UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-K


(Mark One)





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




For
the fiscal year ended December 31, 2008





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





For the
transition period from ________________ to _______________





333-128077


(Commission
file number)





MARINE
GROWTH VENTURES, INC.


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





Delaware
                
                20-0890800(State or other jurisdiction
                
                (IRS
      Employerof
      incorporation or organization)
                
                Identification
      No.)


405-A
Atlantis Road


Cape
Canaveral, Florida 32920


(Address
of principal executive offices)





(321)
783-1744


(Issuer's
telephone number)





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





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


Common
Stock, par value $0.001 per share





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-K (229.405 of this chapter) 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-K or any amendment to this Form 10-K. x




Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.  See definitions of “large accelerated filer”, “accelerated
filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange
Act.
 
 Large
      accelerated filer  ̈
              Accelerated
      filer  ̈Non-accelerated
      filer  ̈
              Smaller
      reporting company x


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





The
Issuer's revenues for the year ending December 31, 2008 were
$12,000.









State the
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
sold or the average bid and asked price of such common equity, as of a specified
date within the past 60 days: As of December 31, 2008, the aggregate market
value of voting stock held by non-affiliates was $167,700, based on the closing
prices as quoted on the OTC Bulletin Board under the symbol “MGRW”, of
$0.10.  As of March 31, 2009, the aggregate market value of voting
stock held by non-affiliates was $50,310, based on the closing prices as quoted
on the OTC Bulletin Board under the symbol “MGRW”, of $0.03.





State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practicable date: As of April 15, 2009 – 21,839,500 shares of
common stock.





2





MARINE
GROWTH VENTURES, INC.


FORM
10-K


FOR
THE FISCAL YEAR ENDED DECEMBER 31, 2008


TABLE
OF CONTENTS





PART
      IItem
      1.
                            Description
      of Business
                            
                            
                            4Item
      2.
                            Description
      of Property
                            
                            
                            11Item
      3.
                            Legal
      Proceedings
                            
                            
                            11Item
      4.
                            Submission
      of Matters to a Vote of Security Holders
                            
                            
                            11PART
      IIItem
      5.
                            Market
      for Common Equity and Related Stockholder Matters
                            
                            
                            12Item
      6.
                            Selected
      Financial Data
                            
                            
                            12Item
      7.
                            Management’s
      Discussion and Analysis or Plan of Operations
                            
                            
                            13Item
      8.
                            Financial
      Statements
                            
                            
                            15Item
      9.
                            Changes
      In and Disagreements with Accountants on Accounting and Financial
      Disclosure
                            
                            
                            16Item
      9A.
                            Controls
      and Procedures
                            
                            
                            16Item
      9B.
                            Other
      Information
                            
                            
                            17PART
      IIIItem
      10.
                            Directors
      and Executive Officers of Marine Growth Ventures, Inc.
                            
                            
                            18Item
      11.
                            Executive
      Compensation
                            
                            
                            20Item
      12.
                            Security
      Ownership of Certain Beneficial Owners and Management and Related
      Stockholder Matters
                            
                            
                            21Item
      13.
                            Certain
      Relationships and Related Transactions, and Director
      Independence
                            
                            
                            22Item
      14.
                            Principal
      Accountant Fees and Services
                            
                            
                            23Item
      15.
                            Exhibits
                            
                            
                            23SIGNATURES
                            
                            
                            26





3





PART
I





Item
      1.
            Description
      of Business





Forward-Looking
Statements





The information in this report contains
forward-looking statements.  All statements other than statements of
historical fact made in report are forward looking.  In particular,
the statements herein regarding industry prospects and future results of
operations or financial position are forward-looking
statements.  These forward-looking statements can be identified by the
use of words such as “believes,” “estimates,” “could,” “possibly,” “probably,”
anticipates,” “projects,” “expects,” “may,” “will,” or “should” or other
variations or similar words.  No assurances can be given that the
future results anticipated by the forward-looking statements will be
achieved.  Forward-looking statements reflect management’s current
expectations and are inherently uncertain.  Our actual results may
differ significantly from management’s expectations.




Organizational
History




We are a specialized holding company
engaged in various marine industry operations. Our current primary operation,
conducted through our wholly-owned subsidiary, Sophlex Ship Management, Inc., is
providing ship crewing and management services to vessel owners and operators in
the United States and abroad. In addition, through our other wholly-owned
subsidiaries we are attempting to provide financing to businesses in the marine
industry, ship crewing and management services to vessel owners and operators in
the United States and abroad. Our website address is http://www.marinegrowthventures.com.




Overview
of Business




We had no
significant business operations, until our acquisition of Sophlex Ship
Management, Inc. on September 1, 2004 in exchange for 1,000,000 shares of our
common stock.  Sophlex Ship Management, Inc., which was founded in
1999, provides ship crewing and management services to vessel owners and
operators in the United States and abroad.  Capt. Timothy Levensaler,
our Chief Operating Officer, was the founder and the sole shareholder of Sophlex
Ship Management, Inc. prior to its acquisition by us.





We are
also currently attempting to sell two vessels in our possession.





In
addition, we are also pursing other opportunities in the shipping
industry.





Crewing
and Management Services




Currently
our primary business is to provide ship crewing and management services to
vessel owners and operators in the United States and abroad. Although as of the
date hereof we are not providing such services to any vessels, we have provided
ship crewing and management services to eight different vessels since
1998.  These services are provided by our wholly-owned subsidiary
Sophlex Ship Management, Inc., which is an International Safety Management Code
certified company holding a Document of Compliance issued by the American Bureau
of Shipping to operate vessels worldwide. This certification authorizes us to
operate any ship anywhere in the world.  A DOC (Certificate of
Compliance) is applied for and is held for each country in which the ship is
under its Flag.




Our
crewing services consist of supplying sea staff to our clients. To ensure
the qualifications of the staff a prerequisite to hiring our crew is to check
that each of the crew members has all the required regulatory training and
certificates. Generally we provide crews for ships that we manage, but we also
provide crews to vessels operated by other entities, for which we do not provide
management services, upon request.  When providing crew services we
generally charge a fee for each crew member provided. We usually obtain
management customers who come to us either in the process of purchasing a ship
or shopping for a ship.  We assist the customers in this process,
which usually requires our inspection of the ship.  Once the purchase
is made we can provide a crew to deliver the ship to the buyer’s location
anywhere in the world.  Once the ship is delivered our goal is to try
to be retained to provide continuing management services for the
vessel.




4




In order
to be able to provide crewmembers, we maintain relationships with employment
agencies in the Philipines, Ukraine, Honduras and Mexico and currently have an
agreement with an agency in China.  These agencies provide highly
qualified and licensed marine crew at all skill levels, many of whom have
experience in operating both United States and foreign flag vessels. We are
therefore able to deploy qualified, responsible crew to our clients’ operations
on an expedited basis.  These agencies are compensated for their
services by either charging the crew member a fee that is paid up front or
garnished from future wages, by charging us a monthly fee ranging from $25 to
$50 per employee or by charging us an upfront fixed fee which ranges from $100
to $300 per employee contract.




In
addition to the provision of crew services, we provide our clients with general
management services including the following:





·
            purchasing
      new vessels or second-hand vessels (we have assisted in the purchase of
      two vessels);


·
            vessel
      maintenance ensuring compliance with all safety and environmental rules
      and procedures (we have assisted in ensuring compliance with all safety
      and environmental rules and procedures of four
  vessels);


·
            shipyard
      supervision of new vessels and conversion projects (we have assisted in
      three conversion projects);


·
            assist
      in devising and obtaining optimal insurance coverage and management of
      insurance related matters (we have assisted in two insurance programs);
      and


·
            assist
      in arranging for client’s financing needs (assisted in one financing
      package).





These
functions are supported by onboard and onshore systems for maintenance,
inventory, purchasing and budget management.





In
providing management services, we normally enter into agreements to provide
complete vessel management services for a period of two to three
years.  However, depending upon the specific needs of the client we
may enter into short-term agreements to provide specific management services,
which to date we have not done.  For example, we have or could assist
a client for the specific purpose of purchasing a vessel, without providing any
additional management services.





In
connection with our management services, we often provides technical personnel
for a wide range of inspection services, such as feasibility, pre-sale
condition, pre-scrapping condition, estimate of work or shipyard package. 
These services may lead to a contract for us to convert the ship and ultimately
provide long-term management services for the ship. Generally these services
requires us to identify a ship for the customers needs and determine the
suitability of the vessel for proposed project and the pre-sale condition of the
vessel.  The term “pre-sale condition” refers to the condition of the
vessel before an offer or any negotiation is done with respect to a vessel,
while “pre-scrapping condition” refers to the condition and general value the
ship will have at the end of its usable life. To convert a ship means to change
the ships useful purpose from it intended original purpose. For example, a ferry
designed to transport cars and trucks can be converted into a casino ship by
putting a casino into the former car deck area. This form of conversion requires
ship management expertise to ensure that the converted vessel obtains all proper
certifications, which allow it to operate safely and legally.




In
addition, we have a record of available ships and an ability to locate
additional ships.  Therefore, when potential customers contact us seeking a
vessel, after ascertaining the type of vessel being sought we are able to assist
the customer in obtaining a vessel that suits their needs by identifying and
inspecting an appropriate vessel.   We will use these contacts as
leads so we can provide conversion management and financing
services.  Conversion management means we will (1) suggest initial
design changes to make a ship suitable for its proposed use, (2) prepare a
specification for ship yard conversion, (3) mange the specification during ship
yard conversion, and (4) deliver the final vessel to the customer.





5





We also
provide "Custodial Services."  When a ship is confiscated for any number of
reasons, we work with local maritime lawyers to obtain a contract to "hold" the
ship for the Federal Court.  This refers to a Federal “custodian”
service.  When a ship gets “arrested” for any reason (most commonly it
is non payment of bills for goods and services) the vendor or a group of vendors
can apply to the Federal Court to “arrest the vessel.”  With this
application they must propose a custodian for the vessel.  The
custodian takes possession of the vessel and preserves and protects it for the
Federal Marshall until the court proceeding is completed.  This can
take anywhere from days to years.  These contracts generally last from
a few hours to one to two years depending on the case.  Since daily
rates charged for Custodial Services are senior to all other creditors
liens we are generally assured of payment.




Competition




Our crew
and management services compete both with existing and established service
providers. Many of these companies have longer operating histories, larger
customer bases and significantly greater financial, marketing and other
resources than we do and may have the ability to better attract and retain the
same customers that we target. Once service providers have established these
business relationships, it could be extremely difficult to convince them to
utilize our crew and management services or replace or limit their existing
business practices.  We cannot be certain that we will be able to
compete successfully against current and future competitors, and competitive
pressures faced by us could materially adversely affect our
business.





Cruise
timeshares and vessel condos
 
 The
Company was pursuing opportunities in a new industry referred to as cruise
timeshares, which combines traditional real estate timeshares with commercial
cruise vacations.  Purchasers of cruise timeshares could receive the
right to a seven-day cruise each year for up to 15 years aboard a cruise ship
purchased by the Company.  The Company had purchased a vessel for this
purpose and finished a number of improvements on the vessel in order to sell
these timeshares.    The Company also began working
with a maritime lodging company in order to sell condos on the vessel that will
take weekend tours of the surrounding Pacific coastline.  Purchasers
would be able to live aboard full-time, cruise only on weekends, rent out their
condos as investment income, or any combination which suits their individual
purposes.  The Company decided that at this point in time, with the
current litigation with Greystone, the best direction to take the vessel would
be to make it available for sale.  The Company believes that the
cruise timeshares or condo sales is a viable opportunity and may go back to it
in the future.


Government
Regulation





Federal
Regulation




We do not
believe that we are currently subject to U.S. federal regulation in connection
with our current operations; however, to the extent that we operate vessels in
United States territorial waters our vessels will be subject to regulation by
the United States Coast Guard. Our cruise timeshare vessel would be subject to
United States Coast Guard regulations if it enters U.S. waters and
ports. These regulations primarily relate to passenger safety. 
Sophlex has extensive experience and expertise in adhering to these
regulations.




6




Risks
Related to Our Business




We
Have A History Of Operating Losses And Accumulated Deficit.  There Is
No Certainty That We Will Ever Achieve Profitability.





We have
incurred operating losses of $5,149,829 since inception. We expect to incur
significant increases in operating losses over the next several years, primarily
due to the expansion of our operations into the cruise timeshare
industry.  The negative cash flow from operations is expected to
continue and to accelerate in the foreseeable future.  Our ability to
achieve profitability depends upon our ability to develop our cruise vessel
timeshare operations.  There can be no assurance that we will ever
achieve any revenues or profitable operations from the sale of our timeshare
products.




We
Have Substantial Doubt About Our Ability To Continue As A Going
Concern.




As we
note in our consolidated balance sheets as of December 31, 2008 and 2007 as well
as our related consolidated statements of operations, stockholders’ equity, and
cash flows for the year ended December 31, 2008, we have experienced, and expect
to continue to experience, recurring net losses, negative cash flows from
operations, limited amount of funds on our balance sheet.  Accordingly, we
have substantial doubt about our ability to continue as a going concern. 
We have prepared our financial statements on a going concern basis, which
contemplates the realization of assets and the satisfaction of liabilities and
commitments in the normal course of business.  The consolidated financial
statements do not include any adjustments that might be necessary should we be
unable to continue in existence.  See also, Item 3 of Part
I.




