ============    ============
INCOME (LOSS) PER COMMON SHARE:

BASIC                                              $       0.08    $      (0.06)
                                                   ============    ============
DILUTED                                            $       0.07    $      (0.06)
                                                   ============    ============
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING:

BASIC                                                16,285,948      16,046,077
                                                   ============    ============
DILUTED                                              16,646,362      16,046,077
                                                   ============    ============


                 See notes to consolidated financials statement

                                      F-3

<PAGE>
<TABLE>
<CAPTION>


                                     THE MACREPORT.NET, INC. AND SUBSIDIARIES
                                     ----------------------------------------

                                       STATEMENT OF STOCKHOLDERS' DEFICIENCY
                                       -------------------------------------

                                     FOR THE TWO YEARS ENDED NOVEMBER 30, 2004
                                     -----------------------------------------



                                                     Common Stock          Additional
                                              -------------------------     Paid-in
                                                 Shares        Amount       Capital        Deficit       Total
                                              -----------   -----------   -----------    -----------  -----------
<S>                                           <C>          <C>           <C>           <C>            <C>
Balance, December 1, 2002                     15,875,232   $     1,588   $   866,412   $(2,145,055)   $(1,277,055)

Stock issued for conversion of convertible
 promissory notes                                397,710            39       814,372          --          814,411

Net loss for the year                               --            --            --      (1,036,875)    (1,036,875)
                                             -----------   -----------   -----------    -----------    ----------

Balance, November 30, 2003                    16,272,942         1,627     1,680,784    (3,181,930)    (1,499,519)

Stock issued for conversion of convertible
 promissory notes                                 20,099             2        51,189          --           51,191

 Net income for the year                            --            --            --       1,244,997      1,244,997
                                             -----------   -----------   -----------    -----------    ----------

 Balance, November 30, 2004                   16,293,041   $     1,629   $ 1,731,973   $(1,936,933)   $  (203,331)
                                             ===========   ===========   ===========    ===========   ===========


                                 See notes to consolidated financials statement

                                                        F-4
</TABLE>

 <PAGE>
<TABLE>
<CAPTION>


                        THE MACREPORT.NET, INC. AND SUBSIDIARIES
                        ----------------------------------------

                         CONSOLIDATED STATEMENTS OF CASH FLOWS
                         -------------------------------------



                                                            Year Ended     Year Ended
                                                           November 30,   November 30,
                                                              2004           2003
                                                           -----------    -----------
<S>                                                        <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income (loss)                                         $ 1,244,997    $(1,036,875)
                                                           -----------    -----------
 Adjustments to reconcile net income (loss) to net cash
  used in operating activities:
  Depreciation and amortization                                 12,638         12,169
  Unrealized (gain) loss on non-marketable securities         (646,064)         4,000
  Realized (gain) loss on sale of securities                   (21,047)           420
  Marketable securities received for payment of services    (1,146,519)          --
  Changes in operating assets and liabilities:
  (Increase) decrease in assets:
    Accounts receivable                                        (14,708)          --
    Other current assets                                        (2,000)        (2,000)
    Security deposits                                             --           (1,726)
  Increase (decrease) in liabilities:
  Accounts payable and accrued expenses                       (262,130)       182,784
  Deferred revenue                                             327,930        (20,556)
                                                           -----------    -----------
 Total adjustments                                          (1,751,900)       175,091
                                                           -----------    -----------
 Net cash used in operating activities                        (506,903)      (861,784)
                                                           -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
 Proceeds from sale of marketable securities                   691,767          7,581
 Purchase of marketable securities                             (26,651)       (32,500)
 Purchase of property and equipment                           (406,304)        (6,247)
                                                           -----------    -----------
 Net cash provided by investing activities                     258,812        (31,166)
                                                           -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
 Decrease in advances to stockholder                              --          (28,167)
 Repayments of notes payable                                   (22,743)          --
 Proceeds from notes payable                                 1,120,000        776,327
                                                           -----------    -----------
 Net cash provided by financing activities                   1,097,257        748,160
                                                           -----------    -----------

