**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, 2005**


OR





[
      ]  TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE  SECURITIES
      EXCHANGE ACT OF 1934.





*Commission
      file number* : ***0-20317***





**Quetzal
      Capital I, Inc.**


(Name
      of
      Small Business Issuer In Its Charter)





**Florida**
              (State
                or Other Jurisdiction
              of
                Incorporation or Organization)
            **20-3061892**
              (I.R.S.
                Employer
              Identification
                No.)




**2435
      E. Coast Hwy., Suite 9,**


**Corona
      del Mar, California 92625**


(Address
      of Principal Executive Offices) (Zip Code)





**(949)
      673-7091**


(Issuer’s
      telephone number, Including Area Code)





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





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





**Common
      Stock, par value $.001 per share**


(Title
      of
      Class)





Check
      whether the issuer is not required to file reports pursuant to Section 13 or
      15(d) of the Exchange Act.  [
      ]





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 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.  [X]





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


The
      issuer did not generate any revenues during the year ended December 31,
      2005.





There
      were no shares of the issuer’s common stock held by non-affiliates on March 31,
      2006. On such date, 5,000,000 shares of the issuer’s common stock were issued
      and outstanding and held by one (1) shareholder deemed to be an affiliate of
      the
      issuer within the meaning of Rule 12b-2 under the Exchange Act.





-1-


**Quetzal
      Capital I, Inc.**





**Table
      of Contents**


**Part
                  I**Item
                  1.Description
                  of Business
              3Item
                  2.Description
                  of Property
              13Item
                  3.Legal
                  Proceedings
              13Item
                  4.Submission
                  of Matters to a Vote of Security Holders
              13**Part
                  II**Item
                  5. Market for Common Equity, Related Stockholder Matters
                  and Small Business Issuer Purchases of Equity
                  Securities
              14Item
                  6. Management’s Discussion and Analysis or Plan of
                  Operation
              14Item
                  7. Financial Statements
              16Item
                  8.Changes
                  in and Disagreements with Accountants on Accounting and Financial
                  Disclosure
              25Item
                  8A. Controls and Procedures
              25Item
                  8B. Other Information
              25**Part
                  III**Item
                  9. Directors, Executive Officers, Promoters and Control
                  Persons; Compliance with Section 16(a) of the Exchange
                  Act
              26Item
                  10. Executive Compensation
              27Item
                  11. Security Ownership of Certain Beneficial Owners and
                  Management and Related  Stockholder Matters
              27Item
                  12. Certain Relationships and Related
                  Transactions
              28Item
                  13. Exhibits
              29Item
                  14. Principal Accountant Fees and
                  Services
              30Index
                to Exhibits
              
              32




-2-





**PART
      I**





**ITEM
      1. DESCRIPTION OF BUSINESS**





**General**





Quetzal
      Capital I, Inc. (the “Company”, “our”, “us” or “we”) was incorporated under the
      laws of the State of Florida on June 27, 2005. We are a developmental stage
      company and have no revenues to date. Since inception, our activities have
      been
      limited to actions related to our organization and the preparation of a
      registration statement on Form 10-SB (the “Registration Statement”). We are a
“shell” company conducting no business operations, other than our efforts to
      seek merger partners or acquisition candidates. We have no full-time employees
      and neither own nor lease any real estate nor vehicles.





We
      were
      created to effect a merger, exchange of capital stock, asset acquisition or
      other similar business combination (a “Business Combination”) with an operating
      or development stage business (the “Target Business”) which desires to utilize
      our status as a reporting corporation under the Securities Exchange Act of
      1934,
      as amended (the “Exchange Act”). We are authorized to issue 100,000,000 shares
      of common stock, par value $.001 per share (the “Common Stock”), pursuant to the
      Articles of Incorporation of the Company, of which 5,000,000 shares are
      currently issued and outstanding. We have a shareholder base consisting of
      only
      one (1) shareholder. None of the shares of Common Stock issued to such
      shareholder have been registered under the Securities Act of 1933, as amended
      (the “Securities Act”). See “Description of Securities”. Pursuant to a
      resolution of our board of directors, we will not enter into any Business
      Combination until the Target Business has obtained the requisite audited
      financial statements required to be included in a report on Form 8-K to be
      filed
      by us with the Securities and Exchange Commission pursuant to the requirements
      of Form 8-K and the Exchange Act and the applicable rules and regulations
      thereunder.





We
      intend
      to seek potential business opportunities and effectuate a Business Combination
      with a Target Business with growth potential which, in the opinion of our sole
      officer and director, could provide a return on investment to our sole
      shareholder in the form of cash compensation and/or the potential for capital
      appreciation in the form of continuing equity ownership. Our efforts in
      identifying prospective Target Businesses are expected to include businesses
      in
      the United States and abroad. While we may, under certain circumstances, seek
      to
      effect Business Combinations with more than one Target Business, as a result
      of
      our limited resources, we will, in all likelihood, have the ability to effect
      only a single Business Combination. We may effect a Business Combination with
      a
      Target Business which may be financially unstable or in its early stages of
      development or growth. We will not restrict our search to any specific business,
      industry or geographical location, and we may participate in a business venture
      of virtually any kind or nature. Our sole officer and director may become
      involved in management of the Target Business and/or may hire qualified but
      as
      yet unidentified individuals to manage such Target Business. There are
      no


acquisitions,
      business combinations, or mergers pending or which have occurred involving
      the
      Company. Presently, we have no plans, proposals, agreements, understandings
      or
      arrangements of any kind or nature whatsoever to acquire or merge with any
      specific business or company, and we have not identified any specific business
      or company for investigation and evaluation.





Our
      discussion of the proposed business under this caption and throughout this
      Registration Statement is purposefully general and is not meant to restrict
      our
      virtually unlimited discretion to search for and enter into potential business
      opportunities.





-3-


**“Shell”
      Corporation**





*Background*





We
      have
      conducted no business operations to date and expect to conduct none in the
      future, other than our efforts to effectuate a Business Combination. We,
      therefore, can be characterized as a shell company under Rule 12b-2 under the
      Exchange Act. As a shell company, we face risks inherent in the investigation,
      acquisition, or involvement in a new business opportunity. Further, as a
“development stage” or “start-up” company, we face all of the unforeseen costs,
      expenses, problems, and difficulties related to such companies, including
      whether we will continue to be a going concern entity for the foreseeable
      future. We are dependent upon the efforts of our sole officer and director
      to
      effectuate a Business Combination. Assuming our sole officer and director is
      successful in identifying a Business Combination, it is unlikely our sole
      shareholder will have an opportunity to evaluate the specific merits or risks
      of
      any one or more Business Combinations and will have no control over the
      decision-making relating to such Business


Combination.