We
Have a significant Amount Of Debt In Default And Lawsuits Filed Seeking
Judgments And Realization Upon Collateral For Same





As we note in our
financial statements for the year ended December 31, 2008, and in Item 3 of Part
I,Greystone Business Credit II, LLC commenced admiralty action against
Marine Growth Canada, Ltd., Marine Growth Finance & Charter, Inc., Marine
Growth Ventures, Inc., Fractional Marine, Inc., and all other interested in the
ship “Pacific Aurora” in the Federal Court in Vancouver, BC Canada seeking to
foreclose its lien and take ownership and possession of the
ship.     If management is unable to defend this
action, we have substantial doubt about our ability to continue as a going
concern.





We
May Be Unable To Manage Our Growth Or Implement Our Expansion
Strategy.





If
management is unable to adapt to the growth of our business operations, we may
not be able to expand our product and service offerings, our client base and
markets, or implement the other features of our business strategy at the rate or
to the extent presently planned.  Our projected growth will place a
significant strain on our administrative, operational and financial resources.
If we are unable to successfully manage our future growth, establish and
continue to upgrade our operating and financial control systems, recruit
and hire necessary personnel or effectively manage unexpected expansion
difficulties, our financial condition and results of operations could be
materially and adversely affected.





The
Vessel Management Services Industry Is Highly Competitive And We May Be Unable
To Compete Effectively.





The
vessel management industry, including crewing and maintenance services, is
highly competitive, rapidly evolving, and subject to technological change and
intense marketing by providers with similar products and services. Many of our
current competitors are significantly larger and have substantially greater
market presence as well as greater financial, technical, operational, marketing
and other resources and experience than we have. In the event that such a
competitor expends significant sales and marketing resources in one or several
markets we may not be able to compete successfully in such
markets.  We believe that competition will continue to
increase, placing downward pressure on prices.  Such pressure
could adversely affect our gross margins if we are not able to reduce costs
commensurate with such price reductions.  In addition, the pace of
technological change makes it impossible for us to predict whether we will face
new competitors using different technologies to provide the same or similar
services offered or proposed to be offered by us.  If our competitors
were to provide better and more cost effective services, our business
initiatives could be materially and adversely affected.





7





We
Are Dependent Upon Key Personnel And Consultants And The Loss Of Any Key Member
Of This Team Could Have A Material Adverse Effect On Our Business.





Our
success is heavily dependent on the continued active participation of our
current executive officers listed under “Management.” Loss of the services of
one or more of these officers could have a material adverse effect upon our
business, financial condition or results of operations. Further, our success and
achievement of our growth plans depend on our ability to recruit, hire, train
and retain other highly qualified technical and managerial
personnel.  Competition for qualified employees among companies in the
communications industry is intense, and the loss of any of such persons, or an
inability to attract, retain and motivate any additional highly skilled
employees required for the expansion of our activities, could have a materially
adverse effect on us. Our inability to attract and retain the necessary
personnel and consultants and advisors could have a material adverse effect on
our business, financial condition or results of operations.


.


Risks
Related To Our Stock





If
We Fail To Maintain Effective Internal Controls Over Financial Reporting, The
Price Of Our Common Stock May Be Adversely Effected.





Our management team has no previous
experience in managing a public company. Accordingly, our internal controls over
financial reporting, while they appear to be sufficient for our needs, may have
weaknesses and conditions that will need to be addressed, the disclosure of
which may have an adverse impact on the price of our common stock. We are
required to establish and maintain appropriate internal controls over financial
reporting. Failure to establish those controls, or any failure of those controls
once established, could adversely impact our public disclosures regarding our
business, financial condition or operating results. In addition, management's
assessment of our internal controls over financial reporting may identify
weaknesses and conditions that need to be addressed in our internal controls
over financial reporting or other matters that may raise concerns for investors.
Any actual or perceived weaknesses and conditions that need to be addressed in
our internal controls over financial reporting or disclosure of management's
assessment of our internal controls over financial reporting may have an adverse
impact on the price of our common stock.





We
Have A Limited Operating History Upon Which An Evaluation Of Our Prospects Can
Be Made.  For That Reason, It Would Be Difficult For A Potential
Investor To Judge Our Prospects For Success.





We had no
significant business operations until our acquisition of Sophlex Ship
Management, Inc. on September 1, 2004.  In light of the fact that
there are no other business models that management can look to in the formation
and operation of a cruise timeshare business operation, there can be no
assurance that our proposed operations will be implemented successfully or that
we will ever have profits.  If we are unable to sustain our
operations, you may lose your entire investment.  We face all the
risks inherent in a new business, which include the expenses, difficulties,
complications and delays frequently encountered in connection with conducting
operations, including capital requirements and management's potential
underestimation of initial and ongoing costs.  As a new business, we
may encounter delays and other problems in connection with the operations that
we implement.  We also face the risk that we will not be able to
effectively implement our business plan. In evaluating our business and
prospects, these difficulties should be considered. If we are not effective in
addressing these risks, we will not operate profitably and we may not have
adequate working capital to meet our obligations as they become
due.  This may cause our stock price to decline and result in a loss
of a portion or all of your investment.





We
Will Need To Raise Additional Equity Or Debt Financing In The
Future.





We will
need to raise financing in the future to fund our operations. If successful in
raising additional financing, we may not be able to do so on terms that are not
excessively dilutive to our existing stockholders or less costly than existing
sources of financing. Failure to secure additional financing in a timely manner
and on favorable terms if and when needed in the future could have a material
adverse affect on our financial performance, balance sheet and stock price and
require us to implement cost reduction initiatives and curtail or cease
operations.  This may cause our stock price to decline and result in a
loss of a portion or all of your investment.




8




Our
common stock has experienced in the past, and is expected to experience in the
future, significant price and volume volatility, which substantially increases
the risk that you may not be able to sell your shares at or above the price that
you pay for the shares.





Certain
factors, some of which are beyond our control, that may cause our share price to
fluctuate significantly include, but are not limited to, the
following:




·
                
                variations
      in our quarterly operating results;·
                
                our
      ability to successfully market and sell cruise vessel
      timeshares;·
                
                changes
      in market valuations of similar companies;·
                
                announcement
      by us or our competitors of significant contracts, acquisitions,
      strategic
                  partnerships,
      joint ventures or capital commitments;·
                
                additions
      or departures of key personnel; and·
                
                Fluctuations
      in stock market price and
volume.




Additionally,
in recent years the stock market in general, and the Over-the-Counter Bulletin
Board and technology stocks in particular, have experienced extreme price and
volume fluctuations. In some cases these fluctuations are unrelated or
disproportionate to the operating performance of the underlying company. These
market and industry factors may materially and adversely affect our stock price
regardless of our operating performance. The historical trading of our common
stock is not necessarily an indicator of how it will trade in the future and our
trading price as of the date of this prospectus is not necessarily an indicator
of what the trading price of our common stock might be in the future. In the
past, class action litigation has often been brought against companies following
periods of volatility in the market price of those companies’ common stock. If
we become involved in this type of litigation in the future it could result in
substantial costs and diversion of management attention and resources, which
could have a further negative affect on your investment in our
stock.




Our
issuance of common stock at a price below prevailing trading prices at the time
of issuance may cause our stock price to decline.





Currently
outstanding options, convertible notes and warrants, as well as other
convertible securities that we may issue in the future, may result in shares
being issued for consideration that is less than the trading price of our common
stock at the time the shares are issued. We may also issue shares in the future
at a discount to the trading price of our common stock. Any such below market
issuances, or the potential for such issuances, could cause our stock price to
decline.





Shares
of our common stock may be subject to price illiquidity and volatility because
our shares may continue to be thinly traded and may never become eligible for
trading on Nasdaq or a national securities exchange.




Although
a trading market for our common stock exists, the trading volume has not been
significant and an active trading market for our common stock may never develop.
There currently is no analyst coverage of our business. As of March 31, 2009,
21,839,500 common shares were issued and outstanding.  Furthermore,
the average three month trading volume for our common shares has been
approximately 572,500 (or approximately 2.6% of the total outstanding. The
trading volume of our shares will continue to be limited due to resale
restrictions under applicable securities laws and the fact that approximately
92.78% of our outstanding shares are held by our officers and directors. As
a result of the limited trading market for our common stock and the lack of
analyst coverage, the market price for our shares may continue to fluctuate
significantly and will likely be more volatile than the stock market as a whole.
There may be a limited demand for shares of our common stock due to the
reluctance or inability of certain investors to buy stocks quoted for trading on
the OTC Bulletin Board, lack of analyst coverage of our common stock and limited
trading market for our common stock. As a result, even if prices appear
favorable, there may not be sufficient demand to complete a stockholder’s sell
order. Without an active public trading market or broader public ownership,
shares of our common stock are likely to be less liquid than the stock of public
companies with broad public ownership and an active trading market, and any of
our stockholders who attempt to sell their shares in any significant volumes may
not be able to do so at all, or without depressing the publicly quoted bid
prices for our shares.




9




While we
may, at some point, be able to meet the requirements necessary for our common
stock to be listed on the Nasdaq stock market or on another national securities
exchange, we cannot assure you that we will ever achieve such a listing. Listing
on one of the Nasdaq markets or one of the national securities exchanges is
subject to a variety of requirements, including minimum trading price and
minimum public “float” requirements. There are also continuing eligibility
requirements for companies listed on national securities exchanges. If we are
unable to satisfy the initial or continuing eligibility requirements of any such
market, then our stock may not be listed or could be delisted. This could result
in a lower trading price for our common stock and may limit your ability to sell
your shares, which could result in you losing some or all of your
investment.




The
so-called “penny stock rule” makes it cumbersome for brokers and dealers to
trade in our common stock, making the market for our common stock less liquid
which could cause the price of our stock to decline.




Trading
of our common stock on the OTC Bulletin Board is subject to certain
provisions of the Securities Exchange Act of 1934, commonly referred to as the
“penny stock” rule. A penny stock is generally defined to be any equity security
that has a market price less than $5.00 per share, subject to certain
exceptions. Because our common stock has historically traded below $5.00 per
share, it is deemed to be a penny stock, and consequently trading in our stock
is subject to additional sales practice requirements on
broker-dealers.




These
require a broker-dealer to:




·
              
              make
      a special suitability determination for purchasers of our
      shares;·
              
              receive
      the purchaser’s written consent to the transaction prior to the purchase;
      and·
              
              deliver
      to a prospective purchaser of our stock, prior to the first transaction, a
      risk disclosure
                document
      relating to the penny stock
market.




Consequently,
the penny stock rules restrict the ability of broker-dealers to trade and/or
maintain a market in our common stock. Also, prospective investors may not want
to get involved with the additional administrative requirements which may have a
material adverse effect on the trading of our shares.





We
Are Controlled By Current Officers, Directors And Principal
Stockholders.





Following
completion of the Offering, our directors, executive officers and principal
stockholders and their affiliates will beneficially own approximately 92.75% of
the outstanding shares of our common stock.  So long as our directors,
executive officers and principal stockholders and their affiliates controls a
majority of our fully diluted equity, they will continue to have the ability to
elect our directors and determine the outcome of votes by our stockholders on
corporate matters, including mergers, sales of all or substantially all of our
assets, charter amendments and other matters requiring stockholder
approval. This controlling interest may have a negative impact on the
market price of our common stock by discouraging third-party
investors.





If
We Are Not Successful In Defending The Litigation Seeking Ownership And
Possession of the Aurora It Could Adversely Affect Our Ability to Continue As A
Going Concern And Investors May Lose Their Entire Investment In Our
Stock





As we note in our
financial statements for the year ended December 31, 2008, and in Item 3 of Part
I,Greystone Business Credit II, LLC commenced admiralty action against
Marine Growth Canada, Ltd., Marine Growth Finance & Charter, Inc., Marine
Growth Ventures, Inc., Fractional Marine, Inc., and all other interested in the
ship “Pacific Aurora” in the Federal Court in Vancouver, BC Canada seeking to
foreclose its lien and take ownership and possession of the
ship.     If management is unable to defend this
action, we have substantial doubt about our ability to continue as a going
concern and investors may lose their entire investment in our
stock.




10




Item
      2.
            Description
      of Property





We lease
our main office which is located at 405-A Atlantis Road, Cape Canaveral, Florida
32920.  The lease has a term of 24 months, which began on September 1,
2007 and expires on August 31, 2009, which includes options to renew. We
currently pay rent and related costs of $2,383 per month, which amount is to be
increased 3% on each anniversary of the lease.





We are
not dependent on a specific location for the operation of our
business.





Item
      3.
            Legal
      Proceedings





During
the fourth quarter of 2008, a case was filed by Euro Oceans,
Co.  against Marine Growth Ventures, Inc., Marine Growth Canada, LTD,
Sophlex Ship Management, Inc and Ship Timeshare Management, Inc. for breach of
contract.    This case is currently pending.





