**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

 

FORM 10-KSB

 

(Mark One)

 

|   | [ X ] | Annual Report Pursuant to Section 13 or 15(d) of The                            Securities Exchange Act of 1934 |
|--------|-------|-----------------------------------------------------------------------------------------------------------------|

 

For the Fiscal Year Ended December 31, 2007

 

|   | [     ] | Transition Report Pursuant to Section 13 or 15(d) of The                            Securities Exchange Act of 1934 |
|--------|-----------------------------|---------------------------------------------------------------------------------------------------------------------|

 

Commission File Number: 000-52886

 

**EASTGATE ACQUISITIONS            CORPORATION**

(Name of small business issuer in its charter)

 

|   | Nevada | 87-0639378 |
|--------|--------|------------|

|   | (State or other jurisdiction of | (I.R.S. Employer |
|--------|---------------------------------|------------------|

|   | incorporation or organization) | Identification No.) |
|--------|--------------------------------|---------------------|

 

19 East 200 South, Suite 1080, Salt Lake City, Utah 84111

(Address of principal executive offices) (Zip Code)

 

Issuer's telephone no.: (801) 322-3401

 

| Securities registered pursuant to Section 12(b) of the                            Exchange Act: | None |
|-------------------------------------------------------------------------------------------------|------|

 

| Securities registered pursuant to Section 12(g) of the                            Exchange Act: | Common |
|-------------------------------------------------------------------------------------------------|--------|

 

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  [ X            ]      No  [   ]

 

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 the Registrant's knowledge, in definitive proxy or information statements            incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form            10-KSB. [   ]

 

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

 

|   | State the issuer's revenues for its most recent fiscal                            year. $ -0- |
|--------|-----------------------------------------------------------------------------------------------|

 

State the aggregate market value of the voting stock held by            non-affiliates computed by reference to the price at which the stock was sold, or the            average bid and ask prices of such stock as of a specified date within 60 days. $            -0-

 

State the number of shares outstanding of each of the issuer's classes            of common equity, as of the latest practicable date.

 

|   | Class | Outstanding as of March 31, 2008 |
|--------|-------|----------------------------------|

             

|   | Common Stock, Par Value |
|--------|-------------------------|

|   | $0.0001 par value | 1,500,000 |
|--------|-------------------|-----------|

 

DOCUMENTS INCORPORATED BY REFERENCE

 

A description of "Documents Incorporated by Reference" is contained in            Part III, Item 14.

 

| Transitional Small Business Disclosure                            Format. | Yes [   ] |   | No [ X ] |
|---------------------------------------------------------------------------|---------------------|--------|----------|

----

**EASTGATE ACQUISITIONS CORPORATION**

 

**TABLE OF CONTENTS**

 

|   | Page |
|--------|------|

**PART I**

 

| Item 1. | Description of Business | 3 |
|---------|-------------------------|---|

 

| Item 2. | Description of Property | 9 |
|---------|-------------------------|---|

 

| Item 3. | Legal Proceedings | 9 |
|---------|-------------------|---|

 

| Item 4. | Submission of Matter to a Vote of Security                            Holders | 9 |
|---------|-------------------------------------------------------------------------------|---|

 

**PART II**

 

| Item 5. | Market for Common Equity and Related Stockholder                            Matters | 9 |
|---------|-------------------------------------------------------------------------------------|---|

 

| Item 6. | Management's Discussion and Analysis or Plan of                            Operation | 11 |
|---------|--------------------------------------------------------------------------------------|----|

 

| Item 7. | Financial Statements | 14 |
|---------|----------------------|----|

 

| Item 8. | Changes in and Disagreements with Accountants on                            Accounting |
|---------|----------------------------------------------------------------------------------------|

|   | and Financial Disclosure | 14 |
|--------|--------------------------|----|

 

| Item 8A(T). | Controls and Procedures | 14 |
|-------------|-------------------------|----|

 

| Item 8B | Other Information | 15 |
|---------|-------------------|----|

             

**PART            III**     

| Item 9. | Directors, Executive Officers, Promoters                            and Control Persons; Corporate Governance; Compliance                            with Section 16(a) of the Exchange Act | 15 |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----|

 

| Item 10. | Executive Compensation | 19 |
|----------|------------------------|----|

 

| Item 11. | Security Ownership of Certain Beneficial Owners and                            Management | 19 |
|----------|-------------------------------------------------------------------------------------------|----|

 

| Item 12. | Certain Relationships and Related Transactions and                            Director Independence | 20 |
|----------|-----------------------------------------------------------------------------------------------------|----|

 

| Item 13. | Exhibits | 20 |
|----------|----------|----|

 

| Item 14. | Principal Accountant Fees and Services | 20 |
|----------|----------------------------------------|----|

 

|   | Signatures | 22 |
|--------|------------|----|

----

             

**PART I**

 

| **Item 1.** | **Description of Business** |
|-------------|-----------------------------|

 

**Business Development**

 

|   | *History* |
|--------|-----------|

 

Eastgate Acquisitions Corporation was organized on September 8, 1999            under the laws of the State of Nevada. We are a development stage company currently            engaged in investigating prospective business opportunities with the intent to acquire            or merge with one or businesses. On November 30, 1999, we filed with the SEC a            registration statement on Form SB-2 under the Securities Act of 1933 to register            our outstanding shares. The registration statement was subsequently            abandoned.

 

In March 2002, we changed our corporate name to Talavera’s Fine            Furniture in anticipation of making an acquisition. However, the acquisition was never            finalized and in November 2006, we changed our name back to Eastgate Acquisitions. In            October 2007, the name was changed to Eastgate Acquisitions Corporation.

 

Management has broad discretion in its search for and negotiations with            any potential business or business opportunity. In certain instances, a target company            may desire to become our subsidiary or contribute assets rather than merge. No            assurance can be given that we will be successful in locating or negotiating with any            target company.

 

Any target acquisition or merger candidate will become subject to the            same reporting requirements as us following finalization of an acquisition or merger.            Thus, in the event of a successful acquisition or merger, the acquired business must            provide audited financial statements for at least the two most recent fiscal years or,            in the event it has been in business for less than two years, from the period of            inception. This could limit our potential business opportunities due to the fact that            many private businesses either do not have audited financial statements, or are unable            to produce audited statements without undo time and expense.

 

Our principal executive offices are located at 19 East 200 South, Suite            #1080, Salt Lake City, Utah 84111 and our telephone number is (801)            322-3401.

 

**Current Business Activities**

 

We have a limited operating history and no representation is made, nor            is any intended, that we will be able to carry on future business activities            successfully. There can be no assurance that we will have the ability to acquire or            merge with a business opportunity that will be of material value.

 

Management plans to investigate, research and, if justified, potentially            acquire or merge with, one or more businesses or business opportunities. We have no            commitment or arrangement, written or oral, to participate in any business opportunity            and management cannot predict the nature of any potential business we may ultimately            consider. Management will have broad discretion in its search for and negotiations with            any potential business or business opportunity.

 

*Sources of Business Opportunities*

 

Management intends to use various resources in its search for potential            business opportunities including, but not limited to, our officers, directors,            stockholders, consultants, special advisors, securities broker-dealers, venture            capitalists, members of the financial community and others who may present management            with unsolicited proposals. Because of a lack of capital, we may not be able to retain,            on a fee basis, professional firms specializing in business acquisitions and            reorganizations. Rather, we will most likely have to rely on outside sources, not            otherwise associated with us that will accept their compensation only after we finalize            a successful acquisition or merger. To date, we have not engaged or entered into any            discussion, agreement or understanding with a particular consultant regarding our            search for business opportunities. Presently, no final decision has been made nor is            management in a position to identify any future prospective consultants.

 

 

-4-

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If we engage an independent consultant, we will look only to consultants            that have experience in working with small companies in search of an appropriate            business opportunity. Also, the consultant must have experience in locating viable            merger and/or acquisition candidates and have a proven track record of finalizing such            business consolidations. Further, we would prefer to engage a consultant that will            provide services for only nominal up-front consideration and is willing to be fully            compensated at the close of a business consolidation.

 

We do not intend to limit our search to any specific kind of industry            or business. We may investigate and ultimately acquire a venture that is in its            preliminary or development stage, is already in operation, or in various stages of its            corporate existence and development. Management cannot predict at this time the status            or nature of any venture in which we may participate. A potential venture might need            additional capital or merely desire to have its shares publicly traded. The most likely            scenario for a possible business arrangement would involve the acquisition of or merger            with an operating business that does not need additional capital, but which merely            desires to establish a public trading market for its shares. Management believes            that we could provide a potential public vehicle for a private entity interested in            becoming publicly held without the time and expense typically associated with an            initial public offering.

 

*Evaluation*

 

Once we identify a potential acquisition or merger candidate, management            will determine whether acquisition or merger is warranted, or whether further            investigation is necessary. Such determination will generally be based on management's            knowledge and experience, or with the assistance of outside advisors and consultants            evaluating the preliminary information available to them. Management may elect to            engage outside independent consultants to perform preliminary analysis of potential            business opportunities. However, because of our lack of capital, we may not have the            necessary funds for a complete and exhaustive investigation of any particular            opportunity.

 

In evaluating potential business opportunities, management will            consider, to the extent relevant to the specific situation, several factors            including:

 

|   | ● | potential benefits to the company and                            stockholders; |
|--------|---------|--------------------------------------------------------------------------------|

|   | ● | working capital; |
|--------|---------|------------------|

|   | ● | financial requirements and availability of additional                            financing; |
|--------|---------|---------------------------------------------------------------------------------------------|

|   | ● | history of operation, if any; |
|--------|---------|-------------------------------|

|   | ● | nature of present and expected competition; |
|--------|---------|---------------------------------------------|

|   | ● | quality and experience of management; |
|--------|---------|---------------------------------------|

|   | ● | need for further research, development or                            exploration; |
|--------|---------|-----------------------------------------------------------------------------------|

|   | ● | potential for growth and expansion; |
|--------|---------|-------------------------------------|

|   | ● | potential for profits; and |
|--------|---------|----------------------------|

|   | ● | other factors deemed relevant to the specific                            opportunity. |
|--------|---------|---------------------------------------------------------------------------------------|

 

Because we have not yet located or identified any specific business            opportunity, there are certain unidentified risks that cannot be adequately expressed.            There can be no assurance following consummation of any acquisition or merger that the            business venture will develop into a going concern or, if the business is already            operating, that it will continue to operate successfully. Many potential business            opportunities available to us may involve a new and untested technology, product,            process or market strategy, which may not ultimately prove successful.

 

*Form of Potential Acquisition or Merger*

 

We cannot predict the manner in which we might participate in a            particular prospective business opportunity. Each separate potential opportunity will            be reviewed and, upon the basis of that review, a suitable legal structure or method of            participation will be chosen. The particular manner in which we participates in a            specific opportunity will depend upon the nature of its business, the respective needs            and desires of the parties’ management, and the relative negotiating strength of            the parties involved. Actual participation in a business venture may take the form            of an asset purchase, lease, joint venture, license, partnership, stock purchase,            reorganization, merger or other form of consolidation. We may act directly or            indirectly through an interest in a partnership, corporation, or other form of            organization, however, we presently do not intend to participate in an opportunity            through the purchase of a minority stock position.

 

-5-

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Because we have only nominal assets and a limited operating history, in            the event we successfully acquire or merge with an operating business, current            stockholders most likely will experience substantial dilution. It is also probable that            we will experience a change in control. The owners of a business that we acquire or            merge with will most likely gain effectively control of our company following such            transaction. Management has not established any guidelines as to the amount of control            it will offer to prospective target. Instead, management will attempt to negotiate the            best possible agreement for the benefit of the stockholders.