Net increase in cash and cash equivalents                      849,166       (144,790)

Cash and cash equivalents at beginning of year                   1,868        146,658
                                                           -----------    -----------

Cash and cash equivalents at end of year                   $   851,034    $     1,868
                                                           ===========    ===========

                     See notes to consolidated financials statement

                                          F-5
</TABLE>

<PAGE>



                     THE MACREPORT.NET, INC.AND SUBSIDIARIES
                     ---------------------------------------
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ------------------------------------------
                     YEARS ENDED NOVEMBER 30, 2004 AND 2003
                     --------------------------------------


1.   Organization\Description of Business:
     ------------------------------------

     The MacReport.Net, Inc. (the "Company") was incorporated in 2000 under the
laws of the State of Delaware. The Company is an internet information and media
company formed to allow publicly and privately held companies to communicate
relevant corporate information directly with the investing public. This is done
through the use of a web site that provides the user with key information via
management interviews, press releases, video conferencing and other information.
The Company has its headquarters in Melville, NY, and satellite locations in New
York City and Marcellus, New York.

2.   Summary of Significant Accounting Policies:
     ------------------------------------------

     a. Principles of consolidation and basis of presentation
        -----------------------------------------------------

        The consolidated financial statements include the accounts of the
Company and three subsidiaries. All significant intercompany transactions have
been eliminated in consolidation. The subsidiaries are as follows:

The Marcellus Group, LLC - A company owned 100% by the MacReport.Net that was
formed in 2004 to acquire, renovate, and lease out commercial properties. As of
November 30, 2004, the Marcellus Group LLC owned three buildings in the town of
Marcellus, New York.

MacNetworks Inc. - A company owned 100% by the MacReport.Net that was formed in
2004. As of November 30, 2004, there has been no material activity in this
corporation.

Spring Bay Oil Company Inc. - A company owned 77% by the MacReport.Net that was
formed in 2004 to develop a product that can be used in the production of oil.

     b. Use of estimates
        ----------------

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

     c. Revenue recognition

         Revenues from fee-based contracts with terms greater than one month are
recognized ratably over the life of the contract. Advertising revenues are
recognized over the period of the related ad.

        Certain agreements with customers provide for payment in the form of
restricted equity securities of publicly traded companies. In accordance with
Financial Accounting Standards Board Statement No. 123(R), "Accounting for Stock
Based Compensation", revenue recognized from these transactions is based on the
value of similar services rendered to other customers for whom the Company
receives payment in cash.

                                       F-6

<PAGE>


2.   Summary of Significant Accounting Policies: (Cont'd)
     ------------------------------------------

     d. Cash and cash equivalents
        -------------------------

        For purposes of the statement of cash flows, the Company includes cash
on deposit, money market funds and amounts held by brokers in cash accounts to
be cash equivalents.

     e. Marketable securities
        ---------------------

        The Company reports its investment in marketable securities under the
provisions of Financial Accounting Standards Board Statement No. 115 "Accounting
for Certain Investments in Debt and Equity Securities." In accordance with this
standard, securities which are classified as "trading securities" are recorded
in the Company's balance sheet at fair market value, with the resulting
unrealized gain or loss reflected in the Company's statement of operations in
the current period. Securities which are classified as "available for sale" are
also reported at fair market value, however, the unrealized gain or loss on
these securities is listed as a separate component of stockholders' deficiency.

     f. Allowance for doubtful accounts
        -------------------------------

        Management must make estimates of the uncollectibility of accounts
receivable. Management specifically analyzes accounts receivable and analyzes
historical bad debts, customer concentrations, customer credit-worthiness,
current economic trends and changes in customer payment terms when evaluating
the adequacy of the allowance for doubtful accounts. Balances in accounts
receivable that are deemed uncollectible due to termination of a contract prior
to services being performed are charged against revenue.