Due
      to
      our limited capital resources, the consummation of a Business Combination will
      likely involve the acquisition of, or merger or consolidation with, a company
      that may or may not need substantial additional capital, and also desires to
      establish a public trading market for its shares of capital stock, while
      avoiding what it might deem to be the adverse consequences of undertaking a
      public offering itself, such as the time delays and significant expenses
      incurred to comply with the various Federal and state securities laws that
      regulate initial public offerings. A Target Business might desire, among other
      reasons, to





·
            create
                a public market for shares of capital stock in order to enhance liquidity
                for shareholders,





·
            facilitate
                raising capital through the private into public sale of securities,
                commonly referred to as a “PIPE”
transaction,





·
            facilitate
                raising capital through the public sale of securities of which the
                existence of a public market for such securities may exist,
                and/or





·
            acquire
                additional assets through the issuance of securities rather
                than


for
      cash





No
      trading market in our securities presently exists and we have no plans on
      registering any securities under the Securities Act or state blue sky laws
      for
      the foreseeable future. In light of the restrictions concerning shell
      companies


contained
      in many state blue sky laws and the regulations thereunder, it is not likely
      that a trading market will be created in our securities until such time as
      a
      Business Combination occurs with a Target Business. No assurances are given
      that
      subsequent to such a Business Combination that a trading market in our
      securities will develop, or, if such a trading market is developed, that it
      can
      be maintained with liquidity. We presently have 100,000,000 shares of Common
      Stock authorized, of which 5,000,000 are currently issued and outstanding.
      None
      of these outstanding shares have been registered under the Securities Act,
      and
      all of which are deemed to be “restricted securities”, as that term is defined
      under Rule 144 promulgated under the Securities Act, because such shares were
      issued in a private placement transaction to one "accredited investor" not
      involving a public offering. These shares cannot be resold under Rule 144 but
      must be registered under the Securities Act. As of the date hereof, we have
      not
      provided to any shareholder registration rights to register under the Securities
      Act any shares of Common Stock of the Company. See “Market Price of and
      Dividends on the Registrant's Common Equity and Related Shareholder
      Matters”.


-4-





We
      cannot
      estimate the time that it will take to effectuate a Business Combination. It
      could be time consuming; possibly in excess of many months or years.
      Additionally, no assurance can be made that we will be able to effectuate a
      Business Combination on favorable terms, or, if such a Business Combination
      can
      be effected at all. We might identify and effectuate a Business Combination
      with
      a Target Business which proves to be unsuccessful for any number of reasons,
      many of which are due to the fact that the Target Business is not identified
      at
      this time. If this occurs, the Company and its sole shareholder might not
      realize any type of profit.





*Unspecified
      Industry and Target Business*





We
      will
      seek to acquire a Target Business without limiting ourselves to a particular
      industry. In seeking a Target Business, we will consider, without limitation,
      businesses which





(i)
      offer
      or provide services or develop, manufacture or distribute goods in the United
      States or abroad, including, without limiting the generality of the foregoing,
      in the following areas: technology; real estate; health care; health products;
      educational services; environmental services; consumer-related products and
      services (including amusement, entertainment, video games, gaming and/or
      recreational services); personal care services; voice and data information
      processing; and telecommunication equipment manufacturers or





(ii)
      are
      engaged in wholesale or retail distribution of various products.





To
      date,
      we have not selected any particular industry or any Target Business in which
      to
      concentrate our Business Combination efforts. Accordingly, we are only able
      to
      make general disclosures concerning the risks and hazards of effectuating a
      Business Combination with a Target Business since there is presently no current
      basis for us to evaluate the possible merits or risks of the Target Business
      or
      the particular industry in which we may ultimately operate. Any Target Business
      that is selected will be required to have audited financial statements prior
      to
      the consummation of a Business Combination consistent with the requirements
      of
      Form 8-K and the Exchange Act and the rules and regulations
      thereunder.





To
      the
      extent that we effect a Business Combination with a financially unstable company
      or an entity in its early stage of development or growth (including entities
      without established records of sales or earnings), we will become subject to
      numerous risks and uncertainties inherent in the business and operations of
      financially unstable and early stage or potential emerging growth companies.
      In
      addition, to the extent that we effect a Business Combination with a Target
      Business in an industry characterized by a high level of risk, we will become
      subject to the currently unascertainable risks of that industry. An extremely
      high level of risk frequently characterizes certain industries which experience
      rapid growth. Although our sole officer and director will endeavor to evaluate
      the risks inherent in a particular industry or Target Business, there can be
      no
      assurances that we will properly ascertain or assess all significant risk
      factors.





-5-


*Probable
      Lack of Business Diversification*





As
      a
      result of our limited resources, in all likelihood, we will have the ability
      to
      effect only a single Business Combination. Accordingly, our prospects for
      success will be entirely dependent upon the future performance of a single
      business. Unlike certain entities that have the resources to consummate several
      Business Combinations or entities operating in multiple industries or multiple
      segments of a single industry, it is highly unlikely that we will have the
      resources to diversify our operations or benefit from spreading risks or
      offsetting losses. Our probable lack of diversification could subject us to
      numerous economic, competitive and regulatory developments, any or all of which
      may have a material adverse impact upon the particular industry in which we
      may
      operate subsequent to consummation of a Business Combination. The prospects
      for
      our success may become dependent upon the development or market acceptance
      of a
      single or limited number of products, processes or services. Accordingly, there
      can be no assurance that the Target Business will prove to be commercially
      viable.





*Limited
      Ability to Evaluate Target Business’ Management*





While
      our
      ability to successfully effect a Business Combination will bedependent upon
      certain key personnel, the future role of such personnel in the Target Business
      cannot presently be stated with any certainty. There can be no assurance that
      our sole officer and director will remain associated in any operational capacity
      with us following a Business Combination. Moreover, there can be no assurances
      that our sole officer and director will have any experience or knowledge
      relating to the operations of the particular Target Business. Furthermore,
      although we intend to scrutinize the management team of a prospective Target
      Business in connection with evaluating the desirability of effecting a Business
      Combination with such Target Business, there can be no assurances that our
      assessment of such management team will prove to be correct, especially since
      our sole officer and director is not a professional business analyst. See
“Directors, Executive Officers, Promoters and Control Persons”.





Accordingly,
      we will be completely dependent on the ability of the management team of the
      Target Business who are unidentifiable as of the date hereof. In addition,
      there
      can be no assurances that such future management team will have the necessary
      skills, qualifications or abilities to manage a public company. We may also
      seek
      to recruit additional managers to supplement the incumbent management team
      of
      the Target Business. There can be no assurances that we will have the ability
      to
      recruit such additional managers, or that such additional managers will have
      the
      requisite skill, knowledge or experience necessary or desirable to enhance
      the
      incumbent management team.





*Opportunity
      for Shareholder Evaluation or Approval of Business
      Combinations*





Our
      non-affiliate shareholders, if any, will, in all likelihood, not receive nor
      otherwise have the opportunity to evaluate any financial or other information
      which will be made available to us in connection with selecting a potential
      Business Combination until after we have entered into an agreement to effectuate
      a Business Combination. Such agreement to effectuate a Business Combination,
      however, will be subject to shareholder approval pursuant to applicable law.
      As
      a result, our non-affiliate shareholders, if any, will be almost entirely
      dependent on the judgment and experience of our sole officer and director and
      his advisors in connection with the selection and ultimate consummation of
      a
      Business Combination. In addition, under Florida law, the form of Business
      Combination could have an impact upon the availability of dissenters' rights
      ( i.e. ,
      the
      right to receive fair payment with respect to our Common Stock) to shareholders
      disapproving the proposed Business Combination. See “Description of Business -
‘Shell Corporation’” “- Conflicts of Interest” and “Certain Relationships and
      Related Transactions”.