 

Presently, management does not intend to borrow funds to compensate any            person, consultant, promoter or affiliate in relation to the consummation of a            potential merger or acquisition. However, if we engage any outside advisor or            consultant in our search for business opportunities, we may have to raise additional            funds. As of the date hereof, we have not made any arrangements or definitive            agreements to use outside advisors or consultants or to raise any capital. In the event            we do need to raise capital, most likely the only method available would be the private            sale of securities. These possible private sales would most likely have to be to            persons known by the officers, current stockholders, directors or to venture            capitalists that would be willing to accept the risks associated with investing in a            business with limited operations.

 

Because we are a development stage company, it is unlikely that we could            make a public sale of securities or be able to borrow any significant sum from either a            commercial or private lender. Management will attempt to acquire funds on the best            available terms. However, there can be no assurance that we will be able to obtain            additional funding when and if needed, or that such funding, if available, can be            obtained on reasonable and/or acceptable terms. Although not presently anticipated,            there is a remote possibility that we could sell securities to our management or            affiliates to raise funds.

 

There exists a possibility that the terms of any future acquisition or            merger transaction might include the sale of shares presently held by our officers            and/or directors to parties affiliated with or designated by the potential target.            Presently, management has no plans to seek or actively negotiate such terms. However,            if this situation does arise, management is obligated to follow our articles of            incorporation and all applicable corporate laws in negotiating such an arrangement.            Under this scenario of a possible sale by officers and directors, it is unlikely that            similar terms and conditions would be offered to all other stockholders or that            stockholders would be given the opportunity to approve such a transaction.

 

In the event of a successful acquisition or merger, a finder's fee, in            the form of cash or securities, may be paid to a person or persons instrumental in            facilitating the transaction. No criteria or limits have been established for the            determination of an appropriate finder's fee, although it is likely that any fee will            be based upon negotiations by management, the business opportunity and finder.            Management cannot at this time make an estimate as to the type or amount of a potential            finder's fee that might be paid. It is unlikely that a finder's fee will be paid to an            affiliate because of the potential conflict of interest that might result. However, if            such a fee were paid to an affiliate, it would have to be in such a manner so as not to            compromise the affiliate’s possible fiduciary duty or violate the doctrine of            corporate opportunity.

 

We believe that it is highly unlikely that we will acquire or merge with            a business in which management, affiliates or promoters have an ownership interest. Any            possible related party transaction of this type would have to be ratified by a            disinterested board and by the stockholders. Management does not anticipate an            acquisition or merger with a related entity. Further, as of the date hereof, no            officer, director, affiliate or associate has had any preliminary contact or            discussions with any specific business opportunity, nor are there any present plans,            proposals, arrangements or understandings regarding the possibility of an acquisition            or merger with any specific business opportunity.

 

**Rights of Stockholders**

 

Management anticipates that prior to consummating any acquisition or            merger, if required by relevant state laws and regulations, we will seek to have the            transaction ratified by stockholders in the appropriate manner. Certain types of            transactions may be entered into solely by board of directors approval without            stockholder ratification. Under Nevada law, certain actions that would routinely be            taken at a meeting of stockholders, may be taken by written consent of stockholders            having not less than the minimum number of votes that would be necessary to authorize            or take the action at a meeting of stockholders. Thus, if stockholders holding a            majority of the outstanding shares decide by written consent to consummate an            acquisition or a merger, minority stockholders would not be given the opportunity to            vote on the issue. If stockholder approval is required, the board will have discretion            to consummate the transaction by written consent if it is determined to

 

-6-

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be in the company’s best interest to do so. Regardless of whether            an acquisition or merger is ratified by board action alone, by written consent or by            holding a stockholders' meeting, we will provide stockholders complete disclosure            documentation concerning the potential target including requisite financial statements.            This information will be disseminated by proxy statement in the event a stockholders'            meeting is held, or by an information statement if the action is taken by written            consent.

 

Under Nevada corporate laws, our stockholders may be entitled to assert            dissenters’ rights in the event of a merger of acquisition. Stockholders will be            entitled to dissent from and obtain payment of the fair value of their shares in the            event of consummation of a plan of merger to which we are a party, if approval by the            stockholders is required under applicable Nevada law. Also, stockholders will be            entitled to dissenters’ rights if we enter into a share exchange and our shares            are to be acquired. A stockholder entitled to assert dissenter’s rights and            obtain the fair value for their shares, may not challenge the corporate action creating            this entitlement, unless the action is unlawful or fraudulent with respect to the            stockholder or the company. A dissenting stockholder shall refrain from voting their            shares in approval of the corporate action. If the proposed action is approved by the            required vote of stockholders, we must give notice to all stockholders who delivered            their written notice of dissent.

 

**Competition**

 

Because no potential acquisition or merger candidate has been            identified, we cannot evaluate the type and extent of future competition. We are aware            that there are several other public companies with only nominal assets that are also            searching for operating businesses and other business opportunities as potential            acquisition or merger candidates. We will be in direct competition with these other            public companies in our search and, due to a lack of funds, it may be difficult to            successfully compete with these other companies.

 

**Employees**

 

As of the date hereof, we do not have any employees and have no plans            for retaining employees until such time as business warrants the expense, or until we            successfully acquire or merge with an operating business. We may find it necessary to            periodically hire part-time clerical help on an as-needed basis.

 

**Facilities**

 

We currently use as our principal place of business the business office            of our President and director, Geoff Williams, in Salt Lake City, Utah. Although we            have no written agreement and currently pay no rent for the use of the facilities, it            is contemplated that at such future time as we acquire or merge with an operating            business, we will secure commercial office space from which we will conduct business.            However, until such time as we complete an acquisition or merger, the type of business            in which we will be engaged and the type of office and other facilities that will be            required is unknown. We have no current plans to secure such commercial office            space.

 

**Industry Segments**

 

No information is presented regarding industry segments. We are            presently a development stage company seeking a potential acquisition of or merger with            a yet to be identified business opportunity. Reference is made to the statements of            income included herein in response to Part F/S of this Form 10-KSB for a report of            our operating history for the past two fiscal years.

 

**Risk Factors Related to Our Business**

 

*We will be subject to substantial risks specific to a particular            business or business opportunity, which specific risks cannot be ascertained until a            potential acquisition or merger candidate has been identified. However, at a minimum,            our present and proposed business operations are highly speculative and subject to the            same types of risks inherent in any new or unproven venture, including the types of            risk factors outlined below.*

 

 

-7-

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|   | ***We have no assets and no source of                            revenue*** |
|--------|-----------------------------------------------------------------------------|

 

We currently have no assets and have had no revenues since inception. It            is unlikely that we will receive any revenues until we complete an acquisition or            merger. There can be no assurance that any acquired business will produce material            revenues for us or our stockholders or that any such business will operate on a            profitable basis.

 

|   | ***Our auditors have expressed a going concern                            opinion*** |
|--------|--------------------------------------------------------------------------------------|

 

Our independent auditors discuss in their report significant doubt            regarding our ability to continue as a going concern. They include a statement in the            notes to our financial statements as follows:

 

“In order to continue as a going concern, the Company will need,            among other things, additional capital resources. Management's plans to obtain such            resources for the Company include (1) obtaining capital from management and significant            shareholders sufficient to meet its minimal operating expenses, and (2) seeking out and            completing a merger with an existing operating company. However, management cannot            provide any assurances that the Company will be successful in accomplishing any of its            plans.

 

Accordingly, if we are not able to secure necessary funding or acquire            an operating business , we may not be able to continue as a going concern and our            shareholders could lose their entire investment. You are encouraged to read note 2 to            financial statements included herewith.

 

|   | ***Discretionary use of proceeds*** |
|--------|-------------------------------------|

 

We are not currently engaged in any substantive business activities            other than looking for and investigating business opportunities. Accordingly,            management has broad discretion with respect to the potential acquisition of any            business, assets, property. Although management intends to apply any proceeds it may            receive through the future issuance of stock or debt to a suitable acquired business,            we will have broad discretion in applying these funds. There can be no assurance that            our use or allocation of such proceeds will allow us to achieve our business            objectives.

 

|   | ***No substantive disclosure relating to prospective                            acquisitions*** |
|--------|-------------------------------------------------------------------------------------------------|

 

Because we have not yet identified any specific industry, assets or            business that we may seek, nor have we finalized any acquisition or merger, potential            investors in our securities will have no substantive information upon which to base a            decision whether to invest in our securities until such a transaction is completed.            Prospective investors currently have no basis to evaluate the comparative risks and            merits of investing in the industry or business in which we may acquire. Potential            investors would have access to significantly more information if we had already            identified a potential acquisition or if the acquisition target had made an offering of            its securities directly to the public.

 

|   | ***Scarcity of and competition for business                            opportunities.*** |
|--------|------------------------------------------------------------------------------------------|

 

We are and will continue to be an insignificant participant in the            business of seeking mergers with and/or acquisitions of business entities. A large            number of established and well-financed entities, including venture capital firms, are            active in mergers and acquisitions of companies that may be merger or acquisition            target candidates for us. Nearly all such entities have significantly greater financial            resources, technical expertise and managerial capabilities than us and, consequently,            we will be at a competitive disadvantage in successfully identifying possible business            opportunities and successfully completing a business combination. Moreover, we will            compete with numerous other small public companies in seeking merger or acquisition            candidates.

 

***No agreement for business combination or other transaction —            no standards for business combination.***

 

We have no current arrangement, agreement or understanding with respect            to engaging in a merger with or acquisition of a specific business entity. There can be            no assurance that the we will be successful in identifying and evaluating suitable            business opportunities or in consummating a business combination. Management has not            identified any particular industry or specific business within an industry for            evaluation. There is no assurance that we will be able to negotiate a business            combination on terms favorable. We have

 

-8-

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not established a specific length of operating history or a specified            level of earnings, assets, net worth or other criteria that we will require a target            company to have achieved, or without which we would not consider a business combination            with such business entity. Accordingly, we may enter into a business combination with a            business entity having no significant operating history, losses, limited or no            potential for immediate earnings, limited assets, negative net worth or other negative            characteristics.

 

|   | ***Reporting requirements may delay or preclude an                            acquisition.*** |
|--------|-----------------------------------------------------------------------------------------------|

 

The Securities Exchange Act of 1934 requires companies subject thereto            to provide certain information about significant acquisitions, including certified            financial statements for the company acquired covering the two most recent fiscal            years. The time and additional costs that may be incurred by some target companies to            prepare such financial statements may significantly delay or essentially preclude            consummation of an otherwise desirable acquisition. Acquisition prospects that do not            have, or are unable to obtain, the required audited statements may not be appropriate            for acquisition so long as the reporting requirements of the Exchange Act are            applicable.

 

|   | ***Future acquisition or merger may result in                            substantial dilution*** |
|--------|--------------------------------------------------------------------------------------------------|

 

We are currently authorized to issued 20 million shares of common stock,            of which 1.5 million shares are outstanding as of the date hereof. The issuance of            additional shares in connection with any acquisition or merger transaction or the            raising of capital may result in substantial dilution of the holdings of current            stockholders.

 

|   | ***Management devotes only minimal time to our                            business*** |
|--------|---------------------------------------------------------------------------------------|

 

Presently, our directors have other full time obligations and devote            only such time to our business as necessary to maintain our viability. Because of            management’s other time commitments and the fact that we have no business            operations, management anticipates that it will devote only a minimal amount of time to            our activities, at least until such time as we have identified a suitable acquisition            candidate.

 

|   | ***Effective voting control held by                            directors*** |
|--------|-----------------------------------------------------------------------------|

 

Our directors own in the aggregate approximately 40% of our outstanding            voting securities and two principal stockholders own approximately 58.9%. No other            stockholder owns in excess of 5%. Accordingly, our current directors and two principal            stockholders will have the ability to elect all of our directors, who in turn elect all            executive officers, without regard to the votes of other stockholders.