     g. Equipment and depreciation
        --------------------------

        Equipment is stated at cost. Major expenditures for property and those
which substantially increase useful lives are capitalized. Maintenance, repairs,
and minor renewals are expensed as incurred. When assets are retired or
otherwise disposed of, their costs and related accumulated depreciation are
removed from the accounts and resulting gains or losses are included in income.
Depreciation is provided by both straight-line and accelerated methods over the
estimated useful lives of the assets. Differences attributable to using
accelerated methods are not considered material.

     h. Concentration of risk
        ---------------------

        The Company invests its excess cash in deposits and money market
accounts with major financial institutions with strong credit ratings. From time
to time, the Company's cash accounts may exceed the Federal Depository Insurance
Coverage Limit. Cash and cash equivalents approximated $851,000 and $1,900 at
November 30, 2004 and 2003, respectively. Generally, the investments mature
within ninety days, and therefore, are subject to little risk. The Company has
not experienced losses related to these investments.

                                       F-7

<PAGE>
<TABLE>
<CAPTION>


2.   Summary of Significant Accounting Policies: (Cont'd)
     ------------------------------------------

     i. Net income (loss) per common share and per common share equivalent share
        ------------------------------------------------------------------------

         The reconciliations for the years ended November 30, 2004 and 2003 are
as follows:

     Year Ended November 30, 2004                  Income          Shares       Per Share
     ------------------------------------------------------------------------------------
     <S>                                         <C>             <C>             <C>
     Basic EPS                                   $1,244,997      16,285,948      $   .08
     Effect of Dilutive Securities                     --           360,414
                                                 ----------      ----------      -------
     Diluted EPS                                 $1,244,997      16,646,362      $   .08
                                                 ==========      ==========      =======

     Year Ended November 30, 2003                  Loss            Shares       Per Share
     -----------------------------------------------------------------------------------


     Basic EPS                                 $(1,036,875)      16,046,077      $  (.06)

     Effect of Dilutive Securities                    --               --           --
                                               -----------      -----------      -------
     Diluted EPS                               $(1,036,875)      16,046,077      $  (.06)
                                               ===========      ===========      =======

     j. Income taxes
        ------------

        Deferred tax assets and liabilities are determined based on differences
between financial reporting and tax bases of assets and liabilities, and are
measured using the enacted tax rates and laws that will be in effect when the
differences are expected to reverse.

     k. Advertising costs
        -----------------

        All costs relating to marketing and advertising are expensed in the
period incurred. Advertising expense for the years ended November 30, 2004 and
2003 approximated $266,000 and $61,000, respectively.

     l. New Accounting pronouncements
        -----------------------------

        In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"),
"Consolidation of Variable Interest Entities, an interpretation of ARB No. 51,"
as revised in December 2003. A Variable Interest Entity ("VIE") is an entity
with insufficient equity investment or in which the equity investors lack some
of the characteristics of a controlling financial interest. Pursuant to FIN 46,
an enterprise that absorbs a majority of the expected losses of the VIE must
consolidate the VIE. The provisions of this statement are effective for small
business filers the first interim reporting period that ends after December 15,
2004. Management does not believe there will be a significant impact as a result
of adopting this statement.

        In December 2004, the FASB issued SFAS No. 123(R), "Accounting for
Stock-Based Compensation" ("SFAS No. 123(R)"). SFAS No. 123(R) establishes
standards for the accounting for transactions in which an entity exchanges its
equity instruments for goods or services. This statement focuses primarily on
accounting for transactions in which an entity obtains employee services in
share-based payment transactions. SFAS No. 123(R) requires that the fair value
of such equity instruments be recognized as an expense in the historical
financial statements as services are performed. Prior to SFAS No. 123(R), only
certain pro forma disclosures of fair value were required. The provisions of
this statement are effective for small business filers the first interim
reporting period that begins after December 15, 2005. The Company has not issued
stock options since its inception.