-6-


*Selection
      of a Target Business and Structuring of a Business Combination*





We
      anticipate that the selection of a Target Business will be complex and risky
      because of competition for such business opportunities among all segments of
      the
      financial community. The nature of our search for the acquisition of a Target
      Business will require maximum flexibility inasmuch as we will be required to
      consider various factors and circumstances which may preclude meaningful direct
      comparison among the various business enterprises to be investigated by us.
      Investors should recognize that the possible lack of diversification among
      our
      acquisitions may not permit us to offset potential losses from one venture
      against profits from another. We have virtually unrestricted flexibility in
      identifying and selecting a prospective Target Business. In addition, in
      evaluating a prospective Target Business, our sole officer and director will
      consider, among other factors, the following factors which are not listed in
      any
      particular order:




·
            financial
                condition and results of operations of the Target
                Business;


·
            growth
                potential and projected financial performance of the Target Business
                and
                the industry in which it operates;


·
            experience
                and skill of management and the availability of additional personnel
                of
                the Target Business;


·
            capital
                requirements of the Target
                Business;


·
            the
                availability of a transaction exemption from the registration requirements
                of the Securities Act for any potential Business
                Combination;


·
            the
                location of the Target Business;


·
            competitive
                position of the Target Business;


·
            stage
                of development or lifecycle of the products, processes or services
                of the
                Target Business, if any;


·
            degree
                of current or potential market acceptance of the products, processes
                or
                services of the Target Business, if
                any;


·
            proprietary
                features, intellectual property rights and trade secrets of the Target
                Business, if any;


·
            regulatory
                environment of the industry in which the Target Business
                operates;


·
            costs
                associated with effecting the Business Combination;
                and


·
            equity
                interest, and possible management participation, in the Target
                Business.





The
      foregoing criteria are not intended to be exhaustive. Any evaluation relating
      to
      the merits of a particular Business Combination will be based, to the extent
      relevant, on the above factors as well as other objective and subjective
      criteria deemed relevant by us in connection with effecting a Business
      Combination consistent with our business objective. In many instances, it is
      anticipated that the historical operations of a Target Business may not
      necessarily be indicative of the potential for such Target Business' future
      prospects.





We
      will
      be dependent upon the owners of a Target Business to identify any such problems
      which may exist and to implement, or be primarily responsible for the
      implementation of, necessary changes. Because we may engage in a Business
      Combination with a newly organized firm or with a firm which is entering a
      new
      phase of growth, we will incur further risks, because in many instances,
      management of the Target Business will not have proven its abilities or
      effectiveness, the eventual market for the products or services of the Target
      Business will likely not be established, and the Target Business may not be
      profitable subsequent to a Business Combination.





-7-


Our
      limited funds and the lack of full-time management will likely make it
      impracticable to conduct a complete and exhaustive investigation and analysis
      of
      a Target Business before we commit capital or other resources. Management
      decisions, therefore, will likely be made without detailed feasibility studies,
      independent analysis, market surveys and the like which, if we had more funds
      available to us, would be desirable. We will be particularly dependent in making
      decisions upon information provided by the promoters, owners, sponsors, or
      others associated with the business opportunity seeking our
      participation.





In
      connection with our evaluation of a prospective Target Business, our sole
      officer and director anticipates that it will conduct a due diligence review
      which will encompass, among other things, meetings with incumbent management
      and
      inspection of facilities, as well as review of financial or other information
      which will be made available to us. The time and costs required to select and
      evaluate a Target Business, including conducting a due diligence review,
      negotiating relevant agreements and preparing requisite documents for filing
      pursuant to applicable Federal securities laws, state blue sky laws, foreign
      securities laws, if any, and corporation laws cannot presently be ascertained
      with any degree of certainty. Our sole officer and director will only devote
      a
      small portion of her time to our operations, and, accordingly, consummation
      of a
      Business Combination may require a greater period of time than if they devoted
      their full time to our affairs.





However,
      our sole officer and director will devote such time as she deems reasonably
      necessary, to carry out the business and affairs of the Company, including
      the
      evaluation of potential Target Businesses and the negotiation of a


Business
      Combination and, as a result, the amount of time devoted to our business and
      affairs may vary significantly depending upon, among other things, whether
      we
      have identified a Target Business or are engaged in active negotiations of
      a
      Business Combination. Any costs incurred in connection with the identification
      and evaluation of a prospective Target Business with which a Business
      Combination is not ultimately consummated will result in a loss to the Company
      and reduce the amount of capital available to otherwise complete a Business
      Combination or for the resulting entity to utilize. In the event we deplete
      our
      cash reserves, we might be forced to cease operations and a Business Combination
      might not occur.





We
      anticipate that we will locate and make contact with Target Businesses primarily
      through the reputation and efforts of our sole officer and director and
      representatives, who intend to meet personally with existing management and
      key
      personnel, visit and inspect material facilities, assets, products and services
      belonging to such prospects, or undertake such reasonable investigation as
      they
      deem appropriate. Our sole officer and director and our representatives have
      a
      network of business contacts and believe that prospective Target Businesses
      will
      be referred to us through this network of contacts.





We
      also
      expect that many prospective Target Businesses will be brought to our sole
      officer and director's attention from various other non-affiliated sources,
      including securities broker-dealers, investment bankers, venture capitalists,
      bankers, and other members of the financial community. We have neither the
      present intention, nor does the present potential exist for us, to consummate
      a
      Business Combination with a Target Business in which our sole officer and
      director or her affiliates or associates, directly or indirectly, have a
      pecuniary interest, although no existing corporate policies would prevent this
      from occurring. Although there are no current plans to do so, we may engage
      the
      services of professional firms that specialize in finding business acquisitions
      and pay a finder’s fee or other compensation. Since we have no current plans to
      utilize any outside consultants or advisors to assist in a Business Combination,
      no policies have been adopted regarding use of such consultants or advisors,
      the
      criteria to be used in selecting such consultants or advisors, the services
      to
      be provided, the term of service, or regarding the total amount of fees that
      may
      be paid. However, because of our limited resources, it is likely that any such
      fee we agree to pay would be paid in cash and/or shares of our Common Stock.





-8-


As
      a
      general rule, Federal and state tax laws and regulations have a significant
      impact upon the structuring of business combinations. We will evaluate the
      possible tax consequences of any prospective Business Combination and will
      endeavor to structure a Business Combination so as to achieve the most favorable
      tax treatment for us, the Target Business and their respective stockholders.
      There can be no assurance that the Internal Revenue Service or relevant state
      tax authorities will ultimately assent to our proposed tax treatment of a
      particular Business Combination.





To
      the
      extent the Internal Revenue Service or any relevant state tax authorities
      ultimately prevail in recharacterizing the tax treatment of a Business
      Combination, there may be adverse tax consequences to us, the Target Business
      and their respective stockholders. Tax considerations, as well as other relevant
      factors, will be evaluated in determining the precise structure of a particular
      Business Combination, which could be effected through various forms of a merger,
      consolidation or stock or asset acquisition.





Although
      we have no commitments as of the date of this registration statement to issue
      any shares of Common Stock, preferred stock, options or warrants or other equity
      consideration, we will, in all likelihood, issue a substantial number of
      additional securities in connection with the consummation of a Business
      Combination. To the extent that such additional securities are issued, dilution
      to the interests of our sole shareholder will inevitably occur. Additionally,
      if
      a substantial number of shares of Common Stock are issued in connection with
      the
      consummation of a Business Combination, a change in our control will occur
      which
      will also likely affect, among other things, our ability to utilize net
      operating loss carry forwards, if any.





Any
      such
      change in control will likely result in the resignation or removal of our sole
      officer and director. If there is a change in the person serving as sole officer
      and director, no assurance can be given as to the experience or qualifications
      of our new management. Our sole officer and director considers it likely that
      in
      order to consummate a Business Combination, a change in control will ultimately
      occur; therefore, he anticipates offering not less than a controlling interest
      to a Target Business in order to effectuate a Business Combination.





Our
      sole
      officer and director may actively negotiate for or otherwise consent to the
      disposition of any portion of the sole shareholder’s Common Stock as a condition
      to or in connection with a Business Combination. Therefore, it is possible
      that
      the terms of any Business Combination will provide for the sale of all or any
      portion of the shares of Common Stock owned beneficially by our sole officer
      and
      director. It is likely that none of our other shareholders, if any, will be
      afforded the right to sell their shares of Common Stock in connection with
      a
      Business Combination pursuant to the same terms that our sole officer and
      director, who is also the beneficial owner of all of our outstanding shares
      of
      Common Stock, will be provided.