 

|   | ***No public market for our common                            stock*** |
|--------|------------------------------------------------------------------------|

 

There is currently no market for our shares and there can be no            assurance that any such market will ever develop or be maintained. We anticipate that            during the next 12 months, we will make an application to have our shares included on            the OTC Bulletin Board. Any trading market that ultimately develops will most likely be            volatile and numerous factors beyond our control may have a significant effect on the            market. Only companies that report their current financial information to the SEC may            have their securities included on the OTCBB. Therefore, to be eligible for the OTCBB we            must keep current in our filing obligations with the SEC, including filing periodic and            annual reports and the financial statements required thereby.

 

***As a reporting company under the Exchange Act, we incur            significant expenses in complying with SEC reporting requirements.***

 

Pursuant to the regulations under the Exchange Act, we incur significant            legal, accounting and other expenses to comply with certain SEC requirements, in            particular, the Sarbanes-Oxley Act of 2002. Sarbanes-Oxley and other rules implemented            by the SEC, requires management to assess its internal controls over financial            reporting and requires auditors to attest to that assessment. Current regulations            require us to include this assessment and attestation in our annual report on            Form 10-KSB commencing with the annual report for our fiscal year ending December            31, 2008.

 

 

-9-

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Management must invest significant time and energy to stay current with            the requisite reporting responsibilities of the Exchange Act, which will limit their            time they can apply to other tasks associated with business operations. It is possible            that the burden and expense of complying with Exchange Act reporting requirements will            cause us to fail in our search to acquire an operating business, which would result in            the potential loss to those investors that hold our stock.

 

Management estimates that compliance with the Exchange Act reporting            requirements will cost in excess of $25,000 annually. This is in addition to other cost            of doing business. It is important that we maintain adequate cash flow, not only to            operate our business, but also to pay the legal and accounting costs associated with            reporting requirements. If we fail to pay these costs as incurred, we could become            delinquent in our reporting obligations and our shares may no longer remain qualified            for quotation on a public market, if a market should develop. Further, investors may            lose confidence in the reliability of our financial statements causing our stock price            to decline.

 

|   | ***Lack of Market Research or Marketing                            Organization.*** |
|--------|-------------------------------------------------------------------------------------|

 

We have not conducted, nor have others made available to us, market            research indicating that demand exists for our intended business. Even in the event            demand exists for a merger or acquisition of the type we contemplate, there is no            assurance we will be successful in completing any such business combination.

 

|   | ***Lack of Diversification.*** |
|--------|--------------------------------|

 

Our business, even if successful, will in all likelihood result in            making only one acquisition or business combination. Consequently, our activities will            be limited to those engaged in by the acquired business entity. Our inability to            diversify economic fluctuations within a particular business or industry could            ultimately increase the risks associated with our business.

 

| **Item 2.** | **Description of Property** |
|-------------|-----------------------------|

 

|   | We do not presently own any property. |
|--------|---------------------------------------|

 

| **Item 3.** | **Legal Proceedings** |
|-------------|-----------------------|

 

There are no material pending legal proceedings to which our company, or            any subsidiary thereof, is a party or to which any of our property is subject and, to            the best of our knowledge, no such actions against us are contemplated or            threatened.

 

| **Item 4.** | **Submission of Matters to a Vote of Security                            Holders** |
|-------------|------------------------------------------------------------------------------------|

 

No matters were submitted to a vote of our securities holders during the            fourth quarter of the fiscal year ended December 31, 2007.

 

**PART II**

 

| **Item 5.** | **Market for Common Equity and Related Stockholder                            Matters** |
|-------------|-----------------------------------------------------------------------------------------|

 

There is not currently, nor has there ever been, a public trading market            for our common stock. As of the date hereof there are approximately 37 stockholders of            record of our common stock. We intend to request a broker/dealer to make an initial            application to the Financial Industry Regulatory Authority to have our shares quoted on            the OTC Bulletin Board. The application will consist of current corporate information,            financial statements and other documents as required by Rule 15c2-11 of the Securities            Exchange Act of 1934.

 

Inclusion on the OTC Bulletin Board will permit price quotations for our            shares to be published by that service. Although we intend to request that an            application to the OTC Bulletin Board be submitted, we do not anticipate a public            trading market in our shares in the immediate future. Any future secondary trading of            our shares may be subject to certain state imposed restrictions. Except for the            application to the OTC Bulletin Board, there are no plans, proposals, arrangements or            understandings with any person concerning the development of a trading market in any of            our securities. There can be no assurance that our shares will be accepted for trading            on the OTC Bulletin Board or any other recognized trading market. Also, there can be            no

 

-10-

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assurance that a public trading market will develop following acceptance            by the OTC Bulletin Board or at any other time in the future or, that if such a market            does develop, that it can be sustained.

 

The ability of individual stockholders to trade their shares in a            particular state may be subject to various rules and regulations of that state. A            number of states require that an issuer's securities be registered in their state or            appropriately exempted from registration before the securities are permitted to trade            in that state. Presently, we have no plans to register our securities in any particular            state.

 

**Penny Stock Rule**

 

It is unlikely that our securities will be listed on any national or            regional exchange or The Nasdaq Stock Market in the foreseeable future. Therefore our            shares most likely will be subject to the provisions of Section 15(g) and Rule 15g-9 of            the Exchange Act, commonly referred to as the "penny stock" rule. Section            15(g) sets forth certain requirements for broker-dealer transactions in penny stocks            and Rule 15g-9(d)(1) incorporates the definition of penny stock as that used in            Rule 3a51-1 of the Exchange Act.

 

The SEC generally defines a penny stock to be any equity security that            has a market price less than $5.00 per share, subject to certain exceptions. Rule            3a51-1 provides that any equity security is considered to be a penny stock unless that            security is:

 

|   | ● | registered and traded on a national securities exchange                            meeting specified criteria set by the SEC; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------|

 

|   | ● | authorized for quotation on The Nasdaq Stock                            Market; |
|--------|---------|---------------------------------------------------------------------------------|

 

|   | ● | issued by a registered investment company; |
|--------|---------|--------------------------------------------|

 

|   | ● | excluded from the definition on the basis of price (at                            least $5.00 per share) or the issuer's net tangible assets;                            or |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

|   | ● | exempted from the definition by the SEC. |
|--------|---------|------------------------------------------|

 

Broker-dealers who sell penny stocks to persons other than established            customers and accredited investors are subject to additional sales practice            requirements. An accredited investor is generally defined as a person with assets in            excess of $1,000,000 or annual income exceeding $200,000, or $300,000 together with            their spouse.

 

For transactions covered by these rules, broker-dealers must make a            special suitability determination for the purchase of such securities and must receive            the purchaser's written consent to the transaction prior to the purchase. Additionally,            for any transaction involving a penny stock, unless exempt, the rules require the            delivery, prior to the first transaction, of a risk disclosure document relating to the            penny stock market. A broker-dealer also must disclose the commissions payable to both            the broker-dealer and the registered representative and current quotations for            the securities. Finally, monthly statements must be sent to clients disclosing            recent price information for the penny stocks held in the account and information on            the limited market in penny stocks. Consequently, these rules may restrict the ability            of broker-dealers to trade and/or maintain a market in our common stock and may affect            the ability of stockholders to sell their shares.

 

These requirements may be considered cumbersome by broker-dealers and            could impact the willingness of a particular broker-dealer to make a market in our            shares, or they could affect the value at which our shares trade. Classification of the            shares as penny stocks increases the risk of an investment in our shares.

 

**Rule 144**

 

All of our outstanding common shares were issued in private transactions            and not registered with the SEC and, when issued, were deemed restricted securities.            Rule 144 is the common means for stockholders to resell restricted securities and for            affiliates, to sell their securities, either restricted on non restricted (control)            shares. Rule 144 has been amended by the SEC, effective February 15, 2008.

 

-11-

----

 

Under the amended Rule 144, an affiliate of a company filing reports            under the Exchange Act who has held their shares for more than six months, may sell in            any three-month period an amount of shares that does not exceed the greater            of:

 

?    the average weekly trading volume in the common            stock, as reported through the automated quotation system of a registered securities            association, during the four calendar weeks preceding such sale, or

 

|   | ● | 1% of the shares then outstanding. |
|--------|---------|------------------------------------|

 

Sales by affiliates under Rule 144 are also subject to certain            requirements as to the manner of sale, filing appropriate notice and the availability            of current public information about the issuer.

 

A non-affiliate stockholder of a reporting company who has held their            shares for more than six months, may make unlimited resales under Rule 144,*provided*only that the issuer has available            current public information about itself. After a one-year holding period, a            non-affiliate may make unlimited sales with no other requirements or            limitations.

 

An important exception to the above described availability of the            amended Rule 144 is that Rule 144 is not available for either a reporting or            non-reporting shell company, unless the company:

 

|   | ● | has ceased to be a shell company; |
|--------|---------|-----------------------------------|

 

|   | ● | is subject to the Exchange Act reporting                            obligations; |
|--------|---------|----------------------------------------------------------------------------------|

 

|   | ● | has filed all required Exchange Act reports during the                            preceding twelve months; and |
|--------|---------|----------------------------------------------------------------------------------------------------------------|

 

?   at least one year has elapsed from the time the            company filed with the SEC current Form 10 type information reflecting its status as an            entity that is not a shell company.

 

Following a successful acquisition of an operating business, we intend            to file with the SEC a report that will include comprehensive information that reflects            that we are no longer a shell company. Accordingly, stockholders would be able to avail            themselves to Rule 144 one year after the report is filed.

 

We cannot predict the effect any future sales under Rule 144 may have on            the market price of our common stock, if a market for our shares develops, but such            sales may have a substantial depressing effect on such market price.

 

**Dividends Policy**

 

We have never declared cash dividends on our common stock, nor do we            anticipate paying any dividends on our common stock in the foreseeable            future.

 

| **Item 6.** | **Management's Discussion and Analysis or Plan of                            Operation** |
|-------------|------------------------------------------------------------------------------------------|

 

*The following information should be read in conjunction with the            financial statements and notes thereto appearing elsewhere in this Form            10-KSB.*

 

We are considered a development stage company with no assets and/or            capital and no material operations or income. Ongoing expenses, including the costs            associated with the preparation of reports and filing with the SEC, have been paid for            by advances from a stockholder, which are evidenced on our financial statements as            payable-related party. It is anticipated that we will require only nominal capital to            maintain our corporate viability. Additional necessary funds will most likely be            provided by officers and directors, although there is no agreement related to future            funds and there is no assurance such funds will be available. However, unless we are            able to facilitate an acquisition of or merger with an operating business or able to            obtain significant outside financing, there is substantial doubt about our ability to            continue as a going concern.

 

 

-12-

----

 

**Results of Operations**

 

We have not reported any revenues since inception and incurred a net            loss of $9,681 for the year ended December 31, 2007, compared to a loss of $5,555 for            the year ended December 31, 2006. We have also reported a cumulative net loss of            $19,156 since inception through December 31, 2007. The increased loss for 2007 is            attributed primarily to professional expenses for accounting and legal fees, general            and administration expenses.

 

**Liquidity and Capital Resources**

 

Expenses incurred during 2006 and 2007 were paid by a stockholder. At            December 31, 2007, we had current liabilities of $10,956 compared to $6,775 at December            31, 2006. Because we have no cash reserves or revenue source, we expect to continue to            rely on the stockholder to pay expenses until such time as we can successfully complete            an acquisition of or merger with an existing, operating company. There is no assurance            that we will complete such an acquisition or merger or that the stockholder will            continue indefinitely to pay expenses.