During
the first quarter of 2009, a case was filed by Greystone Business Credit II, LLC
against Marine Growth Canada, Ltd., Marine Growth Finance & Charter, Inc.,
Marine Growth Ventures, Inc., Fractional Marine, Inc., and all other interested
in the ship “Pacific Aurora” in the Federal Court in Vancouver, BC Canada for
admiralty action seeking to foreclose its lien and take ownership and possession
of the ship.  This case is currently pending.





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





The Company did not submit any matters
to a vote of security holders during this reporting period.





11





PART
II





Item
      5.
            Market
      for Common Equity and Related Stockholder
  Matters





Our
common stock has been trading publicly on the OTC Bulletin Board under the
symbol "MGRW" since July, 2007. The table below sets forth the range of
quarterly high and low closing sales prices for our common  stock on
the OTC Bulletin Board during the calendar quarters indicated. The quotations
reflect inter-dealer prices, without retail mark-ups, markdowns, or conversion,
and may not represent actual transactions.





COMMON
STOCK





2007Third
      Quarter
                    
                    
                    0.90
                    
                    
                    
                    0.30Fourth
      Quarter
                    
                    
                    0.90
                    
                    
                    
                    0.40





2008First
      Quarter
                    
                    
                    0.89
                    
                    
                    
                    0.35Second
      Quarter
                    
                    
                    0.79
                    
                    
                    
                    0.26Third
      Quarter
                    
                    
                    0.60
                    
                    
                    
                    0.20Fourth
      Quarter
                    
                    
                    0.34
                    
                    
                    
                    0.10





The
transfer agent for our common stock is:


Interwest
Transfer


1981 East
4800 South, Suite 100


Salt Lake
City, UT 84117





As of
March 31, 2009, we had 68 registered owners of our common stock and
approximately 6 beneficial owners of our common stock.





Dividend
Policy





Our
payment of dividends, if any, in the future rests within the discretion of the
Board of Directors and will depend, among other things, upon our earnings,
capital requirements and financial condition, as well as other relevant
factors.  We have not paid any dividends since our inception and do
not intend to pay any cash dividends in the foreseeable future, but intend to
retain all earnings, if any, for use in our business.  There are no
provisions in our articles of incorporation or bylaws that restrict us from
declaring dividends. However, agreements we may enter into in connection with
debt financing in the future may restrict our ability to declare dividends,
without lenders consent.




Equity
Compensation Plan Information




None





Item
6 – Selected Financial Data





None




12




Item
7 - Management’s Discussion and Analysis





Forward-Looking
Statements





This Quarterly Report of Form 10-K,
including this discussion and analysis by management, contains or incorporates
forward-looking statements.   All statements other than
statements of historical fact made in report are forward looking.  In
particular, the statements herein regarding industry prospects and future
results of operations or financial position are forward-looking
statements.  These forward-looking statements can be identified by the
use of words such as “believes,” “estimates,” “could,” “possibly,” “probably,”
anticipates,” “projects,” “expects,” “may,” “will,” or “should” or other
variations or similar words.  No assurances can be given that the
future results anticipated by the forward-looking statements will be
achieved.  Forward-looking statements reflect management’s current
expectations and are inherently uncertain.  Our actual results may
differ significantly from management’s expectations.





The following discussion and analysis
should be read in conjunction with our financial statements, included
herewith.  This discussion should not be construed to imply that the
results discussed herein will necessarily continue into the future, or that any
conclusion reached herein will necessarily be indicative of actual operating
results in the future.  Such discussion represents only the best
present assessment of our management.





Background





We were
formed and incorporated in the state of Delaware on November 6,
2003.  We are a holding company and conduct our current operations
solely through a wholly-owned subsidiary, Sophlex Ship Management, Inc.
(“Sophlex”).





We had no
significant business operations until our acquisition of Sophlex on September 1,
2004.  Sophlex, which was founded in 1999, and provides ship crewing
and management services to vessel owners and operators in the United States and
abroad.  Our Chief Operating Officer was the founder and the sole
shareholder of Sophlex prior to the acquisition.





We are
also currently attempting to sell two vessels in our possession, the “Pacific
Aurora” and the “Babe.”





Results
of Operations





Since our
inception, we have been dependent upon the proceeds of loans from our
stockholders and the receipt of capital investment to fund our continuing
activities.  We have incurred operating losses since our
inception.  We expect to incur significant increasing operating losses
over the next several years, primarily due to the expansion of our business. We
will continue to require the infusion of capital until operations become
profitable.  We had a net loss of $2,317,186 and a negative cash flow
from operations of $806,235 for the twelve months ended December 31,
2008.





Twelve
Months  Ended December 31, 2008 and 2007:





Revenue:   Revenue
was $12,000 for the twelve months ended December 31, 2008 compared to $158,236
earned in the twelve months ended December 31, 2007.    The
reduction in revenue was due to the decrease in leasing, and income incurred
from custodial services.    The $12,000 of revenue in 2008
was from leasing, the Company subsequently recorded an allowance for the
receivable in the amount of $12,000.





Payroll and Related
Expenses:  Payroll and related expenses were $180,807 for the
twelve months ended December 31, 2008 compared to $360,764 for the twelve months
ended December 31, 2007, representing a decrease of $179,957.  The
decrease in payroll was due to several officers waiving their payroll as of
March 1, 2008.





Professional Fees:  Professional fees were $245,961 for the twelve months ended
December 31, 2008 compared to $356,478 for the twelve months ended December 31,
2007.   Professional fees decreased by $110,577 in the twelve
months ended December 31, 2008.   The change in professionals is
primarily due to a decrease in accounting fees of $5,206, a decrease in
consulting fees of $64,141 and an approximate decrease in legal fees of 56,621
offset by an increase in other professional fess of $5,039.




13




General and Administrative
Expenses:  General and administrative expenses were $118,927
and $104,690 for the twelve months ended December 31, 2008 and 2007,
respectively.  General and administrative expenses increased by
$14,237 in the twelve months ended December 31, 2008 as compared to the twelve
months ended December 31, 2007.  This increase is primarily as a
result of an increase in travel to Canada in the amount of $16,900, and a
decrease in utilities of $1,195.





Selling
Expenses:   Selling expenses were $64,257 and $2,354 for
the twelve months ended December 31, 2008 and 2007,
respectively.    The large increase in selling expenses in
the twelve months 2008 were due to the advertising costs of the timeshares and
condos in the amount of $64,257.





Impairment of
Vessel:  Impairment of vessel expenses including costs for
disposal were $864,926 and $0 for the twelve months ended December 31, 2008 and
2007, respectively.   $300,000 was for the approximately cost of
disposal for the Babe.   The remaining $564,926 was for the
impairment of the fair market value of the Babe.





Operating
Expenses:  Operating expenses were $272,488 for the twelve
months ended December 31, 2008 compared to $452,442 for the twelve months ended
December 31, 2007.   The decrease was primarily due the decrease
in crew related expenses of $95,353, and decrease in parts and supplies of
$121,356 for the Pacific Aurora, offset by the increase in dockage costs of $
38,937 for the Babe.





Other
Expenses:  Other Expenses were $462,516 and $225,856 for the
twelve months ended December 31, 2008 and 2007,
respectively.   Other expenses increased by $236,660 for the
twelve months ended December 31, 2008.    This increase was
primarily due to the continued financing costs of the M/V Pacific Aurora and the
M/V Babe which include an increase in interest expenses of $187,385, an increase
in loan service fees of $21,957, an increase in finance costs of $8,312 and
other expenses of $18,319.





Net
Loss:  Net loss before income taxes was $2,317,186 and
$1,488,295 for the twelve months ended December 31, 2008 and 2007, respectively.
The increase in net loss is attributed to expenses related to the approximate
disposal costs of the Babe, the impairment of the fair market value of the Babe
and the increase in interest expense.





Liquidity
and Capital Resources





For the
twelve months ended December 31, 2008, we had a negative cash flow from
operations of $806,235 compared to a negative cash flow of $672,887 as of
December 31, 2007, an increase in the negative cash flow of $168,034. Since
inception, we have been dependent upon proceeds of loans from our stockholders
and receipt of capital investment to fund our continuing
activities.





For the
twelve months ended December 31, 2008, we had a net loss of $2,317,186 compared
to a net loss of $1,488,295 for the twelve months ended December 31, 2007, an
increase in the net loss of $828,891.





On
January 5, 2006 the Company entered into a Revolving Note (“Note A”) with an
aggregate principal amount of $50,000 to Frank Crivello. Funds are advanced to
us as needed to pay for ongoing operations. Note A had a maturity date of June
30, 2006. As a result of eleven amendments to Note A, the principal amount of
Note A was increased to $800,000 and the maturity date of Note A was extended to
February 20, 2009. Note A has an interest rate of 10%.   During
the twelve months ended December 31, 2008, the Company received $447,078 on this
loan and the Company paid $1,197,021 down on this loan ($40,393 in interest and
$1,156,628 in principal).  As of December 31, 2008, the balance on
this loan is $120,431 ($59,500 in principal and $60,931 in
interest).   This note is currently in default.





On August
1, 2007, the Company issued a revolving note (“Note B”), with an aggregate
principal amount of $100,000 to an entity that is controlled by the Chairman of
the Board of Directors.   Funds are advanced to the Company, as
needed, to finance ongoing operations.  Note B had a maturity date of
July 31, 2008.  It has been agreed that the maturity date will extend
to December 31, 2008 unless the lender notifies the borrower, in writing, thirty
days prior to the maturity date.  Note B bears an interest rate of
10%.   As a result of six amendments to Note B, the principal
amount of Note B was increased to $750,000 and the maturity date was extended to
December 31, 2008. During the twelve months ended December 31, 2008, the Company
received $523,113 on this loan and the Company paid $150,000 down on the
principal of this loan..  As of December 31, 2008, the balance on this
loan is $710,956 ($648,613 in principal and $62,343 in
interest).  This note is currently in default.





14





In June
2008, Greystone Business Credit II and the Company entered into a loan
agreement. During the twelve months ended December 31, 2008 the Company was
advanced an additional $1,407,017.In addition, the Company
borrowed an additional $2,289,926 for the purchase of the “Babe”. These monies
were collateralized by the two vessels.   As of December 31,
2008, the balance on the loan from Greystone was $5,252,552 ($5,149,503 in
principal, $86,669 in interest and $16,380 in loan service fees.  On February 9, 2009, the Company received a notice of default
from Greystone.    On March 6, 2009, Greystone Business
Credit II, LLC filed against Marine Growth Canada, Ltd., Marine Growth Finance
& Charter, Inc., Marine Growth Ventures, Inc., Fractional Marine, Inc., and
all other parties interested in the ship “Pacific Aurora” in the Federal Court
in Vancouver, BC Canada for admiralty action to foreclose its lien and acquire
ownership and possession of the ship.     Greystone
seeks judgment in the amount of $2,851,919 against Marine Growth Canada, Ltd.,
Marine Growth Finance and Marine Growth Ventures.   Additionally,
Greystone seeks judgment against Fractional Marine in the amount of
$215,193.   This suit is currently pending.




We
currently do not have sufficient cash reserves to meet all of our anticipated
obligations for the next twelve months and there can be no assurance that we
will ultimately close on the necessary financing. In addition to any third-party
financing we may obtain, we currently expect that loans from our stockholders
may be a continuing source of liquidity to fund our operations, however, it is
not a guarantee.   Accordingly, we will need to seek funding in
the near future.





Our
ability to continue as a going concern is dependent on our ability to obtain
additional funds through debt and equity funding as well as from sales of
various services.   The Company expects to
sell the “Pacific Aurora” and the “Babe” during the twelve months ending
December 31, 2009, which is expected go produce cash flow for the
company.





Off-Balance
Sheet Arrangements





The Company does not have any off
balance sheet arrangements that are reasonably likely to have a current or
future effect on our financial condition, revenues, results of operations,
liquidity or capital expenditures.





Critical
Accounting Policies





Going
Concern:





Our ability to continue as
a going concern is dependent on our ability to obtain additional funds through
debt and equity funding as well as from sales of various
services.The Company expects to sell its two vessels
during the twelve months ending December 31, 2009.   With these
sales the Company anticipates that it will become less reliant on short-term
financing.





Item
      8.
            Financial
      Statements





The consolidated financial statements
of Marine Growth Ventures, Inc. and subsidiaries, including the notes thereto,
together with the report thereon of Demetrius & Company, is presented
beginning at page F-1.





15





Item
      9.
            Changes
      In and Disagreements with Accountants on Accounting Procedures and
      Financial Disclosures





On May 3,
2007, Marine Growth Ventures, Inc. (the “Company”) terminated the services of
Weinberg & Company, PC (“Weinberg”) as its independent registered public
accountants. The decision to terminate the services of Weinberg was recommended
and approved by the Company’s Board of Directors.





During
the two fiscal years ended December 31, 2005 and 2006, and through May 3, 2007,
(i) there were no disagreements between the Company and Weinberg on any matter
of accounting principles or practices, financial statement disclosure or
auditing scope or procedure which, if not resolved to the satisfaction of
Weinberg would have caused Weinberg to make reference to the matter in its
reports on the Company’s financial statements, and (ii) except for Weinberg’s
report on the Company's December 31, 2006 and 2005 financial statements, which
included an explanatory paragraph wherein they expressed substantial doubt about
the Company's ability to continue as a going concern, Weinberg’s reports on the
Company’s financial statements did not contain an adverse opinion or disclaimer
of opinion, or was modified as to audit scope or accounting principles. During
the two fiscal years ended December 31, 2006 and 2005 and through May 3, 2007,
there were no reportable events as the term described in Item 304(a)(1)(iv) of
Regulation S-B.





