UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-QSB

[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
      EXCHANGE ACT OF 1934.

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2005

                                       OR

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
      EXCHANGE ACT OF 1934. FOR THE TRANSITION PERIOD FROM TO

                        COMMISSION FILE NUMBER: 000-30781


                                 MANGOSOFT, INC.
        (Exact name of small business issuer as specified in its charter)


                 NEVADA                                87-0543565
             (State or other                (IRS Employer Identification No.)
              jurisdiction
    of incorporation or organization)


            12 TECHNOLOGY WAY
               NASHUA, NH                                 03060
 (Address of principal executive offices)              (Zip code)


                    ISSUER'S TELEPHONE NUMBER: (603) 324-0400

      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 [
]

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

              COMMON STOCK                          1,013,038 SHARES
            $0.001 Par Value               (Outstanding on November 14, 2005)


    Transitional Small Business Disclosure Format (check one) Yes [ ] No [X]


<PAGE>

                         MANGOSOFT, INC. AND SUBSIDIARY

                              INDEX TO FORM 10-QSB


<TABLE>
<CAPTION>
                                                                                             Page
<S>                                                                                          <C>
PART I.     FINANCIAL INFORMATION

ITEM 1 - Condensed Consolidated Financial Statements (unaudited):

Balance Sheets as of September 30, 2005 and December 31, 2004...................................3
Statements of Operations for the Three Months Ended September 30, 2005 and 2004 ................4
Statements of Operations for the Nine Months Ended September 30, 2005 and 2004 .................5
Statements  of Cash  Flows  for the Nine  Months  Ended  September  30,  2005 and 2004 .........6
Notes to the Condensed Consolidated Financial Statements........................................7

ITEM  2 -  Management's  Discussion  and  Analysis  of  Financial  Condition  and
           Results of Operations................................................................9

ITEM 3 - Controls and Procedures...............................................................17

PART II.    OTHER INFORMATION

ITEM 1 - Legal Proceedings.....................................................................18
ITEM 6 - Exhibits..............................................................................19

Signature......................................................................................20
Officer Certification..........................................................................21
</TABLE>


                                       2
<PAGE>

                         MANGOSOFT, INC. AND SUBSIDIARY

                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                        SEPTEMBER 30,                DECEMBER 31,
                                                                                             2005                        2004
                                                                                       ---------------              ---------------
                                                                                         (UNAUDITED)
                                     ASSETS
<S>                                                                                    <C>                          <C>
Current Assets:
     Cash and cash equivalents ...........................................             $       574,193              $       458,032
     Short-term investments ..............................................                       3,538                      346,508
     Accounts receivable .................................................                      16,505                       12,512
                                                                                       ---------------              ---------------
          Total current assets ...........................................             $       594,236              $       817,052
                                                                                       ===============              ===============

                      LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current Liabilities:
     Accounts payable ....................................................             $       732,655              $       731,850
     Accrued compensation ................................................                       3,894                       10,073
     Other accrued expenses and current liabilities ......................                      52,374                       51,274
     Deferred revenue ....................................................                          --                       20,467
                                                                                       ---------------              ---------------
          Total current liabilities ......................................                     788,923                      813,664
                                                                                       ---------------              ---------------

Commitments and contingencies

Stockholders' Equity (Deficit):
Preferred stock-$.001 par value; authorized, 5,000,000
 shares; issued and outstanding, 20,000 ..................................                          20                           20
Common stock .............................................................                       1,013                        1,013
     Additional paid-in capital ..........................................                  88,725,694                   88,725,694
     Deferred compensation ...............................................                          --                         (428)
     Accumulated deficit .................................................                 (88,921,414)                 (88,722,911)
                                                                                       ---------------              ---------------
          Total stockholders' equity (deficit) ...........................                    (194,687)                       3,388
                                                                                       ---------------              ---------------
               Total .....................................................             $       594,236              $       817,052
                                                                                       ===============              ===============

</TABLE>

     See notes to the unaudited condensed consolidated financial statements.