There
      are
      currently no limitations relating to our ability to borrow funds to increase
      the
      amount of capital available to us to effect a Business Combination or otherwise
      finance the operations of the Target Business. However, our limited resources
      and lack of operating history could make it difficult for us to borrow funds
      from other sources. The amount and nature of any borrowings by us will depend
      on
      numerous considerations, including our capital requirements, potential lenders'
      evaluation of our ability to meet debt service on borrowings and the then
      prevailing conditions in the financial markets, as well as general economic
      conditions. We do not have any arrangements with any bank or financial
      institution to secure additional financing and there can be no assurance that
      such arrangements, if required or otherwise sought, would be available on terms
      commercially acceptable or otherwise in our best interests. Our inability to
      borrow funds required to effect or facilitate a Business Combination, or to
      provide funds for an additional infusion of capital into a Target Business,
      may
      have a material adverse effect on our financial condition and future prospects,
      including the ability to effect a Business Combination. To the extent that
      debt
      financing ultimately proves to be available, any borrowings may subject us
      to
      various risks traditionally associated with indebtedness, including the risks
      of
      interest rate fluctuations and insufficiency of cash flow to pay principal
      and
      interest. Furthermore, a Target Business may have already incurred liabilities
      in connection with a debt financing and, therefore, all the risks inherent
      thereto.





-9-


If
      our
      securities are issued as part of an acquisition, such securities are required
      to
      be issued either in reliance upon an exemption from registration under
      applicable Federal or state securities laws or registered for public
      distribution. We intend to primarily target only those companies where an
      exemption from registration would be available; however, since the structure
      of
      the Business Combination has yet to be determined, no assurances can be made
      that we will be able to rely on such exemptions. Registration of securities
      typically requires significant costs and time delays are typically encountered.
      In addition, the issuance of additional securities and their potential sale
      in
      any trading market which might develop in our Common Stock, of which there
      is
      presently no trading market and no assurances can be given that one will
      develop, could depress the price of our Common Stock in any market which may
      develop in our Common Stock. Further, such issuance of additional securities
      would result in a decrease in the percentage ownership of our sole
      shareholder.





Due
      to
      our small size and limited amount of capital, our ability to raise additional
      capital, if and when needed, could be constrained. Until such time as any
      enterprise, product or service which we acquire generates revenues sufficient
      to
      cover operating costs, it is conceivable that we could find ourselves in a
      situation where we need additional funds in order to continue our operations.
      This need could arise at a time when we are unable to borrow funds and when
      market acceptance for the sale of additional shares of our Common Stock does
      not
      exist. See “Management’s Discussion and Analysis or Plan of
      Operation”.





Conflicts
      of Interest





Our
      sole
      officer and director is not required to commit her full time to our affairs
      and,
      accordingly, such person may have a conflict of interest in allocating
      management time among various business activities. Our sole officer and director
      may engage in other business activities similar and dissimilar to those we
      are
      engaged in with any limitations or restrictions applicable to such activities.
      To the extent that such persons engage in such other activities, they will
      have
      possible conflicts of interest in diverting opportunities to other companies,
      entities or persons with which they are or may be associated or have an
      interest, rather than diverting such opportunities to us. As no policy has
      been
      established for the resolution of such a conflict, we could be adversely
      affected should our sole officer and director choose to place her other business
      interests before ours. No assurance can be given that such potential conflicts
      of interest will not cause us to lose potential opportunities. Our sole officer
      and director may become aware of investment and business opportunities which
      may
      be appropriate for presentation to us as well as the other entities with which
      they are affiliated. Our sole officer and director may have conflicts of
      interest in determining which entity a particular business opportunity should
      be
      presented. Accordingly, as a result of multiple business affiliations, our
      sole
      officer and director may have similar legal obligations relating to presenting
      certain business opportunities to multiple entities. In addition, conflicts
      of
      interest may arise in connection with evaluations of a particular business
      opportunity by the board of directors with respect to the foregoing criteria.
      There can be no assurances that any of the foregoing conflicts will be resolved
      in our favor. We may also consider Business Combinations with entities owned
      or
      controlled by persons other than those persons described above. There can be
      no
      assurances that any of the foregoing conflicts will be resolved in our
      favor.





Our
      sole
      officer and director may actively negotiate for or otherwise consent to the
      disposition of all or any portion of the shares of Common Stock held by the
      sole
      shareholder, as a condition to, or in connection, with a Business Combination.
      Therefore, it is possible that the terms of any Business Combination will
      provide for the sale of all or a portion of the shares of Common Stock held
      by
      such shareholder. In the event that such a sale occurs, the Company's sole
      officer and director intends to approve the Business Combination pursuant to
      Section 607.0902(2)(d)(7) of the Florida Business Corporation Act, which will
      have the effect of removing the transaction from the purview of the
      control-share acquisition statute promulgated under Section 607.0902 of the
      Florida Business Corporation Act. Thus, it is likely that no other shareholders,
      if any, will be afforded the right to sell shares of Common Stock in connection
      with a Business Combination pursuant to the same terms that our sole shareholder
      will be provided. Also, such other shareholders, if any, will not be afforded
      an
      opportunity to approve or consent to the purchase of all or any portion of
      the
      shares of Common Stock being sold by our sole shareholder, whose shares are
      beneficially owned by our sole officer and director. See “Description of
      Business - ‘Shell Corporation’” and “- Selection of a Target Business and
      Structuring of a Business Combination”.





-10-


Investment
      Company Act and Other Regulation





We
      may
      participate in a Business Combination by purchasing, trading or selling the
      securities of such Target Business. We do not, however, intend to engage
      primarily in such activities.





Specifically,
      we intend to conduct our activities so as to avoid being classified as an
      "investment company" under the Investment Company Act of 1940 (the "Investment
      Act"), and, therefore, to avoid application of the costly and restrictive
      registration and other provisions of the Investment Act, and the regulations
      promulgated thereunder.





Our
      plan
      of business may involve changes in our capital structure, corporate structure,
      management team, the board of directors, voting control by our sole shareholder
      and business prospects and plans, especially if we consummate a Business
      Combination, as discussed above. Each of these areas is regulated by the
      Investment Act, in order to protect purchasers of investment company securities.
      Since we will not register as an investment company, shareholders will not
      be
      afforded these protections.





Any
      securities which we might acquire in exchange for our Common Stock will be
      restricted securities within the meaning of the Securities Act. If we elect
      to
      resell such securities, such sale cannot proceed unless a registration statement
      has been declared effective by the Securities and Exchange Commission or an
      exemption from registration is available under the Securities Act. Section
      4(1)
      of the Securities Act, which exempts sales of securities not involving a public
      distribution by persons other than an issuer, underwriter or dealer, would
      in
      all likelihood be available to permit a private sale. Although our plan of
      operation does not contemplate the resale of an acquired Target Business'
      securities, if such a sale were to be necessary, we would be required to comply
      with the provisions of the Securities Act to effect such resale.





Any
      Business Combination that we consummate may be in an industry which is regulated
      or licensed by Federal, state or local authorities. Compliance with such
      regulations can be expected to be a time consuming and expensive
      process.





