UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549



Form 10-KSB



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



For the fiscal year ended December 31, 2006



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



Commission file number: 000-49634



RENOVO HOLDINGS

(Name of small business issuer in its charter)



Nevada
        
        90-0224622(State or other jurisdiction of incorporation or organization)
        
        (I.R.S. Employer Identification No.)




1375 Semoran Blvd.Casselberry, Florida
        
        32707(Address of principal executive offices)
        
        (Zip Code)




Issuer's telephone number:(407) 599-2886



Securities registered under Section 12(b) of the Exchange Act:None.



Securities registered under Section 12(g) of the Exchange Act:



Common Stock, $0.001 par value

(Title if Class)



Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes
xNo
o



Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of 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.
o



Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes
xNo
o



The issuers revenues for its most recent fiscal year ended December 31, 2006. $-0-.



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The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of March 8, 2007 was $156,311.49 based on a share value of $0.00065.



The number of shares of Common Stock, $0.001 par value, outstanding on March 8, 2007 was 499,854,216 shares.



Transitional Small Business Disclosure Format (Check one):  Yes
oNo
x





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RENOVO HOLDINGS

(A Development Stage Company)



FORM 10-KSB



For The Fiscal Year Ended December 31, 2006



INDEX



PART I
        Page


Item 1.
        Description of Business
        1Item 2.
        Description of Property
        5Item 3.
        Legal Proceedings
        5Item 4.
        Submission of Matters to a Vote of Security Holders
        6PART IIItem 5.
        Market for Common Equity and Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities
        6Item 6.
        Plan of Operation
        8Item 7.
        Financial Statements
        14Item 8.
        Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
        14Item 8A.
        Controls and Procedures
        15Item 8B.
        Other Information
        15PART IIIItem 9.
        Directors, Executive Officers, Promoters, Control Persons and Corporate Governance; Compliance with Section 16(a) of the Exchange Act
        15Item 10.
        Executive Compensation
        18Item 11.
        Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
        19Item 12.
        Certain Relationships and Related Transactions, and Director Independence
        20Item 13.
        Exhibits
        21Item 14.
        Principal Accountant Fees and Services
        22






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FORWARD-LOOKING STATEMENTS



This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  All statements other than statements of historical fact are forward-looking statements for purposes of federal and state securities laws, including, but not limited to, any projections of earnings, revenue or other financial items; any statements of the plans, strategies and objections of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; any statements or belief; and any statements of assumptions underlying any of the foregoing.



Forward-looking statements may include the words may, could, estimate, intend, continue, believe, expect or anticipate or other similar words.  These forward-looking statements present our estimates and assumptions only as of the date of this report.  Except for our ongoing securities laws, we do not intend, and undertake no obligation, to update any forward-looking statement.



Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements.  Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties.  The factors impacting these risks and uncertainties include, but are not limited to:



o
        increases in interest rates or our cost of borrowing or a default under any material debt agreements;


o
        the unavailability of funds for capital expenditures;


o
        the ability to locate potential merger or acquisition candidates.




For a detailed description of these and other factors that could cause actual results to differ materially from those expressed in any forward-looking statement, please see Factors That May Affect Our Plan of Operation in this document.



In this filing references to Company, we, our, and/or us, refers to Renovo Holdings.



PART I



ITEM 1.
        DESCRIPTION OF BUSINESS.




(a) General Business Development



Renovo Holdings is a development stage company, originally incorporated in the State of Nevada on October 18, 2000 under the name First Impressions.  On July 14, 2003, we amended our Articles of Incorporation changing our name from First Impressions to Fortis Enterprises.  We also increased the total amount of authorized common stock from 50,000,000 shares to 100,000,000 shares.



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On July 15, 2003, our board of directors approved the cancellation of 60,000,000 (post split) shares of common stock held by three of our major stockholders. Concurrently, we issued 45,000,000 (post split) shares of common stock to Mr. Stephen W. Carnes as consideration for his business expertise and his business concept of establishing a national network of commercial and residential restoration service companies, his serving on the Board of Directors, and assuming the liability of being an officer and director of a publicly trading and reporting Company.



Prior to the cancellations and issuances, we had a total of 80,000,000 (post split) shares of common stock issued and outstanding. The canceling stockholders held approximately 75% of the issued and outstanding common stock. The cancellations and issuance resulted in 65,000,000 (post split) shares of common stock to be issued and outstanding with approximately 69% of those shares being held by Mr. Carnes. Mr. Carnes percentage ownership of the Companys common stock and his position as sole director of the Company allows him to exercise control of the Company.



On June 14, 2004, we changed our name from Fortis Enterprises to Renovo Holdings.  We also increased our total authorized shares of common stock from 100,000,000 shares to 500,000,000 shares.



For the years ended December 31, 2006 and December 31, 2005, we incurred net losses of $421,223 and $435,059 respectively.  Our accumulated deficit at the end of December 31, 2006 was $2,300,045.  As a result of our losses, our audited financial statements for the year ended December 31, 2006, indicate that there is substantial doubt about our ability to continue as a going concern.



(b) Our Business



Initially, we were seeking to establish Renovo in the Florida restoration market, with the ability to expedite the recovery process, with eventual capability of responding to loss and restoration across the United States.  However, as a result of our lack of revenue generation, we have not been satisfied with our business plan, and we are aggressively seeking other business opportunities in an effort to substantiate stockholder value, including mergers with or the acquisition of private companies.  We have not focused on any one market.



Management believes that there are perceived benefits to being a reporting company with a class of publicly-registered securities.  These are commonly thought to include (1) the ability to use registered securities to make acquisition of assets or businesses; (2) increased visibility in the financial community; (3) the facilitation of borrowing from financial institutions; (4) improved trading efficiency; (5) stockholder liquidity; (6) greater ease in subsequently raising capital; (7) compensation of key employees through stock options; (8) enhanced corporate image; and (9) a presence in the United States capital market.



A business entity, if any, which may be interested in a business combination with us may include (1) a company for which a primary purpose of becoming public is the use of its securities for the acquisition of assets or businesses; (2) a company which is unable to find an underwriter



2



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of its securities or is unable to find an underwriter of securities on terms acceptable to it; (3) a company which wishes to become public with less dilution of its common stock than would occur normally upon an underwriting; (4) a company which believes that it will be able to obtain investment capital on more favorable terms after it has become public; (5) a foreign company which may wish to gain an initial entry into the United States securities market; (6) a special situation company, such as a company seeking a public market to satisfy redemption requirements under a qualified Employee Stock Option Plan; or (7) a company seeking one or more of the other perceived benefits of becoming a public company.



Management is seeking a qualified company as a candidate for a business combination.  We are authorized to enter into a definitive agreement with a wide variety of businesses without limitation as to their industry or revenues.  It is not possible at this time to predict with which company, if any, we will enter into a definitive agreement or what will be the industry, operating history, revenues, future prospects or other characteristics of that company.



We may seek a business opportunity with entities which have recently commenced operations, or which wish to utilize the public marketplace in order to raise additional capital in order to expand into new products or markets, to develop a new product or service, or for other corporate purposes.  We may acquire assets and establish wholly-owned subsidiaries in various businesses or acquire existing businesses as subsidiaries.



Our management, which in all likelihood will not be experienced in matters relating to the business of a target business, will rely upon its own efforts in accomplishing our business purposes.  Outside consultants or advisors may be utilized by us to assist in the search for qualified target companies.  If we do retain such an outside consultant or advisor, any cash fee earned by such person will need to be assumed by the target business, as we have no cash assets with which to pay such obligation.



The analysis of new business opportunities will be undertaken by, or under the supervision of our officer and director, who is not a professional business analyst.  In analyzing prospective business opportunities, management may consider such matters as:




        the available technical, financial and managerial resources;



        working capital and other financial requirements;



        history of operations, if any;



        prospects for the future;



        nature of present and expected competition;



        the quality and experience of management services which may be available and the depth of that management;



        the potential for further research, development, or exploration;



        specific risk factors not now foreseeable but which then may be anticipated to impact our proposed activities;



        the potential for growth or expansion;



        the potential for profit;



        the perceived public recognition or acceptance of products, services, or trades; name identification; and



        other relevant factors.




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Management does not have the capacity to conduct as extensive an investigation of a target business as might be undertaken by a venture capital fund or similar institution.  As a result, management may elect to merge with a target business which has one or more undiscovered shortcomings and may, if given the choice to select among target businesses, fail to enter into an agreement with the most investment-worthy target business.



Following a business combination we may benefit from the services of others in regard to accounting, legal services, underwritings and corporate public relations.  If requested by a target business, management may recommend one or more underwriters, financial advisors, accountants, public relations firms or other consultants to provide such services.



A potential target business may have an agreement with a consultant or advisor, providing that services of the consultant or advisor be continued after any business combination.  Additionally, a target business may be presented to us only on the condition that the services of a consultant or advisor be continued after a merger or acquisition.  Such preexisting agreements of target businesses for the continuation of the services of attorneys, accountants, advisors or consultants could be a factor in the selection of a target business.



In implementing a structure for a particular business acquisition, we may become a party to a merger, consolidation, reorganization, joint venture, or licensing agreement with another corporation or entity.  We may also acquire stock or assets of an existing business.  On the consummation of a transaction, it is likely that our present management and stockholder will no longer be in control.  In addition, it is likely that our officer and director will, as part of the terms of the acquisition transaction, resign and be replaced by one or more new officers and directors.



It is anticipated that any securities issued in any such reorganization would be issued in reliance upon exemption from registration under applicable federal and state securities laws.  In some circumstances however, as a negotiated element of its transaction, we may agree to register all or a part of such securities immediately after the transaction is consummated or at specified times thereafter.  If such registration occurs, of which there can be no assurance, it will be undertaken by the surviving entity after we have entered into an agreement for a business combination or have consummated a business combination and we are no longer considered a blank check company. The issuance of additional securities and their potential sale into any trading market which may develop in our securities may depress the market value of our securities in the future if such a market develops, of which
there is no assurance.



While the terms of a business transaction to which we may be a party cannot be predicted, it is expected that the parties to the business transaction will desire to avoid the creation of a taxable event and thereby structure the acquisition in a tax-free reorganization under Sections 351 or 368 of the Internal Revenue Code of 1986, as amended.



With respect to any merger or acquisition negotiations with a target business, management expects to focus on the percentage of the Company which target business stockholder would acquire in exchange for their shareholdings in the target business.  Depending upon, among other things, the target business's assets and liabilities, our stockholder will in all likelihood hold a substantially lesser percentage ownership interest in the Company following any merger or acquisition.  Any merger or acquisition effected by us can be expected to have a significant dilutive effect on the percentage of shares held by our stockholder at such time.



4



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No assurances can be given that we will be able to enter into a business combination, as to the terms of a business combination, or as to the nature of the target business.