                                       3
<PAGE>

                         MANGOSOFT, INC. AND SUBSIDIARY

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                                             THREE MONTHS ENDED SEPTEMBER 30,
                                                                                       --------------------------------------------
                                                                                             2005                         2004
                                                                                       ---------------              ---------------
                                                                                                        (UNAUDITED)

<S>                                                                                    <C>                          <C>
Service revenues .........................................................             $        80,918              $       131,225
                                                                                       ---------------              ---------------

Costs and expenses:

  Cost of services .......................................................                      66,604                      109,027
  General and administrative (1) .........................................                      82,567                      138,086

  Loss on disposal of equipment ..........................................                          --                       21,910

  Stock-based compensation expense .......................................                          --                          258
                                                                                       ---------------              ---------------
     Loss from operations ................................................                     (68,253)                    (138,056)
Interest income ..........................................................                       3,162                       10,757
                                                                                       ---------------              ---------------
Net loss .................................................................             $       (65,091)             $      (127,299)
                                                                                       ===============              ===============

Net loss per share  - basic and diluted ..................................             $         (0.06)             $         (0.13)

Weighted average shares outstanding - basic and diluted ..................                   1,013,038                    1,013,038

(1) Excludes stock-based compensation expense as follows:
      General and administrative .........................................             $            --              $           258
</TABLE>

     See notes to the unaudited condensed consolidated financial statements.


                                       4
<PAGE>

                         MANGOSOFT, INC. AND SUBSIDIARY

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


<TABLE>
<CAPTION>
                                                                                             NINE MONTHS ENDED SEPTEMBER 30,
                                                                                       --------------------------------------------
                                                                                             2005                         2004
                                                                                       ---------------              ---------------
                                                                                                        (UNAUDITED)
<S>                                                                                    <C>                          <C>
Service revenues .........................................................             $       260,158              $       388,790
                                                                                       ---------------              ---------------
Costs and expenses:
  Cost of services .......................................................                     201,214                      321,997
  General and administrative (1) .........................................                     271,149                      463,992
  Loss on disposal of equipment ..........................................                          --                       21,910
  Stock-based compensation expense .......................................                         428                          774
                                                                                       ---------------              ---------------
     Loss from operations ................................................                    (212,633)                    (418,883)
Interest income ..........................................................                      14,130                       49,086
                                                                                       ---------------              ---------------
Net loss .................................................................             $      (198,503)             $      (370,797)

Net loss per share  - basic and diluted ..................................             $         (0.19)             $         (0.37)

Weighted average shares outstanding - basic and diluted ..................                   1,013,038                    1,013,038

(1) Excludes stock-based compensation expense as follows:
      General and administrative .........................................             $           428              $           258
</TABLE>

     See notes to the unaudited condensed consolidated financial statements.

                                       5
<PAGE>
                         MANGOSOFT, INC. AND SUBSIDIARY

                      CONSOLIDATED STATEMENTS OF CASH FLOWS


<TABLE>
<CAPTION>
                                                                                             NINE MONTHS ENDED SEPTEMBER 30,
                                                                                       --------------------------------------------
                                                                                             2005                         2004
                                                                                       ---------------              ---------------
                                                                                                        (UNAUDITED)
<S>                                                                                    <C>                          <C>

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss .................................................................                    (198,503)             $      (370,797)
Adjustments to reconcile net loss to net cash used by
  operating activities:
    Depreciation and amortization.........................................                          --                      119,715

    Loss on disposal of equipment ........................................                          --                       21,910
    Stock-based compensation .............................................                         428                          774
    Increase (decrease) in cash from the change in:
      Accounts receivable ................................................                      (3,993)                      13,980
      Prepaid expenses and other current assets...........................                          --                        1,036
      Accounts payable ...................................................                         805                       81,404
      Accrued compensation ...............................................                      (6,179)                      (4,653)
      Other accrued expenses .............................................                       1,100                      (91,554)
      Deferred revenue ...................................................                     (20,467)                       5,608
                                                                                       ---------------              ---------------
          Net cash used by operating activities...........................                    (226,809)                    (222,577)
                                                                                       ---------------              ---------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Investment maturities ....................................................                     321,446                      323,248

Interest receivable ......................................................                      21,524                       (3,485)
Return of security deposit ...............................................                          --                          850
                                                                                       ---------------              ---------------
          Net cash provided by investing activities ......................                     342,970                      320,613
                                                                                       ---------------              ---------------


NET INCREASE IN CASH AND CASH
  EQUIVALENTS ............................................................                     116,161                       98,036
CASH AND CASH EQUIVALENTS, BEGINNING OF
  PERIOD .................................................................                     317,444                      458,032
                                                                                       ---------------              ---------------
CASH AND CASH EQUIVALENTS, END OF PERIOD .................................             $       574,193              $       415,480
                                                                                       ===============              ===============
</TABLE>

     See notes to the unaudited condensed consolidated financial statements.