On May 3,
2007, the Company engaged the firm of Demetrius & Company, L.L.C.
(“Demetrius”) to serve as its independent registered public accountants. The
decision to hire Demetrius was recommended and approved by the Company’s Board
of Directors.





Item
      9A.
            Controls
      and Procedures.





Managements
Report on Internal Control over Financial Reporting.




The
Company’s  management are responsible for establishing and maintaining
adequate internal control over financial reporting (as defined in
Rules 13a-15(f) and 15d-15(f) under the Exchange Act). The
Company’s  internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in
accordance with GAAP. The Company’s 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 dispositions of our assets;





- provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with GAAP, and that receipts
and expenditures of our company are being made only in accordance with
authorizations of our management and directors; 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.





Because
of its 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. Under the supervision and with
the participation of our management, the Company assessed the effectiveness of
the internal control over financial reporting as of December 31, 2008. In
making this assessment, we used the criteria set forth in Internal Control-Integrated
Frameworkissued by the Committee of Sponsoring Organizations of the
Treadway Commission. Based on the results of this assessment and on those
criteria, the Company concluded that a material weakness exists in the internal
controls as of December 31, 2008.




16




A
material weakness in the Company’s internal controls exists in that there is
limited segregation of duties amongst the Company’s employees with respect to
the Company’s preparation and review of the Company’s financial
statements.   Additionally, there is an insufficient number of
personnel with an appropriate level of experience and knowledge of the U.S. GAAP
and SEC reporting requirements.  This material weakness is a result of
the Company’s limited number of employees. This material weakness may affect
management’s ability to effectively review and analyze elements of the financial
statement closing process and prepare financial statements in accordance with
U.S. GAAP.  In making this assessment, our management used the
criteria established in Internal Control — Integrated
Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO). As a result of the material weaknesses described
above, our management concluded that as of March 30, 2009, we did not maintain
effective internal control over financial reporting based on the criteria
established in Internal
Control — Integrated Framework issued by the COSO.




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





Changes
in internal control





There
were no changes in the small business issuer’s internal control over financial
reporting identified in connection with the company evaluation required by
paragraph (3) of Rule 13a-15 or Rule 15d-15 under the Exchange Act that occurred
during the small business issuer’s fiscal year that has materially affected or
is reasonably likely to materially affect the small business issuer’s internal
control over financial reporting





Item
      9B.
            Other
      Information





On March
6, 2009,  Greystone Business Credit II, LLC filed against Marine
Growth Canada, Ltd., Marine Growth Finance & Charter, Inc., Marine Growth
Ventures, Inc., Fractional Marine, Inc., and all other parties interested in the
ship “Pacific Aurora” in the Federal Court in Vancouver, BC Canada for admiralty
action to foreclose its lien and acquire ownership and possession of the
ship.





Changes
in Control of Registrant


None





Change
of Management




None





Entry
into a Material Definitive Agreement





None




17





PART
III





Item
10. Directors,
Executive Officers, Promoters and Control Persons; Compliance with Section 16(a)
of the Exchange Act




MANAGEMENT




DIRECTORS
AND EXECUTIVE OFFICERS





Our
executive officers and directors and their respective ages and positions as of
December 31, 2006 are as follows:




Name
              Age
              PositionDavid
      Marks
              41
              Chairman
      of the BoardCraig
      Hodgkins
              47
              President
      and DirectorCapt.
      Timothy Levensaler
              50
              Chief
      Operating Officer and DirectorKatherine
      Ostruszka
              38
              Chief
      Financial Officer and ControllerFrank
      J. Orlando
              36
              Executive
      Vice President and DirectorPaul
      Schwabe
              51
              Secretary
      and Director





Executive
Biographies





David Marks,Chairman of the
Board - Mr. Marks has served as our Chairman since October
2004.    Mr. Marks has served as Chairman and member of the
board of Titan Global Holdings, Inc., a high-growth diversified holding company
with a dynamic portfolio of companies engaged in emerging telecommunications
markets and advanced technologies, since August 2002.  Mr. Marks was
the former Chairman of Thomas Equipment, Inc., a company engaged in the
manufacture and distribution of compact equipment and a distributor of pneumatic
and hydraulic components, from November 2004 to November
2006.   Mr. Marks is the Managing Member of Farwell Equity
Partners, LLC and Farwell Equity Partners II, LLC, investors in high growth
small cap companies.   David Marks serves as the Trustee of the
Irrevocable Children's Trust, Irrevocable Children's Trust No.2, Phoenix
Business Trust and as principal officer of their respective subsidiary
investments, positions he has held since 1994, where he oversees all trust
investments, with responsibilities that begin pre-acquisition and extend through
ownership and disposition. Investments include real estate, natural resources,
marine and casino gaming, telecommunications and technology.  David
Marks has a B.S. in economics from the University of Wisconsin.





Craig Hodgkins,President -
Mr. Hodgkins has been our President since July 2004.  From June 2002
until July 2004 Mr. Hodgkins was an executive vice president and technical
manager for Sophlex Ship Management, Inc., responsible for all technical and
engineering programs and maintenance systems for various ships
worldwide.  From June 1999 until March 2002 Mr. Hodgkins was president
and general manager of the Sahara Hotel and Casino in Las Vegas, Nevada,
responsible for all aspects of entire operation including casino operations,
hotel, food and beverage, engineering, marketing and human
resources.  Mr. Hodgkins received a B.S. in Marine Engineering and a
minor in Business from Maine Maritime Academy, Castine, ME in 1983.





Capt. Timothy Levensaler,Chief Operating Officer - Capt. Levensaler has been our Chief Operating
Officer since September 2004.  From January 2000 until September 2004
he was the president of Sophlex Ship Management, Inc., a Company which he
founded to provide ship crew and management services.  Capt.
Levensaler has numerous licenses and certificates and received a B.S. in
Nautical Science/Marine Transportation from the Maine Maritime Academy, Castine,
ME in 1983. In addition Capt. Levensaler holds a valid USCG unlimited Masters
License, which qualifies him to be a Captain.





Katherine Ostruszka, Chief
Financial Officer – Ms. Ostruszka was our controller since September 2004 and
has been our Chief Financial Officer since July 2005. Ms. Ostruszka has over
fourteen years of experience in financial analysis particularly in the areas of
real estate, gaming, telecommunications and technology while working for Phoenix
Investors, LLC and its family of companies. In addition, Ms. Ostruszka is also
currently and has been the controller for Phoenix Investors, LLC since 2004.
From 1997 until 2004 Ms. Ostruszka was employed by the Waukesha County Technical
College. Ms. Ostruszka also holds a position as an economics instructor at
Waukesha County Technical College, Wisconsin. Ms. Ostruszka received a BA in
Economics and International Affairs from Marquette University and a MS in
Management from the University of Wisconsin – Milwaukee.




18




Frank J. Orlando,Executive
Vice President - Mr. Orlando has been our Executive Vice President since
September 2004.  From September 1996 until April 2002 Mr. Orlando was vice
president and director of corporate development for Phoenix Internet
Technologies, Inc., a start up Internet service provider (ISP). In April
2002, Phoenix Internet Technologies, Inc. was sold and Mr. Orlando was retained
by the new owners and worked there in a similar capacity until September
2003.  From September 2003 through September 2004, Mr. Orlando acted as a
consultant to Phoenix Investors, LLC.  Mr. Orlando received Bachelors
Degrees in Marketing and Production & Operations Management from the
University of Wisconsin in 1995.




Paul Schwabe,Secretary - Mr.
Schwabe has been our Secretary since April 2004.  Since April 1994,
Mr. Schwabe has served as vice president for Phoenix Investors, LLC. In that
capacity he has also served as an officer for many subsidiaries of Irrevocable
Children's Trust and Irrevocable Children's Trust No. 2 and their affiliates.
Mr. Schwabe has extensive experience in the management of real estate and the
administration of various businesses.




Board
of Directors





Our
Directors are elected by the vote of a majority in interest of the holders of
our voting stock and hold office until the expiration of the term for which he
or she was elected and until a successor has been elected and
qualified.





A
majority of the authorized number of directors constitutes a quorum of the Board
for the transaction of business.  The directors must be present at the
meeting to constitute a quorum.  However, any action required or
permitted to be taken by the Board may be taken without a meeting if all members
of the Board individually or collectively consent in writing to the
action.





Directors
may receive compensation for their services and reimbursement for their expenses
as shall be determined from time to time by resolution of the
Board.  Each of our directors currently receives no compensation for
their service on the Board of Directors.




Limitation
on Liability and Indemnification of Directors and Officers




Our
certificate of incorporation provides that no director or officer shall have any
liability to the company if that person acted in good faith and with the same
degree of care and skill as a prudent person in similar
circumstances.




Our
certificate of incorporation and bylaws provide that we will indemnify our
directors and officers and may indemnify our employees or agents to the fullest
extent permitted by law against liabilities and expenses incurred in connection
with litigation in which they may be involved because of their offices or
positions with us.  However, nothing in our certificate of
incorporation or bylaws protects or indemnifies a director, officer, employee or
agent against any liability to which that person would otherwise be subject by
reason of willful misfeasance, bad faith, gross negligence or reckless disregard
of the duties involved in the conduct of that person’s office or
position.  To the extent that a director has been successful in
defense of any proceeding, the Delaware General Corporation Law provides that
the director shall be indemnified against reasonable expenses incurred in
connection with the proceeding.




19




Code
of Ethics




We have
not as yet adopted a code of ethics that applies to our directors, principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions.  We plan to adopt
a code of ethics in the near future, at which time, it will be available in
print to any person who requests it and on our website, when our website is
completed. Any amendments and waivers to the code will also be available in
print and on our website.




Item
      11.
            Executive
      compensation





The
following table sets forth the annual and long-term compensation paid to our
Chief Executive Officer and the other executive officers who earned more than
$100,000 per year at the end of the last completed fiscal year.  We
refer to all of these officers collectively as our "named executive
officers."




Summary
Compensation Table




Name
      & Principal Position
                      
                      Year
                      
                      
                      Accrued
                        Salary
      ($)
                      
                      
                      Bonus
                        ($)
                      
                      
                      Stock
                        Awards
                        ($)
                      
                      
                      Option
                        Awards
                        ($)
                      
                      
                      Non-Equity
                        Incentive
      Plan
                        Compensation
                        ($)
                      
                      
                      Change
      in
                        Pension
      Value
                        and
      Non-
                        Qualified
                        Deferred
                        Compensation
                        Earnings
      ($)
                      
                      
                      All
      Other
                        Compensation
                        ($)
                      
                      
                      Total
      ($)Craig
      Hodgkins
                        President
                      
                      
                      2008
                        2007
                      
                      
                      
                      100,000
                        100,000
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      100,000
                        100,000Timothy
      Levensaler
                        Chief
      Operating
                        Officer
                      
                      
                      2008
                        2007
                      
                      
                      
                      16,666
                        100,000
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      16,666
                        100,000
                      *Katherine
      Ostruszka
                        Chief
      Financial
                        Officer
                      
                      
                      2008
                        2007
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0
                      
                      
                      
                      0
                        0




* In June 2008, Levensaler
exchanged $241,667 worth of accrued payroll in exchange for 100,000 shares of
common stock.    The Company reported $241,577 in additional
paid in capital and $100 in common stock on the financials.  The stock
was valued based on the five day average trading value of the stock on the date
of the exchange.




Employment
Agreements with Executive Officers





None




Outstanding
Equity Awards at Fiscal Year-End Table.




Option
      Awards
                                                              
                                                              
                                                              Stock
      AwardsName
                                                              
                                                              Number
                                                                of
                                                                Securities
                                                                Underlying
                                                                Unexercised
                                                                Options
                                                                (#)
                                                                Exercisable
                                                              
                                                              
                                                              Number
                                                                of
                                                                Securities
                                                                Underlying
                                                                Unexercised
                                                                Options
                                                                (#)
                                                                Unexercisable
                                                              
                                                              
                                                              Equity
                                                                Incentive
                                                                Plan
                                                                Awards:
                                                                Number
                                                                of
                                                                Securities
                                                                Underlying
                                                                Unexercised
                                                                Unearned
                                                                Options
                                                                (#)
                                                              
                                                              
                                                              Option
                                                                Exercise
                                                                Price
                                                                ($)
                                                              
                                                              
                                                              Option
                                                                Expiration
                                                                Date
                                                              
                                                              
                                                              Number
                                                                of
      Shares
                                                                or
      Units
                                                                of
      Stock
                                                                That
                                                                Have
                                                                Not
                                                                Vested
                                                                (#)
                                                              
                                                              
                                                              Market
                                                                Value
                                                                of
                                                                Shares
                                                                or
                                                                Units
                                                                of
                                                                Stock
                                                                That
                                                                Have
                                                                Not
                                                                Vested
                                                                ($)
                                                              
                                                              
                                                              Equity
                                                                Incentive
                                                                Plan
                                                                Awards:
                                                                Number
                                                                of
                                                                Unearned
                                                                Shares,
                                                                Units
      or
                                                                Other
                                                                Rights
                                                                That
                                                                Have
                                                                Not
                                                                Vested
                                                                (#)
                                                              
                                                              
                                                              Equity
                                                                Incentive
                                                                Plan
                                                                Awards:
                                                                Market
                                                                or
      Payout
                                                                Value
                                                                of
                                                                Unearned
                                                                Shares,
                                                                Units
      or
                                                                Other
                                                                Rights
                                                                That
                                                                Have
                                                                Not
                                                                Vested
                                                                ($)Not
      applicable at this time




20




As of December 31, 2008, the Company
has no outstanding options, restricted stocks or similar awards.