As of the date hereof, management has not made any final decision concerning or entered into any written agreements for a business combination.  When any such agreement is reached or other material fact occurs, we will file notice of such agreement or fact with the Securities and Exchange Commission on Form 8-K.  Persons reading this Form 10-KSB are advised to determine if we have subsequently filed a Form 8-K.



We anticipate that the selection of a business opportunity in which to participate will be complex and without certainty of success. Management believes (but has not conducted any research to confirm) that there are numerous firms seeking the perceived benefits of a publicly registered corporation.  Such perceived benefits may include facilitating or improving the terms on which additional equity financing may be sought, providing liquidity for incentive stock options or similar benefits to key employees, increasing the opportunity to use securities for acquisitions, and providing liquidity for our stockholder and other factors.  Business opportunities may be available in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex.



Employees



As of December 31, 2006, we had one employee, Stephen W. Carnes.



AVAILABLE INFORMATION



We file annual, quarterly and special reports and other information with the SEC that can be inspected and copied at the public reference facility maintained by the SEC at 100 F Street, N.E., Room 1580, Washington, D.C. 20549-0405. Information regarding the public reference facilities may be obtained from the SEC by telephoning 1-800-SEC-0330. The Company's filings are also available through the SEC's Electronic Data Gathering Analysis and Retrieval System which is publicly available through the SEC's website (www.sec.gov). Copies of such materials may also be obtained by mail from the public reference section of the SEC at 100 F Street, N.E., Room 1580, Washington, D.C. 20549-0405 at prescribed rates.



ITEM 2.
        DESCRIPTION OF PROPERTY.




We do not lease or rent any property.  In January 8, 2007, we relocated our executive office to 1375 Semoran Blvd., Casselberry, FL 32707.  Office space and related services are provided at no charge by our sole officer and director.



ITEM 3.
        LEGAL PROCEEDINGS.




We are not a party to any material legal proceedings.



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




We did not submit any matters to vote of our stockholders during the fourth quarter of 2006.



PART II



ITEM 5.
        MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES.




(a) Market Information



Our Common Stock is traded in the over-the-counter securities market through the National Association of Securities Dealers Automated Quotation Bulletin Board System, under the symbol RNVO. We have been eligible to participate in the OTC Bulletin Board since April 23, 2003.  The following table sets forth the quarterly high and low bid prices for our Common Stock during our last two fiscal years, as reported by a Quarterly Trade and Quote Summary Report of the OTC Bulletin Board.  The quotations reflect inter-dealer prices, without retail mark-up, markdown or commission, and may not necessarily represent actual transactions.



2006
        2005High
        Low
        High
        Low1st Quarter
        0.0036
        0.0016
        0.004
        0.00042nd Quarter
        0.0018
        0.0007
        0.0011
        0.00023rd Quarter
        0.0026
        0.0008
        0.0086
        0.00034th Quarter
        0.0019
        0.0005
        0.004
        0.0015




(b) Holders of Common Stock



As of March 8, 2007, we had approximately 44 stockholders of record of the 499,854,216 shares outstanding.



(c) Dividends



The Board of Directors has not declared any dividends due to the following reasons:



1.
        The Company has not yet adopted a policy regarding payment of dividends;


2.
        The Company does not have any money to pay dividends at this time;


3.
        The declaration of a cash dividend would result in an impairment of future working capital; and


4.
        The Board of Directors will not approve the issuance of a stock dividend.






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(d) Securities Authorized for Issuance under Equity Compensation Plans



Employee and Consultant Stock Compensation Plans



Effective August 26, 2003, we adopted an Employee and Consultant Stock Compensation Plan.  The maximum number of shares that may be issued pursuant to the plan is 3,000,000 shares.  As of December 31, 2006, 2,564,493 shares have been granted under this plan.



Effective May 11, 2004, we adopted another Employee and Consultant Stock Compensation Plan.  The maximum number of shares that may be issued pursuant to the plan is 15,000,000 shares.  As of December 31, 2006, 3,508,207 shares have been issued under this plan.



Equity Compensation Plans Information



We currently maintain equity compensation plans to allow the Company to compensate employees, directors, consultants and certain other persons providing bona fide services to the Company or to compensate officers, directors and employees for accrual of salary, through the award of our common stock.  The following table sets forth information as of December 31, 2006 regarding outstanding shares granted under the plans, warrants issued to consultants and options reserved for future grant under the plans.



Plan Category
        
        Number
of shares to be issued upon exercise of outstanding options, warrants and rights
(a)
        
        Weighted-average exercise price of outstanding options, warrants and rights
(b)
        
        Number of shares remaining available for future issuance under equity compensation plans (excluding shares reflected in column (a))
(c)Equity compensation plans approved by stockholders
        
        --
        
        $                        --
        
        --Equity compensation plans not approved  by stockholders
        
        0
        
        $                         0
        
        11,927,300 (1)Total
        
        0
        
        $                         0
        
        11,927,300


(1) Includes: 435,507 shares available for issuance under the 2003 plan and 11,491,793 shares available under the 2004 plan.



These plans are intended to encourage directors, officers, employees and consultants to acquire ownership of common stock.  The opportunity so provided is intended to foster in participants a strong incentive to put forth maximum effort for its success and growth, to aid in retaining individuals who put forth such effort, and to assist in attracting the best available individuals to the Company in the future.



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Recent Sales of Unregistered Securities



We did not sale or issue any securities in the forth quarter of 2006 or as of the date of this filing.



ITEM 6.
        PLAN OF OPERATION.




Overview



Renovo Holdings is a Development Stage Company that intended to capitalize upon the niche market opportunities within the commercial and residential restoration service markets.



As a company in an early development stage, our ability to proceed with our plan of operation has continuously been a function of our ability to raise sufficient capital to continue our operations.  At the end of the fiscal year 2006 we did not have any cash available.



We have continuously incurred losses since inception. For the year ended December 31, 2006 we had a net loss of $421,223 as compared to a net loss of $435,059 for the year ended December 31, 2005.



Plan of Operation



Our original plan of operation was to position Renovo to provide complete loss management and restoration services to residential, commercial, industrial, and institutional properties.  Initially, we were seeking to establish Renovo in the Florida market, with the ability to expedite the recovery process, with the eventual capability of responding to loss and restoration across the United States. However, as a result of our lack of revenue generation, we have not been satisfied with our business plan or original plan of operation. Therefore, we re-assessed our business plan, and we are aggressively seeking out other business opportunities in an effort to substantiate stockholder value.



We will attempt to locate and negotiate with other business entities for the merger of a target business into the Company.  In certain instances, a target business may wish to become a subsidiary of the Company or may wish to contribute assets to the Company rather than merge.  No assurances can be given that we will be successful in locating or negotiating with any target business.



We are currently seeking to engage in a merger with or acquisition of an unidentified foreign or domestic company which desires to become a reporting (public) company whose securities are qualified for trading in the United States secondary market. We meet the definition of a blank check company contained in Section (7)(b)(3) of the Securities Act of 1933, as amended. We have been in the developmental stage since inception and have no operations to date. Other than issuing shares to our sole stockholder, we have not commenced any operational activities.



8



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We will not acquire or merge with any entity which does not intend to provide audited financial statements at or within a reasonable period of time after closing of the proposed transaction. We are subject to all the reporting requirements included in the Exchange Act. Included in these requirements is our duty to file audited financial statements as part of our Form 8-K to be filed with the Securities and Exchange Commission upon consummation of a merger or acquisition, as well as our audited financial statements included in our annual report on 10-KSB. If such audited financial statements are not available at closing, or within time parameters necessary to insure our compliance with the requirements of the Exchange Act, or if the audited financial statements provided do not conform to the representations made by the target business, the closing documents may provide that the proposed
transaction will be voidable at the discretion of our present management.



We will not restrict our search for any specific kind of businesses, but may acquire a business which is in its preliminary or development stage, which is already in operation, or in essentially any stage of its business life. It is impossible to predict at this time the status of any business in which we may become engaged, in that such business may need to seek additional capital, may desire to have its shares publicly traded, or may seek other perceived advantages which we may offer.



A business combination with a target business will normally involve the transfer to the target business of the majority of our common stock, and the substitution by the target business of its own management and board of directors.



We have, and will continue to have, no capital with which to provide the owners of business opportunities with any cash or other assets. However, management believes we will be able to offer owners of acquisition candidates the opportunity to acquire a controlling ownership interest in a company with securities registered pursuant to Rule 12(g) of the Exchange Act. Our officer and director has not conducted market research and is not aware of statistical data to support the perceived benefits of a merger or acquisition transaction for the owners of a business opportunity.



Our audit reflects the fact that we have no current source of income. Further, that without realization of additional capital, it would be unlikely for the Company to continue as a going concern.



Our sole officer and director has agreed that he will advance any additional funds which we need for operating capital and for costs in connection with searching for or completing an acquisition or merger. Such advances have historically been converted to equity. There is no minimum or maximum amount the Officer and Director will advance to us. We will not borrow any funds for the purpose of repaying advances made by such Officer and Director, and we will not borrow any funds to make any payments to our promoters, management or their affiliates or associates.



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The Board of Directors has passed a resolution which contains a policy that we will not seek an acquisition or merger with any entity in which our officer, director, stockholder or his affiliates or associates serve as officer or director or hold more than a 10% ownership interest.



Satisfaction of our cash obligation for the next 12 months.



We plan on satisfying our cash obligations over the next twelve months through additional equity and/or third party financing.  We do not anticipate generating revenues within the next twelve months, unless we successfully complete a merger or acquisition with a company generating revenues from operations.



A critical component of our operating plan impacting our continued existence is the ability to obtain additional capital through additional equity and/or debt financing.  We do not anticipate enough positive internal operating cash flow until such time as we complete the acquisition and can generate substantial revenues, which may take the next few years to fully realize, if ever.  In the event we cannot obtain the necessary capital to pursue our strategic plan, we may have to cease or significantly curtail our operations.  This would materially impact our ability to continue operations.



Liquidity and Capital Resources



During April 2006, we executed three Notes to Stephen W. Carnes for a total amount of $9,731.31 for expenses paid by Mr. Carnes on our behalf.  The notes were to be paid in full on or before July 15, 2006.  The delay of payment beyond July 15, 2006 resulted in interest beginning to accrue at a rate of 12% interest.



Over the next twelve months we believe that existing capital and anticipated funds from operations will not be sufficient to sustain our operations.  As a result, we will be required to seek additional capital to fund our operations through additional equity or debt financing or credit facilities.  No assurance can be made that such financing would be available, and if available it may take either the form of debt or equity.  In either case, the financing could have a negative impact on our financial condition and our Stockholders.



We anticipate incurring operating losses over the next twelve months.  Our lack of operating history makes predictions of future operating results difficult to ascertain.  Our prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies in their early stage of development.  To address these risks we must, among other things, locate suitable acquisition targets, obtain a customer base, implement and successfully execute a business and marketing strategy, respond to competitive developments, and attract, retain and motivate qualified personnel.  There can be no assurance that we will be successful in addressing such risks, and the failure to do so can have a material adverse effect on our business prospects, financial condition and results of operations.