 

In the opinion of management, inflation has not and will not have a            material effect on our operations until such time as we successfully complete an            acquisition or merger. At that time, management will evaluate the possible effects            of inflation related to our business and operations following a successful acquisition            or merger.

 

**Plan of Operation**

 

During the next 12 months, we will actively seek out and investigate            possible business opportunities with the intent to acquire or merge with one or more            business ventures. We will not restrict our search to any specific business, industry,            or geographical location and it may participate in a business venture of virtually any            kind or nature.

 

Because we lack funds, it may be necessary for officers, directors or            stockholders to advance funds and we will accrue expenses until such time as a            successful business consolidation can be accomplished. Management intends to hold            expenses to a minimum and to obtain services on a contingency basis when possible.            Further, directors will defer any compensation until such time as an acquisition or            merger can be accomplished and will strive to have the business opportunity provide            their remuneration. However, if we engage outside advisors or consultants in our search            for business opportunities, it may be necessary to attempt to raise additional funds.            As of the date hereof, we have not made any arrangements or definitive agreements to            use outside advisors or consultants or to raise any capital.

 

If we need to raise capital, most likely the only method available would            be the private sale of securities. Because we are a development stage company, it is            unlikely that we could make a public sale of securities or be able to borrow any            significant sum from either a commercial or private lender. There can be no assurance            that we will be able to obtain additional funding when and if needed, or that such            funding, if available, can be obtained on acceptable terms.

 

We do not intend to use any employees, with the possible exception of            part-time clerical assistance on an as-needed basis. Outside advisors or consultants            will be used only if they can be obtained for minimal cost or on a deferred payment            basis. Management is confident that it will be able to operate in this manner and to            continue its search for business opportunities during the next twelve months. Also, we            do not anticipate making any significant capital expenditures until we can successfully            complete an acquisition or merger.

 

**Net Operating Loss**

 

We have accumulated approximately $11,456 of net operating loss            carryforwards as of December 31, 2007. This loss carry forward may be offset against            future taxable income through the year 2027. The use of these losses to reduce future            income taxes will depend on the generation of sufficient taxable income prior to the            expiration of the net operating loss carryforwards. In the event of certain changes in            control, there will be an annual limitation on the amount of net operating loss            carryforwards that can be used. No tax benefit has been reported in the financial            statements for the year ended December 31, 2007 because it has been fully offset by a            valuation reserve. The use of future tax benefit is undeterminable because we presently            has no operations.

 

-13-

----

             

**Recent Accounting Pronouncements**

 

In September 2006, the Financial Accounting Standards Board            (“***FASB***”) issued            Statement of Financial Accounting Standards            (“***SFAS***”)            No.  157, “*Fair Value            Measurements*.” SFAS 157 defines fair value,            establishes a framework for measuring fair value in accordance with U.S. GAAP, and            expands disclosures about fair value measurements. The statement clarifies that the            exchange price is the price in an orderly transaction between market participants to            sell an asset or transfer a liability at the measurement date. The statement emphasizes            that fair value is a market-based measurement and not an entity-specific measurement.            It also establishes a fair value hierarchy used in fair value measurements and expands            the required disclosures of assets and liabilities measured at fair value.            SFAS 157 is effective for financial statements issued for fiscal years beginning            after November 15, 2007. The adoption of this standard is not expected to have a            material impact on our financial condition, results of operation or            liquidity.

 

In June 2006, the FASB issued FASB Interpretation No. 48            (“***FIN*** ***48***”),            “*Accounting for Uncertainty in Income            Taxes* *— an            interpretation of FASB Statement No.* *109*,” which prescribes comprehensive            guidelines for recognizing, measuring, presenting and disclosing in the financial            statements tax positions taken or expected to be taken on tax returns. FIN 48,            effective for fiscal years beginning after December 15, 2006, seeks to reduce the            diversity in practice associated with certain aspects of the recognition and            measurement related to accounting for income taxes. We are currently assessing the            impact of FIN 48 on our consolidated financial position and results of            operations.

 

In March 2006, the FASB issued SFAS No. 156, “Accounting for            Servicing of Financial Assets, an amendment of FASB Statement No. 140, Accounting for            Transfers and Servicing of Financial Assets and Extinguishments of Liabilities.”            This statement requires all separately recognized servicing assets and servicing            liabilities to be initially measured at fair value, if practicable. It permits for            subsequent measurement using either fair value measurement with changes in fair value            reflected in earnings, or the amortization and impairment requirements of Statement No.            140. Subsequent measurement of separately recognized servicing assets and servicing            liabilities at fair value, eliminates the necessity for entities that manage risks            inherent in servicing assets and servicing liabilities with derivatives, to qualify for            hedge accounting treatment and eliminates the characterization of declines in fair            value as impairments or direct write-downs. SFAS No. 156 is effective for an entity's            first fiscal year beginning after September 15, 2006. The adoption of this statement is            not expected to have a material effect on our future reported financial position or            results of operations.

 

**Forward Looking and Cautionary Statements**

 

This report includes "forward-looking statements" within the meaning of            Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange            Act of 1934. These forward-looking statements may relate to such matters as anticipated            financial performance, future revenues or earnings, business prospects, projected            ventures, new products and services, anticipated market performance and similar            matters. When used in this report, the words "may," "will," expect," anticipate,"            "continue," "estimate," "project," "intend," and similar expressions are intended to            identify forward-looking statements within the meaning of Section 27A of the Securities            Act of 1933 and Section 21E of the Securities Exchange Act of 1934 regarding events,            conditions, and financial trends that may affect our future plans of operations,            business strategy, operating results, and financial position. We caution readers that a            variety of factors could cause actual results to differ materially from the anticipated            results or other matters expressed in forward-looking statements. These risks and            uncertainties, many of which are beyond our control, include:

 

|   | ● | the sufficiency of existing capital resources and the                            ability to raise additional capital to fund cash requirements for                            future operations; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | uncertainties following any successful acquisition or                            merger related to the future rate of growth of the acquired business                            and acceptance of its products and/or services; |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | volatility of the stock market, particularly within the                            technology sector; and |
|--------|---------|-----------------------------------------------------------------------------------------------------------|

|   | ● | general economic conditions. |
|--------|---------|------------------------------|

 

Although management believes the expectations reflected in these            forward-looking statements are reasonable, such expectations cannot guarantee future            results, levels of activity, performance or achievements.

 

 

-14-

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| **Item 7.** | **Financial Statements** |
|-------------|--------------------------|

             

Financial statements for the fiscal years ended December 31, 2007 and            2006 have been examined to the extent indicated in their reports by Moore &            Associates, Chartered, independent certified public accountants and have been prepared            in accordance with accounting principles generally accepted in the United States of            America and pursuant to Regulation S-B as promulgated by the SEC. The aforementioned            financial statements are included herein starting with page F-1.

 

| **Item 8.** | **Changes in and Disagreements with Accountants on                            Accounting and Financial Disclosure** |
|-------------|---------------------------------------------------------------------------------------------------------------------|

 

|   | This Item is not applicable. |
|--------|------------------------------|

 

| **Item 8A(T).** | **Controls and Procedures** |
|-----------------|-----------------------------|

 

|   | *Evaluation of Disclosure Controls and                            Procedures* |
|--------|-------------------------------------------------------------------------------|

 

As of the end of the period covered by this annual report, management,            with the participation of our chief executive officer and principal accounting officer,            carried out an evaluation of the effectiveness of the design and operation of our            “disclosure controls and procedures”, as defined in the Securities Exchange            Act of 1934, Rules 13a-15(e) and 15-d-15(e). Based upon that evaluation, our chief            executive officer and principal accounting officer concluded that as of December 31,            2007, our disclosure controls and procedures are effective to ensure that information            required to be disclosed by us in the reports that we file or submit under the Exchange            Act is:

 

(i) recorded, processed, summarized and reported, within the time            periods specified in the SEC's rules and forms; and

 

(ii) accumulated and communicated to our management, including our chief            executive officer and principal accounting officer, as appropriate, to allow timely            decisions regarding required disclosure.

 

In designing and evaluating the disclosure controls and procedures,            management recognizes that there are inherent limitations to the effectiveness of any            system of disclosure controls and procedures, including the possibility of human error            and the circumvention or overriding of the controls and procedures. A control system,            no matter how well conceived and operated, can provide only reasonable, not absolute,            assurance that the objectives of the control system are met. Further, the design of a            control system must reflect the fact that there are resource constraints and the            benefits of controls must be considered relative to their costs. Accordingly, even            effective disclosure controls and procedures can only provide reasonable assurance of            achieving their desired control objectives. Additionally, in evaluating and            implementing possible controls and procedures, management is required to apply its            reasonable judgment.

 

|   | *Management’s Annual Report on Internal Control                            Over Financial Reporting* |
|--------|------------------------------------------------------------------------------------------------------------|

 

Management is responsible for establishing and maintaining adequate            internal control over financial reporting for our company. Our control system is            designed to provide reasonable assurance regarding the reliability of financial            reporting and the preparation of financial statements for external purposes in            accordance with U.S. generally accepted accounting principals. Our internal control            over financial reporting includes those policies and procedures that :

 

|   | ● | pertain to the maintenance of records that, in                            reasonable detail, accurately and fairly reflect the transactions and                            disposition of our assets; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

|   | ● | provide reasonable assurance that the transactions are                            recorded as necessary to permit preparation of the financial statements                            in accordance with generally accepted accounting principles and that                            receipts and expenditures are being made only with proper                            authorizations; and |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

|   | ● | provide reasonable assurance regarding prevention or                            timely detection of unauthorized acquisition, use or disposition of our                            assets that could have a material effect on the financial                            statements. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

-15-

----

 

Because of inherent limitations, internal control over financial            reporting may not prevent or detect misstatements. Also, projections of any evaluation            of effectiveness to future periods are subject to the risk that controls may become            inadequate because of changes in conditions, or that the degree of compliance with the            policies or procedures may deteriorate.

 

Management, including our principal executive officer and principal            financial officer, assessed the effectiveness of our internal control over financial            reporting as of December 31, 2007. In making this assessment, management used the            criteria set forth by the Committee of Sponsoring Organizations of the Treadway            Commission (COSO) in*Internal Control Over Financial Reporting            – Guidance for Smaller Public Companies.*Based on our            assessment and those criteria, our management concluded that our internal control over            financial reporting was effective as of December 31, 2007.

 

This annual report does not include an attestation report of our            registered public accounting firm regarding internal control over financial reporting.            Managements report was not subject to attestation by our registered public accounting            firm pursuant to temporary rules of the Securities and Exchange Commission that permit            us to provide only management’s report in this annual report.

 

|   | *Changes in Internal Control over Financial                            Reporting* |
|--------|-----------------------------------------------------------------------------------|

 

There have been no significant changes in our internal controls over            financial reporting or in other factors that could materially affect, or would be            likely to materially affect, our internal controls over financial reporting subsequent            to the date we carried out our evaluation.

 

| **Item 8B.** | **Other Information** |
|--------------|-----------------------|

 

|   | Not applicable. |
|--------|-----------------|

 

**PART III**

 

| **Item 9.** | **Directors, Executive Officers, Promoters and Control                            Persons; Corporate Governance; Compliance with                            Section** **16(a)                            of the Exchange** **Act** |
|-------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

|   | Our executive officers and directors are as                            follows: |
|--------|---------------------------------------------------------------------------------|

 

|   | **Name** | **Age** | **Position** |
|--------|----------|---------|--------------|

|   | Geoff Williams | 35 | President, CEO and Director |
|--------|----------------|----|-----------------------------|

|   | Nancy Ah Chong | 37 | Secretary / Treasurer and Director |
|--------|----------------|----|------------------------------------|

___________________________

 

All directors hold office until the next annual meeting of stockholders            and until their successors have been duly elected and qualified. There are no            agreements with respect to the election of directors. We have not compensated directors            for service on the board of directors or any committee thereof, but directors are            entitled to be reimbursed for expenses incurred for attendance at meetings of the board            and any committee thereof. However, directors may defer their expenses and/or take            payment in shares of our common stock. As of the date hereof, no director has accrued            any expenses or compensation. Officers are appointed annually by the board of directors            and each executive officer serves at the discretion of the board. We do not have any            standing committees.