                                       6
<PAGE>

                         MANGOSOFT, INC. AND SUBSIDIARY

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.    NATURE OF BUSINESS AND BASIS OF PRESENTATION

      MangoSoft, Inc. and subsidiary (the "Company") has developed Internet
business software and services that improve the utility and effectiveness of
Internet-based business applications. The Company's software solutions address
the networking needs of small businesses, workgroups and large enterprises. The
Company is engaged in a single operating segment of the computer software
industry.

      The accompanying unaudited condensed consolidated financial statements
have been prepared on the same basis as the annual financial statements. In the
opinion of management, all significant adjustments, which are normal, recurring
in nature and necessary for a fair presentation of the financial position, cash
flows and results of the operations of the Company, have been consistently
recorded. The operating results for the interim periods presented are not
necessarily indicative of expected performance for the entire year. Certain
amounts from the prior year have been reclassified to conform to the current
year presentation.

      The unaudited information should be read in conjunction with the audited
financial statements of the Company and the notes thereto for the year ended
December 31, 2004 included in the Company's Annual Report on Form 10-KSB filed
with the Securities and Exchange Commission.

      As shown in the unaudited condensed consolidated financial statements,
during the nine months ended September 30, 2005 and 2004, the Company incurred
net losses of $198,503 and $370,797 respectively. Cash used in operations during
the nine months ended September 30, 2005 and 2004 was $226,809 and $222,577,
respectively. These factors, among others, raise significant doubt about the
Company's ability to continue as a going concern. The unaudited condensed
consolidated financial statements do not include any adjustments relating to the
recoverability and classification of assets or the amounts and classification of
liabilities that might be necessary should the Company be unable to continue as
a going concern. The Company's continuation as a going concern is dependent upon
its ability to generate sufficient cash flow and meet its obligations on a
timely basis and ultimately attain profitability.

2.    NET LOSS PER SHARE

      Basic net loss per share is computed by THREE MONTHS NINE MONTHS ENDED
dividing net loss by the weighted average number ENDED of common shares
outstanding for the period. Diluted net loss per share reflects, in addition to
the weighted average number of common shares, the potential dilution if stock
options and warrants outstanding were exercised and/or converted into common
stock, unless the effect of such equivalent shares was antidilutive.

      For the nine months ended September 30, 2005 and 2004, the effect of stock
options and other potentially dilutive shares were excluded from the calculation
of diluted net loss per common share as their inclusion would have been
antidilutive.


3.    REVENUE RECOGNITION

            The Company records revenue upon delivery if pervasive evidence of
      an arrangement exists, the price is fixed and determinable, delivery has
      occurred and collection is probable. Revenue for sales to distributors is
      recognized upon sales to end-users. Service revenue is recognized as
      services are performed.

                                       7
<PAGE>


            In December 2003, the Securities and Exchange Commission issued
      Staff Accounting Bulletin ("SAB") No. 104, "Revenue Recognition," which
      superseded SAB 101, "Revenue Recognition in Financial

      Statements" and Emerging Issues Task Force Extract No. 00-21, "Revenue
Arrangements with Multiple Deliverables." The adoption of SAB No. 104 did not
have a material impact on the Company's results of operations or financial
position.

4.    STOCK-BASED COMPENSATION

      The Company currently has one stock-based compensation plan, which is
described more fully in Note 8 in the Company's Annual Report on Form 10-KSB for
the period ended December 31, 2004, as filed on March 28, 2005. As amended, this
plan provides for the issuance of up to 296,297 shares of common stock to
employees, officers, directors and consultants in the form of nonqualified and
incentive stock options, restricted stock grants or other stock-based awards,
including stock appreciation rights. The stock options are exercisable as
specified at the date of grant and expire no later than ten years from the date
of grant. As of September 30, 2005, there were 186,052 remaining options
available under this plan.