Going Concern



The consolidated financial statements included in this filing have been prepared in conformity with generally accepted accounting principles that contemplate the continuance of the Company as a going concern.  The Companys cash position is inadequate to pay all of the costs associated with its intended business plan.  Management intends to use borrowings and security sales to mitigate the effects of its cash position, however no assurance can be given that debt or equity financing, if and when required will be available.  The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets and classification of liabilities that might be necessary should the Company be unable to continue existence.



10

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Summary of any product and development that we will perform for the term of the plan.



We do not anticipate performing any significant product research and development under our plan of operation until such time as we complete an acquisition.



Expected purchase or sale of plant and significant equipment.



We do not anticipate the purchase or sale of any plant or significant equipment, as such items are not required by us at this time or anticipated to be needed in the next twelve months.



Significant changes in the number of employees.



As of December 31, 2006, we had 1 part-time employee.  We are dependent upon Stephen W. Carnes our sole officer and director.  We will need to hire full time operational staff if and when we complete anticipated acquisitions.



Off-Balance Sheet Arrangements



We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.



FACTORS THAT MAY AFFECT OUR PLAN OF OPERATION



Renovo has historically lost money and losses may continue in the future, which may cause us to curtail operations.



Since our inception we have not been profitable and have lost money on both a cash and non-cash basis.  For the years ended December 31, 2006 and December 31, 2005 we incurred net losses of $421,223 and $435,059 respectively. Our accumulated deficit at the end of December 31, 2006 was $2,300,045. Future losses are likely to occur, as we are dependent on spending money to pay for our operations. No assurances can be given that we will be successful in reaching or maintaining profitable operations.  Accordingly, we may experience liquidity and cash flow problems.  If our losses continue, our ability to operate may be severely impacted.



We have not accounted for the withholding of federal or state taxes upon the issuance of common stock for services rendered by our officer, employees and consultants, which may subject us to substantial tax liabilities, including penalties and interest.



11



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In 2006, the Company did not recognize withholding tax liabilities on the issuance of shares of common stock to our sole officer and director.  Further, over the past several years we have issued several million dollars worth of stock compensation, to consultants who may be deemed to be employees, without withholding potential federal or state income tax liabilities.



The Company has based its decision not to withhold taxes on the belief such shares of common stock were issued in connection with the performance of services by true consultants and not by employees, and, as such, are not subject to tax withholding requirements.  There can be no assurance, however, that the IRS or state taxing authorities will agree with the Companys position and will not assert that the Company is liable for the failure to withhold income and employment taxes with respect to the issuance of common stock services.  If the Company became liable for the failure to withhold taxes on the issuances, the aggregate potential liability, exclusive of any interest or penalties, would have a material impact on the Company and its results of operations.



The Company has not recognized accruals for the potential withholding taxes, penalties and/or interest that may be imposed with respect to the withholding tax issues.  If taxing authorities assert such issues and prevail related to these withholding tax issues and other related contingencies, including penalties, the liability that could be imposed by taxing authorities would be substantial.



Renovo will need to raise additional capital or debt funding to sustain operations.



We will require additional capital to sustain operations and we may need access to additional capital or additional debt financing to establish revenues.  In addition, to the extent that we have a working capital deficit and cannot offset the deficit from profitable sales we may have to raise capital to repay the deficit and provide more working capital to permit growth in revenues.  We cannot be assured that financing, whether from external sources or related parties, will be available if needed or on favorable terms. Our inability to obtain adequate financing will result in the need to reduce the pace of business operations and the search for acquisition candidates.  Any of these events could be materially harmful to our business and may result in a lower stock price.



We have been the subject of a going concern opinion for the years ended December 31, 2006 and December 31, 2005 from our independent auditors, which means that we may not be able to continue operations unless we can become profitable or obtain additional funding.



Our independent auditors have added an explanatory paragraph to their audit opinions issued in connection with our financial statements for the years ended December 31, 2006 and December 31, 2005, which states that the financial statements raise substantial doubt as to our ability to continue as a going concern. Our ability to make operations profitable or obtain additional funding will determine our ability to continue as a going concern.  Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.  We do not have sufficient cash on hand to continue operations for the next twelve months.  In order to be able to continue operations for the next twelve months we will need to obtain funding through equity or debt financing.



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We are subject to a working capital deficit, which means that our current assets on December 31, 2065, were not sufficient to satisfy our current liabilities and, therefore, our ability to continue operations is at risk.



We had a working capital deficit for the year ended December 31, 2006, which means that our current liabilities exceeded our current assets on December 31, 2006 by $1,093,585.  Current assets are assets that are expected to be converted to cash within one year and, therefore, may be used to pay current liabilities as they become due. Our working capital deficit means that our current assets on December 31, 2006 were not sufficient to satisfy all of our current liabilities on those dates.  If our ongoing operations do not begin to provide sufficient profitability to offset the working capital deficit, we may have to raise capital or debt to fund the deficit or curtail future operations.



Our common stock may be affected by limited trading volume and may fluctuate significantly, which may affect our stockholders ability to sell shares of our common stock.



There has been a limited public market for our common stock and there can be no assurance that a more active trading market for our common stock will develop.  An absence of an active trading market could adversely affect our stockholders' ability to sell our common stock in short time periods, or possibly at all.  Our common stock has experienced, and is likely to experience in the future, significant price and volume fluctuations, which could adversely affect the market price of our common stock without regard to our operating performance.  In addition, we believe that factors such as quarterly fluctuations in our financial results and changes in the overall economy or the condition of the financial markets could cause the price of our common stock to fluctuate substantially. These fluctuations may also cause short sellers to enter the market from time to time in the belief that we will
have poor results in the future. We cannot predict the actions of market participants and, therefore, can offer no assurances that the market for our stock will be stable or appreciate over time. These factors may negatively impact our stockholders' ability to sell shares of our common stock.



Our common stock is deemed to be a low priced Penny Stock, which may make it more difficult for investors to sell their shares due to suitability requirements.



Our common stock is deemed to be a "penny stock" as that term is defined in Rule 3a51-1 promulgated under the Securities Exchange Act of 1934.  These requirements may reduce the potential market for our common stock by reducing the number of potential investors. This may make it more difficult for investors in our common stock to sell shares to third parties or to otherwise dispose of them. This could cause our stock price to decline. Penny stocks are stock:




        With a price of less than $5.00 per share;



        That are not traded on a "recognized" national exchange;



        Whose prices are not quoted on the NASDAQ automated quotation system (NASDAQ listed stock must still have a price of not less than $5.00 per share); or



        In issuers with net tangible assets less than $2.0 million (if the issuer has been in continuous operation for at least three years) or $10.0 million (if in continuous operation for less than three years), or with average revenues of less than $6.0 million for the last three years.




13



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Broker/dealers dealing in penny stocks are required to provide potential investors with a document disclosing the risks of penny stocks. Moreover, broker/dealers are required to determine whether an investment in a penny stock is a suitable investment for a prospective investor.



We may acquire assets or other businesses in the future.



We may consider acquisitions of other assets or other business.  Any acquisition involves a number of risks that could fail to meet our expectations and adversely affect our profitability.



For example:




        The acquired assets or business may not achieve expected results;



        We may incur substantial, unanticipated costs, delays or other operational or financial problems when integrating the acquired assets;



        We may not be able to retain key personnel of an acquired business;



        Our managements attention may be diverted; or



        Our management may not be able to manage the acquired assets or combined entity effectively or to make acquisitions and grow our business internally at the same time.




If these problems arise we may not realize the expected benefits of an acquisition.



Our internal controls may be inadequate, which could cause our financial reporting to be unreliable and lead to misinformation being disseminated to the public.



Our management is responsible for establishing and maintaining adequate internal control over financial reporting. As defined in Exchange Act Rule 13a-15(f), internal control over financial reporting is a process designed by, or under the supervision of, the principal executive and principal financial officer and effected by the board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that: (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation
of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Companys assets that could have a material effect on the financial statements.



We have one individual performing the functions of all officers and directors. This individual is responsible for monitoring and ensuring compliance with our internal control procedures. As a result, our internal controls may be inadequate or ineffective, which could cause our financial reporting to be unreliable and lead to misinformation being disseminated to the public. Investors relying upon this misinformation may make an uninformed investment decision.



14



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ITEM 7.
        FINANCIAL STATEMENTS.




See Index to Financial Statements and Financial Statement Schedules appearing on page F-1 through F-19 of this Form 10-KSB.



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




We have had no disagreements with our independent auditors on accounting or financial disclosures.

ITEM 8.A.
        CONTROLS AND PROCEDURES.




We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the specified time periods.  As of the end of the period covered by this report, Stephen W. Carnes, our Chief Executive Officer and Principal Financial Officer evaluated the effectiveness of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-15. Based on the evaluation, which disclosed no significant deficiencies or material weaknesses, Mr. Carnes, our Chief Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures are effective in timely alerting him to material information required to be included in our periodic SEC filings.



It should be noted, however, that no matter how well designed and operated, a control system can provide only reasonable, not absolute, assurance that the objectives of the control system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because of these and other inherent limitations of control systems (including faulty judgments in decision making or breakdowns resulting from simple errors or mistakes), there can be no assurance that any design will succeed in achieving its stated goals under all potential conditions. Additionally, controls can be circumvented by individual acts, collusion or by management override of the controls in place.



There were no changes in our internal control over financial reporting that occurred during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.



ITEM 8.B.
        OTHER INFORMATION.




None.




PART III



ITEM 9
        DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSONS and CORPORATE GOVERNANCE; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.




The following table sets forth the name and position of our sole officer and director.  Directors will be elected at our annual meeting of stockholders and serve for one year or until their successors are elected and qualified.  Officers are elected by the Board and their terms of office are, except to the extent governed by employment contract, at the discretion of the Board.

15



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Name
        Age
        Positions and Offices held
        TermStephen W. Carnes
        42
        CEO, President, Secretary/Treasurer and Director
        Since July 2004




Duties, Responsibilities and Experience



Stephen W. Carnes,age 42,is Chief Executive Officer, President, Secretary/Treasurer and Director of the Company since July of 2004.  Mr. Carnes is also the President, CEO and a director of Signature Leisure, Inc., a publicly traded company trading on the OTC Bulletin Board.  From 2000 to 2003, Mr. Carnes was founder and co-owner of a private public relations firm that assisted companies with marketing and public relations. From 1998 to 2003, Mr. Carnes has been self-employed as an independent manufacturers representative acting as an outside sales representative for various companies.   From 1982 thru 1986, Mr. Carnes attended Indiana University at Fort Wayne, Indiana and received a B.S. degree in Business Administration.



Election of Directors and Officers.




Directors are elected to serve until the next annual meeting of stockholders and until their successors have been elected and qualified. Officers are appointed to serve until the meeting of the Board of Directors following the next annual meeting of stockholders and until their successors have been elected and qualified.