 

No director, officer, affiliate or promoter of our company has, within            the past five years, filed any bankruptcy petition, been convicted in or been the            subject of any pending criminal proceedings, or is any such person the subject or any            order, judgment, or decree involving the violation of any state or federal securities            laws.

 

Directors currently devote only such time to company affairs as needed.            The time devoted could amount to as little as 1% of the time they devote to their own            business affairs, or if business conditions ultimately warrant, they could possibly            elect to devote their full time to our business. Presently, there are no other persons            whose activities are material to our operations.

 

-16-

----

 

Currently, there is no arrangement, agreement or understanding between            management and non-management stockholders under which non-management stockholders may            directly or indirectly participate in or influence the management of our affairs.            Present management openly accepts and appreciates any input or suggestions from            stockholders. However, the board of directors is elected by the stockholders and the            stockholders have the ultimate say in who represents them on the board. There are no            agreements or understandings for any officer or director to resign at the request of            another person and none of the current offers or directors of are acting on behalf of,            or will act at the direction of any other person.

 

|   | The business experience of each of the persons listed                            above during the past five years is as follows: |
|--------|----------------------------------------------------------------------------------------------------------------------------------|

 

***Geoff Williams**.*Mr. Williams has served as a director and President of our company since            its inception in September 1999. From 1994 to the present, Mr. Williams has been a            representative of Williams Investments Company, a Salt Lake City, Utah financial            consulting firm involved in facilitating mergers, acquisitions, business consolidations            and financings. Mr. Williams attended the University of Utah and California Institute            of the Arts.

 

Mr. Williams has been an executive officer, director and/or principal            stockholder (10%) within the last three years of the following public            companies:

 

|   | ● | Big Flash Corporation, n.k.a. Intelgenx Technologies                            Corporation (Secretary, director and principal stockholder from 1999 to                            April 28, 2006); |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Bull Trout Lake, Inc. (President and director since July                            2005 to present); |
|--------|---------|-------------------------------------------------------------------------------------------------------|

|   | ● | Calypso Media Services Group, Inc. (f.k.a. Calypso                            Financial Services, Inc.) (Secretary, director |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------|

and principal stockholder from 1999 to December 2007);

|   | ● | Cathay International Holdings, Inc., n.k.a. Cyber                            Operations, Inc. (director and Secretary / |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------|

Treasurer from April 12, 2002 to September 2005 – President            from September, 2005 to January

8, 2007);

|   | ● | Cementitious Materials, Inc., (f.k.a. Ocean Express                            Lines, Inc.) n.k.a. NaturalNano Holdings, Inc. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------|

(Director and President from February 2000 to February 2003 –            Director and Secretary/Treasurer

from October 2004 to November 2005 – principal stockholder until            November 2005);

|   | ● | Consolidated Travel Systems, Inc., n.k.a. Knobias, Inc.                            (Director from August 1999 and |
|--------|---------|-------------------------------------------------------------------------------------------------------------------|

President from February 2001 to November 2004);

|   | ● | Green Mountain Merger, Inc. (President and director                            since July 2005); |
|--------|---------|--------------------------------------------------------------------------------------------------|

|   | ● | Grant Ventures, Inc. n.k.a., Grant Life Sciences, Inc.                            (Secretary and director from July 2001 to |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------|

July 2004);

|   | ● | Green Mt. Labs., Inc., n.k.a. Hydrogen Engine Center,                            Inc. (director from August 2002, and |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------|

President from April 2004 to August 2005);

|   | ● | Hazelwood Ventures, Inc., n.k.a. Monarch Molybdenum                            & Resources, Inc. (director since |
|--------|---------|----------------------------------------------------------------------------------------------------------------------|

October 2003 and President since May 2006)

|   | ● | Interstate Development, n.k.a. Pro-Tect, Inc. (President                            and director since April 2002); |
|--------|---------|---------------------------------------------------------------------------------------------------------------------|

|   | ● | RAKO Capital Corporation (President and director from                            February 2001 to December 2002); |
|--------|---------|-------------------------------------------------------------------------------------------------------------------|

|   | ● | Silver River Ventures, Inc., n.k.a BioForce Nanosciences                            Holdings, Inc. (President and director |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------|

from September 2004 to December 2005); and

|   | ● | Westgate Acquisitions Corp. (Secretary and director from                            1999 to the present). |
|--------|---------|-----------------------------------------------------------------------------------------------------------|

 

|   | The current status of each of these companies is set                            forth below: |
|--------|----------------------------------------------------------------------------------------------|

 

|   | **Name of Company** | **Date of Registration** | **Status** |
|--------|---------------------|--------------------------|------------|

             

|   | Big Flash Corporation | 11-16-1999 (SB-2) | Active and current with SEC |
|--------|-----------------------|-------------------|-----------------------------|

|   | (n.k.a. Intelgenx Technologies Corp.)7-28-2000                            (10-SB) | Acquired Intelgenx Corp. on                            April 28, 2006

Traded on OTCBB (“IGXT”) |
|--------|-----------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------|

 

|   | Bull Trout Lake, Inc. | None | Seeking merger and/or acquisition

Traded on “Pink Sheets”                            (“BTLK”) |
|--------|-----------------------|------|------------------------------------------------------------------------------------------------------------------------|

             

             

-17-

----

 

             

|   | Calypso Media Services Group, Inc. | 11-17-1999 (SB-2) | Active and current with SEC |
|--------|------------------------------------|-------------------|-----------------------------|

|   | (f.k.a. Calypso Financial Servicies, Inc. 7-31-2000                            (10-SB) | Acquired Media Depot, Inc. on December 31,                            2007

Not trading |
|--------|----------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------|

             

 

|   | Cathay International Holdings, Inc. | None | Active |
|--------|-------------------------------------|------|--------|

|   | (n.k.a. Cyber Operations, Inc. | Acquired Cyber Operations, LLC on January 8,                            2007

Traded on “Pink Sheets”                            (“CYPJ”) |
|--------|--------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

             

 

|   | Cementitious Materials, Inc. | 7-3-2002 (10-SB) | Active and current with SEC |
|--------|------------------------------|------------------|-----------------------------|

|   | (f.k.a. Ocean Express Lines, Inc.) | Acquired Cementitious Materials |
|--------|------------------------------------|---------------------------------|

|   | (n.k.a. NaturalNano Holdings, Inc.) | Technologies, Inc. in November 2003 |
|--------|-------------------------------------|-------------------------------------|

|   |   | (rescinded in 2004) |
|--------|--------|---------------------|

|   |   | Acquired NaturalNano, Inc. in |
|--------|--------|-------------------------------|

|   |   | November 2005 |
|--------|--------|---------------|

|   |   | Traded on OTCBB (“NNAN”) |
|--------|--------|--------------------------------------|

|   |   |
|--------|--------|

             

 

|   | Consolidated Travel Systems, Inc. | 11-9-2001(10-SB) | Active and current with SEC |
|--------|-----------------------------------|------------------|-----------------------------|

|   | (n.k.a. Knobias, Inc.) | Completed merger with Knobias Holdings, Inc. on November                            4, 2004

Traded on OTCBB (“KNBS”) |
|--------|------------------------|-----------------------------------------------------------------------------------------------------------------------------------|

             

 

|   | GMMT, Inc. | None | Seeking merger and/or acquisition

Application to “Pink Sheets”                            pending |
|--------|------------|------|----------------------------------------------------------------------------------------------------------------|

             

 

|   | Grant Ventures, Inc. | 12-20-2002 (10-SB) | Active and current with SEC |
|--------|----------------------|--------------------|-----------------------------|

|   | (n.k.a. Grant Life Sciences, Inc.) | Completed merger with Impact

Diagnostics, Inc. in July 2004

Traded on OTCBB (“GLIF”) |
|--------|------------------------------------|----------------------------------------------------------------------------------------------------|

             

             

|   | Green Mountain Merger, Inc. | None | Seeking merger and/or acquisition

Traded on “Pink Sheets”                            (“GMTU”) |
|--------|-----------------------------|------|------------------------------------------------------------------------------------------------------------------------|

             

 

|   | Green Mt. Labs., Inc. | 1-8-2004 (10-SB) | Active and current with SEC |
|--------|-----------------------|------------------|-----------------------------|

|   | (n.k.a. Hydrogen Engine Center, Inc.) | Acquired Hydrogen Engine Center, Inc. in August                            2005

Traded on OTCBB (“HYEG”) |
|--------|---------------------------------------|-----------------------------------------------------------------------------------------------------------------------|

             

 

|   | Hazelwood Ventures, Inc. | None | Seeking merger and/or Acquisition |
|--------|--------------------------|------|-----------------------------------|

|   | ( n.k.a. Monarch Molybdenum & Resources,                            Inc.) | Traded on “Pink Sheets”                            (“MMRO”) |
|--------|-------------------------------------------------------------------------------|-------------------------------------------------------------------------------------|

 

 

|   | Interstate Development, Inc. | None | Seeking merger and/or Acquisition |
|--------|------------------------------|------|-----------------------------------|

|   | (n.k.a. Pro-Tect, Inc.) | Traded on “Pink Sheets”                            (“PRTT”) |
|--------|-------------------------|-------------------------------------------------------------------------------------|

 

|   | RAKO Capital Corporation | 7-16-1998 (10-SB) | Currently delinquent in filings

with SEC

Acquired Centra Industries, Inc. in

January 2003, a telecommunica-tions infrastructure                            company

Formerly traded on OTCBB and now on Pink Sheets                            (“RKOC”) |
|--------|--------------------------|-------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

             

|   | Silver River Ventures, Inc. | 12-13-2005 (10-SB) | Active and current with SEC |
|--------|-----------------------------|--------------------|-----------------------------|

|   | (n.k.a. BioForce Nanosciences Holdings, Inc.) | Acquired BioForce Nanosciences, Inc. on February 24,                            2006

Traded on OTCBB (“BFNH”) |
|--------|-----------------------------------------------|----------------------------------------------------------------------------------------------------------------------------|

             

             

-18-

----

 

             

|   | Westgate Acquisitions Corp. | 11-30-1999 (SB-2) | Registration not effective

Seeking merger and/or

acquisition

Not Trading |
|--------|-----------------------------|-------------------|-----------------------------------------------------------------------------|

***Nancy Ah Chong***. Ms. Ah Chong became            a director and Secretary of our company in September 2006. From August 2004 to the            present, she has been an office manager for Williams Investment Company, a Salt Lake            City, Utah financial consulting firm involved in facilitating mergers, acquisitions,            business consolidations and financings. Previously, Mrs. Ah Chong was an administrative            assistant for Forsgren Associates in Salt Lake City from March 2004 to August 2004. She            has also worked as a customer service representative for Overstock.com from November            2003 to January 2004 and O’Currance from February 2001 to November 2003, and as a            marketing and travel coordinator for MGIS from February 2000 to August 2001. From            August 1991 to December 1999, Mrs. Ah Chong was with Barrick Goldstrike Mines, Inc. in            Elko, Nevada, first as an exploration draftsperson and then an administrative            assistant. Mrs. Ah Chong attended and graduated from the Omaha Institute of Art and            Design in Omaha, Nebraska.