      The following table illustrates the effect on net loss and net loss per
share if the Company applied the fair value recognition provision of SFAS No.
123 to stock-based employee compensation:

<TABLE>
<CAPTION>
                                                                 THREE MONTHS ENDED                       NINE MONTHS ENDED
                                                                     SEPTEMBER 30,                            SEPTEMBER 30,
                                                          --------------------------------          -------------------------------
                                                              2005                 2004                2005                 2004
                                                          -----------          -----------          ----------          -----------

<S>                                                       <C>                  <C>                  <C>                 <C>
Net loss as reported ............................         $   (65,091)         $  (127,299)         $ (198,503)         $  (370,797)
Add back stock-based compensation
  included in the determination of net loss
  as reported ...................................                  --                  258                 428                  774
Less stock-based compensation had
  all options been recorded at fair value........                  --             (180,386)             (1,243)            (238,952)
                                                          -----------          -----------          ----------          -----------
Adjusted net loss ...............................         $   (65,091)         $  (307,427)         $ (199,746)         $  (608,975)
                                                          ===========          ===========          ==========          ===========


Weighted average shares outstanding,
  basic and diluted .............................           1,013,038            1,013,038           1,013,038            1,013,038
                                                          ===========          ===========          ==========          ===========
Net loss per share, basic and diluted,
  as reported ...................................         $     (0.06)         $     (0.13)         $    (0.19)         $     (0.37)
                                                          ===========          ===========          ==========          ===========

Adjusted net loss per share, basic
  and diluted ...................................         $     (0.06)         $     (0.30)         $    (0.20)         $     (0.60)
                                                          ===========          ===========          ==========          ===========
</TABLE>


                                       8
<PAGE>

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

      This Quarterly Report on Form 10-QSB contains forward-looking statements
within the safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. Any statements in this Quarterly Report that are not statements of
historical facts are forward-looking statements, which involve risks and
uncertainties. Without limiting the foregoing, the words "believes,"
"anticipates," "plans," "expects," and similar expressions are intended to
identify forward-looking statements. Our actual results may differ materially
from those indicated in the forward-looking statements as a result of the
factors set forth elsewhere in this Quarterly Report on Form 10-QSB, including
under "Risk Factors." You should read the following discussion and analysis
together with our condensed consolidated financial statements for the periods
specified and the related notes included herein. Further reference should be
made to our Annual Report on Form 10-KSB for the period ended December 31, 2004
filed with the Securities and Exchange Commission.

OVERVIEW

      We have developed Internet business software and services that improve the
utility and effectiveness of Internet-based business applications. Our software
solutions address the networking needs of small businesses, workgroups and large
enterprises. Our products and services enhance the performance of PC networks
and deliver improved service utilizing existing equipment. We no longer develop
new software products or services.

      Mangomind(SM) is a multi-user, business-oriented, peer-to-peer file
sharing system, allowing individual users to collaborate over the Internet
across organizational boundaries in a safe and secure manner. The architecture
is a blend of the manageability of client/server with the autonomy, clustering,
and caching optimizations of peer-to-peer. The user experience is one of easy
file sharing with colleagues through what looks like an ordinary LAN shared
drive. Mangomind(SM) provides the secure file sharing benefits of a VPN without
additional hardware and configuration complexities. Mangomind(SM) is sold as
both a service and a standalone software product.

      FileTRUST(SM) is an online data storage service we purchased from Bank of
America (formerly FleetBoston) in February 2002 for approximately $427,000, of
which $175,000 was paid in cash and the balance in our common stock and warrants
to purchase our common stock at $14.31 per share. FileTRUST(SM) users can access
their stored files from any Internet-connected system. The fileTRUST(SM) service
complements our Mangomind(SM) service by providing customers with a lower cost
online storage system. In conjunction with our purchase of fileTRUST(SM), we
executed a two-year enterprise license agreement with Bank of America (formerly
FleetBoston) for the internal use of fileTRUST(SM) by Bank of America (formerly
FleetBoston), which expired in February 2004. Bank of America (formerly
FleetBoston) terminated its license agreement with us in September 2004. If we
are unable to replace this revenue, our operations may be adversely affected. We
have instituted cost reductions to lessen the adverse effects of this loss of
revenue, including restructuring our business relationships with key vendors
such as Built Right Networks.