No Executive Officer or Director of the Corporation has been the subject of any Order, Judgment, or Decree of any Court of competent jurisdiction, or any regulatory agency permanently or temporarily enjoining, barring suspending or otherwise limiting him from acting as an investment advisor, underwriter, broker or dealer in the securities industry, or as an affiliated person, director or employee of an investment company, bank, savings and loan association, or insurance company or from engaging in or continuing any conduct or practice in connection with any such activity or in connection with the purchase or sale of any securities.



No Executive Officer or Director of the Corporation has been convicted in any criminal proceeding (excluding traffic violations) or is the subject of a criminal proceeding which is currently pending.



No Executive Officer or Director of the Corporation is the subject of any pending legal proceedings.



Audit Committee and Financial Expert



We do not have an Audit Committee, Stephen W. Carnes, our sole director, performs some of the same functions of an Audit Committee, such as: recommending a firm of independent certified public accountants to audit the annual financial statements; reviewing the independent auditors independence, the financial statements and their audit report; and reviewing management's administration of the system of internal accounting controls. The Company does not currently have a written audit committee charter or similar document.



16



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We have no financial expert. We believe the cost related to retaining a financial expert at this time is prohibitive. Further, because of our start-up operations, we believe the services of a financial expert are not warranted.



Code of Ethics



A code of ethics relates to written standards that are reasonably designed to deter wrongdoing and to promote:



(1)
        Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;


(2)
        Full, fair, accurate, timely and understandable disclosure in reports and documents that are filed with, or submitted to, the Commission and in other public communications made by an issuer;


(3)
        Compliance with applicable governmental laws, rules and regulations;


(4)
        The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and


(5)
        Accountability for adherence to the code.




We have not adopted a corporate code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions in that our sole officer and director serves in all the above capacities.



Our decision to not adopt such a code of ethics results from our having only one officer and director operating as the sole management for the Company. We believe that as a result of the limited interaction, which occurs having a sole officer/director for the Company eliminates the current need for such a code, in that violations of such a code would be reported to the party generating the violation.



Corporate Governance



Nominating Committee



We do not have a Nominating Committee or Nominating Committee Charter. Stephen W. Carnes, our sole director, performs some of the functions associated with a Nominating Committee. We have elected not to have a Nominating Committee in that we are a development stage company with limited operations and resources.



Director Nomination Procedures



Generally, nominees for Directors are identified and suggested by
the members of the Board or management using their business networks. The Board
has not retained any executive search firms or other third parties to identify
or evaluate director candidates in the past and does not intend to in the near
future. In selecting a nominee for director, the Board or management considers
the following criteria:



17



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1.
        whether the nominee has the personal attributes for successful service on the Board, such as demonstrated character and integrity; experience at a strategy/policy setting level; managerial experience dealing with complex problems; an ability to work effectively with others; and sufficient time to devote to the affairs of Renovo;


2.
        whether the nominee has been the chief executive officer or senior executive of a public company or a leader of a similar organization, including industry groups, universities or governmental organizations;


3.
        whether the nominee, by virtue of particular experience, technical expertise or specialized skills or contacts relevant to Renovos current or future business, will add specific value as a Board member; and


4.
        whether there are any other factors related to the ability and willingness of a new nominee to serve, or an existing Board member to continue his service.




The Board or management has not established any specific minimum qualifications that a candidate for director must meet in order to be recommended for Board membership. Rather the Board or management will evaluate the mix of skills and experience that the candidate offers, consider how a given candidate meets the Boards current expectations with respect to each such criterion and make a determination regarding whether a candidate should be recommended to the stockholders for election as a director. During 2006, Renovo received no recommendation for Directors from its stockholders.



Renovo will consider for inclusion in its nominations of new Board of Director nominees proposed by stockholders who have held at least 1% of the outstanding voting securities of Renovo for at least one year. Board candidates referred by such stockholders will be considered on the same basis as Board candidates referred from other sources. Any stockholder who wishes to recommend for Renovos consideration a prospective nominee to serve on the Board of Directors may do so by giving the candidates name and qualifications in writing to Renovos Secretary at the following address:  1375 Semoran Blvd., Casselberry, Florida 32707.



Section 16(a) Beneficial Ownership Reporting Compliance



Section 16(a) of the Securities Exchange Act of 1934, as amended (the Exchange Act), requires our executive officers and directors, and persons who beneficially own more than ten percent of our common stock, to file initial reports of ownership and reports of changes in ownership with the SEC. Executive officers, directors and greater than ten percent beneficial owners are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. Based upon a review of the copies of such forms furnished to us and written representations from our executive officers and directors, we believe that during the year ended 2006, Stephen W. Carnes was current in his filings.



ITEM 10.
        EXECUTIVE COMPENSATION.




The following table summarizes the total compensation paid or earned by the named executive officer and director for the fiscal years ended December 31, 2006 and 2005.  The remuneration described in the table does not include the cost to the Company of benefits furnished to the named executive officers, including premiums for health insurance and other benefits provided to such individual that are extended in connection with the conduct of the Companys business.



SUMMARY COMPENSATION TABLEName and Principal Position
(a)
        Year
(b)
        Salary ($)
(c)
        Bonus ($)
(d)
        Stock Awards ($)
(e)
        Option Awards ($)
(f)
        Non-Equity Incentive Plan Compen-sation ($)
(g)
        Nonqualified Deferred Compensation Earnings ($)
(h)
        All Other Compen-sation ($)
(i)
        Total ($)
(j)Stephen W. Carnes,President
        2006
        $250,000
(1)
        -0-
        -0-
        -0-
        -0-
        -0-
        $8,400
(2)
        $258,4002005
        $250,000
(3)
        -0-
        -0-
        -0-
        -0-
        -0-
        $8,400
(4)
        $258,400






18



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(1)
        Of the $250,000, $0 was paid, $23,000 was paid in shares of our restricted common stock and the remaining $227,000 was accrued for the year 2006.


(2)
        Pursuant to Mr. Carnes employment agreement, we agreed to give him an automobile allowance of $700 per month, of which all was accrued for the year 2006.


(3)
        Of the $250,000, $45,000 was paid, $120,000 was paid in shares of our restricted common stock and the remaining $85,000 was accrued for the year 2005.


(4)
        Pursuant to Mr. Carnes employment agreement, we agreed to give him an automobile allowance of $700 per month, of which all was accrued for the year 2005.




Employment Agreement



On September 3, 2003, we entered into an Employment Agreement with Stephen W. Carnes, wherein Mr. Carnes agreed to serve as the Chairman of the Board, President and Chief Executive Officer of the Company.  The term of the Agreement was for a period of three years, it commenced on August 1, 2003 and terminated on July 31, 2006.  On August 1, 2006, we extended the termination date to July 31, 2010.  Pursuant to the agreement we agreed to pay Mr. Carnes a salary at an annual rate equal to the sum of $250,000.  A bonus in the amount of $500,000 will be paid to Mr. Carnes upon successfully completing the opening or merger/acquisition of our first operating business unit.  A bonus of $250,000 will be compensated to Mr. Carnes for each additional merger and/or acquisition and/or business unit start-up Mr. Carnes brings to the Company.  Mr. Carnes will also receive an automobile allowance of
$700 per month.  Mr. Carnes has agreed to accrue such portions of his salary as deemed relevant by the board of directors until such time as the Company is adequately capitalized and able to pay such salary.



Termination of Employment



There are no compensatory plans or arrangements, other than those described above, including payments to be received from the Company, with respect to any person named in Cash Consideration set out above which would in any way result in payments to any such person because of his resignation, retirement, or other termination of such persons employment with the Company or its subsidiaries, or any change in control of the Company, or a change in the persons responsibilities following a change in control of the Company.



Compensation of Directors



All directors will be reimbursed for expenses incurred in attending Board or committee, when established, meetings.



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




The following table presents information, to the best of our knowledge, about the beneficial ownership of our common stock on March 8, 2007 relating to the beneficial ownership of our common stock by those persons known to beneficially own more than 5% of our capital stock and by our director and executive officer. The percentage of beneficial ownership for the following table is based on 499,854,216 shares of common stock outstanding.



19



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Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and does not necessarily indicate beneficial ownership for any other purpose. Under these rules, beneficial ownership includes those shares of common stock over which the stockholder has sole or shared voting or investment power. It also includes shares of common stock that the stockholder has a right to acquire within 60 days after March 8, 2007 pursuant to options, warrants, conversion privileges or other rights. The percentage ownership of the outstanding common stock, however, is based on the assumption, expressly required by the rules of the Securities and Exchange Commission, that only the person or entity whose ownership is being reported has converted options or warrants into shares of our common stock.



Security Ownership of Management

Name of Beneficial Owner (1)
        
        Number
of Shares
        
        Percent
Beneficially
Owned (2)Stephen W. Carnes
4185 West Lake Mary Blvd., Ste. 137
Lake Mary, Florida 32746
        
        259,375,000
        
        52%Director & Officer
        
        259,375,000
        
        52%


(1)
        As used in this table, beneficial ownership means the sole or shared power to vote, or to direct the voting of, a security, or the sole or shared investment power with respect to a security (i.e., the power to dispose of, or to direct the disposition of, a security).


(2)
        Rounded to the nearest whole percentage.




ITEM 12.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.



Employment Agreement with Steve Carnes



On September 3, 2003, we entered into an Employment Agreement with Stephen W. Carnes, wherein Mr. Carnes agreed to serve as the Chairman of the Board, President and Chief Executive Officer of the Company.  The term of the Agreement was for a period of three years, it commenced on August 1, 2003 and terminated on July 31, 2006.  On August 1, 2006, we extended the termination date to July 31, 2010.  Pursuant to the agreement we agreed to pay Mr. Carnes a salary at an annual rate equal to the sum of $250,000.  A bonus in the amount of $500,000 will be paid to Mr. Carnes upon successfully completing the opening or merger/acquisition of our first operating business unit.  A bonus of $250,000 will be compensated to Mr. Carnes for each additional merger and/or acquisition and/or business unit start-up Mr. Carnes brings to the Company.  Mr. Carnes will also receive an automobile allowance of $700
per month.  Mr. Carnes has agreed to accrue such portions of his salary as deemed relevant by the board of directors until such time as the Company is adequately capitalized and able to pay such salary.



On August 17, 2005, we issued 200,000,000 shares of our common stock to Mr. Carnes as partial payment of accrued salary, valued at $120,000.



On September 6, 2006, we issued 14,375,000 shares of our common stock to Mr. Carnes as partial payment of accrued salary, valued at $23,000.



20



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Reimbursements/ Salary Accrued



As of December 31, 2006, Mr. Carnes had accrued reimbursements of $1,650, accrued salary of $656,166 and accrued auto allowance of $28,700.



Director Independence



The Board of Directors has concluded that Stephen W. Carnes, being the sole director of the Company is not considered an independent director in accordance with the director independence standards of the American Stock Exchange.