                                       F-8
</TABLE>

<PAGE>


        On December 16, 2004, the FASB issued SFAS No. 153, "Exchange of
Non-monetary Assets", an amendment of Accounting Principles Board ("APB")
Opinion No. 29, which differed from the International Accounting Standards
Board's ("IASB") method of accounting for exchanges of similar productive
assets. Statement No. 153 replaces the exception from fair value measurement in
APB No. 29, with a general exception from fair value measurement for exchanges
of non-monetary assets that do not have commercial substance. The statement is
to be applied prospectively and is effective for non-monetary asset exchanges
occurring in fiscal periods beginning after June 15, 2005. The Company does not
believe that SFAS No. 153 will have a material impact on its results of
operations or cash flows.

     m. Comprehensive Income
        --------------------

        Other comprehensive income refers to revenues, expenses, gains and
losses that under generally accepted accounting principles are included in
comprehensive income but are excluded from net income as these amounts are
recorded directly as an adjustment to stockholders' equity. Comprehensive income
approximated net income for all periods presented.


3.   Supplemental Cash Flow Information:
     ----------------------------------
                                                 Years Ended
                                                November 30,
                                  ----------------------------------------
                                         2004                   2003
                                  -----------------      -----------------
    Cash paid for:
      Interest                    $          18,657      $           3,439
                                  =================      =================

      Income taxes                $               0      $             455
                                  =================      =================

     For the years ended November 30, 2004 and 2003, the Company had a non-cash
operating and financing activity when it issued shares of its common stock for
the conversion of convertible promissory notes totaling $51,191 and $814,411,
respectively.

4.   Marketable Securities:
     ---------------------

        Following is a comparison of the cost and market value of trading
securities included in current assets at November 30, 2004:



           Cost                   $   522,950
           Unrealized gain            646,064
                                   ----------

            Market Value          $ 1,169,014
                                   ==========

5.   Equipment:
     ---------

     Major classes of equipment consist of the following at November 30, 2004:

                                            Estimated
                                           Useful Life
                                               Years
     Land                                       -             $     75,825
     Buildings and improvements                40                  274,761
     Furniture and fixtures                     5                   49,780
     Equipment                                  5                   66,455
                                                          ----------------
                                                                   466,821
     Less accumulated depreciation                                  41,154
                                                          ----------------

     Net equipment                                        $        425,667
                                                          ================

     Depreciation expense was $12,638 and $12,170 for the years ended November
30, 2004 and 2003, respectively.

                                       F-9

<PAGE>
<TABLE>
<CAPTION>


6.   Notes Payable:
     -------------

     <S>                                                                      <C>
     Notes payable consist of the following at November 30, 2004:

     Promissory note, principal and interest due May 30, 2004.
     The note bears interest at a rate of 8% per annum. (a)                    $        752,997

     Promissory  notes,  principal  and interest due at various dates through
     August 10, 2005.  The notes bear interest at a rate of 6% per annum. (b)           120,000

     Convertible notes payable (c)                                                      174,059

     Note payable - related party (d)                                                   987,257
                                                                               ----------------

                                                                               $      2,034,313
                                                                               ================

     (a)  During March, April and May 2003, pursuant to a loan restructuring of
          the $100,000 February 28, 2003 six month promissory note, the $100,000
          January 14, 2002 120-day promissory note (as amended), the $100,000
          November 16, 2001 60-day promissory note (as amended), and other notes
          (as included below) with an aggregate principal amount of $97,997, the
          Company received an additional $355,000 from the holder of the notes
          who is also a shareholder of the Company. Pursuant to the
          restructuring, the Company issued this shareholder (the holder of the
          notes) a convertible promissory note with an aggregate principal
          amount of $752,997 plus interest accrued pursuant to the terminated
          notes. In addition, pursuant to the loan restructuring, the holder of
          the note is entitled to be issued warrants to purchase common stock of
          the Company in an amount to be agreed upon between the Company and
          such holder. The convertible note bears interest at a rate of 8% per
          annum with a maturity date of May 30, 2004. Pursuant to the terms of
          the convertible note, prior to May 30, 2004, we may convert the
          balance due together with accrued interest into shares of common
          stock. The conversion ratio is 2.50. Each of the prior notes, the
          $100,000 February 28, 2003 six month promissory note, the $100,000
          January 14, 2002 10-day promissory note (as amended), the $100,000
          November 16, 2001 60-day promissory note (as amended), and the other
          notes with an aggregate principal amount of $97,997, have been
          cancelled. As of February 8, 2005, the note has not been repaid, but
          the Company is in the process of restructuring the note with the
          individual.