                                       9
<PAGE>

CRITICAL ACCOUNTING POLICIES

      Our accounting policies are described in our Annual Report on Form 10-KSB
for the period ended December 31, 2004 filed with the Securities and Exchange
Commission. The following describes the application of accounting principles
that have a significant impact on our consolidated financial statements:

      Going Concern Assumption - The consolidated financial statements do not
include any adjustments relating to the recoverability and classification of
assets or the amounts and classification of liabilities that might be necessary
should we be unable to continue as a going concern. If the consolidated
financial statements were prepared on liquidation basis, the carrying value of
our assets and liabilities would be adjusted to net realizable amounts. In
addition, the classification of the assets and liabilities would be adjusted to
reflect the liquidation basis of accounting.

      Revenue Recognition - We recognize revenue generated from product sales
when persuasive evidence of an arrangement exists, the price is fixed and
determinable, delivery has occurred and collection is probable. We recognize
revenue generated from the sale of the Mangomind(SM) and fileTRUST(SM) services
as the service is provided. We recognize revenue generated from the sale of the
Mangomind(SM) product over the period of the first year's maintenance agreement
when persuasive evidence of the arrangement exists, the price is fixed and
determinable, delivery and any required installation has been completed and
collection is probable.

      Investments - At September 30, 2005, we have approximately $3,000 invested
in one high-yield, secured corporate note with related parties to better
maximize our rate of return on our cash. These investments are classified as
held-to-maturity and are carried at their amortized cost. Investments and
maturities of less than one year are classified as short-term investments.

      Stock-based Compensation - As part of our compensation programs offered to
our employees, we grant stock options. In addition, we have engaged third-party
consultants and advisors and have compensated them in the form of stock options.
Compensation for stock options issued to employees is generally measured as the
difference between the exercise price of the options granted and the fair value
of our common stock on the date of grant. Compensation for stock options issued
to third-party consultants and advisors is measured at the fair value on the
date of grant, determined using the Black-Scholes valuation model. Because of
the cashless exercise feature of the stock options granted in 1999 and the
repricing of options granted in 2000 and 2003, we are required to remeasure the
compensation related to these awards at each reporting date. As the quoted
market price of our common stock fluctuates, our reported operating expenses
will continue to fluctuate. These fluctuations can be significant.

      Deferred Taxation - Because of the significant operating losses incurred
and projected future operating losses, we have provided a full valuation
allowance against the deferred tax assets created by our net operating loss
carryforwards.

COSTS AND EXPENSES

      Cost of services - Cost of services consist solely of the expenses we
incur to administer and service the Mangomind(SM) and fileTRUST(SM) services.
These expenses consist primarily of salaries and related personnel costs, the
cost of our outsourced data center, the license royalties we pay to our
e-security software provider for the encryption used in the Mangomind(SM)
service and the fees we pay to Built Right Networks to manage our billable
services infrastructure.

                                       10
<PAGE>

      Other Operating Expenses - Selling and marketing expenses consist
primarily of costs incurred to market our products and services such as the
costs of attending and presenting at trade shows. General and administrative
expenses consist primarily of salaries and related personnel costs and other
general corporate costs such as facility costs, commercial and general liability
insurance, accounting and legal expenses and other costs typical of a publicly
held corporation. At September 30, 2005, there were no full time employees
performing selling and marketing activities. Effective April 1, 2005, we have
outsourced our general and administrative personnel activities to Built Right
Networks. Our one remaining employee is performing some general and
administrative activities.

      Reduction in Force - We have reduced our work force on four occasions
since April 23, 2001 due to adverse economic conditions and our need to conserve
capital. At September 30, 2005, we had one employee working in a general and
administrative capacity.

RESULTS OF OPERATIONS - THREE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004

      Revenues for the three months ended September 30, 2005 decreased $50,307
or 38% to $80,918 from $131,225 for the comparable period in 2004. No customer
accounted for more than 10% of our revenues for the three-month period ended
September 30, 2005. One customer, Bank of America (formerly FleetBoston)
represented approximately 40% of our revenues for the three-month period ended
September 30, 2004. In September 2004, we were notified by Bank of America
(formerly FleetBoston) that it had terminated its February 2002 enterprise
license agreement with us.