Director
Compensation




Name
                        (a)
                      
                      Fees
                        Earned
                        or
      Paid
                        in
      Cash
                        ($)
                        (b)
                      
                      
                      Stock
                        Awards
                        ($)
                        (c)
                      
                      
                      Option
                        Awards
                        ($)
                        (d)
                      
                      
                      Non-Equity
                        Incentive
      Plan
                        Compensation
                        ($)
                        (e)
                      
                      
                      Change
      in
                        Pension
                        Value
      and
                        Nonqualified
                        Deferred
                        Compensation
                        Earnings
                        (f)
                      
                      
                      All
      Other
                        Compensation
                        ($)
                        (g)
                      
                      
                      Total
                        ($)
                        (h)David
      M. Marks
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0Craig
      Hodgkins
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      100,000
                      *
                      
                      
                      100,000Timothy
      Levensaler
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      16,666
                      *
                      
                      
                      16,666
                      **Frank
      J. Orlando
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0Paul
      Schwabe
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0
                      
                      
                      
                      0


*This
compensation is for payroll earned as employee of the Company.  No
compensation is paid to these individuals for their services as directors of the
Company.
 ** In June 2008,
Levensaler exchanged $241,667 worth of accrued payroll in exchange for 100,000
shares of common stock.    The Company reported $241,577 in
additional paid in capital and $100 in common stock on the
financials.  The stock was valued based on the five day average
trading value of the stock on the date of the exchange.


Directors
may receive compensation for their services and reimbursement for their expenses
as shall be determined from time to time by resolution of the
Board.  As of December 31, 2008, none of the Company’s directors
currently receive any compensation for their service on the Board of
Directors





Item
      12.
            Security
      Ownership of Certain Beneficial Owners and
  Management





The
following table sets forth certain information, as of December  31,
2008 with respect to the beneficial ownership of the outstanding common stock by
(i) any holder of more than five (5%) percent; (ii) each of our executive
officers and directors; and (iii) our directors and executive officers as a
group. Except as otherwise indicated, each of the stockholders listed below has
sole voting and investment power over the shares beneficially
owned.





Name
      of
                      Beneficial
      Owner (1)
                    
                    Number
      of Shares Beneficially
                      Owned
      (2)
                    
                    
                    Percent
      of
                      TotalDavid
      Marks
                    
                    
                    18,025,000
                    (3)
                    
                    
                    82.53
                    %Craig
      Hodgkins
                    
                    
                    1,005,000
                    
                    
                    
                    4.60
                    %Capt.
      Timothy Levensaler
                    
                    
                    1,115,000
                    
                    
                    
                    5.10
                    %Frank
      J. Orlando
                    
                    
                    112,500
                    
                    
                    
                    *Katherine
      Ostruszka
                    
                    
                    2,500
                    
                    
                    
                    *Paul
      Schwabe
                    
                    
                    2,500
                    
                    
                    
                    *Farwell
      Equity Partners II, LLC
                    
                    
                    18,000,000
                    (3)
                    
                    
                    82.41
                    %All
      Executive Officers and Directors as a Group (6 persons)
                    
                    
                    20,162,500
                    
                    
                    
                    92.78
                    %




21




* Less
than 1%


(1)
            Except
      as otherwise indicated, the address of each beneficial owner is c/o Marine
      Growth Ventures, Inc., 405-A Atlantis Road, Cape Canaveral, FL
      32920.


(2)
            Beneficial
      ownership is determined in accordance with the rules of the Securities and
      Exchange Commission and generally includes voting or investment power with
      respect to the shares shown. Except where indicated by footnote and
      subject to community property laws where applicable, the persons named in
      the table have sole voting and investment power with respect to all shares
      of voting securities shown as beneficially owned by
  them.


(3)
            Frank
      Crivello is the majority owner of the membership interests of Farwell
      Equity Partners II, LLC. David Marks is the managing member of Farwell
      Equity Partners II, LLC, and has sole investment and dispositive power
      with respect to all shares owned by such
entity.





Item
      13.
            Certain
      Relationships and Related
Transactions





Revolving
Note





On
January 5, 2006 the Company entered into a Revolving Note (“Note A”) with an
aggregate principal amount of $50,000 to Frank Crivello. Funds are advanced to
us as needed to pay for ongoing operations. Note A had a maturity date of June
30, 2006. As a result of eleven amendments to Note A, the principal amount of
Note A was increased to $800,000 and the maturity date of Note A was extended to
February 20, 2009. Note A has an interest rate of 10% and as of December 31,
2008, the principal balance was $59,500.  This note is currently in
default.





Revolving
Note





On August
1, 2007, the Company issued a revolving note (“Note B”), with an aggregate
principal amount of $100,000 to an entity that is controlled by the Chairman of
the Board of Directors.   Funds are advanced to the Company, as
needed, to finance ongoing operations.  Note B had a maturity date of
July 31, 2008.  It has been agreed that the maturity date will extend
to December 31, 2008 unless the lender notifies the borrower, in writing, thirty
days prior to the maturity date.  Note B bears an interest rate of
10%.   On September 6, 2007 a first amendment was issued on Note
B increasing the aggregate amount to $200,000.  On November 27, 2007 a
second amendment was issued on Note B increasing the aggregate amount to
$300,000. On January 4, 2008 a third amendment was issued on Note B increasing
the aggregate amount to $400,000.  On February 11, 2008 a fourth
amendment was issued on Note B increasing the aggregate amount to
$500,000.  On April 16, 2008, a fifth amendment was issued on Note B
increasing the aggregate amount to $650,000, confirming the maturity date of
Note B as December 31, 2008 and waiving all accrued and unpaid interest on Note
B in the event of a repayment of Note B in full prior to September 30,
2008.  On June 25, 2008, a sixth amendment was issued on Note B
increasing the aggregate amount to $750,000.  The principal balance on
Note B was $648,613 as of December 31, 2008.  This note is currently
in default.





Consulting
Services





The
company is using a related party for consulting services. As of December 31,
2008 and 2007, the Company was charged $0 and $77,500 respectively.




Director
Independence




The Board
of Directors has analyzed the independence of each director and has determined
that the following directors are independent as defined under the National
Association of Securities Dealers Automated Quotations System (“NASDAQ”) rules
and has no direct or indirect material relationships with the
Company:




None




22




Item
      14.
            Principal
      Accountant Fees and Services





The
aggregate fees billed by our principal accountant for the audit of our annual
financial statements, review of financial statements included in the quarterly
reports and other fees that are normally provided by the accountant in
connection with statutory and regulatory filings or engagements for the fiscal
years ended December 31, 2008 and 2007 were $48,000 and $41,388, respectively.
In addition $5,317 of fees were paid to our former auditor Weinberg &
Company, PA  in connection termination fees.








Item
      15.
            Exhibits




Number
              Description1.
              Financial
      Statements:  See “Index to Consolidated Financial Statements” in
      Part II, Item 8 of the Form
10-K.





2.
            Financial
      Statement Schedule:  Schedules are included in the Consolidated
      Financial Statements or notes of this Form 10-K or are not
      required.





3.
            Exhibits:  The exhibits
      listed in the accompanying index to exhibits are filed or incorporated by
      reference as part of this Form
10-K.




3.1
            Registrant's
      Certificate of Incorporation, incorporated by reference to Exhibit 3.1, to
      the Company’s registration statement on Form SB-2 (the “SB-2”), filed with
      the Securities and Exchange Commission (the “SEC”) on September 2,
      2005.3.2
            Certificate
      of Amendment to Registrant's Certificate of Incorporation, incorporated by
      reference to Exhibit 3.2, to the Company’s SB-2, filed with the SEC on
      September 2, 2005.3.3
            Certificate
      of Amendment to Registrant's Certificate of Incorporation, incorporated by
      reference to Exhibit 3.3, to the Company’s SB-2, filed with the SEC on
      September 2, 2005.3.4
            Certificate
      of Amendment to Registrant's Certificate of Incorporation, incorporated by
      reference to Exhibit 3.4, to the Company’s SB-2, filed with the SEC on
      September 2, 2005.3.5
            Registrant's
      By-Laws, incorporated by reference to Exhibit 3.5, to the Company’s SB-2,
      filed with the SEC on September 2, 2005.10.1
            Sale
      and Purchase Agreement, by and between British Columbia Discovery Voyages,
      Inc., T. Jones Enterprises, Inc. and Trevor Jones, as sellers, and Marine
      Growth Ventures, Inc., as buyer. (incorporated by reference to Exhibit
      10.1 of Form 8-K filed March 28, 2007)10.2
            Loan
      and
      Security  Agreement  between  Greystone  Business
      Credit II LLC, Marine Growth Canada, Ltd. and Marine Growth Finance &
      Charter, Inc., dated as of March 27, 2007  (incorporated by
      reference to Exhibit 10.2 of Form 8-K filed March 28,
  2007)10.3
            Guaranty
      in favor of Greystone Business Credit II LLC, by and among Marine Growth
      Ventures, Inc., Marine Growth Canada, Ltd. and Marine Growth Finance &
      Charter, Inc., dated as of March 27, 2007 (incorporated by reference to
      Exhibit 10.3 of Form 8-K filed March 28,
2007)




23


10.4
                                              Revolving
      Note by and among Marine Growth Ventures, Inc., its subsidiaries and Frank
      P. Crivello (incorporated by reference to Exhibit 10.4 of Form 8-K filed
      March 28, 2007)10.5
                                              First
      Amendment to Revolving Note by and among Marine Growth
                                                Ventures,
      Inc., its subsidiaries and Frank P. Crivello (incorporated by reference to
      Exhibit 10.5 of Form 8-K filed March 28, 2007)10.6
                                              Second
      Amendment to Revolving Note by and among Marine Growth
                                                Ventures,
      Inc., its subsidiaries and Frank P. Crivello (incorporated by reference to
      Exhibit 10.6 of Form 8-K filed March 28, 2007)10.7
                                              Third
      Amendment to Revolving Note by and among Marine Growth Ventures, Inc., its
      subsidiaries and Frank P. Crivello (incorporated by reference to Exhibit
      10.7 of Form 8-K filed March 21, 2007)10.8
                                              Forth
      Amendment to Revolving Note by and among Marine Growth
                                                Ventures,
      Inc., its subsidiaries and Frank P. Crivello (incorporated by reference to
      Exhibit 10.8 of Form 8-K filed March 28, 2007)10.9
                                              Fifth
      Amendment to Revolving Note by and among Marine Growth
                                                Ventures,
      Inc., its subsidiaries and Frank P. Crivello (incorporated by reference to
      Exhibit 10.9 of Form 8-K filed March 28, 2007)10.10
                                              Sixth
      Amendment to Revolving Note by and among Marine Growth Ventures, Inc., its
      subsidiaries and Frank P. Crivello.(incorporated by
      reference to Exhibit 10.10 of Form 8-K filed March 28,
    2007)10.11
                                              Seventh
      Amendment to Revolving Note by and among Marine Growth
                                                Ventures,
      Inc., its subsidiaries and Frank P. Crivello (incorporated by reference to
      Exhibit 10.11 of Form 8-K filed March 28, 2007)10.12
                                              Share
      Ship Agreement, date April 11, 2007, by and between Euro Oceans, Ltd.,
      Marine Growth Ventures, Inc., Marine Growth Canada, Ltd., Sophlex Ship
      Management, Inc. and Ship Timeshare Management, Inc. (incorporated by
      reference to Exhibit 10.1 of Form 8-K filed April 17,
  2007)10.13
                                              Eighth
      Amendment to Revolving Note by and among Marine Growth Ventures, Inc., its
      subsidiaries and Frank P. Crivello (incorporated by reference to Exhibit
      10.1 of Form 8-K filed May 17,
2007)
 10.14
                  Ninth
      Amendment to Revolving Note by and among Marine Growth Ventures, Inc., its
      subsidiaries and Frank P. Crivello (incorporated by reference to Exhibit
      10.10 of Form 8-K filed July 5, 2007)10.15
                  Bareboat
      Charter by and between Fractional Marine, Inc. and Greystone Maritime
      Holdings LLC, dated July 30, 2007 (incorporated by reference to Exhibit
      10.1 of Form 8-K filed August 7, 2007)10.16
                  Revolving
      Note by and among Marine Growth Ventures, Inc., its subsidiaries and
      Irrevocable Children’s Trust, dated August 1, 2007 (incorporated by
      reference to Exhibit 10.2 of Form 8-K filed August 7,
  2007)10.17
                  First
      Amendment to Revolving Note by and among Marine Growth Ventures, Inc., its
      subsidiaries and Irrevocable Children’s Trust, dated September 6, 2007
      (incorporated by reference to Exhibit 10.2 of Form 8-K filed September 10,
      2007)