ITEM 13.
        EXHIBITS.




(a)
        Exhibits


|                 |  |                                                                                                 |  |                  |  | Incorporated by reference
|---------------- |  | ----------------------------------------------------------------------------------------------- |  | ---------------- |  | -------------------------
|Exhibit
		number |  | Exhibit description                                                                             |  | Filed
		herewith |  | Form                     
|2.1              |  | Letter of Intent to acquire James Bar Contractors, Inc.
		dated October 23, 2003                |  |                  |  | SB-2                     
|                 |  |                                                                                                 |  |                  |  |                          
|2.2              |  | Agreement and Plan of Merger with ei3 Corporation, dated
		September 26, 2005                   |  |                  |  | 8-K                      
|                 |  |                                                                                                 |  |                  |  |                          
|2.3              |  | Amendment No. 1 to Agreement and Plan of Merger with ei3
		Corporation, dated November 22, 2005 |  |                  |  | 8-K                      
|                 |  |                                                                                                 |  |                  |  |                          
|2.4              |  | Amendment No. 2 to Agreement and Plan of Merger with ei3
		Corporation, dated February 14, 2006 |  |                  |  | 8-K                      
|                 |  |                                                                                                 |  |                  |  |                          
|3(i).1           |  | Articles of Incorporation dated October 17, 2000                                                |  |                  |  | 10-SB                    
|                 |  |                                                                                                 |  |                  |  |                          
|3(i).2           |  | Certificate of Amendment to Articles of Incorporation dated
		January 10, 2002                  |  |                  |  | 10-SB                    
|                 |  |                                                                                                 |  |                  |  |                          
|3(i).3           |  | Certificate of Amendment to Articles of Incorporation dated
		July 14, 2003                     |  |                  |  | 10-QSB                   
|                 |  |                                                                                                 |  |                  |  |                          
|3(i).4           |  | Certificate of Amendment of Articles of Incorporation dated
		June 19, 2004                     |  |                  |  | SB-2                     
|                 |  |                                                                                                 |  |                  |  |                          
|3(ii).1          |  | Bylaws dated October 17, 2002                                                                   |  |                  |  | 10-SB                    
|                 |  |                                                                                                 |  |                  |  |                          
|10.1             |  | Employment Agreement with Stephen W. Carnes dated September
		3, 2003                           |  |                  |  | 10-QSB                   
|                 |  |                                                                                                 |  |                  |  |                          
|10.2             |  | Independent Contractor Agreement with Cynthia Wainwright
		dated October 1, 2003                |  |                  |  | 10-QSB                   
|                 |  |                                                                                                 |  |                  |  |                          
|10.3             |  | Independent Contractor Agreement with Loren Brown dated
		October 1, 2003                       |  |                  |  | 10-QSB                   
|                 |  |                                                                                                 |  |                  |  |                          
|10.4             |  | Independent Contractor Agreement with Matt Lettau dated
		October 1, 2003                       |  |                  |  | 10-QSB                   
|                 |  |                                                                                                 |  |                  |  |                          
|10.5             |  | Consulting Agreement with Mark Broersma dated August 27,
		2003                                 |  |                  |  | 10-QSB                   
|                 |  |                                                                                                 |  |                  |  |                          
|10.6             |  | Consulting Agreement with Mike Barr dated August 27, 2003                                       |  |                  |  | 10-QSB                   
|                 |  |                                                                                                 |  |                  |  |                          
|10.7             |  | Consulting Agreement with Florida Catastrophe Corp. dated
		September 17, 2003                  |  |                  |  | 8-K                      
|                 |  |                                                                                                 |  |                  |  |                          





21



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Incorporated by referenceExhibit
number
        
        Exhibit description
        
        Filed
herewith
        
        Form
        
        Period
ending
        
        Exhibit No.
        
        Filing
date10.8
        
        Letter Agreement with Source Capital Group, Inc. dated January 21, 2004
        
        
        
        10-KSB
        
        12/31/03
        
        10.8
        
        3/30/0410.9
        
        Consulting Agreement with Mark Broersma dated April 29, 2004
        
        
        
        10-QSB
        
        3/31/04
        
        10.2
        
        5/17/0410.10
        
        Consulting Agreement with Mike Barr dated April 29, 2004
        
        
        
        10-QSB
        
        3/31/04
        
        10.3
        
        5/17/0410.11
        
        Consulting Agreement with VBg Design dated April 29, 2004
        
        
        
        10-QSB
        
        3/31/04
        
        10.4
        
        5/17/0410.12
        
        Standby Equity Distribution Agreement with Cornell Capital Partners, LP dated April 14, 2004
        
        
        
        SB-2
        
        
        
        10.14
        
        6/30/0410.13
        
        Registration Rights Agreement with Cornell Capital Partners, LP dated April 14, 2004
        
        
        
        SB-2
        
        
        
        10.15
        
        6/30/0410.14
        
        Escrow Agreement with Cornell Capital Partners, LP dated April 14, 2004
        
        
        
        SB-2
        
        
        
        10.16
        
        6/30/0410.15
        
        Placement Agent Agreement with Cornell Capital Partners, LP and Newbridge Securities Corporation dated April 14, 2004
        
        
        
        SB-2
        
        
        
        10.17
        
        6/30/0410.16
        
        Securities Purchase Agreement with Cornell Capital Partners, LP dated April 14, 2004
        
        
        
        SB-2
        
        
        
        10.18
        
        6/30/0410.17
        
        Secured Convertible Debenture dated April 14, 2004
        
        
        
        SB-2
        
        
        
        10.19
        
        6/30/0410.18
        
        Investor Registration Rights Agreement with Cornell Capital Partners, LP dated April 14, 2004
        
        
        
        SB-2
        
        
        
        10.20
        
        6/30/0410.19
        
        Security Agreement with Cornell Capital Partners, LP dated April 14, 2004
        
        
        
        SB-2
        
        
        
        10.21
        
        6/30/0410.20
        
        Warrant Agreement dated April 14, 2004
        
        
        
        SB-2
        
        
        
        10.22
        
        6/30/0410.21
        
        Escrow Agreement with Butler Gonzalez, LLP dated April 14, 2004
        
        
        
        SB-2
        
        
        
        10.23
        
        6/30/0410.22
        
        Assumption Agreement with Stephen W. Carnes dated September 26, 2005
        
        
        
        8-K
        
        
        
        10.1
        
        9/29/0531
        
        Certification of Stephen W. Carnes pursuant to Section 302 of the Sarbanes-Oxley Act
        
        X32
        
        Certification of Stephen W. Carnes pursuant to Section 906 of the Sarbanes-Oxley Act
        
        X




ITEM 14.
        PRINCIPAL ACCOUNTANT FEES AND SERVICES.




(1) AUDIT FEES



The aggregate fees billed for professional services rendered by Jaspers + Hal, PC, for the audit of the registrant's annual financial statements and review of the financial statements included in the registrant's Form 10-QSB or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for fiscal years 2006 and 2005 were $4,500 and $6,000.



22



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(2) AUDIT-RELATED FEES



NONE



(3) TAX FEES



NONE



(4) ALL OTHER FEES



NONE



(5) AUDIT COMMITTEE POLICIES AND PROCEDURES



The Company does not have an audit committee.



(6)If greater than 50 percent, disclose the percentage of hours expended on the principal accountant's engagement to audit the registrant's financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant's full-time, permanent employees.



Not applicable.



SIGNATURES



Pursuant to the requirements of 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.



RENOVO HOLDINGS




By:/s/
			Stephen Carnes


Stephen W. Carnes, President




Dated: April 2, 2007




Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.



NAME
        OFFICE
        DATE




/s/ Stephen Carnes
        CEO/President
        April 2, 2007


Stephen W. Carnes
        Secretary/Treasurer
			Chief Accounting Officer
			Director




23



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TABLE OF CONTENTS







PAGEIndependent Auditors Report
        F-1Balance Sheets
        F-2Statement of Operations
        F-3Statement of Stockholders Equity
        F-4  F-5Statement of Cash Flows
        F-6Footnotes
        F-7  F-19






24



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JASPERS + HALL, PC

CERTIFIED PUBLIC ACCOUNTANTS

9175 Kenyon Avenue, Suite 100

Denver, CO 80237

303-796-0099




Report of Independent Registered Public Accounting Firm



To the Board of Directors

Renovo Holdings, Inc.



We have audited the accompanying balance sheet of Renovo Holdings, (A Development Stage Company) as of December 31, 2006 and 2005, and the related statements of operations, changes in stockholders equity, and cash flows for the years then ended and for the period October 18, 2000 (inception) to December 31, 2006.  These financial statements are the responsibility of the Companys management.  Our responsibility is to express an opinion on these financial statements based on our audits.



We conducted our audits in accordance with auditing standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit 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 financial statements referred to above present fairly, in all material respects, the financial position of Renovo Holdings at December 31, 2006 and 2005, and the results of its operations and its cash flows for the year then ended and for the period October 18, 2000 (date of inception) to December 31, 2006, in conformity with accounting principles generally accepted in the United States.



The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  As described in Note 6 to the financial statements, conditions exist which raise substantial doubt about the Companys ability to continue as a going concern.  Managements plans in regard to these matters are also discussed in Note 6.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.





/s/Jaspers + Hall, PC

March 13, 2007





F-1



---



RENOVO HOLDINGS

(A Development Stage Company)

BALANCE SHEETS



December 31,
        
        December 31,2006
        2005ASSETSCurrent assets:Cash
        $
        -
        $
        2,867Total current assets
        
        -
        
        2,867Equipment, net of accumulated depreciation
        
        -
        
        16,696Total Assets
        $
        -
        $
        19,563LIABILITIES AND STOCKHOLDERS' DEFICITCurrent Liabilities:Accounts payable
        $
        84,299
        $
        -Payroll taxes payable
        
        24,111
        
        24,111Accrued interest payable
        
        29,120
        
        17,488Accrued auto allowance
        
        28,700
        
        20,300Accrued reimbursement to officer
        
        1,650
        
        3,861Accrued salary - officer
        
        656,166
        
        429,167Accrued redemption premium
        
        49,539
        
        -Secured convertible debenture
        
        220,000
        
        220,000Total current liabilities
        
        1,093,585
        
        714,927Stockholders' deficit:Preferred stock, $.001 par value authorized 5,000,000; no shares issued and outstanding as of December 31, 2006 and December 31, 2005
        
        -
        
        -Common stock, $.001 par value, authorized 500,000,000 shares;  499,854,216 and 485,479,216 issued and outstanding as of December 31, 2006 and December 31, 2005
        
        499,854
        
        485,479Additional paid-in capital
        
        706,606
        
        697,981Deficit accumulated during development stage
        
        (2,300,045)
        
        (1,878,824)Total stockholders' deficit
        
        (1,093,585)
        
        (695,364)Total liabilities and stockholders' deficit
        $
        -
        $
        19,563




See accountants review report and accompanying notes.