      We recognized $72,855 from the sale of our Mangomind(SM) service and
$8,063 from the sale of our fileTRUST(SM) service during the three months ended
September 30, 2005. During the comparable period in 2004, we recognized $67,474
from the sale of our Mangomind(SM) service, $63,751 from the sale of our
fileTRUST(SM) service.

      Cost of services for the three months ended September 30, 2005 decreased
$42,423 or approximately 39% to $66,604 compared to $109,027 for the comparable
period in 2004. The decrease in the cost of delivering our services was
primarily a result of our continued reductions and our switch to a lower cost
data center. In response to our loss of Bank of America (formerly FleetBoston)
as a customer, we have instituted cost reductions to lessen the adverse effects
of the loss of the Bank of America (formerly FleetBoston) revenues, including
restructuring our business relationships with key vendors such as Built Right
Networks.

      For the three-month period ended September 30, 2005, general and
administrative expenses decreased $55,519 or approximately 40% to $82,567
compared with $138,086 for the comparable period in 2004. The decrease in
operating expenses was due primarily to our reduced spending in the areas of
marketing and sales consultants, public relations, legal and other corporate
consultants and facility rent in addition to reductions in our marketing,
selling and general and administrative personnel associated with our work force
reductions. In 2005, we have reduced our workforce to one (1) full-time employee
working in a general and administrative capacity.

      Our loss from operations decreased $69,803 to $68,253 for the three-month
period ended September 30, 2005 compared with a loss from operations of $138,056
for the comparable period in 2004 as a result of the above factors.

      Interest income decreased $7,595 to $3,162 for the three months ended
September 30, 2005 compared to $10,757 for the three months ended September 30,
2004 primarily as a result of a reduction in our cash balances available for
investment.

RESULTS OF OPERATIONS - NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004

      Revenues for the nine months ended September 30, 2005 decreased $128,632
or 33% to $260,158 from $388,790 for the comparable period in 2004. No customers
accounted for more than 10% of our revenues for the nine-month period ended
September 30, 2005. One customer, Bank of America (formerly FleetBoston)
represented approximately 42% of our revenues for the nine-month period ended
September 30, 2004.

      In September 2004, we were notified by Bank of America (formerly
FleetBoston) that it had terminated its February 2002 enterprise license
agreement with us.

                                       11
<PAGE>

      We recognized $238,975 from the sale of our Mangomind service and $21,183
from the sale of our fileTRUST(SM) service during the nine months ended
September 30, 2005. During the same period in 2004, we recognized $199,386 from
the sale of our Mangomind service and $189,404 from the sale of our
fileTRUST(SM) service.

      Cost of services for the nine months ended September 30, 2005 decreased
$120,783 or 38% to $201,214 from $321,997 for the comparable period in 2004. The
decrease in the cost of delivering our services was primarily a result of
continued overhead reductions and our switch to a lower cost data center. In
response to our loss of Bank of America (formerly FleetBoston) as a customer, we
have instituted cost reductions to lesson the adverse effects of the loss of the
Bank of America (formerly FleetBoston) revenues, including restructuring our
business relationship with key vendors such as Built Right Networks.

      For the nine-month period ended September 30, 2005, general and
administrative expenses decreased $192,843 or 42% to $271,149 compared with
$463,992 for the comparable period in 2004. The decrease in other operating
expenses was due primarily to our reduced spending in the areas of marketing and
sales consultants, public relations, legal and other corporate consultants and
facility rent in addition to reductions in our marketing, selling and general
and administrative personnel associated with our work force reductions. During
the nine-month period ended September 30, 2005, we reduced our workforce to one
(1) full-time employee working in a general and administrative capacity.

      Our loss from operations decreased $207,250 to $212,633 for the nine-month
period ended September 30, 2005 compared with a loss from operations of $419,883
for the comparable period in 2004 as a result of the above factors.