     (b)  Spring Bay Oil Company, Inc., a 77% owned subsidiary of the Company
          entered into a loan agreement with a hedge fund. A wholly owned
          subsidiary of the Company was appointed as a General Partner of this
          hedge fund in February 2004. Accrued interest on the outstanding
          principal amount of these notes together with the principal amount is
          due and payable on the maturity date.

                                      F-10
</TABLE>

<PAGE>


     (c)  Convertible promissory notes totaling $174,059 bear interest at a rate
          of 9% per annum with maturity dates that have expired. Pursuant to the
          terms of the convertible notes, if the Company does not prepay the
          notes prior to their expiration, the Company may convert the balance
          due, together with accrued interest, into shares of the Company's
          common stock. The conversion ratio for these notes is the greater of :
          (i) the amount that is equal to the product of the closing bid price
          per share for the Common Stock, as reported on the over-the-counter
          electronic bulletin board, or such other public market that the
          Company's Common Stock is then traded and seventy-five percent (75%);
          and (ii) 3.50. The Company is currently in negotiations with these
          note holders with respect to the conversion of notes into common stock
          and expects to convert the notes within 30 days.


     (d)  In October of 2004, a company that is 100% owned by the majority
          stockholder and CEO of the Company loaned The Marcellus Group LLC
          $1,000,000. The note bears interest at 8% and is being repaid in
          monthly installments of $25,947, with a final balloon payment of
          approximately $500,000 due November 1, 2006.

     Long-term debt matures as follows:

              Years Ending
              November 30,                                   Amount
              ------------                                   ------

                  2005                                     $1,295,232
                  2006                                        739,081
                                                           ----------
                                                           $2,034,313
                                                           ==========

7.   Commitments:
     -----------

     a. Leases
        ------

        The Company leases its Melville office space under a three year lease
expiring November 2006, with minimum monthly rent of approximately $1,700, plus
annual escalations of approximately 3%.

        Minimum future rental commitments for the remainder of the lease term
are as follows:

              Years Ending
              November 30,                                   Amount
              ------------                                   ------

                  2005                                     $   21,300
                  2006                                         30,000

        The Company also leases an apartment in New York City for the personal
use of its CEO under a month to month lease with minimum monthly rent of $5,800.

        Total rental expense approximated $184,000 and $230,000 for the years
ended November 30, 2004 and 2003, respectively.

                                      F-11

<PAGE>


     b. Litigation
        ----------

     The Company is involved in various legal proceedings and claims incident to
the normal conduct of its business. The Company believes that such legal
proceedings and claims, individually and in the aggregate, are not likely to
have a material adverse effect on its financial position or results of
operations.


8.   Related Party Transactions:
     --------------------------

     Fees for management, executive, and administrative services paid to
stockholders for the year ended November 30, 2004 and 2003 were $235,000 and
$295,000, respectively.

     The Company leases an executive residence and office facility for $5,800 in
monthly rent on a month-to-month basis. The Company's CEO has the exclusive
personal use of the executive residence facility at no cost. The lease cost
associated with the executive residence is not included as compensation to the
CEO.

9.   Stockholders' Equity:
     --------------------

     (a) The Company has authorized 25,000,000 shares, par value $0.0001, of
common stock. The common stock has one vote per share, with no cumulative
voting. There are no pre-emptive rights, conversion rights, preferences,
redemption provision, sinking fund provisions or any liability for further calls
or assessments. There are no stated liquidation rights other than those that may
exist under Delaware law.