F-2



---





RENOVO HOLDINGS

(A Development Stage Company)

STATEMENT OF OPERATIONS



|          |                                             |           |                                  |           |             |             | For the Period October 18, 2000 (Inception) to December 31, 2006
|--------- | ------------------------------------------- | --------- | -------------------------------- | --------- | ----------- | ----------- | ----------------------------------------------------------------
|          |                                             |           | Twelve Months Ended December 31, |          
|          |                                             |           | 2006                             |           | 2005        |            
|          |                                             |           |                                  |           |             |             |                                                                 
|          |                                             |           |                                  |           |             |             |                                                                 
|Revenue   | $                                           | -         | $                                | -         | $           | -          
|          |                                             |           |                                  |           |             |             |                                                                 
|Expenses: |                                             |           |                                  |           |             |            
|          | Loss on sale of property                    |           | 6,552                            |           | 5,556       |             | 12,108                                                          
|          | General and Administrative                  |           | 2,562                            |           | 54,666      |             | 326,965                                                         
|          | Depreciation                                |           | 3,142                            |           | 14,809      |             | 23,821                                                          
|          | Advertising                                 |           | -                                |           | 39,750      |             | 286,900                                                         
|          | Consulting                                  |           | -                                |           | 22,500      |             | 411,500                                                         
|          | Officer salary                              |           | 250,000                          |           | 250,000     |             | 854,167                                                         
|          | Legal and accounting                        |           | 89,396                           |           | 25,592      |             | 186,698                                                         
|          | Auto Allowance                              |           | 8,400                            |           | 8,400       |             | 28,700                                                          
|          | Interest expense                            |           | 11,632                           |           | 13,786      |             | 33,376                                                          
|          | Redemption premium                          |           | 49,539                           |           | -           |             | 49,539                                                          
|          | Other services - related party              |           | -                                |           | -           |             | 72,500                                                          
|          | Other expense                               |           | -                                |           | -           |             | 13,771                                                          
|          | Total expenses                              |           | 421,223                          |           | 435,059     |             | 2,300,045                                                       
|Net loss  | $                                           | (421,223) | $                                | (435,059) | $           | (2,300,045)
|          |                                             |           |                                  |           |             |             |                                                                 
|          |                                             |           |                                  |           |             |             |                                                                 
|          | Weighted average number of common           |           |                                  |           |             |             |                                                                 
|          | shares outstanding, basic and fully diluted |           | 343,037,333                      |           | 338,823,292 |             | 343,037,333                                                     
|          |                                             |           |                                  |           |             |             |                                                                 
|          | Net loss per weighted share                 |           |                                  |           |             |             |                                                                 
|          | basic and fully diluted                     | $         | (0.00)                           | $         | (0.00)      | $           | (0.01)                                                          





See accountants review report and accompanying notes.



F-3



---



RENOVO HOLDINGS

(A Development Stage Company)

October 18, 2000, (Inception) to December 31, 2005

STATEMENT OF STOCKHOLDERS' EQUITY



Accumulated During Developmental Stage (Deficit)
        
        Total Stockholder's EquityStock subscriptions receivable
        
        Additional Paid-in CapitalCommon StockShares
        
        Amount10/18/2000 - (inception)Shares issued for services
        20,000,000
        $
        200
        $
        -
        $
        4,800
        $
        -
        $
        5,000Shares issued for cash
        40,000,000
        
        400
        
        -
        
        9,600
        
        -
        
        10,000Net (loss) October 18, 2000 (Inception) to December 31, 2000
        -
        
        -
        
        -
        
        -
        
        (12,849)
        
        (12,849)Balance - December 31, 2000
        60,000,000
        
        600
        
        -
        
        14,400
        
        (12,849)
        
        2,151Shares issued for cash
        6,200,000
        
        62
        
        -
        
        9,238
        
        -
        
        9,300Donated services
        -
        
        -
        
        -
        
        4,231
        
        -
        
        4,231Net loss for year
        -
        
        -
        
        -
        
        -
        
        (7,429)
        
        (7,429)Balance - December 31, 2001
        66,200,000
        
        662
        
        -
        
        27,869
        
        (20,278)
        
        8,253Shares issued for cash
        13,800,000
        
        138
        
        -
        
        20,562
        
        -
        
        20,700January 10, 2002 recapitalizationadjustment to additional paid-in-capital
        -
        
        79,200
        
        -
        
        (79,200)
        
        -
        
        -Donated services
        -
        
        -
        
        -
        
        6,000
        
        -
        
        6,000Net loss for year
        -
        
        -
        
        -
        
        -
        
        (10,647)
        
        (10,647)Balance - December 31, 2002
        80,000,000
        
        80,000
        
        -
        
        (24,769)
        
        (30,925)
        
        24,306Donated services
        -
        
        -
        
        -
        
        3,000
        
        -
        
        3,000Shares Cancelled by majority stockholders
        (60,000,000)
        
        (60,000)
        
        -
        
        60,000
        
        -
        
        -Shares issued for services
        45,000,000
        
        45,000
        
        -
        
        22,500
        
        -
        
        67,500Shares issued for services
        957,062
        
        957
        
        -
        
        115,843
        
        -
        
        116,800Net loss for year
        -
        
        -
        
        -
        
        -
        
        (313,527)
        
        (313,527)Balance - December 31, 2003
        65,957,062
        
        65,957
        
        -
        
        176,574
        
        (344,452)
        
        (101,921)






See accountants review report and accompanying notes.



F-4



---



RENOVO HOLDINGS

(A Development Stage Company)

October 18, 2000, (Inception) to December 31, 2005

STATEMENT OF STOCKHOLDERS' EQUITY



Accumulated During Developmental Stage (Deficit)
        
        Total Stockholder's EquityStock subscriptions receivable
        
        Additional Paid-in CapitalCommon StockShares
        
        AmountShares issued for cash
        13,988,094
        
        13,988
        
        -
        
        47,191
        
        -
        
        61,179Shares issued related toequity distribution agreement
        82,300,000
        
        82,300
        
        (47,000)
        
        317,700
        
        -
        
        353,000Shares issued for services
        7,887,938
        
        7,888
        
        -
        
        226,812
        
        -
        
        234,700Net loss for year
        -
        
        -
        
        -
        
        -
        
        (1,099,313)
        
        (1,099,313)Balance - December 31, 2004
        170,133,094
        
        170,133
        
        (47,000)
        
        768,277
        
        (1,443,765)
        
        (552,355)Shares issued related toequity distribution agreement
        83,758,696
        
        83,759
        
        47,000
        
        18,449
        
        -
        
        149,208Shares issued for debt repayment
        221,637,426
        
        221,637
        
        -
        
        (80,795)
        
        -
        
        140,842Shares issued for services
        9,950,000
        
        9,950
        
        -
        
        (7,950)
        
        -
        
        2,000Net loss for year
        
        
        
        
        
        
        
        
        (435,057)
        
        (435,057)Balance - December 31, 2005
        485,479,216
        
        485,479
        
        -
        
        697,981
        
        (1,878,822)
        
        (695,362)Shares issued in payment forofficer salaries payable
        14,375,000
        
        14,375
        
        -
        
        8,625
        
        -
        
        23,000Net loss December 31, 2006
        
        
        
        
        
        
        
        
        (421,223)
        
        (421,223)Balance - December 31, 2006
        499,854,216
        $
        499,854
        $
        -
        $
        706,606
        $
        (2,300,045)
        $
        (1,093,585)






See accountants review report and accompanying notes.



F-5



---



RENOVO HOLDINGS

(A Development Stage Company)

STATEMENT OF CASH FLOWS



|                                              |   |                                  |   |           | For the Period October 18, 2000 (Inception) to December 31, 2006
|--------------------------------------------- | - | -------------------------------- | - | --------- | ----------------------------------------------------------------
|                                              |   | Twelve Months Ended December 31,
|                                              |   | 2006                             |   | 2005     
|                                              |   |                                  |   |           |                                                                 
|CASH FLOWS FROM OPERATIONS                    |   |                                  |   |           |                                                                 
|                                              |   |                                  |   |           |                                                                 
|Net loss                                      | $ | (421,223)                        | $ | (435,059) | $                                                               
|                                              |   |                                  |   |           |                                                                 
|Adjustments to reconcile net loss to net cash |   |                                  |   |           |                                                                 
|used for operating activities:                |   |                                  |   |           |                                                                 
|Stock issued for services                     |   | -                                |   | 22,500    |                                                                 
|Loss on sale of equipment                     |   | 6,552                            |   | 5,556     |                                                                 
|Donated services                              |   | -                                |   | -         |                                                                 
|Depreciation                                  |   | 3,142                            |   | 14,809    |                                                                 
|Increase(decrease) in accounts payable        |   | 84,299                           |   | (2,516)   |                                                                 
|Increase in accrued auto allowance            |   | 8,400                            |   | 8,400     |                                                                 
|Increase in accrued expenses                  |   | 68,174                           |   | 11,826    |                                                                 
|Increase in accrued salary -officer           |   | 250,000                          |   | 250,000   |                                                                 
|Increase(decrease) in loan from officer       |   | (2,211)                          |   | 22,221    |                                                                 
|Net cash used for operating activities        |   | (2,867)                          |   | (102,263) |                                                                 
|                                              |   |                                  |   |           |                                                                 
|CASH FLOWS FROM INVESTING ACTIVITIES          |   |                                  |   |           |                                                                 
|Purchase of equipment                         |   | -                                |   | (1,255)   |                                                                 
|Proceeds from sale of equipment               |   | -                                |   | 20,000    |                                                                 
|Net cash used in investing activities         |   | -                                |   | 18,745    |                                                                 
|                                              |   |                                  |   |           |                                                                 
|CASH FLOWS FROM FINANCING ACTIVITIES          |   |                                  |   |           |                                                                 
|Issuance of common stock                      |   | -                                |   | 126,500   |                                                                 
|Issuance of secured debenture                 |   | -                                |   | -         |                                                                 
|Proceeds from note payable                    |   | -                                |   | 100,000   |                                                                 
|Payment of accrued salary to officer          |   | -                                |   | (165,000) |                                                                 
|Repayment of debt to officer                  |   | -                                |   | (19,000)  |                                                                 
|Net cash used in financing activities         |   | -                                |   | 42,500    |                                                                 
|                                              |   |                                  |   |           |                                                                 
|Net increase (decrease) in cash               |   | (2,867)                          |   | (41,018)  |                                                                 
|Cash, beginning of period                     |   | 2,867                            |   | 43,885    |                                                                 
|Cash, end of period                           | $ | -                                | $ | 2,867     | $                                                               
|                                              |   |                                  |   |           |                                                                 
|Supplemental disclosure                       |   |                                  |   |           |                                                                 
|Interest paid                                 | $ | -                                | $ | -         | $                                                               
|Taxes paid                                    | $ | -                                | $ | -         | $                                                               





See accountants review report and accompanying notes.