 

Ms. Ah Chong has been an executive officer, director and/or principal            stockholder (10%) within the last three years of the following public            companies:

 

|   | ● | Bull Trout Lake, Inc. (Secretary and director since                            October 2005); |
|--------|---------|-----------------------------------------------------------------------------------------------|

|   | ● | Cathay International Holdings, Inc., n,k,a, Cyber                            Operations, Inc. (Secretary from May 2006 to January 8,                            2007; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Green Mountain Merger, Inc. (Secretary and Director                            since October 2005; |
|--------|---------|----------------------------------------------------------------------------------------------------|

|   | ● | Hazelwood Ventures, Inc., n.k.a. Monarch Molybdenum                            & Resources, Inc. (Secretary and director since October                            2005); |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Interstate Development, Inc., n.k.a. Pro-Tect, Inc.                            (Secretary and director since March 2005); |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------|

|   | ● | Silver River Ventures, Inc., n.k.a BioForce Nanosciences                            Holdings, Inc. (Secretary and director from August 2005 to February                            2006); and |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Westgate Acquisitions Corp. (Treasurer and director from                            September 2006 to the present). |
|--------|---------|---------------------------------------------------------------------------------------------------------------------|

 

The current status of each of these companies is set forth            below:

 

|   | **Name of Company** | **Date of Registration** | **Status** |
|--------|---------------------|--------------------------|------------|

 

|   | Bull Trout Lake, Inc. | None | Seeking merger and/or acquisition |
|--------|-----------------------|------|-----------------------------------|

Traded on “Pink Sheets” (“BTLK”)

 

|   | Cathay International Holdings, Inc. | None | Active |
|--------|-------------------------------------|------|--------|

|   | (n.k.a. Cyber Operations, Inc. | Acquired Cyber Operations, LLC on January 8,                            2007 |
|--------|--------------------------------|------------------------------------------------------------------------------|

Traded on “Pink Sheets” (“CYPJ”)

 

|   | GMMT, Inc. | None | Seeking merger and/or acquisition |
|--------|------------|------|-----------------------------------|

Application to “Pink Sheets” pending

 

|   | Green Mountain Merger, Inc. | None | Seeking merger and/or acquisition |
|--------|-----------------------------|------|-----------------------------------|

Traded on “Pink Sheets” (“GMTU”)

 

|   | Hazelwood Ventures, Inc. | None | Seeking merger and/or acquisition |
|--------|--------------------------|------|-----------------------------------|

|   | ( n.k.a. Monarch Molybdenum & Resources,                            Inc.) | Traded on “Pink Sheets”                            (“MMRO”) |
|--------|-------------------------------------------------------------------------------|-------------------------------------------------------------------------------------|

 

|   | Interstate Development, Inc. | None | Seeking merger and/or acquisition |
|--------|------------------------------|------|-----------------------------------|

|   | (n.k.a. Pro-Tect, Inc.) | Traded on “Pink Sheets”                            (“PRTT”) |
|--------|-------------------------|-------------------------------------------------------------------------------------|

 

|   | Silver River Ventures, Inc. | 12-13-2005 (10-SB) | Active and current with SEC - acquired |
|--------|-----------------------------|--------------------|----------------------------------------|

|   | (n.k.a. BioForce Nanosciences Holdings, Inc.) | BioForce Nanosciences, Inc. on February 24,                            2006 |
|--------|-----------------------------------------------|-----------------------------------------------------------------------------|

|   | Traded on OTCBB (“BFNH”) |
|--------|--------------------------------------|

 

-19-

----

 

 

|   | Westgate Acquisitions Corp. | 11-30-1999 (SB-2) | Registration not effective |
|--------|-----------------------------|-------------------|----------------------------|

Seeking merger and/or acquisition

Not trading

 

**Compliance With Section 16(a) of the Exchange Act**

 

Section 16(a) of the Exchange Act requires our directors and executive            officers, and persons who own more than 10% of our common stock, to file with the SEC            initial reports of ownership and reports of changes in ownership of our common stock            and other equity securities. We believe that these reports were not filed during the            fiscal year 2007.

 

**Code of Ethics**

 

We currently do not have a code of ethics. During the current fiscal            year, we do intend to adopt a code of ethics that applies to our principal executive            officer, principal financial officer, principal accounting officer or controller or            persons performing similar functions.

 

| **Item 10.** | **Executive Compensation** |
|--------------|----------------------------|

 

We have not had a bonus, profit sharing, or deferred compensation plan            for the benefit of employees, officers or directors. We have not paid any salaries or            other compensation to officers, directors or employees for the years ended December 31,            2007 and 2006. Further, we have not entered into an employment agreement with any            of our officers, directors or any other persons and no such agreements are anticipated            in the immediate future. We expect that directors will defer any compensation            until such time as an acquisition or merger can be accomplished and will strive to have            the business opportunity provide their remuneration. As of the date hereof, no            person has accrued any compensation.

 

| **Item 11.** | **Security Ownership of Certain Beneficial Owners and                            Management** |
|--------------|-----------------------------------------------------------------------------------------------|

 

The following table sets forth information, to the best of our            knowledge, as of March 31, 2008, with respect to each person known by us to own            beneficially more than 5% of the outstanding common stock, each director and all            directors and officers as a group.

 

| **Name and Address** | **Amount and Nature of** | **Percent** |
|----------------------|--------------------------|-------------|

| **of Beneficial Owner** | **Beneficial Ownership** | **of                            Class**(1) |
|-------------------------|--------------------------|--------------------------------------------|

|   | *Directors and Officers* |
|--------|--------------------------|

| Geoff Williams * | 600,000 | 40.0 % |
|------------------|---------|--------|

|   | 19 East 200 South, Suite 1080 |
|--------|-------------------------------|

|   | Salt Lake City, UT 84111 |
|--------|--------------------------|

| Nancy Ah Chong | 0 | 0.0 % |
|----------------|---|-------|

|   | 19 East 200 South, Suite 1080 |
|--------|-------------------------------|

|   | Salt Lake City, UT 84111 |
|--------|--------------------------|

 

|   | *5% Stockholders* |
|--------|-------------------|

| Edward F. Cowle * | 600,000 | 40.0 % |
|-------------------|---------|--------|

|   | 20 West 64th Street |
|--------|---------------------|

|   | New York, NY 10023 |
|--------|--------------------|

| H. Deworth Williams | 284,200 | 18.9 % |
|---------------------|---------|--------|

|   | 19 East 200 South, Suite 1080 |
|--------|-------------------------------|

|   | Salt Lake City, UT 84111 |
|--------|--------------------------|

| All directors and officers | 600,000 | 40.0 % |
|----------------------------|---------|--------|

|   | a group (2 persons) |
|--------|---------------------|

 

|   | * | Director and/or executive officer |
|--------|---|-----------------------------------|

|   | Note: | Unless otherwise indicated, we have been advised that                            each person above has sole voting power over the shares indicated                            above. |
|--------|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

|   | (1) | Based upon 1,500,000 shares of common stock outstanding                            on March 31, 2008. |
|--------|-----|-------------------------------------------------------------------------------------------------------|

 

-20-

----

 

 

| **Item 12.** | **Certain Relationships and Related Transactions and                            Director Independence.** |
|--------------|----------------------------------------------------------------------------------------------------------|

 

There have been no material transactions during the past two fiscal            years between our company and any officer, director, nominee for election as director,            or any stockholder owning greater than five percent (5%) of our outstanding shares, nor            any member of the above referenced individuals' immediate families.

 

Our officers and directors are subject to the doctrine of corporate            opportunities, only insofar as it applies to business opportunities in which we have            indicated an interest, either through our proposed business plan or by way of an            express statement of interest contained in our corporate minutes. If directors are            presented with business opportunities that may conflict with business interests            identified by us, such opportunities must be promptly disclosed to the board of            directors and made available to us. In the event the board rejects an opportunity so            presented and only in that event, any officer or director may avail themselves of such            an opportunity. Every effort will be made to resolve any conflicts that may arise in            favor of our company. There can be no assurance, however, that these efforts will be            successful.

 

In the event of a successful acquisition or merger, a finder's fee, in            the form of cash or securities, may be paid to persons instrumental in facilitating the            transaction. We have not established any criteria or limits for the determination of a            finder's fee, although it is likely that an appropriate fee will be based upon            negotiations by management, the appropriate business opportunity and the finder. Such            fees are estimated to be customarily between 1% and 5% of the size of the transaction,            based upon a sliding scale of the amount involved. Management cannot at this time make            an estimate as to the type or amount of a potential finder's fee that might be paid,            but is expected to be comparable to consideration normally paid in like transactions.            It is unlikely that a finder's fee will be paid to an affiliate because of the            potential conflict of interest that might result. Any such fee would have to be            approved by the stockholders or a disinterested board of directors. See Item 1            “Description of Business - Form of Potential Acquisition or Merger”            above.

 

None of our directors are deemed to be independent directors. We do not            have a compensation, audit or nominating committee, rather those functions are carried            out by the board as a whole.

 

| **Item 13.** | **Exhibits** |
|--------------|--------------|

 

|   | (a) | Exhibits |
|--------|-----|----------|

 

| Exhibit No. | Exhibit Name |
|-------------|--------------|

|   | 3.1* | Certificate of Incorporation |
|--------|------|------------------------------|

|   | 3.2* | By-Laws |
|--------|------|---------|

|   | 4.1* | Instrument defining rights of stockholders (See Exhibit                            No. 3.1, Certificate of Incorporation) |
|--------|------|---------------------------------------------------------------------------------------------------------------------------|

|   | 31.1 | Certification of C.E.O. and Principal Accounting Officer                            Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|--------|------|-----------------------------------------------------------------------------------------------------------------------------------------------|

|   | 32.1 | Certification of C.E.O. and Principal Accounting Officer                            Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906                            of the Sarbanes-Oxley Act of 2002 |
|--------|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

________________

|   | * | Previously filed as an Exhibit to the Form 10-SB filed                            November 2, 2007. |
|--------|---|-----------------------------------------------------------------------------------------------------|

 

| **Item 14.** | **Principal Accountant Fees and Services** |
|--------------|--------------------------------------------|

 

We do not have an audit committee and as a result our entire board of            directors performs the duties of an audit committee. Our board of directors will            approve in advance the scope and cost of the engagement of an auditor before the            auditor renders audit and non-audit services. As a result, we do not rely on            pre-approval policies and procedures.

 

We do not have an audit committee and as a result our entire board of            directors performs the duties of an audit committee. Our board of directors will            approve in advance the scope and cost of the engagement of an auditor before the            auditor renders audit and non-audit services. As a result, we do not rely on            pre-approval policies and procedures.

 

 

-21-

----

 

|   | *Audit Fees* |
|--------|--------------|

 

The aggregate fees billed by our independent auditors, Moore &            Associates, Chartered, for professional services rendered for the audit of our annual            financial statements included in our Annual Reports on Form 10-KSB for the year            ended December 31, 2007 was $4,500. We were not subject to the            reporting requirements of the SEC prior to November 2007.

 

|   | *Audit Related Fees* |
|--------|----------------------|

 

For the year ended December 31, 2007 and 2006, there were no fees billed            for assurance and related services by Moore & Associates, Chartered relating to the            performance of the audit of our financial statements which are not reported under the            caption "Audit Fees" above.

 

|   | *Tax Fees* |
|--------|------------|

 

For the years ended December 31, 2007 and 2006, no fees were billed by            Moore & Associates, Chartered for tax compliance, tax advice and tax            planning.

 

We do not use Moore & Associates, Chartered for financial            information system design and implementation. These services, which include designing            or implementing a system that aggregates source data underlying the financial            statements or generates information that is significant to our financial statements,            are provided internally or by other service providers. We do not engage Moore &            Associates, Chartered to provide compliance outsourcing services.