*Penny
      Stock Regulations - State Blue Sky restrictions - Restrictions on
      Marketability.*





The
      Securities and Exchange Commission has adopted regulations which generally
      define a “penny stock” to be any equity security that has a market price of less
      than $5.00 per share or an exercise price of less than $5.00 per share, subject
      to certain exceptions. Our securities may be covered by the penny stock rules,
      which impose additional sales practice requirements on broker-dealers who sell
      such securities to persons other than established customers and accredited
      investors, which are, generally, institutions with assets in excess of
      $5,000,000 or individuals with net worth in excess of $1,000,000 or annual
      income exceeding $200,000 or $300,000 jointly with their spouse. For
      transactions covered by this rule, the broker-dealers must make a special
      suitability determination for the purchase and receive the purchaser's written
      agreement of the transaction prior to the sale. Consequently, the rule may
      affect the ability of broker-dealers to sell our securities and also may affect
      the ability of any shareholder to sell shares of Common Stock in the secondary
      market.





In
      addition, the Securities and Exchange Commission has adopted a number of rules
      to regulate penny stocks. Such rules include Rules 3a51-1, 15g-1, 15g-2, 15g-3,
      15g-4, 15g-5, 15g-6, and 15g-9 under the Exchange Act. Because our securities
      may from time to time, and at the present time, constitute penny stocks within
      the meaning of these rules, the rules would apply to the Company and to its
      securities. These rules may further affect the ability of our sole shareholder
      and other shareholders, if any, to sell their shares in any public market which
      might develop.





-11-


Shareholders
      should be aware that, according to Securities and Exchange Commission Release
      No. 34-29093, the market for penny stocks has suffered in recent years from
      patterns of fraud and abuse. Such patterns include the following:





·
            control
                of the market for the security by one or a few broker-dealers that
                are
                often related to the promoter or
                issuer;


·
            manipulation
                of prices through prearranged matching of purchases and sales and
                false
                and misleading press releases;


·
            “boiler
                room” practices involving high-pressure sales tactics and unrealistic
                price projections by inexperienced sales
                persons;


·
            excessive
                and undisclosed bid-ask differentials and markups by selling
                broker-dealers; and


·
            the
                wholesale dumping of the same securities by promoters and broker-dealers
                after prices have been manipulated to a desired level, along with
                the
                resulting inevitable collapse of those prices and with consequent
                investor
                losses.





We
      are
      aware of the abuses that have occurred historically in the penny stock market.
      Although we do not expect to be in a position to dictate the behavior of the
      market or of broker-dealers who participate in the market, our sole officer
      and
      director will strive within the confines of practical limitations and applicable
      laws and regulations to prevent the described patterns from being established
      with respect to our securities.





**Competition**





We
      expect
      to encounter intense competition from other entities having a business objective
      similar to ours. Many of these entities are well-established and have extensive
      experience in connection with identifying and effecting business combinations
      directly or through affiliates. Many of these competitors possess greater
      financial, marketing, technical, personnel and other resources than us, and
      there can be no assurances that we will have the ability to compete
      successfully. Our financial resources will be extremely limited in comparison
      to
      those of many of our competitors. This inherent competitive limitation could
      compel us to select certain less attractive Target Businesses for a Business
      Combination. There can be no assurances that such Target Businesses will permit
      us to meet our stated business objective. Our sole officer and director
      believes, however, that our status as a reporting public entity could give
      us a
      competitive advantage over privately held entities having a similar business
      objective to ours in acquiring a Target Business with significant growth
      potential on favorable terms.





**Uncertainty
      of Competitive Environment of Target Business**





In
      the
      event that we succeed in effecting a Business Combination, we will, in all
      likelihood, become subject to intense competition from competitors of the Target
      Business. In particular, certain industries which experience rapid growth
      frequently attract an increasingly larger number of competitors, including
      competitors with increasingly greater financial, marketing, technical and other
      resources than the initial competitors in the industry. The degree of
      competition characterizing the industry of any prospective Target Business
      cannot presently be ascertained. There can be no assurances that, subsequent
      to
      a Business Combination, we will have the resources to compete effectively,
      especially to the extent that the Target Business is in a high-growth
      industry.





-12-


**Federal
      Securities Laws Compliance**





Under
      the
      Federal securities laws, companies reporting under the Exchange Act must furnish
      shareholders certain information about significant acquisitions, which
      information may require audited financial statements for a Target Business
      with
      respect to one or more fiscal years, depending upon the relative size of the
      acquisition. Consequently, our policy is to only effect a Business Combination
      with a Target Business that has available the requisite audited financial
      statements. See “Description of Securities-General”.





**Employees**





As
      of
      March 31, 2006, we are in the development stage and currently have no employees,
      other than our sole officer and director. Our sole officer and director serves
      on a part-time basis. We expect to use consultants, attorneys and accountants
      as
      necessary, and do not anticipate a need to engage any other employees, so long
      as we our seeking and evaluating Target Businesses. The need for employees
      and
      their availability will be addressed in connection with the decision whether
      or
      not to acquire a Target Business, or participate in a specific Business
      Combination.





**ITEM
      2. DESCRIPTIONOF PROPERTY**





Our
      principal executive office is located at 2435 East Coast Highway, Suite 8,
      Corona del Mar, California 92625. We believe these facilities are adequate
      to
      serve our needs until such time as a Business Combination occurs. We expect
      to
      be able to utilize these facilities, free of charge, until such time as a
      Business Combination occurs.





**ITEM
      3. LEGAL PROCEEDINGS**





We
      are
      not a party to any legal proceedings, nor are we aware of any threatened
      litigation whatsoever.





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





There
      were no matters submitted to a vote of security holders during the three month
      period ended December 31, 2005.


-13-


**PART
      II**





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





There
      currently exists no public trading market for our common stock. As of March
      31,
      2006, there were 5,000,000 shares of our common stock issued and outstanding
      to
      one shareholder of record, which constitutes all of our issued and outstanding
      capital stock.





We
      have
      not paid any cash dividends on our shares of common stock in the past two years
      and do not anticipate the payment of dividends on our shares of common stock
      in
      the foreseeable future.





On
      June
      27, 2005, we issued an aggregate of 5,000,000 shares of our Common Stock in
      a
      private offering exempt from the registration under the Securities Act pursuant
      to Section 4(2) thereof for the total consideration of $5,000, or $0.001 per
      share, to one investor, Talles Family Holdings, an “accredited investor”, as
      that term is defined in Rule 501 promulgated under the Securities Act of 1933,
      as amended. The investor represented its intention to acquire the securities
      for
      investment only and not with a view to sell the securities in connection with
      any distribution thereof and an appropriate restrictive legend was affixed
      to
      the share certificate.





**ITEM
      6. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF
      OPERATION**





**Overview**





Quetzal
      Capital I, Inc., a Florida corporation (the “Company”, “us”, “we” and “our”), is
      a development stage company conducting no business operations, other than our
      efforts to effect a business combination with a target business that desires
      to
      utilize our status as a reporting corporation under the Securities Exchange
      Act
      of 1934, as amended (the “Exchange Act”), which we consider to have significant
      growth potential. To date, we have neither engaged in any operations nor
      generated any revenue. We have generated no cash flow. We cannot predict to
      what
      extent our liquidity and capital resources will be diminished prior to the
      consummation of a business combination or whether our capital will be further
      depleted by the operating losses, if any, of the target business with which
      we
      may effectuate a business combination. The continuation of our business is
      dependent upon our ability to obtain adequate financing arrangements, effectuate
      a business combination and ultimately, engage in future profitable
      operations.





Presently,
      we are not in a position to meet our cash requirements for the next 12 months.
      We neither generate any cash revenue nor cash flow. Our sole shareholder,
      Quetzal Capital Funding 1, Inc., has committed to make loans to us on an “as
      needed” basis, which are unsecured book entry loans. Our operating costs, which
      include professional fees and costs are likely to approximate $10,000 to $15,000
      during the next 12 months. In the event we cannot meet our operating costs
      prior
      to the effectuation of a business combination, we may cease operations and
      a
      business combination may not occur.