F-6



---



RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)



Note 1  Organization and summary of significant accounting principles



Organization

The Company was organized October 18, 2000 (Date of Inception) under the laws of the State of Nevada, as First Impressions. The Company has not commenced significant operations and, in accordance with Statement of Financial Accounting Standards No. 7Accounting and Reporting by Development Stage Enterprises(SFAS No. 7), the Company is considered a development stage company.



On July 14, 2003, we amended our Articles of Incorporation changing our name from First Impressions to Fortis Enterprises. The Board of Directors determined that the name, "First Impressions" was limiting the Company's ability to pursue the expansion of our business into other marketing arenas and felt that the name Fortis Enterprises was more generic and allows for more flexibility in the future expansion of business opportunities.  We also increased the total amount of authorized common stock from 50,000,000 shares to 100,000,000 shares.



On June 11, 2004, we amended our Articles of Incorporation changing our name from Fortis Enterprises to Renovo Holdings.  We also increased the total amount of authorized common stock from 100,000,000 to 500,000,000 shares.



Accounting period

The Company has adopted an annual accounting period of January 1 through December 31.



Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 revenue and expenses during the reporting period.  Actual results could differ significantly from those estimates.



Cash and cash equivalents

For the purpose of the statements of cash flows, all highly liquid investments with maturity of three months or less are considered to be cash equivalents.



Revenue recognition

Sales and related cost of sales are generally recognized upon shipment of products. Cost of goods sold generally represents the cost of items sold and the related shipping and selling expenses.





F-7

---



RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)



Furniture and equipment- Furniture and equipment are stated at cost less accumulated depreciation.  It is the policy of the Company to capitalize items greater than or equal to $1,000 and provide depreciation based on the estimated useful life of individual assets, calculated using the straight line method.



Estimated useful lives range as follows:



YearsFurniture and equipment
        3  5Computer hardware
        3Vehicles
        5




Advertising Costs

The Company expenses all costs of advertising as incurred. There were no advertising costs included in general and administrative expenses as of December 31, 2006 or December 31, 2005.



Fair value of financial instruments

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2006 and 2005. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial instruments include cash, accounts payable and notes payable. Fair values were assumed to approximate carrying values for cash and payables because they are short term in nature and their carrying amounts approximate fair values or they are payable on demand.



Stock-Based Compensation

During 2004, the Company adopted thefair value based methodof Statement of Financial Accounting Standards No. 123 (SFAS 123).  Under the fair value based method, compensation cost is measured at the grant date based on the value of the award and is recognized over the service period, which is usually the vesting period.  Stock-based compensation to vendors is recorded based upon the fair value of the services provided when it constitutes a more reliable measure of fair value than the stock price.



Adoption of the fair value provisions of SFAS 123 did not result in a significant change in the financial statements of the Company.



Earnings per share

The Company has adopted Statement of Financial Accounting Standards No. 128.Earnings Per Share("SFAS No. 128").  Basic earnings per common share ("EPS") calculations are determined by dividing net income by the weighted average number of shares of common stock outstanding



F-8



---



RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)



during the year.  Diluted earning per common share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common share equivalents outstanding.  During periods when common stock equivalents, if any, are anti- dilutive they are not considered in the computation.



Segment reporting

The Company has adopted Statement of Financial Accounting Standards No. 130,Disclosures About Segments of an Enterprise and Related Information. The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations.



Income taxes

The Company has adopted Statement of Financial Accounting Standard No. 109,Accounting for Income Taxes("SFAS No. 109") for recording the provision for income taxes. Deferred tax assets and liabilities are computed based upon the difference between the financial statement and income tax basis of assets and liabilities using the enacted marginal tax rate applicable when the related asset or liability is expected to be realized or settled.  Deferred income tax expenses or benefits are based on the changes in the asset or liability each period.  If available evidence suggests that it is more likely than not that some portion or all of the deferred tax assets will not be realized, a valuation allowance is required to reduce the deferred tax assets to the amount that is more likely than not to be realized.  Future changes in such valuation allowance are included in
the provision for deferred income taxes in the period of change.



The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes because of differences in amounts deductible for tax purposes.  Deferred income taxes may arise from temporary differences resulting from income and expense items reported for financial accounting and tax purposes in different periods.  Deferred taxes are classified as current or non-current, depending on the classification of assets and liabilities to which they relate.  Deferred taxes arising from temporary differences that are not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse.



Recent pronouncements

In June 2003, the Securities and Exchange Commission (SEC) adopted final rules under Section 404 of the Sarbanes-Oxley Act of 2002 (Section 404). Commencing with our annual report for the year ended December 31, 2007, we will be required to include a report of management on our internal control ever financial reporting. The internal control report must include a statement,





F-9



---



RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)




        of managements responsibility for establishing and maintaining adequate internal control over our financial reporting;





        of managements assessment of the effectiveness of our internal control over financial reporting as of year end;





        of the framework used by management to evaluate the effectiveness of our internal control over financial reporting; and





        that our independent accounting firm has issued an attestation report on managements assessment of our internal control over financial reporting, which report is also required to be filed.




In December 2005 the SECs advisory committee on small business recommended that the SEC allow most companies with market values of less than $700 million to avoid having their internal controls certified by auditors. The advisory committee recommended that most companies with market capitalizations under $100 million be exempted totally. It further recommended that companies with market capitalizations of $100 million to $700 million not face audits of internal controls. Some Companies with large revenues but low market values would still be required to comply with the act. There can be no assurances that these proposals or similar proposals will be adopted.



During 2003, the Financial Accounting Standards Board issued Statement of Financial Accounting Standard No. 150Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity(SFAS No. 150).  SFAS No. 150 became fully effective for periods beginning after December 15, 2003.  SFAS No. 150 requires financial instruments with the certain characteristics or redemption options to be classified as liabilities in the financial statements.  The Company adopted SFAS No. 150 as of January 1, 2004.  This adoption did not result in a significant change to the financial statements.



In November 2004, the FASB issued SFAS 151, "Inventory Costs." SFAS 151 amends the accounting for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage) under the guidance in ARB 43, Chapter 4, "Inventory Pricing." Paragraph 5 of ARB 43, Chapter 4, previously stated that "...under some circumstances, items such as idle facility expense, excessive spoilage, double freight, and rehandling costs may be so abnormal as to require treatment as current period charges...." This Statement requires that those items be recognized as current-period charges regardless of whether they meet the criterion of "so abnormal." In addition, this Statement requires that allocation of fixed production overheads to the costs of conversion be based on the normal capacity of the production facilities. This statement is effective for inventory costs incurred during fiscal years beginning after June 15,



F-10



---



RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)



2005. Management does not expect adoption of SFAS 151 to have a material impact on the Company's financial statements.



In December 2004, the FASB issued SFAS 152, "Accounting for Real Estate Time-Sharing Transactions." The FASB issued this Statement as a result of the guidance provided in AICPA Statement of Position (SOP) 04-2, "Accounting for Real Estate Time-Sharing Transactions." SOP 04-2 applies to all real estate time-sharing transactions. Among other items, the SOP provides guidance on the recording of credit losses and the treatment of selling costs, but does not change the revenue recognition guidance in SFAS 66, "Accounting for Sales of Real Estate," for real estate time-sharing transactions. SFAS 152 amends Statement 66 to reference the guidance provided in SOP 04-2. SFAS 152 also amends SFAS 67, "Accounting for Costs and Initial Rental Operations of Real Estate Projects", to state that SOP 04-2 provides the relevant guidance on accounting for incidental operations and costs related to the sale of real estate
time-sharing transactions. SFAS 152 is effective for years beginning after June 15, 2005, with restatements of previously issued financial statements prohibited. Management does not expect adoption of SFAS 152 to have a material impact on the Company's financial statements.



In December 2004, the FASB issued SFAS 153, "Exchanges of Nonmonetary Assets," an amendment to Opinion No. 29, "Accounting for Nonmonetary Transactions." Statement 153 eliminates certain differences in the guidance in Opinion No. 29 as compared to the guidance contained in standards issued by the International Accounting Standards Board. The amendment to Opinion No. 29 eliminates the fair value exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchanges of nonmonetary assets that do not have commercial substance. Such an exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange. SFAS 153 is effective for nonmonetary asset exchanges occurring in periods beginning after June 15, 2005. Earlier application is permitted for nonmonetary asset exchanges occurring in periods
beginning after December 16, 2004. Management does not expect adoption of SFAS 153 to have a material impact on the Company's financial statements.



In December 2004, the FASB issued SFAS 123(R), "Share-Based Payment." SFAS 123(R) amends SFAS 123, "Accounting for Stock-Based Compensation," and APB Opinion 25, "Accounting for Stock Issued to Employees." SFAS 123(R) requires that the cost of share-based payment transactions (including those with employees and non-employees) be recognized in the financial statements. SFAS 123(R) applies to all share-based payment transactions in which an entity acquires goods or services by issuing (or offering to issue) its shares, share options, or other equity  instruments (except for those held by an ESOP) or by incurring liabilities (1) in amounts based (even in part) on the price of the entity's shares or other equity instruments, or (2) that require (or may require) settlement by the issuance of an entity's shares or other equity instruments. This statement is effective (1) for public companies qualifying as SEC small



F-11



---



RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)



business issuers, as of the first interim period or fiscal year beginning after December 15, 2005, or (2) for all other public companies, as of the first interim period or fiscal year beginning after June 15, 2005, or (3) for all nonpublic entities, as of the first fiscal year beginning after December 15, 2005. Management does not expect adoption of SFAS 123(R) to have a material impact on the Company's financial statements.



In May 2005, the FASB issued SFAS 154, Accounting Changes and Error Corrections  a replacement of APB Opinion 20, Accounting Changes and FASB Statement No. 3, Reporting Accounting Changes in Interim Financial Statements.  SAFS requires This Statement requires retrospective application to prior periods financial statements of changes in accounting principle, unless it is impracticable to determine either the period-specific effects or the cumulative effect of the change. When it is impracticable to determine the period specific effects of an accounting change on one or more individual prior periods presented, this Statement requires that the new accounting principle be applied to the balances of assets and liabilities as of the beginning of the earliest period for which retrospective application is practicable and that a corresponding adjustment be made to the
opening balance of retained earnings (or other appropriate components of equity or net assets in the statement of financial position) for that period rather than being reported in an income statement. When it is impracticable to determine the cumulative effect of applying a change in accounting principle to all prior periods, this Statement requires that the new accounting principle be applied as if it were adopted prospectively from the earliest date practicable.  This statement is effective for accounting changes and errors made in fiscal years beginning after December 15, 2005.  Management does not expect adoption of SFAS 152 to have a material impact on the Company's financial statements.