24




10.18
                  Tenth
      Amendment to Revolving Note by and among Marine Growth Ventures, Inc., its
      subsidiaries and Frank P. Crivello (incorporated by reference to Exhibit
      10.11 of Form 8-K filed September 25, 2007)10.19
                  Second
      Amendment to Revolving Note by and among Marine Growth Ventures, Inc., its
      subsidiaries and Irrevocable Children’s Trust, dated November 27, 2007
      (incorporated by reference to Exhibit 10.3 of Form 8-K filed November 28,
      2007)10.20
                  Third
      Amendment to Revolving Note by and among Marine Growth Ventures, Inc., its
      subsidiaries and Irrevocable Children’s Trust, dated January 4, 2008
      (incorporated by reference to Exhibit 10.4 of Form 8-K filed January 8,
      2008)10.21
                  Forth
      Amendment to Revolving Note by and among Marine Growth Ventures, Inc., its
      subsidiaries and Irrevocable Children’s Trust, dated February 11, 2008
      (incorporated by reference to Exhibit 10.5 of Form 8-K filed February 14,
      2008)10.22
                  Eleventh
      Amendment to Revolving Note by and among Marine Growth Ventures, Inc., its
      subsidiaries and Frank P. Crivello, dated March 19, 2008 (filed
      herewith)10.23
                  Fifth
      Amendment to the Revolving Note by and among Marine Growth Ventures, Inc.,
      its subsidiaries and Irrevocable Children’s Trust, dated April 16, 2008
      (incorporated by reference to Exhibit 10.6 of Form 8-K filed April 16,
      2008)10.24
                  Modification
      lf Agreement dated June 12, 2008 (incorporated by reference to Exhibit
      10.1 of Form 8-k filed August 11, 2008)10.25
                  Sixth
      Amendment to the Revolving Note by and among Marine Growth Ventures, Inc.,
      its subsidiaries and Irrevocable Children’s Trust, dated June 25, 2008
      (incorporated by reference to Exhibit 10.7 of Form 8-K filed June 26,
      2008)10.26
                  Notice
      of default under Marine Growth Loan Agreement with Greystone Business
      Credit II, LLC dated February 9, 2009 (incorporated by reference to
      Exhibit 2.1 of Form 8-K filed on February 13, 2009)10.27
                  Employment
      agreement dated July 1, 2004 between the Company and Craig Hodgkins,
      incorporated by reference to Exhibit 10.1, to the Company’s SB-2, filed
      with the SEC on September 2, 2005.10.28
                  Employment
      agreement dated July 1, 2004 between the Company and Capt. Timothy
      Levensaler, incorporated by reference to Exhibit 10.2, to the Company’s
      SB-2, filed with the SEC on September 2, 200521.1
                  List
      of Subsidiaries, incorporated by reference to Exhibit 21.1, to the
      Company’s SB-2, filed with the SEC on September 2,
2005.31.1
                  Certification
      of CEO Pursuant to 13a-14(a) under the Exchange Act31.2
                  Certification
      of the CFO Pursuant to 13a-14(a) under the Exchange Act32.1
                  Certification
      of the CEO pursuant to 18 U.S.C Section 135032.2
                  Certification
      of the CFO pursuant to 18 U.S.C. Section
1350


25





SIGNATURES




Pursuant
to the requirements of section 13 or 15 (d) of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.


MARINE
      GROWTH VENTURES, INC.Dated:  April
      15, 2009
                              
                              By:
                              /s/  Craig
      HodgkinsCraig
      HodgkinsPresident
      and Director(Principal
      Executive Officer)Date:  April
      15, 2009
                              
                              By:
                              /s/
      Katherine OstruszkaKatherine
      OstruszkaChief
      Financial Officer and Controller(Principal
      Financial
Officer)
 
 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*/s/ David Marks
              
              Chairman
      of the Board
              
              April
      15, 2009David
      Marks* /s/ Craig Hodgkins
              
              President
      and Director
              
              April
      15, 2009Craig
      Hodgkins*  /s/ Katherine
      Ostruszka
              
              Chief
      Financial Officer and ControllerKatherine
      Ostruszka
              
              (Principal  Accounting
      Officer and Principal
                Financial
      Officer)
              
              April
      15, 2009* /s/ Capt Timothy
    Levensaler
              
              Chief
      Operating Officer and Director
              
              April
      15, 2009Capt.
      Timothy Levensaler* /s/ Paul Schwabe
              
              Secretary
      and Director
              
              April
      15, 2009Paul
      Schwabe
 
 26





Marine
Growth Ventures, Inc.


And
Subsidiaries


Consolidated
Financial Statements


For
the Years Ended December 31, 2008 and 2007





27





Marine
Growth Ventures, Inc. and Subsidiaries





Table of Contents
                      
                      PageReport
      of Independent Registered Public Accounting Firm-Demetrius & Company,
      L.L.C.
                      
                      
                      F-1Consolidated
      Balance Sheets as of  December 31,  2008 and
      2007
                      
                      
                      F-2Consolidated
      Statements of Operations for the Years endedDecember
      31, 2008 and 2007
                      
                      
                      F-3Consolidated
      Statements of Stockholders’ Deficiency for the
                        Years
      ended December 31, 2008 and 2007
                      
                      
                      F-4Consolidated
      Statements of Cash Flow for the Years endedDecember
      31, 2008 and 2007
                      
                      
                      F-5Notes
      to Consolidated Financial Statements as of December 31,
    2008
                      
                      
                      F7-F13




28




Report
of Independent Registered Public Accounting Firm





To
The Board of Directors and


Shareholders
of Marine Growth Ventures, Inc.





We have
audited the accompanying consolidated balance sheets of Marine Growth Ventures,
Inc. and its subsidiaries as of December 31, 2008 and 2007 and the related
consolidated statements of operations, stockholders' equity and cash flows for
each of the two years in the period ended December 31, 2008.  These
consolidated financial statements are the responsibility of the Company's
management.  Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.





We
conducted our audits in accordance with the 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.  The
Company is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audit included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company’s internal control
over financial reporting.  Accordingly, we express no such
opinion.  An audit also includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing   the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.  We believe
that our audits provide a reasonable basis for our opinion.





In our
opinion, the consolidated financial statements referred to above present fairly,
in all material respects, the financial position of Marine Growth Ventures, Inc.
and subsidiaries as of December 31, 2008 and 2007, and the results of their
operations and their cash flows for each of the two years in the period ended
December 31, 2008, in conformity with accounting principles generally accepted
in the United States of America.





The
accompanying consolidated financial statements have been prepared assuming that
Marine Growth Ventures, Inc. and subsidiaries will continue as a going
concern.  As discussed in Note1 to the financial statements, the
Company requires additional working capital to meet its current
liabilities.  This condition raises substantial doubt about its
ability to continue as a going concern.   Management’s plans in
regard to this matter are more fully described in Note 1.  The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.





/s/
Demetrius & Company,  L.L.C.





Wayne,
New Jersey 07470


April 15,
2009




F-1


Marine
Growth Ventures, Inc and Subsidiaries
 Consolidated
Balance Sheets
 As  of  December
31, 2008
 
 December
      31, 2008
                                            
                                            
                                            December
      31, 2007ASSETSCURRENT
      ASSETSCash
                                            
                                            $
                                            7,897
                                            
                                            
                                            $
                                            501Prepaid
      Expenses
                                            
                                            
                                            734
                                            
                                            
                                            
                                            719Loan
      Reserve
                                            
                                            
                                            -
                                            
                                            
                                            
                                            67,916Vessels
      Held for Sale
                                            
                                            
                                            2,923,670
                                            
                                            
                                            
                                            -Total
      Current Assets
                                            
                                            
                                            2,932,301
                                            
                                            
                                            
                                            69,136FIXED
      ASSETS, NET
                                            
                                            
                                            818
                                            
                                            
                                            
                                            1,504,301PRE
      PAID FINANCING COSTS
                                            
                                            
                                            2,258
                                            
                                            
                                            
                                            20,781OTHER
      ASSETSRetainers
                                            
                                            
                                            17,500
                                            
                                            
                                            
                                            5,000Other
      Receivables
                                            
                                            
                                            -
                                            
                                            
                                            
                                            6,000Other
      Deposits
                                            
                                            
                                            1,656
                                            
                                            
                                            
                                            2,181Total
      Other Assets
                                            
                                            
                                            19,156
                                            
                                            
                                            
                                            13,181TOTAL
      ASSETS
                                            
                                            $
                                            2,954,533
                                            
                                            
                                            $
                                            1,607,399LIABILITIES
      AND STOCKHOLDER'S DEFICIENCYCURRENT
      LIABILITIESAccrued
      Payroll
                                            
                                            $
                                            434,235
                                            
                                            
                                            $
                                            581,414Accounts
      Payable
                                            
                                            
                                            539,986
                                            
                                            
                                            
                                            376,290Cash
      Overdraft
                                            
                                            
                                            -
                                            
                                            
                                            
                                            17,343Accrued
      Interest Payable
                                            
                                            
                                            209,943
                                            
                                            
                                            
                                            135,905Accrued
      Expenses
                                            
                                            
                                            259,450
                                            
                                            
                                            
                                            261,226Deferred
      Expenses
                                            
                                            
                                            -
                                            
                                            
                                            
                                            19,166Note
      Payable – Greystone
                                            
                                            
                                            5,149,503
                                            
                                            
                                            
                                            270,833Note
      Payable – Other
                                            
                                            
                                            648,613
                                            
                                            
                                            
                                            275,500Note
      Payable – Stockholder
                                            
                                            
                                            59,500
                                            
                                            
                                            
                                            769,050Total
      Current Liabilities
                                            
                                            
                                            7,301,230
                                            
                                            
                                            
                                            2,706,727LONG
      TERM LIABILITIESGreystone
      Note Payable
                                            
                                            
                                            -
                                            
                                            
                                            
                                            1,168,150Total
      Long Term Liabilities
                                            
                                            
                                            -
                                            
                                            
                                            
                                            1,168,150TOTAL
      LIABILITIES
                                            
                                            
                                            7,301,230
                                            
                                            
                                            
                                            4,054,877STOCKHOLDERS'
      DEFICIENCYPreferred
      Stock, $0.001 par value, 5,000,000shares
      authorized, none issued or outstandingCommon
      Stock, $0.001 par value, 100,000,000shares
      authorized, 21,839,500  and 21,739,500 issued and outstanding,
      respectively
                                            
                                            
                                            21,840
                                            
                                            
                                            
                                            21,740Additional
      Paid-In Capital
                                            
                                            
                                            816,015
                                            
                                            
                                            
                                            555,699Accumulated
      Deficit
                                            
                                            
                                            (5,149,829
                                            )
                                            
                                            
                                            (2,811,862
                                            )Accumulated
      Other Comprehensive (Loss)
                                            
                                            
                                            (34,723
                                            )
                                            
                                            
                                            (33,053
                                            )Total
      Stockholders' Deficiency
                                            
                                            
                                            (4,346,697
                                            )
                                            
                                            
                                            (2,267,476
                                            )TOTAL
      LIABILITIES & STOCKHOLDERS'DEFICIENCY
                                            
                                            $
                                            2,954,533
                                            
                                            
                                            $
                                            1,607,399
 
 See
Accompanying Notes to Consolidated Financial Statements
  F-2
  Marine
Growth Ventures, Inc and Subsidiaries
 Consoldiated
Statements of Operations
 For
the Years Ended December 31, 2008 and 2007
 
 2008
                        
                        
                        2007REVENUEShip
      Management Fees and Consulting Income
                        
                        $
                        12,000
                        
                        
                        $
                        134,236Ship
      Leasing
                        
                        
                        -
                        
                        
                        
                        24,000Total
      Revenue
                        
                        
                        12,000
                        
                        
                        
                        158,236Cost
      of Sales
                        
                        
                        140,125
                        
                        
                        
                        143,947NET
      REVENUE
                        
                        
                        (128,125
                        )
                        
                        
                        14,289EXPENSESPayroll
      and Related  Expenses
                        
                        
                        180,807
                        
                        
                        
                        360,764Professional
      Fees
                        
                        
                        245,961
                        
                        
                        
                        356,478General
      and Administrative Expenses
                        
                        
                        118,927
                        
                        
                        
                        104,690Selling
      Expenses
                        
                        
                        64,257
                        
                        
                        
                        2,354Impairment
      of Vessel
                        
                        
                        864,926
                        
                        
                        
                        -Operating
      Expenses
                        
                        
                        272,448
                        
                        
                        
                        452,442Total
      Expenses
                        
                        
                        1,747,326
                        
                        
                        
                        1,276,728LOSS
      FROM OPERATIONS
                        
                        
                        (1,875,451
                        )
                        
                        
                        (1,262,439
                        )OTHER
      INCOME(EXPENSE)Other
      Income
                        
                        
                        -
                        
                        
                        