-14-


**Critical
      Accounting Policies and Estimates**





A
      summary
      of significant accounting policies is provided in Note 1 to our financial
      statements included in our 2005 Form 10-KSB. Our sole officer and director
      believes that the application of these policies on a consistent basis enables
      the Company to provide useful and reliable financial information about the
      Company's operating results and financial condition.





The
      preparation of financial statements in conformity with generally accepted
      accounting principles requires our sole officer and director 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 will differ from those estimates.





**Plan
      of Operation**





The
      Company was incorporated in Florida on June 27, 2005. We intend to serve as
      a
      vehicle to effect asset acquisition, merger, exchange of capital stock or other
      type of business combination with a domestic or foreign business. At March
      31,
      2006 we had not yet commenced any formal business operations and all activity
      to
      date has related to the Company’s formation, capital stock issuance,
      professional fees with regard to the subject matter of the filings with the
      Commission and identification of businesses.





-15-


**ITEM
      7. FINANCIALSTATEMENTS**








REPORT
      OF
      INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





To
      the
      Board of Directors


Quetzal
      Capital I, Inc.





We
      have
      audited the accompanying balance sheet of Quetzal Capital I, Inc. as of December
      31, 2005, and the related statements of operations, shareholders' deficiency
      and
      cash flows for the period June 27, 2005 (inception) through December 31, 2005.
      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 audit.





We
      conducted our audit in accordance with the standards of the Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audit to obtain reasonable assurance about whether the financial
      statements are free of material misstatement. An audit includes examining on
      a
      test basis, evidence supporting the amount 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 audit provides 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 Quetzal Capital I, Inc. as of
      December 31, 2005, and the results of its operations and cash flows for the
      period June 27, 2005 (inception) through December 31, 2005, 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 1 to the financial
      statements, the Company has a shareholders' deficit of $142, a working capital
      deficiency of $142 and net losses of $5,142 as of December 31, 2005. This raises
      substantial doubt about its ability to continue as a going concern. Management's
      plans in regards to these matters are also described in Note 1. The financial
      statements do not include any adjustments that might result from the outcome
      of
      this uncertainty.


Sherb
&
Co.,
              LLPDate: April
              7, 2006
            By:
            /s/ Sherb
              & Co., LLPSherb
&
Co.,
              LLPCertified
                Public
                Accountants
              Boca Raton,
                Florida


-16-





**QUETZAL
                CAPITAL I, INC.****(A
                DEVELOPMENT STAGE COMPANY)****BALANCE
                SHEET****DECEMBER
                31, 2005****ASSETS****CURRENT
                ASSETS:**Cash
                & cash equivalents
            
            $
            -Total
                assets
            
            $
            -**LIABILITIES
                AND SHAREHOLDERS' DEFICIENCY****CURRENT
                LIABILITIES:**Accounts
                payable & accrued expenses
            
            $
            142**SHAREHOLDERS'
                DEFICIENCY**Common
                stock, $.001 par value, 100,000,000 shares authorized;5,000,000
                issued and outstanding
            
            
            5,000Accumulated
                deficit
            
            
            (5,142
            )Total
                shareholders' deficiency
            
            
            (142
            )Total
                liabilities and shareholders' deficiency
            
            $
            -


-17-





**QUETZAL
                CAPITAL I, INC.****(A
                DEVELOPMENT STAGE COMPANY)****STATEMENT
                OF OPERATIONS****FOR
                THE PERIOD JUNE 27, 2005 (INCEPTION) TO DECEMBER 31,
                2005****Cumulative
                from****June
                27, 2005 (Inception)****To
                December 31, 2005****Revenue**
            
            $
            -**Expenses:****Printing
                Costs**
            
            
            142**Organization
                Costs**
            
            
            156**Accounting**
            
            
            5,000**Legal**
            
            
            2,5007,798**Other
                income:****Debt
                forgiveness income**
            
            
            2,656**Net
                loss**
            
            $
            (5,142
            )**Basic
                and diluted net loss per share**
            
            $
            (0.001
            )**Weighted
                average number of shares used in calculating****basic
                and diluted net loss per share**
            
            
            5,000,000


-18-





**QUETZAL
                CAPITAL I, INC.****(A
                DEVELOPMENT STAGE COMPANY)****STATEMENT
                OF SHAREHOLDERS' DEFICIENCY******
            ****
            ****
            ****
            ****
            ****
            ********
            ****
            **Number**
            ****
            ****
            ****
            ****
            ****
            ****
            ********
            ****
            **of
                Common**
            ****
            **Common**
            ****
            **Accumulated**
            ****
            ****
            ********
            ****
            **Shares**
            ****
            **Stock**
            ****
            **Deficit**
            ****
            **Total**Balance
                atJune
                27, 2005
            
            
            -
            
            $
            -
            
            $
            -
            
            $
            -Net
                Loss forthe
                period
            
            
            -
            
            
            -
            
            
            (5,142
            )
            
            (5,142
            )Shares
                Issuedfor
                cash
            
            
            5,000,000
            
            
            5,000
            
            
            -
            
            
            5,000Balance
                atDecember
                31, 2005
            
            
            5,000,000
            
            $
            5,000
            
            $
            (5,142
            )
            $
            (142
            )


-19-





**QUETZAL
                CAPITAL I, INC.****(A
                DEVELOPMENT STAGE COMPANY)****STATEMENT
                OF CASH FLOWS****FOR
                THE PERIOD JUNE 27, 2005 (INCEPTION) TO DECEMBER 31,
                2005**




**Cumulative
                from****June
                27, 2005 (Inception)****To
                December 31, 2005****CASH
                FLOWS FROM OPERATING ACTIVITIES:**Net
                loss
            
            
            
            $
            (5,142
            )Decrease
                in accounts payable
            
            
            
            
            (4,858
            )Net
                cash used in operating activities
            
            
            
            
            (10,000
            )**CASH
                FLOWS FROM FINANCING ACTIVITIES:**Proceeds
                from issuance of common stock
            
            
            
            
            5,000NET
                DECREASE IN CASH & CASH EQUIVALENTS
            
            
            
            
            (5,000
            )**CASH
                & CASH EQUIVALENTS, BEGINNING BALANCE**
            
            
            
            
            5,000**CASH
                & CASH EQUIVALENTS, ENDING BALANCE**
            
            
            
            $
            -**SUPPLEMENTAL
                DISCLOSURE OF CASH FLOW INFORMATION****NONCASH
                INVESTING AND FINANCING TRANSACTIONS**Taxes
                paid
            
            
            
            $
            -Interest
                paid
            
            
            
            $
            -





-20-


**QUETZAL
      CAPITAL I, INC.**


**(A
      Development Stage Company)**





**Notes
      to Financial Statements**


**December
      31, 2005**


**Note
      1 - Accounting Policies and Operations**





**Organization**





Quetzal
      Capital I, Inc. (the “Company”), a development stage company, was incorporated
      in Florida on June 27, 2005. The Company intends to serve as a vehicle to effect
      asset acquisition, merger, exchange of capital stock or other type of business
      combination with a domestic or foreign business. At March 31, 2006, the Company
      had not yet commenced any formal business operations and all activity to date
      related to the Company formation, capital stock issuance, professional fees
      with
      regard to the filings with the Commission and identification of businesses.
      The
      Company's fiscal year ends on December 31st.





**Cash
      and Cash Equivalents**





The
      Company considers all highly liquid debt instruments with original maturities
      of
      three months or less to be cash equivalents.