In February 2006, the FASB issued SFAS 155, Accounting for Certain Hybrid Financial Instruments."  This Statement amends FASB Statements No. 133, Accounting for Derivative Instruments and Hedging Activities, and No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities. This Statement resolves issues addressed in Statement 133 Implementation Issue No. Dl, Application of Statement 133 to Beneficial Interests in Securitized Financial Assets. This Statement:



a)   Permits fair value remeasurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation.



b)   Clarifies which interest-only strips and principal-only strips are not subject to the requirements of Statement 133.



c)   Establishes a requirement to evaluate interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation.



F-12



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RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)





d)      Clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives.



e)   Amends Statement 140 to eliminate the prohibition on a qualifying special-purpose entity from holding a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument.



The fair value election provided for in paragraph 4(e) of this Statement may also be applied upon adoption of this Statement for hybrid financial instruments that had been bifurcated under paragraph 12 of Statement 133 prior to the adoption of this Statement. Earlier adoption is permitted as of the beginning of our fiscal year, provided we have not yet issued financial statements, including financial statements for any interim period, for that fiscal year. Provisions of this Statement may be applied to instruments that we hold at the date of adoption on an instrument-by-instrument basis.



Adoption of this Statement is required as of the beginning of the first fiscal year that begins after September 15, 2005. The adoption of this statement is not expected to have a material impact on the Companys financial statements.



In March 2006, The FASB issued SEAS 156,Accounting for Servicing of Financial Assets. This Statement amends FASB Statement No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities, with respect to the accounting for separately recognized servicing assets and servicing liabilities. This Statement:



a)      Requires an entity to recognize a servicing asset or servicing liability each time it undertakes an obligation to service a financial asset by entering into a servicing contract in certain situations.



b)     Requires all separately recognized servicing assets and servicing liabilities to be initially measured at fair value, if practicable.



c)      Permits an entity to choose either the amortization method or the fair value measurement method for each class of separately recognized servicing assets and servicing liabilities.



F-13



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RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)



d)At its initial adoption, permits a one-time reclassification of available-for-sale securities to trading securities by entities with recognized servicing rights, without calling into question the treatment of other available-for-sale securities under Statement 115, provided that the available-for-sale securities are identified in some manner as offsetting the entitys exposure to changes in fair value of servicing assets or servicing liabilities that a servicer elects to subsequently measure at fair value.



e)      Requires separate presentation of servicing assets and servicing liabilities subsequently measured at fair value in the statement of financial position and additional disclosures for all separately recognized servicing assets and servicing liabilities.



Adoption of this Statement is required as of the beginning of the first fiscal year that begins after September 15, 2006. The adoption of this statement is not expected to have a material impact on the Companys financial statements.



In September 2006, the FASB issued Statement No. 157, Fair Value Measurements. This Statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurement. The implementation of this guidance is not expected to have any impact on the Companys financial statements.



In September 2006, the FASB issued Statement of Financial Accounting Standards No. 158, Employers Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of PASS Statements No. 87, 106, and 132(R) (SFAS No. 158). SFAS No. 158 requires companies to recognize a net liability or asset and an offsetting adjustment to accumulated other comprehensive income to report the funded status of defined benefit pension and other postretirement benefit plans. SFAS No. 158 requires prospective application, recognition and disclosure requirements effective for the Companys fiscal year ending December 31, 2007. Additionally, SFAS No. 158 requires companies to measure plan assets and obligations at their year-end balance sheet date. This requirement is effective for the Companys fiscal year ending December 31, 2009. The Company is currently evaluating the
impact of the adoption of SFAS No. 258 and does not expect that it will have a material impact on its financial statements.



In September 2006, the United States Securities and Exchange Commission (SEC), adopted SAB No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. This SAB provides guidance on the consideration of the effects to prior year misstatements in quantifying current year misstatements for the purpose of a materiality assessment. SAB 108 establishes an approach that requires quantification of financial statement errors based on the effects of each of the companys balance



F-14



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RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)



sheet and statement of operations financial statements and the related financial statement disclosures. The SAB permits existing public companies to record the cumulative effect of initially applying this approach in the first year ending after November 15, 2006 by recording the necessary correcting adjustments to the carrying values of assets and liabilities as of the beginning of that year with the offsetting adjustment recorded to the opening balance of retained earnings. Additionally, the use of the cumulative effect transition method requires detailed disclosure of the nature and amount of each individual error being corrected through the cumulative adjustment and how and when it arose. The Company is currently evaluating the impact, if any, that SAB 108 may have on the Companys results of operations or financial position.



In July 2006, the FASB issued FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes-an interpretation of FASB Statement No. 109. This Interpretation prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Interpretation No. 48 also provides guidance on derecognition, classification, interest and penalties,accounting in interim periods, disclosure, and transition. Interpretation No. 48 is effective for fiscal years beginning after December 15, 2006 and the Company is currently evaluating the impact, if any, that FASB No. 48 may have on the Companys results of operations or financial position.



Note 2  Furniture and Equipment



Furniture and equipment consists of the following categories at December 31, 2006 and 2005:



2006
        2005Computers
        -
        17,739Office equipment
        -
        6,508Software
        
        -
        527-
        24,774Less accumulated depreciation
        -
        (8,078)Total
        -
        16,696




Depreciation expense for the years ended December 31, 2006 and 2005 totaled $3,143 and $11,782, respectively.





Note 3  Secured convertible debentures



During 2004, the Company issued secured convertible debentures totaling $300,000 to a securities broker.  These debentures mature in April 2007 and include interest of 5% payable upon conversion or maturity.



F-15



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RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)



The holder has the option to convert, at any time, all or part of the principal amount of the debenture, plus accrued interest, into shares of the Companys common stock at a conversion price equal to the lesser of (a) 120% of the closing bid price of the common stock or (b) 80% of the lowest closing bid price of the Companys common stock for the five trading days immediately preceding the conversion date.  During the years ended December 31, 2006 and 2005, $0 and $20,000 of these debentures were converted to 0 and 21,637,426 shares of common stock, respectively.



The Company may redeem a portion or all of these debentures with 15 days notice for 120% of the amount redeemed, plus accrued interest.



Note 4  Income taxes



Deferred income taxes may arise from temporary differences resulting from income and expense items reported for financial accounting and tax purposes in different periods. Deferred taxes are classified as current or non-current, depending on the classification of assets and liabilities to which they relate.  Deferred taxes arising from temporary differences that are not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse.



The Company currently has net operating loss carryforwards aggregating approximately $1,500,000, which expire through 2025. The deferred tax asset of approximately $500,000 related to this carryforward has been fully reserved.



The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes. The sources and tax effects of the differences for the periods presented are as follows:



Income tax provision at thefederal statutory rate
        34%Effect of operating losses
        -34%0%






F-16



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RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)

Net deferred tax assets consist of the following:



The Company did not pay any income taxes during the years ended December 31, 2006 or 2005.



Note 5  Stockholders equity



The Company is authorized to issue 5,000,000 shares of preferred stock with a par value of $0.001.  Rights, preferences and other terms of the preferred stock will be determined by the board of directors at the time of issuance.



During the year ended December 31, 2005, the Company issued 83,758,696 shares of its $0.01 par value common stock to an escrow agent on behalf of Cornell Capital pursuant to the Standby Equity Distribution Agreement entered into on June 30, 2004.  The Company received $79,500 in payment of the subscription receivable in 2005.



In February 2005, the Company converted $20,000 of the secured convertible debenture in exchange for 21,637,426 shares of its $0.001 par value common stock.



On August 17, 2005, the Company issued 200,000,000 shares of its par value common stock to its sole officer in exchange for accrued salaries valued at $120,000.



On September 30, 2006, the Company issued 14,375,000 shares of its par value common stock to its sole officer in exchange for accrued salaries valued at $23,000.



There have been no other issuances of common stock.



During 2004, management entered into a Standby Equity Distribution Agreement with Cornell Capital Partners (Cornell) in order to fund development efforts.  This agreement calls for Cornell to purchase up to $5,000,000 of the Companys common stock at a price based upon recent market activity.  Purchases of stock are initiated by the Company as funds are needed in accordance with the agreement.



Note 6  Going concern



The accompanying financial statements have been prepared assuming that the Company will continue as a going concern which contemplates the recoverability of assets and the satisfaction of liabilities in the normal course of business.  As noted above, the Company is in the development stage and, accordingly, has not yet generated revenues from operations.  Since its inception, the Company has been engaged substantially in financing activities and developing its product line, setting up its e-commerce website, and incurring substantial costs and expenses.  As a result, the Company incurred accumulated net losses from October 18, 2000 (inception) through the period ended December 31, 2006 in excess of $2,300,000. The Companys current liabilities exceed its current assets by $1,093,585.  In addition, the Company's development activities since inception have been financially sustained through equity financing.

F-17

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RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)



The ability of the Company to continue as a going concern is dependent upon its ability to raise additional capital from the sale of common stock and, ultimately, the achievement of significant operating revenues.  The accompanying financial statements do not include any adjustments that might be required should the Company be unable to recover the value of its assets or satisfy its liabilities.



In order to fund development, management has entered into a Standby Equity Distribution Agreement with Cornell Capital as described in Note 5.



Note 7  Warrants and options



There are no warrants or options outstanding to acquire any additional shares of common stock.



Note 8  Related party transactions



Amounts due to the Companys chief executive officer totaled approximately $685,000 and $450,000 at December 31, 2006 and 2005, respectively.  These amounts primarily represent unpaid salary and auto allowance in accordance with an employment agreement.



Note 9  Commitments and contingent liabilities



Lease commitments- The Company leases certain office premises under non-cancelable operating leases.  The leases expire in October 2006 and require the Company to pay real estate taxes, insurance and other costs.



Aggregate minimum rental commitments at December 31, 2006 under non-cancelable operating leases are summarized as follows:



Year ending
        
        GrossDecember 31,
        
        Rentals2006
        
        $ 40,026$ 40,026






F-18



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RENOVO HOLDINGS

(A DEVELOPMENTAL STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

(continued)



Rental expense included in operations totaled approximately $0 and $15,000 for the years ended December 31, 2006 and 2005, respectively.



Legal matters- The Company is occasionally party to litigation or threat of litigation arising in the normal course of business.  Management, after consultation with legal counsel, does not believe that the resolution of any such matters will have a material effect on the Companys financial position or results of operations.



Employment agreement- The Company has entered into an employment agreement with its chief executive officer.  This agreement establishes bonuses based upon new mergers, acquisitions or business unit start-ups the executive brings to the Company.



Note 10  Stock-based compensation



During 2004, the Company adopted a consultant and employee stock compensation plan whereby they may issue up to 15,625,000 shares of common stock at the discretion of the board of directors.  The purpose of the plan is to further the growth of the Company by awarding common stock for services provided.



During the year ended December 31, 2006, the Company did not grant any shares to employees, vendors and others as disclosed in the accompanying statement of changes in stockholders equity.  Shares granted as compensation to non-employees are recorded at the fair value of the services provided since that provides a more objective source of information.  Expenses included in the accompanying financial statements related to stock-based compensation totaled approximately $0 during the year ended December 31, 2006.



F-19