 

The board of directors has considered the nature and amount of fees            billed by Moore & Associates, Chartered and believes that the provision of services            for activities unrelated to the audit is compatible with maintaining Moore &            Associates, Chartered's independence.

 

-22-

----

 

**SIGNATURES**

 

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

 

**Eastgate Acquisitions Corporation**

 

 

|   | By: | /S/    | GEOFFWILLIAMS | Geoff Williams |
|--------|-----|------------------|---------------|----------------|

|   | President and C.E.O. |
|--------|----------------------|

 

| Dated: | April 7, 2007 |
|--------|---------------|

 

In accordance with the Exchange Act, this report has been signed below            by the following persons on behalf of the Registrant and in the capacities and on the            dates indicated.

 

|   | Signature | Title | Date |
|--------|-----------|-------|------|

             

             

|   | April 7, 2008 |
|--------|---------------|

| /S/GEOFFWILLIAMS | President, C.E.O. and director |
|------------------|--------------------------------|

|   | Geoff Williams | (Principal Accounting Officer) |
|--------|----------------|--------------------------------|

 

 

|   | April 7, 2008 |
|--------|---------------|

| /S/NANCYAHCHONG | Secretary and Director |
|-----------------|------------------------|

|   | Nancy Ah Chong |
|--------|----------------|

 

-24-

----

 

 

**EASTGATE ACQUISITIONS CORPORATION**

**(A Development Stage Company)**

 

FINANCIAL STATEMENTS

 

December 31, 2007

**C O N T E N T S**

 

| Report of Independent Registered Public Accounting                            Firm | F-3 |
|------------------------------------------------------------------------------------|-----|

 

| Balance Sheets | F-4 |
|----------------|-----|

 

| Statements of Operations | F-5 |
|--------------------------|-----|

 

| Statements of Stockholders’ Equity                            (Deficit) | F-6 |
|-------------------------------------------------------------------------------|-----|

 

| Statements of Cash Flows | F-8 |
|--------------------------|-----|

 

| Notes to the Financial Statements | F-9 |
|-----------------------------------|-----|

 

----

 

 

 

MOORE & ASSOCIATES, CHARTERED

|   | *ACCOUNTANTS AND ADVISORS* |
|--------|----------------------------|

|   | *PCAOB REGISTERED* |
|--------|--------------------|

 

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING            FIRM

 

To the Board of Directors

Eastgate Acquisitions Corp

( A Development Stage Company)

 

We have audited the accompanying balance sheets of            Eastgate Acquisitions Corp (A Development Stage Company) as of December 31, 2007 and            2006 and the related statements of operations, stockholders’ equity and cash            flows for the years ended December 31, 2007 and 2006, and from inception on July 27,            1999 through December 31, 2007. 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 standards of            the Public Company Accounting Oversight Board (United States). Those standards require            that we plan and perform the audits to obtain reasonable assurance about whether the            financial statements are free of material misstatement. An audit includes examining, on            a test basis, evidence supporting the amounts and disclosures in the financial            statements. An audit also includes assessing the accounting principles used and            significant estimates made by management, as well as evaluating the overall financial            statement presentation. We believe that our audits provide a reasonable basis for our            opinion.

 

In our opinion, the financial statements referred to            above present fairly, in all material respects, the financial position of Eastgate            Acquisitions Corp (A Development Stage Company) as of December 31, 2007 and 2006 and            the results of its operations and its cash flows for the years ended December 31, 2007            and 2006 and from inception on July 27, 1999 through December 31, 2007, in conformity            with accounting principles generally accepted in the United States of            America.

 

The accompanying financial statements have been prepared            assuming that the Company will continue as a going concern. As discussed in Note 2 to            the financial statements, the Company’s has no established source of revenue,            this raises substantial doubt about its ability to continue as a going concern.            Management’s plans concerning these matters are also described in Note 2. The            financial statements do not include any adjustments that might result from the outcome            of this uncertainty.

 

/s/ Moore & Associates, Chartered

 

Moore & Associates Chartered

Las Vegas, Nevada

February 13, 2008

             

             

*2675 S. Jones Blvd. Suite 109, Las Vegas, NV 89146            (702) 253-7511 Fax (702) 253-7501*

             

F-3

             

----

             

| **EASTGATE                            ACQUISITIONS CORPORATION**                                      |
|-------------------------------------------------------------------------------------------------------|
| (A Development                            Stage Company)                                              |
| Balance                            Sheets                                                             |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
| ASSETS                                                                                                |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   | December                            31, |   | December                            31, |
|                                                                                                  |   |   |   | 2007 |   | 2006 |
|                                                                                                  |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
| CURRENT                            ASSETS                                                             |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  | Cash |   | $ | -  |   | $ | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   | Total Current                            Assets |   | -  |   |   | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   | TOTAL                            ASSETS | $ | -  |   | $ | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
| LIABILITIES AND                            STOCKHOLDERS' EQUITY (DEFICIT)                             |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
| CURRENT                            LIABILITIES                                                        |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  | Accounts                            payable | $ | -  |   | $ | 5,325  |
|                                                                                                  | Payable - related                            party |   | 10,956  |   |   | 1,450  |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   | Total Current                            Liabilities |   | 10,956  |   |   | 6,775  |
|                                                                                                  |   |   |   |   |   |   |   |   |
| STOCKHOLDERS'                            EQUITY (DEFICIT)                                             |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  | Common                            stock;20,000,000 shares authorized, |   |   |   |   |   |
|                                                                                                  | at $0.00001 par                            value, 1,500,000 shares issued |   |   |   |   |   |
|                                                                                                  | and                            outstanding |   | 15  |   |   | 15  |
|                                                                                                  | Additional paid-in                            capital |   | 8,185  |   |   | 2,685  |
|                                                                                                  | Deficit accumulated                            during the development stage |   | (19,156) |   |   | (9,475) |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   | Total Stockholders'                            Equity (Deficit) |   | (10,956) |   |   | (6,775) |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   | TOTAL LIABILITIES                            AND STOCKHOLDERS' |   |   |   |   |   |
|                                                                                                  |   | EQUITY                            (DEFICIT) | $ | - |   | $ |                               -  |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |
| The accompanying                            notes are an integral part of these financial statements. |
| F-4                                                                                                   |

----

| **EASTGATE ACQUISITIONS CORPORATION**                                                                |
|------------------------------------------------------------------------------------------------------|
| (A Development                            Stage Company)                                             |
| Statements of                            Operations                                                  |
|                                                                                                 |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   | From |
|                                                                                                 |   |   |   |   |   |   |   |   |   | Inception                            on |
|                                                                                                 |   |   |   |   |   |   |   |   |   | July 27, |
|                                                                                                 |   |   |   | For the Year                            Ended |   | 1999                            Through |
|                                                                                                 |   |   |   | December                            31, |   | December                            31, |
|                                                                                                 |   |   |   | 2007 |   | 2006 |   | 2007 |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
| REVENUES                                                                                             |   | $ | -  |   | $ | -  |   | $ | -  |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
| EXPENSES                                                                                             |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 | General                            and |   |   |   |   |   |   |   |   |   |
|                                                                                                 | administrative |   |   | 9,372  |   |   | 5,555  |   |   | 18,847  |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   | Total                            Expenses |   |   | 9,372  |   |   | 5,555  |   |   | 18,847  |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
| LOSS FROM                            OPERATIONS                                                      |   |   | (9,372) |   |   | (5,555) |   |   | (18,847) |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
| OTHER                            EXPENSES                                                            |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 | Interest                            expense |   |   | (309) |   |   | -  |   |   | (309) |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   | Total Other                            Expenses |   |   | (309) |   |   | -  |   |   | (309) |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
| NET LOSS                                                                                             |   | $ | (9,681) |   | $ | (5,555) |   | $ | (19,156) |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
| BASIC LOSS PER                            SHARE                                                      |   | $ | (0.01) |   | $ | (0.00) |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
| WEIGHTED                            AVERAGE                                                          |   |   |   |   |   |   |   |   |   |
| NUMBER OF                            SHARES                                                          |   |   |   |   |   |   |   |   |   |
| OUTSTANDING                                                                                          |   |   | 1,500,000  |   |   | 1,500,000  |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |
| The accompanying                            notes are an integral part of these financial statements |
| F-5                                                                                                  |

----

| **EASTGATE                            ACQUISITIONS CORPORATION**                                      |
|-------------------------------------------------------------------------------------------------------|
| (A Development                            Stage Company)                                              |
| Statements of                            Stockholders' Equity (Deficit)                               |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   | Deficit |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   | Accumulated |   | Total |
|                                                                                                  |   |   |   |   |   | Additional |   | During                            the |   | Stockholders' |
|                                                                                                  | Common                            Stock |   | Paid-In |   | Development |   | Equity |
|                                                                                                  | Shares |   | Amount |   | Capital |   | Stage |   | (Deficit) |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance at                            inception on July 27, 1999                                      | -  |   | $ | -  |   | $ | -  |   | $ | -  |   | $ | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common stock issued                            for cash on                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| September 8, 1999                            at $0.0003 per share                                     | 1,500,000  |   |   | 15 |   |   | 485  |   |   | -  |   |   | 500  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss from                            inception on July 27, 1999                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| through December                            31, 1999                                                  | -  |   |   | -  |   |   | -  |   |   | -  |   |   | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December                            31, 1999                                                 | 1,500,000  |   |   | 15 |   |   | 485  |   |   | -  |   |   | 500  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss for the                            period from                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| January 1, 2000                            through                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31,                            2004                                                          | - |   |   | -  |   |   | - |   |   | (3,320) |   |   | (3,320) |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December                            31, 2004                                                 | 1,500,000  |   |   | 15 |   |   | 485  |   |   | (3,320) |   |   | (2,820) |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Services                            contributed by shareholders                                       | - |   |   | -  |   |   | 500  |   |   | -  |   |   | 500  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss for the                            year ended                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31,                            2005                                                          | - |   |   | -  |   |   | -  |   |   | (600) |   |   | (600) |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December                            31, 2005                                                 | 1,500,000  |   |   | 15 |   |   | 985  |   |   | (3,920) |   |   | (2,920) |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Services                            contributed by shareholders                                       | - |   |   | -  |   |   | 1,700  |   |   | -  |   |   | 1,700  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss for the                            year ended                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31,                            2006                                                          | - |   |   | -  |   |   | -  |   |   | (5,555) |   |   | (5,555) |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December                            31, 2006                                                 | 1,500,000  |   |   | 15 |   |   | 2,685  |   |   | (9,475) |   |   | (6,775) |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Services                            contributed by shareholders                                       | -  |   |   | -  |   |   | 5,500  |   |   | -  |   |   | 5,500  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss for the                            year ended                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31,                            2007                                                          | -  |   |   | -  |   |   | -  |   |   | (9,681) |   |   | (9,681) |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December                            31, 2007                                                 | 1,500,000 |   | $ | 15 |   | $ | 8,185 |   | $ | (19,156) |   | $ | (10,956) |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |
| The accompanying                            notes are an integral part of these financial statements. |
| F-6                                                                                                   |