**Earnings
      Per Share**





The
      Company computes earnings per share in accordance with Statement of Accounting
      Standards No. 128, “Earnings per Share” (“SFAS No. 128”). Under the provisions
      of SFAS No. 128, basic earnings per share is computed by dividing the net income
      (loss) for the period by the weighted average number of common shares
      outstanding during the period. Diluted earnings per share is computed by
      dividing the net income (loss) for the period by the weighted average number
      of
      common and potentially dilutive common shares outstanding during the period.
      Potentially dilutive common shares consist of the common shares.





**Use
      of Estimates**





The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States of America requires management to make
      estimates and assumptions that affect certain reported amounts and disclosures.
      Accordingly, actual results could differ from those estimates.


-21-


**Income
      Taxes**





The
      Company accounts for income taxes in accordance with Statement of Financial
      Accounting Standards No. 109, “Accounting for Income Taxes.” Under the asset and
      liability method of Statement 109, deferred tax assets and liabilities are
      recognized for the estimated future tax consequences attributable to differences
      between the financial statement carrying amounts of existing assets and
      liabilities and their respective tax bases. Deferred tax assets and liabilities
      are measured using enacted tax rates in effect for the year in which those
      temporary differences are expected to be recovered or settled.





**Fair
      Value of Financial Instruments**





Substantially
      all of the Company’s assets and liabilities are carried at fair value or
      contracted amounts that approximate fair value. Estimates of fair value are
      made
      at a specific point in time, based on relative market information and
      information about the financial instrument, specifically, the value of the
      underlying financial instrument. Assets that are recorded at fair value consist
      largely of the other assets, which are carried at contracted amounts that
      approximate fair value. Similarly, the Company’s liabilities consist of
      liabilities recorded at fair value.




**Going
      Concern**





The
      accompanying financial statements have been prepared assuming that the Company
      will continue as a going concern, which contemplates the realization of assets
      and the satisfaction of liabilities in the normal course of business. The
      amounts of assets and liabilities in the financial statements do not purport
      to
      represent realizable or settlement values. However, the Company has incurred
      an
      operating loss. Such loss may impair its ability to obtain additional financing.
      This factor raises substantial doubt about the Company's ability to continue
      as
      a going concern. The financial statements do not include any adjustments that
      might result from the outcome of this uncertainty. The Company has met its
      historical working capital requirements from sale of capital shares. Owners
      of
      the shares, in order not to burden the Company, have agreed to pay its annual
      audit fees, filing costs and legal fees as long as the board of directors deems
      it necessary. However, there can be no assurance that such financial support shall
      be
      ongoing or available on terms or conditions acceptable to the
      Company.





**Note
      2 - Shareholders’ Deficiency**





On
      June
      27, 2005, the Company issued 5,000,000 shares of common stock, par value $.001
      per share, to its initial shareholder in exchange for $5,000 in
      cash.





-22-


**Note
      3 - Income Taxes**





The
      components of the Company's tax provision as of December 31, 2005 were as
      follows:





Current
                income tax expense
            
            $
            -Deferred
                income tax (benefit)
            
            
            -$
            -




Deferred
      income taxes reflect the net income tax effect of temporary differences between
      the carrying amounts of the assets and liabilities for financial reporting
      purposes and amounts used for income taxes. The Company’s deferred income tax
      assets and liabilities consist of the following:










Net
                operating loss carryforward
            
            $
            1,980Deferred
                tax asset
            
            
            1,980Valuation
                allowance
            
            
            (1,980
            )Net
                Deferred tax asset
            
            $
            -





Net
      operating loss carryforwards totaled approximately $5,142 at December 31, 2005.
      The net operating loss carryforwards will begin to expire in the year 2025
      if
      not utilized. After consideration of all the evidence, both positive and
      negative, management has recorded a valuation allowance at December 31, 2005
      due
      to uncertainty of realizing the deferred tax assets.





-23-


The
      reconciliation of the income tax computed at the U.S. Federal statutory rate
      to
      income tax expense for the period December 31, 2005:





Tax
                expense (benefit) at Federal rate (35%)
            
            $
            (1,800
            )State
                income tax, net of Federal benefit
            
            
            (180
            )Change
                in valuation allowance
            
            
            1,980Net
                income tax (benefit) allowance
            
            $
            -





Utilization
      of the Company’s net operating loss carryforwards are limited based on changes
      in ownership as defined in Internal Revenue Code Section 382.


-24-


**ITEM8. CHANGESIN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
      FINANCIAL DISCLOSURE**





On
      June
      27, 2005, the date of our incorporation, Sherb & Co., LLP was appointed by
      the Board of Directors as our outside independent auditors.





**ITEM
      8A. CONTROLS AND PROCEDURES**





Our
      disclosure controls and procedures are designed to ensure that information
      required to be disclosed in reports that we file or submit under the Securities
      Exchange Act of 1934, as amended (the “Exchange Act”), was recorded, processed,
      summarized and reported within the time periods specified in the rules and
      forms
      of the Securities and Exchange Commission (“SEC”). Our management, with the
      participation of our President and Chief Executive Officer and Chief Financial
      Officer, have evaluated the effectiveness, as of October 31, 2005, of our
“disclosure controls and procedures”, as that term is defined in Rule 13a-15(e)
      under the Exchange Act. Based upon that evaluation, our President and Chief
      Executive Officer and our Chief Financial Officer concluded that the disclosure
      controls and procedures as of December 31, 2005, were effective to provide
      a
      reasonable assurance that information required to be disclosed by us in the
      reports filed or submitted by us under the Exchange Act is recorded, processed,
      summarized and reported within the time periods specified in the SEC's rules
      and
      forms, and to provide reasonable assurance that information required to be
      disclosed by the us in such reports is accumulated and communicated to our
      management, including our principal executive officer and principal financial
      officer, as appropriate to allow timely decisions regarding required disclosure.





There
      was
      no change in our “internal control over financial reporting”, as such term is
      defined in Rule 13a-15(f) under the Exchange Act that occurred during the year
      ended December 31, 2005, that has materially affected, or is reasonably likely
      to materially effect, our internal control over financial
      reporting.





**ITEM
      8B. OTHER INFORMATION**





There
      exists no information required to be disclosed by us in a report on Form 8-K
      during the three month period ended December 31, 2005, but not
      reported.





-25-


**PART
      III**





**ITEM
      9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
      WITH
      SECTION 16(a) OF THE EXCHANGE ACT**




Our
      sole
      executive officer and director and his age as of March 31, 2006, is as follows:





**Name**
              Tony
                N. Frudakis
            **Age**
              37
            **Positions**
              President,
                Secretary, Treasurer and Sole
                Director





Tony
      N.
      Frudakis, Ph.D, serves as our President, Secretary, Treasurer and sole Director.
      Dr. Frudakis is the founder, chief scientific officer and a member of the board
      of directors of DNAPrint genomics, Inc., a publicly traded company, and since
      its inception in 1998, has served in many capacities, including president and
      chief executive officer. In 1998, Dr. Frudakis founded GAFF Biologic, the
      predecessor-in-interest to DNAPrint genomics, Inc., and served as its president
      and chief executive officer. From June 30, 2004 to February 11, 2005, Dr.
      Frudakis served as president and a director of Worldwide Biotech and
      Pharmaceutical Company (OTCBB: WWBP), formerly named Sun City Industries, Inc.
      Earlier in his career, Dr. Frudakis was a research scientist for Corixa
      Corporation. While at Corixa, Dr. Frudakis developed several new techniques
      for
      RNA fingerprinting, managed and executed high-throughput gene discovery programs
      for various cancers and was instrumental in the company's early success in
      attracting research and development partners. Dr. Frudakis’ work has resulted in
      a patent portfolio for over 350 unique genes and two products. Dr. Frudakis
      received his Ph.D. from the University of California at Berkeley in 1995.