     (b) The Company has authorized 5,000,000 shares, par value $0.0001, of
preferred stock. Shares of preferred stock may be issued in such classes or
series, and may have such voting powers, and such designations, preferences and
other special rights and qualifications, or restrictions thereof, as shall be
set by the Board of Directors.

     (c) Conversion of notes payable

         During the 2004, the Company issued 31,567 shares of common stock in
the conversion of promissory notes held by investors. The total of the notes
converted plus accrued interest was $51,191.

     (d) Stock option plan
         -----------------

         In 2001, the Company adopted a plan (the "2001 Stock Option Plan" or
the "Plan") pursuant to which the Board of Directors is authorized to award
options to purchase up to 1,000,000 shares of Common Stock to selected officers,
employees, agents, consultants and other persons who render services to the
Company. The options may be issued on such terms and conditions as determined by
the Board or Committee, and may be issued so as to qualify as incentive stock
options under Internal Revenue Code Section 422A. Reserved shares under the Plan
at November 30, 2004 are 1,000,000. As of November 30, 2004, there were no
options granted under this Plan.

10.  Income Taxes:
     ------------

         The components of the net deferred tax assets at November 30, 2004 are
as follows:

                                      F-12

<PAGE>



         Deferred Tax Assets:
           Tax loss carryforwards                       $     708,000
            Valuation Allowance                              (708,000)
                                                        -------------
         Net Deferred Income Taxes                               --
                                                        =============

        A reconciliation of the federal statutory rate to the Company's
effective tax rate is as follows:

                                                             Years Ended
                                                             November 30,
                                                        -----------------------
                                                       2004               2003
         ----------------------------------------------------------------------

         Tax Provision (Benefit) U.S. Federal
          Statutory Income Rate                         34%                (34%)
         State Income Tax, net of federal tax
          benefits                                       7%                 (7%)
         (Reduction) Increase Valuation Allowance      (41%)                41%
                                                       ------------------------
                                                         0%                  0%
                                                       ========================

     No provision for income taxes was recorded during the year ended November
30, 2003 due to net losses being incurred. At November 30, 2004, the Company had
net operating and capital loss carryforwards for tax purposes of approximately
$1,600,000, which expire through 2024.

     At November 30, 2004 and 2003, the Company provided a full valuation
allowance against the gross deferred tax asset since, in management's judgment,
it is more likely than not, such benefits will not be realized.

11.  Subsequent Events:
     -----------------

     In February 2005, the Company sold 1,000,000 shares of its common stock to
one individual for two million dollars ($2,000,000). The shares of common stock
are restricted. The issuance of the securities in the transaction were deemed to
be exempt from registration under the Securities Act of 1933, as amended, in
reliance on Section 4(2) of the Securities Act and Regulation D promulgated
thereunder as transactions by an issuer not involving any public offering.

     In January 2005, the Company moved from one of its offices at 200
Broadhollow, Melville, New York to 150 Broadhollow, Suite PH11, Melville, New
York. The Company leases its Melville office space pursuant to a lease expiring
November 2006, with minimum monthly rent of approximately $1,700, plus annual
escalations of approximately 3%. The Company now has three (3) offices located
at Melville, New York, Marcellus, New York and New York, New York.


12.  Fair Value of Financial Instruments:

     The methods and assumptions used to estimate the fair value of the
following classes of financial instruments for:

     Current Assets and Current Liabilities: The carrying amount of cash, and
payables approximate their fair value. The fair value of marketable securities
was derived from quotes listed by national stock exchanges. The fair value of
the Company's notes payable was estimated using a discounted cash flow analysis,
based on the Company's assumed incremental borrowing rates for similar types of
borrowing arrangements. The carrying amount of fixed rate debt at November 30,
2004 approximates fair value.

                                       F-13