----

| **EASTGATE ACQUISITIONS CORPORATION**                                                                 |
|-------------------------------------------------------------------------------------------------------|
| (A Development                            Stage Company)                                              |
| Statements of Cash                            Flows                                                   |
|                                                                                                  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   | From |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   | Inception                            on |
|                                                                                                  |   |   |   |   |   |   | July 27, |
|                                                                                                  |   |   |   |   | For the Year                            Ended |   | 1999                            Through |
|                                                                                                  |   |   |   |   | December                            31, |   | December                            31, |
|                                                                                                  |   |   |   |   | 2007 |   | 2006 |   | 2007 |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |
| CASH FLOWS                            FROM                                                            |   |   |   |   |   |   |   |   |
| OPERATING                            ACTIVITIES                                                       |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  | Net loss |   | $ | (9,681) |   | $ | (5,555) |   | $ | (19,156) |
|                                                                                                  | Adjustments to                            reconcile net loss to net cash |   |   |   |   |   |   |   |   |
|                                                                                                  | used by operating                            activities: |   |   |   |   |   |   |   |   |
|                                                                                                  |   | Services                            contributed by shareholders |   | 5,500  |   |   | 1,700  |   |   | 7,700  |
|                                                                                                  | Changes in                            operating assets and liabilities: |   |   |   |   |   |   |   |   |
|                                                                                                  |   | Change in accounts                            payable |   | (5,325) |   |   | 2,405  |   |   | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   | Net Cash Used                            by |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   | Operating                            Activities |   | (9,506) |   |   | (1,450) |   |   | (11,456) |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| CASH FLOWS FROM                            INVESTING ACTIVITIES                                       |   | -  |   |   | -  |   |   | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| CASH FLOWS FROM                            FINANCING ACTIVITIES                                       |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   | Common stock issued                            for cash |   | -  |   |   | -  |   |   | 500  |
|                                                                                                  |   | Increase in note                            payable - related party |   | 9,506  |   |   | 1,450  |   |   | 10,956  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   | Net Cash Provided                            by |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   | Financing                            Activities |   | 9,506  |   |   | 1,450  |   |   | 11,456  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   | NET DECREASE IN                            CASH |   | -  |  |  | -  |  |  | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   | CASH AT BEGINNING                            OF PERIOD |   | -  |   |  | -  |   |   | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   | CASH AT END OF                            PERIOD | $ | -  |   | $ | -  |   | $ | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| SUPPLIMENTAL                            DISCLOSURES OF                                                |   |   |   |   |   |   |   |   |
|                                                                                                  | CASH FLOW                            INFORMATION |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  | CASH PAID                            FOR: |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   | Interest |   | $ | -  |   | $ | -  |   | $ | -  |
|                                                                                                  |   | Income                            Taxes | $ | -  |   | $ | -  |   | $ | -  |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| The accompanying                            notes are an integral part of these financial statements. |
| F-7                                                                                                   |

----

**EASTGATE ACQUISITIONS            CORPORATION**

(A Development Stage Company)

Notes to the Financial Statements

             

             

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT            ACCOUNTING POLICIES

             

|   | a. | Business and Organization |
|--------|----|---------------------------|

             

Eastgate Acquisitions Corporation (The Company) was            organized on July 27, 1999, under the laws of the State of Delaware. Pursuant to            Statement of Financial Accounting Standards No. 7, "Accounting and Reporting by            Development Stage Enterprises," the Company is classified as a development stage            company.

             

The Company's financial statements are prepared using the            accrual method of accounting. The Company has elected a December 31            year-end.

             

|   | b. | Revenue Recognition |
|--------|----|---------------------|

             

The Company currently has no source of revenues. Revenue            recognition policies will be determined when principal operations            begin.

             

|   | c. | Basic Loss Per Share |
|--------|----|----------------------|

             

The computation of basic loss per share of common stock            is based on the weighted average number of shares outstanding during the            period.

             

|   | For the Years                            Ended |
|--------|------------------------------------------------|

|   | December 31, |
|--------|--------------|

|   | 2007 | 2006 |
|--------|------|------|

|   | ---------------- | ---------------- |
|--------|------------------|------------------|

             

|   | Loss (numerator) | $ | (9,681) | $ | (5,555) |
|--------|------------------|---|---------|---|---------|

|   | Shares (denominator) | 1,500,000 | 1,500,000 |
|--------|----------------------|-----------|-----------|

|   | --------------- | ------------------ |
|--------|-----------------|--------------------|

             

|   | Per share amount | $ | (0.01) | $ | (0.00) |
|--------|------------------|---|--------|---|--------|

|   | ========= | =========== |
|--------|-----------|-------------|

 

 

**Eastgate **                                                                                                                                   

|   | d. | Provision for Taxes |
|--------|----|---------------------|

             

Deferred taxes are provided on a liability method whereby            deferred tax assets are recognized for deductible temporary differences and operating            loss and tax credit carryforwards and deferred tax liabilities are recognized for            taxable temporary differences. Temporary differences are the differences between the            reported amounts of assets and liabilities and their tax bases. Deferred tax assets are            reduced by a valuation allowance when, in the opinion of management, it is more likely            than not that some portion or all of the deferred tax assets will to be realized.            Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws            and rates on the date of enactment.

             

             

             

F-8

----

             

**EASTGATE ACQUISITIONS            CORPORATION**

(A Development Stage Company)

Notes to the Financial Statements

             

             

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT            ACCOUNTING POLICIES (Continued)

             

|   | d. | Provision for Taxes (Continued) |
|--------|----|---------------------------------|

             

Net deferred tax assets consist of the following            components as of December 31, 2007 and 2006:

             

|   | 2007 | 2006 |
|--------|------|------|

|   | ---------------- | ----------------- |
|--------|------------------|-------------------|

|   | Deferred tax                            assets: |
|--------|-------------------------------------------------|

|   | NOL carryover | $ | 4,468 | $ | 2,837 |
|--------|---------------|---|-------|---|-------|

|   | Valuation allowance | (4,468) | (2,837) |
|--------|---------------------|---------|---------|

|   | ---------------- | ----------------- |
|--------|------------------|-------------------|

|   | Net deferred tax asset | $                                          -- |   | $                                             -- |   |
|--------|------------------------|---------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------|--------|

|   | ========= | ========== |
|--------|-----------|------------|

             

The income tax provision differs from the amount of            income tax determined by applying the U.S. federal and state income tax rates of 39% to            pretax income from continuing operations for the years ended December 31, 2007 and 2006            due to the following:

             

|   | 2007 | 2006 |
|--------|------|------|

|   | ---------------- | ----------------- |
|--------|------------------|-------------------|

             

|   | Book Income | $ | (3,776 ) | $ | (2,166 ) |
|--------|-------------|---|----------|---|----------|

|   | Contributed services | 2,145 | 663 |
|--------|----------------------|-------|-----|

|   | Valuation allowance | 1,631 | 1,503 |
|--------|---------------------|-------|-------|

|   | ---------------- | ----------------- |
|--------|------------------|-------------------|

|   | $                                          -- |  | $                                            -- |   |
|--------|---------------------------------------------------------------------------------------------------------------------|--|---------------------------------------------------------------------------------------------------------------------------------|--------|

|   | ======== | ========== |
|--------|----------|------------|

             

At December 31, 2007, the Company had net operating loss            carryforwards of approximately $11,456 that may be offset against future taxable income            through 2027. No tax benefit has been reported in the December 31, 2007 financial            statements since the potential tax benefit is offset by a valuation allowance of the            same amount.

             

Due to the change in ownership provisions of the Tax            Reform Act of 1986, net operating loss carry forwards for Federal income tax reporting            purposes are subject to annual limitations. Should a change in ownership occur, net            operating loss carryforwards may be limited as to use in future            years.

             

e. Use of Estimates

             

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

             

F-9

----

             

             

**EASTGATE ACQUISITIONS            CORPORATION**

(A Development Stage Company)

Notes to the Financial Statements

             

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT            ACCOUNTING POLICIES (Continued)

             

f. Newly Issued Accounting            Pronouncements

             

In September 2006, the Financial Accounting Standards            Board issued Statement of Financial Accounting Standards No. 157, “Fair Value            Measurements” which defines fair value, establishes a framework for measuring            fair value in generally accepted accounting principles (GAAP), and expands disclosures            about fair value measurements. Where applicable, SFAS No. 157 simplifies and            codifies related guidance within GAAP and does not require any new fair value            measurements. SFAS No. 157 is effective for financial statements issued for fiscal            years beginning after November 15, 2007, and interim periods within those fiscal            years. Earlier adoption is encouraged. The Company does not expect the            adoption of SFAS No. 157 to have a significant effect on its financial position or            results of operation.

             

In June 2006, the Financial Accounting Standards Board            issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes            – an interpretation of FASB Statement No. 109”, which 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. FIN 48            also provides guidance on de-recognition, classification, interest and penalties,            accounting in interim periods, disclosure and transition. FIN 48 is effective for            fiscal years beginning after December 15, 2006. The Company does not expect the            adoption of FIN 48 to have a material impact on its financial reporting, and the            Company is currently evaluating the impact, if any, the adoption of FIN 48 will have on            its disclosure requirements.

             

In March 2006, the Financial Accounting Standards Board            issued Statement of Financial Accounting Standards No. 156, “Accounting for            Servicing of Financial Assets—an amendment of FASB Statement No. 140.” This            statement 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 any of the following situations: a transfer of the            servicer’s financial assets that meets the requirements for sale accounting; a            transfer of the servicer’s financial assets to a qualifying special-purpose            entity in a guaranteed mortgage securitization in which the transferor retains all of            the resulting securities and classifies them as either available-for-sale securities or            trading securities; or an acquisition or assumption of an obligation to service a            financial asset that does not relate to financial assets of the servicer or its            consolidated affiliates. The statement also requires all separately recognized            servicing assets and servicing liabilities to be initially measured at fair value, if            practicable, and permits an entity to choose either the amortization or fair value            method for subsequent measurement of each class of servicing assets and liabilities.            The statement further permits, at its initial adoption, 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 and 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. This statement is effective for fiscal            years beginning after September 15, 2006, with early adoption permitted as of the            beginning of an entity’s fiscal year. Management believes the

             

F-10

----

             

**EASTGATE ACQUISITIONS            CORPORATION**

(A Development Stage Company)

Notes to the Financial Statements

             

| NOTE 1 - | SIGNIFICANT ACCOUNTING POLICIES (Continued) |
|----------|---------------------------------------------|

             

|   | f. | Newly Issued Accounting Pronouncements                            (Continued) |
|--------|----|-------------------------------------------------------------------------------|

             

adoption of this statement will have no immediate impact            on the Company’s financial condition or results of operations.

             

| NOTE 2 - | GOING CONCERN |
|----------|---------------|

             

The Company's financial statements are prepared using            generally accepted accounting principles in the United States of America applicable to            a going concern which contemplates the realization of assets and liquidation of            liabilities in the normal course of business. The Company has not yet established an            ongoing source of revenues sufficient to cover its operating costs and allow it to            continue as a going concern. The ability of the Company to continue as a going concern            is dependent on the Company obtaining adequate capital to fund operating losses until            it becomes profitable. If the Company is unable to obtain adequate capital, it could be            forced to cease operations.

             

In order to continue as a going concern, the Company will            need, among other things, additional capital resources. Management's plans to obtain            such resources for the Company include (1) obtaining capital from management and            significant shareholders sufficient to meet its minimal operating expenses, and (2)            seeking out and completing a merger with an existing operating company. However,            management cannot provide any assurances that the Company will be successful in            accomplishing any of its plans.

             

The ability of the Company to continue as a going concern            is dependent upon its ability to successfully accomplish the plans described in the            preceding paragraph and eventually secure other sources of financing and attain            profitable operations. The accompanying financial statements do not include any            adjustments that might be necessary if the Company is unable to continue as a going            concern.

             

| NOTE 3 - | RELATED PARTY TRANSACTIONS |
|----------|----------------------------|

             

The Company’s expenses are paid by its majority            shareholder. The Company accrues interest on the amount payable to the shareholder at            10% per annum. The liability of $10,956 is unsecured and due upon            demand.

             

             

F-11