Our
      Board
      of Directors does not have audit, compensation or nominating committees, and
      no
      determination has been made as to whether our sole director qualifies as an
      “audit committee financial expert”, as defined in Item 401 of Regulation
      S-B.





**Compliance
      with Section 16(a) of the Act**





Section
      16(a) of the Exchange Act requires our officers and directors, and persons
      who
      own more than ten percent (10%) of our shares of common stock, to file reports
      of ownership and changes in ownership with the SEC. Officers, directors and
      greater than ten percent (10%) stockholders are required by regulations
      promulgated by the SEC to furnish us with copies of all Section 16(a) forms
      that
      they file. With reference to transactions during the fiscal year ended December
      31, 2005, to our knowledge, based solely on review of the copies of such reports
      furnished to us and written representations, all Section 16(a) forms required
      to
      be filed with the SEC were filed.





-26-


**Code
      of Ethics**





We
      do not
      currently have a code of ethics applicable to our principal executive and
      financial officers. Prior to the tion, we did not believe such a code was
      necessary because we were not an operating company. Our Board of Directors
      intends to consider adopting such a code.





**ITEM
      10. EXECUTIVECOMPENSATION**





**Executive
      Compensation**





No
      officer will receive any salary or other compensation in connection with being
      employed by, or providing services to, us. There are no employment or consulting
      agreements with our sole officer and director in any form
      whatsoever.





**Compensation
      of Directors**





No
      director receives any type of compensation from us for serving as a director.
      Until we effectuate a Business Combination, it is not anticipated that any
      director will receive any compensation other than reimbursement for
      out-of-pocket expenses incurred on our behalf.





We
      have
      no stock option, retirement, pension, or profit-sharing programs for the benefit
      of directors, but the Board of Directors may recommend adoption of one or more
      such programs in the future. No other arrangements are presently in place
      regarding compensation to our sole officer and director for her services as
      a
      director or for committee participation or special assignments. Our sole officer
      and director will hold office until his successor is elected and qualified
      or
      until his resignation is accepted in the manner provided in our
      bylaws.





**ITEM
      11. SECURITYOWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
      MANAGEMENT AND RELATED STOCKHOLDER MATTERS**





The
      following table sets forth as of March 31, 2006, certain information regarding
      the beneficial ownership of our common stock by our sole shareholder and sole
      officer and director.





-27-


Except
      as
      otherwise indicated, the persons or entities listed below have sole voting
      and
      investment power with respect to all shares of common stock beneficially owned
      by them, except to the extent such power may be shared with a spouse.




NAME
                  AND ADDRESS OF
              SHARES
                  BENEFICIALLY
              PERCENTAGE
                  OF SHARESBENEFICIAL
                  OWNER
              OWNED
                  (1)
              OUTSTANDING
                  (1)Quetzal
                  Capital Funding 1, Inc. (2)
              5,000,000
              100%2435
                  E. Coast Hwy, Suite 8Corona
                  del Mar, California 92625All
                  executive officers and sole director as a group (1)
              5,000,000
              100%





(1)
      The
      number of shares and percentage of class beneficially owned set forth above
      is
      determined under rules promulgated by the SEC and the information is not
      necessarily indicative of beneficial ownership for any other purpose. Under
      such
      rules, beneficial ownership includes any shares as to which the individual
      has
      sole or shared voting power or investment power and also any shares that the
      individual has the right to acquire within 60 days through the exercise of
      stock
      options. Unless otherwise indicated and pursuant to applicable community
      property laws, each person or entity named in the table has sole voting power
      and investment power with respect to all shares of common stock listed as owned
      by such person or entity.





(2)  Tony
      N.
      Frudakis, our President, Secretary, Treasurer and sole director, maintains
      sole
      voting and investment control of the shares held by Quetzal Capital Funding
      1,
      Inc. As a result, Dr. Frudakis is deemed to beneficially own all of the shares
      of Common Stock held by Quetzal Capital Funding 1, Inc.





**ITEM
      12. CERTAINRELATIONSHIPS AND RELATED
      TRANSACTIONS**





Neither
      our sole officer and director nor any promoter or affiliate have, or proposes
      to
      have, any direct or indirect material interest in any asset proposed to be
      acquired through security holdings, contracts, options, or
      otherwise.





It
      is not
      currently anticipated that any salary, consulting fee, or finder’s fee shall be
      paid to any of our sole officer and director, or to any other affiliate, if
      any.
      See “Executive Compensation”.





-28-


Our
      sole
      officer and director, who is also deemed to beneficially own all of the shares
      of Common Stock held by the sole shareholder, may actively negotiate for or
      otherwise consent to the disposition of any portion of the outstanding shares
      of
      Common Stock, as a condition to or in connection with a Business Combination.
      Therefore, it is possible that the terms of any Business Combination will
      provide for the sale of some or all of the shares of Common Stock held by the
      sole shareholder. However, it is probable that other shareholders, if any,
      of
      the Company will not be afforded the right to sell all or a portion of their
      shares of Common Stock, if any, in connection with a Business Combination
      pursuant to the same terms that our sole shareholder will be provided. Also,
      such other shareholders, if any, will not be afforded an opportunity to approve
      or consent to the sale of the sole shareholder's shares of Common Stock in
      connection with a Business Combination. See “Description of Business - Shell
      Corporation” and “- Selection of a Target Business and Structuring of a Business
      Combination”. It is more likely than not that any sale of securities by our sole
      shareholder to an acquisition candidate would be at a price substantially higher
      than that originally paid by such sole shareholder. Any payment to such sole
      shareholder in the context of an acquisition involving us would be determined
      entirely by largely unforeseeable terms of a future agreement with an
      unidentified business entity. See “Description of Business - Shell Corporation”
and “- Selection of a Target Business and Structuring of a Business
      Combination”.





**ITEM
      13. EXHIBITS**





The
      following Exhibits are filed herein:





Exhibits




Exhibit
                3.1
            Articles
                of Incorporation of registrant*Exhibit
                3.2
            Bylaws
                of registrant*Exhibit
                4.1
            Stock
                Certificate of registrant*Exhibit
                4.2
            Instruments
                defining the rights of security holders (included in Exhibit
                3.1)Exhibit
                31.1
            302
                Certification - Tony N. Frudakis (filed
                herewith)Exhibit
                32.1
            906
                Certification - Tony N. Frudakis (filed
                herewith)


__________


*
      Previously filed as exhibits to the Company’s Registration Statement on Form
      10-SB (File No. 0-51420) with the Securities and Exchange Commission on July
      7,
      2005





-29-


**ITEM
      14. PRINCIPAL ACCOUNTANT FEES AND
      SERVICES**





The
      following table sets forth fees billed to us for principal accountant fees
      and
      services during the periods ended December 31, 2005.


**2005**Audit
                Fees
            
            $
            5,000Audit-Related
                Fees (1)
            
            
            750Tax
                Fees
            
            
            —All
                Other Fees
            
            
            —Total
                Audit and Audit-Related Fees
            
            $
            5,750





(1)
            Audit-related
                fees incurred during 2005 include billings for services related to
                a
                filing on Form 10-QSB.


-30-





**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, on the 14 th day of
      April, 2006.


**QUETZAL
              CAPITAL I, INC.**By:
            /s/ Tony
              N.
              FrudakisTony
              N. FrudakisPresident,
              Secretary, Treasurer and Sole Director


-31-


QuetzalCapitalI, Inc.





Index
      to
      Exhibits





Exhibits




Exhibit
                31.1
            302
                Certification - Tony N.
                FrudakisExhibit
                32.1
            906
                Certification - Tony N.
                Frudakis




-32-