                        1Interest
      (Expense)
                        
                        
                        (368,040
                        )
                        
                        
                        (180,655
                        )Loan
      Service Fee (Expense)
                        
                        
                        (48,155
                        )
                        
                        
                        (26,198
                        )Financing
      Fees (Expense)
                        
                        
                        (20,781
                        )
                        
                        
                        (12,469
                        )Sales
      Tax (Expense)
                        
                        
                        (869
                        )
                        
                        
                        (183
                        )Other
      (Expense)
                        
                        
                        (24,671
                        )
                        
                        
                        (6,352
                        )Total
      Other (Expense)
                        
                        
                        (462,516
                        )
                        
                        
                        (225,856
                        )NET
      LOSS
                        
                        $
                        (2,317,186
                        )
                        
                        $
                        (1,488,295
                        )Basic
      and diluted loss per common share
                        
                        $
                        (0.11
                        )
                        
                        $
                        (0.07
                        )Weighted
      average number of commonshares
      outstanding - basic and diluted
                        
                        
                        21,789,637
                        
                        
                        
                        21,739,500
 
 See
Accompanying Notes To Consolidated Financial Statements
 
 F-3
 Marine
Growth Ventures, Inc. and Subsidiaries
 Consolidated
Statements of Stockholders’ Deficiency
 For
the Years Ended December  31, 2008 and 2007
 
 Common
      Stock
                    Shares
                  
                  
                  Common
      Stock
                    Amount
                  
                  
                  Additional
                    Paid-In
      Capital
                  
                  
                  Accumulated
                    Deficit
                  
                  
                  Accumulated
                    Other
                    Comprehensive
                    Income/(Loss)
                  
                  
                  TotalBalance  December
      31,  2006
                  
                  
                  21,739,500
                  
                  
                  $
                  21,740
                  
                  
                  $
                  551,949
                  
                  
                  $
                  (1,323,567
                  )
                  
                  $
                  -
                  
                  
                  $
                  (749,878
                  )Donated
      rent & services
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  3,750
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  3,750Foreign
      Currency Translation
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (33,053
                  )
                  
                  
                  (33,053
                  )Net
      loss
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (1,488,295
                  )
                  
                  
                  -
                  
                  
                  
                  (1,488,295
                  )Balance  December
      31,  2007
                  
                  
                  21,739,500
                  
                  
                  
                  21,740
                  
                  
                  
                  555,699
                  
                  
                  
                  (2,811,862
                  )
                  
                  
                  (33,053
                  )
                  
                  
                  (2,267,476
                  )Donated
      rent & services
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  18,750
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  18,750Forgiven
      Payroll for Stock
                  
                  
                  100,000
                  
                  
                  
                  100
                  
                  
                  
                  241,567
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  241,667Foreign
      Currency Translation
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (1,670
                  )
                  
                  
                  (1,670
                  )Net
      Loss
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (2,337,967
                  )
                  
                  
                  -
                  
                  
                  
                  (2,337,967
                  )Balance  December
      31,  2008
                  
                  
                  21,839,500
                  
                  
                  $
                  21,840
                  
                  
                  $
                  816,016
                  
                  
                  $
                  (5,149,829
                  )
                  
                  $
                  (34,723
                  )
                  
                  $
                  (4,346,697
                  )
 
 See
Accompanying Notes To Consolidated Financial Statements
  F-4




Marine
Growth Ventures, Inc and Subsidiaries
 Consolidated
Statements of Cash Flow
 For
the Years Ended December 31, 2008 and 2007
 
 2008
                        
                        
                        2007CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
                        
                        $
                        (2,337,967
                        )
                        
                        $
                        (1,488,295
                        )Adjustments
      to reconcile net loss to net cashused
      in operating activitiesDepreciation
      & Amortization
                        
                        
                        18,883
                        
                        
                        
                        12,912Donated
      Rent & Services
                        
                        
                        18,750
                        
                        
                        
                        3,750Impairment
      of Vessel
                        
                        
                        864,926
                        
                        
                        
                        -Changes
      in Operation Assets & Liabilities:Accounts
      Receivable
                        
                        
                        6,000
                        
                        
                        
                        (6,000
                        )Sales
      Tax Receivable
                        
                        
                        501
                        
                        
                        
                        501Retainers
                        
                        
                        (12,500
                        )
                        
                        
                        -Prepaid
      Insurance
                        
                        
                        (15
                        )
                        
                        
                        13Accrued
      Payroll
                        
                        
                        94,488
                        
                        
                        
                        233,450Accounts
      Payable
                        
                        
                        252,766
                        
                        
                        
                        270,459Accrued
      Interest Payable
                        
                        
                        207,299
                        
                        
                        
                        125,933Accrued
      Expenses
                        
                        
                        80,109
                        
                        
                        
                        155,224Deferred
      Expenses
                        
                        
                        -
                        
                        
                        
                        19,166Other
      Current Assets
                        
                        
                        525
                        
                        
                        
                        -Net
      Cash Used by Operating Activities
                        
                        
                        (806,235
                        )
                        
                        
                        (672,887
                        )CASH
      FLOWS FROM INVESTING ACTIVITIESLegal
      Fees on Ship Purchase
                        
                        
                        -
                        
                        
                        
                        (69,891
                        )Purchase
      of Fixed Assets
                        
                        
                        -
                        
                        
                        
                        (749
                        )Purchase
      of Ship Furnishings
                        
                        
                        -
                        
                        
                        
                        (20,990
                        )Net
      Cash Provided by Investing Activities
                        
                        
                        -
                        
                        
                        
                        (91,630
                        )CASH
      FLOWS FROM FINANCING ACTIVITIESLoan
      costs
                        
                        
                        -
                        
                        
                        
                        (13,000
                        )Bank
      Overdraft
                        
                        
                        (17,343
                        )
                        
                        
                        17,343Payment
      on Note Payable – Greystone
                        
                        
                        (141,499
                        )
                        
                        
                        (61,017
                        )Proceeds
      From Note Payable-Stockholder
                        
                        
                        447,078
                        
                        
                        
                        574,800Proceeds
      From Note Payable – Related Party
                        
                        
                        523,113
                        
                        
                        
                        275,500Net
      Cash Provided by Financing Activities
                        
                        
                        811,349
                        
                        
                        
                        793,626Currency
      Conversion Gain/Loss
                        
                        
                        2,783
                        
                        
                        
                        (33,053
                        )NET
      INCREASE (DECREASE) IN CASH:
                        
                        
                        7,897
                        
                        
                        
                        (3,947
                        )BEGINNING
      CASH
                        
                        
                        -
                        
                        
                        
                        3,947ENDING
      CASH
                        
                        $
                        7,897
                        
                        
                        $
                        -
 
 F-5
  SUPPLEMENTAL
      DISCLOSURES OF CASH ITEMSInterest
      Paid
                      
                      $
                      130,473
                      
                      
                      $
                      39,100SUPPLEMENTAL
      DISCLOSURES OF NON-CASH  INVESTING & FINANCING
      ACTIVITESGreystone
      (Pacific Aurora Note)
                      
                      $
                      1,347,021
                      
                      
                      $
                      -Payment
      on Note Payable Stockholder
                      
                      
                      (1,156,628
                      )
                      
                      
                      -Payment
      on Accrued Interest
                      
                      
                      (40,393
                      )
                      
                      
                      -Payment
      on Note Payable – Related Party
                      
                      
                      (150,000
                      )
                      
                      
                      -Greystone
      (Babe)
                      
                      
                      2,350,002
                      
                      
                      
                      -Purchase
      of Fixed Assets (Babe)
                      
                      
                      (2,289,926
                      )
                      
                      
                      -Payables
                      
                      
                      (60,076
                      )
                      
                      
                      -APIC
                      
                      
                      (241,567
                      )
                      
                      
                      -Common
      Stock
                      
                      
                      (100
                      )
                      
                      
                      -Accrued
      Payroll
                      
                      
                      241,667
                      
                      
                      
                      -Purchase
      of Fixed Assets (Pacific Aurora)
                      
                      
                      -
                      
                      
                      
                      (1,350,000
                      )Loan
      Costs
                      
                      
                      -
                      
                      
                      
                      (20,250
                      )Loan
      Reserve
                      
                      
                      -
                      
                      
                      
                      (67,916
                      )Legal
      Fees
                      
                      
                      -
                      
                      
                      
                      (61,834
                      )Note
      Payable – Ship Purchase
                      
                      
                      -
                      
                      
                      
                      1,500,000





See
Accompanying Notes To Consolidated Financial Statements





F-6




Marine
Growth Ventures, Inc. and Subsidiaries


Notes
to Consolidated Financial Statements


As
of December 31, 2008 and 2007





Note
      1 –
            Organization and
      Operations and Going Concern





Marine
Growth Ventures, Inc. (“MGV”) was formed and incorporated in the state of
Delaware on November 6, 2003.  MGV is a holding company that conducts
its operations primarily  through a wholly-owned subsidiary, Sophlex
Ship Management, Inc. (“Sophlex”).  MGV, Sophlex and MGV’s other
subsidiaries are referred to collectively herein as the “Company”.





The
Company had no significant business operations until its acquisition of Sophlex
on September 1, 2004.  Sophlex, which was founded in 1999, provides
ship crewing and management services to vessel owners and operators in the
United States and abroad.  The founder
and the sole shareholder of Sophlex at the time of the acquisition is the
current Chief Operating Officer of the Company.   At the time
acquisition both companies were private entities.





Since its
inception, the Company has been dependent upon the proceeds of loans from its
stockholders and the receipt of capital investments to fund its continuing
activities.  The Company has incurred operating losses since its
inception.  The Company expects to incur significant increasing
operating losses over the next several years, primarily due to the expansion of
its business.   There is no assurance that the Company’s
developmental and marketing efforts will be successful.   The
Company will continue to require the infusion of capital or loans until
operations become profitable.  There can be no assurance that the
Company will ever achieve any revenues or profitable operations from the sale of
its proposed products.  The Company is seeking additional capital at
this time.  During the twelve months ended December 31, 2008, the
Company had a net loss of $2,317,186 and a negative cash flow from operations of
$806,235 and as December 31, 2008, the Company had a working capital deficiency
of $4,368,929 and a stockholders’ deficiency of $4,346,697.  As a
result of the above, the accompanying consolidated financial statements have
been prepared assuming that the Company will continue as a going
concern.   The consolidated financial statements do not include
any adjustments that might result from the outcome of this
uncertainty.





Note
      2 -
            Summary of Significant
      Accounting Policies





(A)
            Principles of
      Consolidation





The
accompanying condensed consolidated financial statements include the accounts of
Marine Growth Ventures, Inc. and its wholly-owned subsidiaries, Marine Growth
Finance & Charter, Inc., Inc., Sophlex Ship Management, Inc., Marine Growth
Freight, Inc., Marine Aggregates, Inc., Gulf Casino Cruises, Inc., Ship
Timeshare Management, Inc., Marine Growth Canada, Ltd., Fractional Marine, Inc.,
Cruiseship Share Owners Association, Inc. and Pacific Aurora Cruise Association,
Inc.  All material inter-company accounts and transactions have been
eliminated in consolidation





(B)
            Cash





The
Company maintains its cash balances with various financial
institutions.  Balances at the institutions may at times exceed
Federal Deposit Insurance Corporation limits.





F-7





(C)
            Fixed
      Assets





Office
furniture and computer equipment is stated at cost less accumulated
depreciation.  The cost of maintenance and repairs is charged to
operations as incurred.  Depreciation is computed by the double
declining balance method over the estimated economic useful life of the assets
(5 – 7 years).





Depreciation
on vessels owned by the company is taken when the vessel is crewed and placed in
service.  Depreciation will be taken over the estimated economic
useful life of the asset (20 years).





(D)
            Revenue
      Recognition





The
Company recognizes ship management revenue and consulting revenue when
earned.  At the time of the transaction, the Company assesses whether
the fee is fixed and determinable based on the payment terms associated with the
transaction and whether collectability is reasonably
assured.   If a significant portion of a fee is due after the
normal payment terms, the Company accounts for the fee as not being fixed and
determinable. In these cases, the Company recognizes revenue as the fee becomes
due.  Where the Company provides a service at a specific point in time
and there are no remaining obligations, the Company recognizes revenue upon
completion of the service.   The Company recognizes charter
revenue on the first of the month when the fee is billed.





(E)
            Fair Value of
      Financial Instruments





The
carrying amounts of the Company’s financial instruments, including cash, accrued
payroll, accounts payable, accrued expenses, note payable- Greystone and note
payable - stockholder at December 31, 2008, approximate their fair value because
of their relatively short-term nature.





(F)
            Use of
      Estimates





The
preparation of condensed consolidated financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosures of contingent assets and
liabilities at the date of the consolidated financial statements and the
reported amounts of revenue and expenses during the reporting
period.  Actual results may differ from those estimates.





(G)
            Accounting for the
      Impairment of Long-Lived
Assets





The
long-lived assets held and used by the Company are reviewed for impairment
whenever events or changes in circumstances indicate that the carrying amount of
assets may not be recoverable.  It is reasonably possible that these
assets could become impaired as a result of technology or other industry
changes.  Determination of recoverability of assets to be held and
used is performed by comparing the carrying amount of an asset to future net
undiscounted cash flows to be generated by the assets.  If such assets
are considered to be impaired, the impairment to be recognized is measured by
the amount by which the carrying amount of assets exceed the fair value of the
assets.  Assets to be disposed of are reported at the lower of the
carrying amount or fair value less costs to sell.  Impairment of
vessel expenses including costs for disposal were $864,926 for the twelve months
ended December 31, 2008.   $300,000 was for the approximately
cost of disposal for the Babe.   The remaining $564,926 was for
the impairment of the fair market value of the Babe.





F-8





(H)
            Deposits





Deposits
as of December 31, 2008 included office rental security deposit and utility
deposit.  Deposits are reduced as charges are incurred or the funds
are returned.




(I)
            Accrued
      Expenses





Accrued
expenses as of December 31, 2008 were comprised of accrued legal
fees.





(J)
            Loss Per
      Share





Net
loss per  share (basic and diluted) has been computed by dividing the
net loss available to common stockholders by the weighted average number of
common shares outstanding during each period.  Common stock
equivalents were not included in the calculation of diluted loss per share as
there were none outstanding during the periods presented as well as their effect
would be anti-dilutive.





(K)
            Segment
      Reporting





Statement
of Financial Accounting Standards No 131 (“SFAS 131”), “Disclosure About
Segments of an Enterprise and Related Information” requires use of the
“management approach” model for segment reporting.  The management
approach model is based on the way a company’s management organizes segments
within the company for making operating decisions and assessing
performance.  Reportable segments are based on products and services,
geography, legal structure, management structure, or any other manner in which
management disaggregates a company.  Currently, SFAS 131 has no effect
on the Company’s financial statements as substantially all of the Company’s
operations are conducted in one industry segment during the years ended December
31, 2008 and 2007.





(L)
            Recent Accounting
      Pronouncements





In
February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for
Financial Assets and Financial Liabilities including an amendment of FASB
Statement No. 115” (“SFAS 159”). SFAS 159 allows all entities a one-time
election to measure many financial instruments and certain other items at fair
value that are not currently required to be measured at fair value (the “fair
value option”). SFAS 159 is effective for fiscal years beginning after
November 15, 2007. The Company does not know the full effect if any of this
statement.





In
December 2007, the FASB issued SFAS No. 141(R), “Business Combinations
(revised - 2007)” (“SFAS 141(R)”). SFAS 141(R) is a revision to previously
existing guidance on accounting for business combinations. The statement retains
the fundamental concept of the purchase method of accounting, and introduces new
requirements for the recognition and measurement of assets acquired, liabilities
assumed and noncontrolling interests. The statement is effective for fiscal
years beginning after December 15, 2008. The Company does not expect
adoption of this standard to have a material impact on its consolidated results
of operations and financial condition.





F-9





In
December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in
Consolidated Financial Statements, an amendment of ARB 51, which changes
the accounting and reporting for minority interests.  Minority
interests will be recharacterized as noncontrolling interests and will be
reported as a component of equity separate from the parent’s equity, and
purchases or sales of equity interests that do not result in a change in control
will be accounted for as equity transactions.  In addition, net income
attributable to the noncontrolling interest will be included in consolidated net
income on the face of the income statement and, upon a loss of control, the
interest sold, as well as any interest retained, will be recorded at fair value
with any gain or loss recognized in earnings.  SFAS No. 160 is
effective for us beginning July 1, 2009 and will apply prospectively, except for
the presentation and disclosure requirements, which will apply
retrospectively.  We are currently assessing the potential impact that
adoption of SFAS No. 160 may have on our financial statements.




In March 2008, the FASB issued SFAS No.
161,Disclosures about
Derivative Instruments and Hedging Activities—an amendment of FASB Statement No.
133,which requires
companies to provide additional disclosures about its objectives and strategies
for using derivative instruments, how the derivative instruments and related
hedged items are accounted for under SFAS No. 133,Accounting for
Derivative Instruments and Hedging Activities, and related interpretations, and how
the derivative instruments and related hedged items affect the Company’s
financial statements. SFAS No. 161 also requires companies to disclose
information about credit risk-related contingent features in their hedged
positions. SFAS No. 161 is effective for fiscal years and interim periods
beginning after November 15, 2008 and is required to be adopted by the Company
beginning in the second quarter of fiscal 2009. Although the Company will
continue to evaluate the application of SFAS No. 161, management does not
currently believe adoption will have a material impact on the Company’s
financial condition or operating results.





In May
2008, The FASB issued SFAS No. 162, “ The hierarchy of Generally Accepted
Accounting Principles.”  SFAS No. 162 identifies the sources of
accounting principles and the framework for selecting the principles to be used
in the preparation of financial statements of nongovernmental entities that are
presented in conformity with GAAP in the united State (The GAAP
hierarchy).  The hierarchical guidance provided by SFAS No. 162 did
not have a significant impact on the company’s financial
statements.





Note
      3-
            Related Party
      Transactions





On
January 5, 2006 the Company entered into a Revolving Note (“Note A”) with an
aggregate principal amount of $50,000 to Frank Crivello. Funds are advanced to
us as needed to pay for ongoing operations. Note A had a maturity date of June
30, 2006. As a result of eleven amendments to Note A, the principal amount of
Note A was increased to $800,000 and the maturity date of Note A was extended to
February 20, 2009. Note A has an interest rate of 10%.   During
the twelve months ended December 31, 2008, the Company received $447,078 on this
loan and the Company paid $1,197,021 down on this loan ($40,393 in interest and
$1,156,628 in principal).  As of December 31, 2008, the balance on
this loan is $120,431 ($59,500 in principal and $60,931 in
interest).  This note is currently in default.





F-10





On August
1, 2007, the Company issued a revolving note (“Note B”), with an aggregate
principal amount of $100,000 to an entity that is controlled by the Chairman of
the Board of Directors.   Funds are advanced to the Company, as
needed, to finance ongoing operations.  Note B had a maturity date of
July 31, 2008.  It has been agreed that the maturity date will extend
to December 31, 2008 unless the lender notifies the borrower, in writing, thirty
days prior to the maturity date.  Note B bears an interest rate of
10%.   As a result of six amendments to Note B, the principal
amount of Note B was increased to $750,000 and the maturity date was extended to
December 31, 2008. During the twelve months ended December 31, 2008, the Company
received $523,113 on this loan and the Company paid $150,000 down on the
principal of this loan..  As of December 31, 2008, the balance on this
loan is $710,956 ($648,613 in principal and $62,343 in
interest).  This note is currently in default.





In June
2008, an officer of the Company exchanged $241,667 worth of accrued payroll in
exchange for 100,000 shares of common stock.    The Company
reported $241,577 in additional paid in capital and $100 in common stock on the
financials.  The stock was valued based on the five day average
trading value of the stock on the date of the exchange.





The
Company utilizes space in Milwaukee, Wisconsin owned by an entity controlled by
the Chairman of the Board of Directors.    The fair market
value of this rent is $250 per month and is recorded as $3000 rent expense and a
corresponding related party liability for the twelve months ended December 31,
2008.   On December 31, 2008, this debt was forgiven and
converted into additional paid in capital.





The
Company utilizes employees of an entity controlled by the Chairman of the Board
of Directors.    In exchange for the use of these employees,
an employee of the Company completes work for an entity controlled by the
Chairman of the Board of Directors.    The value of the work
done by the employees of the entity controlled by the Chairman of the Board of
Directors exceeded the value of the work of the Company’s employee by $15,750
during the twelve months ending December 31, 2008 and was recorded as payroll
and a corresponding related party liability was recorded.   On
December 31, 2007, this debt was forgiven and converted into additional paid in
capital.





The
company used a related party for consulting services.  As of December
31, 2008 and 2007 the Company was charged $0 and $77,500,
respectively.





Note
      4 –
            Vessels Held For
      Sale





The
Company currently has two vessels held for sale.   On the vessel
the “Babe”, the Company recorded an impairment charge of $864,926 in connection
with the fair market value and the estimated disposal costs.  The
current fair market value is $1,425,000.   The Company has
reclassified the “Pacific Aurora” as held for sale.  The Company
believes that the fair market value of the vessel exceed its carrying
amount.





F-11




Note
      5 –
            Fixed
      Assets





Fixed
assets as of December 31, 2008 and 2007 consisted of:




December
      31, 2008
                              
                              
                              December
      31, 2007Office
      Furniture
                              
                              $
                              1,286
                              
                              
                              $
                              1,286Computer
      Equipment
                              
                              
                              1,827
                              
                              
                              
                              1,078Vessel
                              
                              
                              -
                              
                              
                              
                              1,481,725Vessel
      Furnishings
                              
                              
                              -
                              
                              
                              
                              20,990Less: Accumulated Depreciation
                              
                              
                              (2,294
                              )
                              
                              
                              (1,527
                              )Fixed
      Assets, net
                              
                              $
                              819
                              
                              
                              $
                              1,504,301





Depreciation
expense for the twelve months ended December 31, 2008 and 2007 amounted to $360
and $443, respectively.





The
vessel the “Pacific Aurora” was reclassified as  held for
sale.





Note
      6 –
            Greystone Business
      Credit II, LLC





In June
2008, Greystone Business Credit II and the Company entered into a loan
agreement. During the twelve months ended December 31, 2008 the Company was
advanced an additional $1,407,017.In addition, the Company
borrowed an additional $2,289,926 for the purchase of the “Babe”. These monies
were collateralized by the two vessels.   As of December 31,
2008, the balance on the loan from Greystone was $5,252,552 ($5,149,503 in
principal, $86,669 in interest and $16,380 in loan service fees.  On February 9, 2009, the Company received a notice of default
from Greystone.    On March 6, 2009, Greystone Business
Credit II, LLC filed against Marine Growth Canada, Ltd., Marine Growth Finance
& Charter, Inc., Marine Growth Ventures, Inc., Fractional Marine, Inc., and
all other parties interested in the ship “Pacific Aurora” in the Federal Court
in Vancouver, BC Canada for admiralty action to foreclose its lien and acquire
ownership and possession of the ship.     Greystone
seeks judgment in the amount of $2,851,919 against Marine Growth Canada, Ltd.,
Marine Growth Finance and Marine Growth Ventures.   Additionally,
Greystone seeks judgment against Fractional Marine in the amount of
$215,193.   This suit is currently
pending.


Note
      7 –
            Income
      Tax




Differences
between the tax provision computed using the statutory federal income tax rate
and the effective income tax rate on operations is as follows:
  2008
                      
                      
                      
                      2007U.S.
      Federal Statutory Rate
                      
                      $
                      (519,032
                      )
                      
                      $
                      (280,001
                      )Foreign
      Statutory Rate
                      
                      
                      (236,209
                      )
                      
                      
                      (177,130
                      )Total
                      
                      
                      (755,242
                      )
                      
                      
                      (457,131
                      )Tax
      Benefit not provided due to valuation allowance
                      
                      
                      755,242
                      
                      
                      
                      457,131$
                      0
                      
                      
                      $
                      0





F-12




As of
December 31, 2008, the Company has a net operating loss carryforward for U.S
Federal Income tax purposes in the aggregate of $3,938,400, which expire at
various dates through 2028.
 
 Components
of the Company’s U.S. deferred tax assets are as follows:
 
 2008
                    
                    
                    2007U.S
      deferred tax assets:U.S.
      tax benefits related to net operating loss carry forwards
                    
                    $
                    1,600,293
                    
                    
                    $
                    905,051Valuation
      allowance for U.S. deferred tax assets
                    
                    
                    (1,600,293
                    )
                    
                    
                    (905,051
                    )Net
      U.S. deferred tax assets
                    
                    $
                    0
                    
                    
                    $
                    0


Note
      8 –
            Operating
      Leases





The
Company leases its main office, located in Cape Canaveral, Florida. The lease
has a term of  24 months, which began on September 1, 2007 and expires
on August 31, 2009, with options to renew. The Company currently pays rent and
related costs of $2,382 per month with a 3% increase on each anniversary of the
lease.





The
Company utilizes space in Milwaukee, Wisconsin owned by an entity controlled by
the Chairman of the Board of Directors.    This space has
been utilized since inception. The fair market value of this rent is $250 per
month (See Note 3).





Minimum
future required lease payments under operating leases that have initial or
remaining noncancelable lease terms in excess of one year as of December 31,
2008 are as follows:





Year
      Ending December 31,
                            
                            Amount2009
                            
                            $
                            19,369




Rent
expense charged to operations was $30,167 and $27,307 in 2008 and 2007,
respectively.





Note
      9 –
            Subsequent
      Events





On March
6, 2009,  Greystone Business Credit II, LLC filed against Marine
Growth Canada, Ltd., Marine Growth Finance & Charter, Inc., Marine Growth
Ventures, Inc., Fractional Marine, Inc., and all other interested in the ship
“Pacific Aurora” in the Federal Court in Vancouver, BC Canada for admiralty
action.     Greystone seeks judgment in the amount of
$2,851,919 against Marine Growth Canada, Ltd., Marine Growth Finance and Marine
Growth Ventures.   Additionally, Greystone seeks judgment against
Fraction Marine in the amount of $215,193.   This suit is
currently pending.





F-13