      Interest income decreased $34,956 to $14,130 for the nine months ended
September 30, 2005 compared to $49,086 for the nine months ended September 30,
2004, primarily as a result of a reduction in our cash balances available for
investment.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

      We were formed in June 1995 and since our formation have raised
approximately $74,250,000 in financing from private placements of debt and
equity securities. In addition to the financing we received through the sale of
our securities, we have, at times, depended on loans from stockholders and
directors and credit from suppliers to meet our interim financing needs.
Borrowings from stockholders and directors have generally been refinanced with
new debt instruments or converted into additional equity. At September 30, 2005,
approximately $789,000 in additional financing was provided through accounts
payables, accrued expenses and other trade credit, a significant portion of
which is past due.

      At September 30, 2005, we had a cash balance of approximately $574,000 and
a working capital deficiency of approximately $195,000. We do not have any
commercial commitments or off balance sheet financing. Our commitments under our
operating leases are described in Note 10 to our consolidated financial
statements filed on Form 10-KSB for the period ended December 31, 2004, as
reported to the Securities and Exchange Commission.

      At September 30, 2005, we had approximately $3,000 invested in a
high-yield short and long-term investments. At September 30, 2005, one corporate
note receivable totaling approximately $3,000 was due from Unicrown Partners
LLC, a privately-held company in which Selig Zises and Jay Zises are members.
Selig Zises and Jay Zises are stockholders of MangoSoft, Inc. Selig Zises was
the former co-chairman of our Board of Directors. Investments in high-yield
securities pose higher risks than investments in lower-yield securities,
including the risk of total loss.

                                       12
<PAGE>

      We did not make any capital expenditures during the nine months ended
September 30, 2005.

      We have significantly modified our operations and reduced our work force
on four separate occasions since April 2001. We currently have one (1) employee
working in a general and administrative capacity. We outsource the management of
our billable services infrastructure, software code base, customer support and
reseller channel management to Built Right Networks for approximately $21,000
per month, under a September 30, 2002 agreement, which can be cancelled with a
ninety (90) day notice.

      Unless we can generate significant on-going revenue, we will need
additional sources of equity or debt financing. Although we have been successful
in raising past financing, there can be no assurances that additional financing
will be available to us on commercially reasonable terms, or at all.

      As shown in the unaudited condensed consolidated financial statements,
during the nine months ended September 30, 2005 and 2004, we incurred net losses
of $198,503 and $370,797, respectively. Cash used in operations during the nine
months ended September 30, 2005 and 2004 was $226,809 and $222,577,
respectively. The factors, among others, raise significant doubt about our
ability to continue as a going concern. Our continuation as a going concern is
dependent upon our ability to generate sufficient cash flow and meet our
obligations on a timely basis and ultimately attain profitability.


OFF-BALANCE SHEET ARRANGEMENTS

      We do not have any commercial commitments or off-balance sheet financing.
Our commitments under our operating leases are described in Note 10 to our
consolidated financial statements filed on Form 10-KSB for the period ended
December 31, 2004, as reported to the Securities and Exchange Commission.


                                       13
<PAGE>

RISK FACTORS

We Have A Limited Operating History And A History Of Substantial Operating
Losses.

      We have a history of substantial operating losses and an accumulated
deficit of $88,921,414 as of September 30, 2005. For the nine months ended
September 30, 2005 and the year ended December 31, 2004, our losses from
operations were $212,633 and $374,066, respectively. We have historically
experienced cash flow difficulties primarily because our expenses have exceeded
our revenues. We expect to incur additional operating losses. These factors,
among others, raise significant doubt about our ability to continue as a going
concern. If we are unable to generate sufficient revenue from our operations to
pay expenses or we are unable to obtain additional financing on commercially
reasonable terms, our business, financial condition and results of operations
will be materially and adversely affected.

We May Need Additional Financing.

      We may require additional capital to finance our future operations. We can
provide no assurance that we will obtain additional financing sufficient to meet
our future needs on commercially reasonable terms or otherwise. Also, Bank of
America (formerly FleetBoston) terminated its license agreement with us in
September 2004. We cannot be certain we will find a replacement for such
revenue. If we are unable to obtain the necessary financing, our business,
operating results and financial condition will be materially and adversely
affected.


Our Success Depends On Our Outsourced Services Agreement.

      Effective September 30, 2002, we outsourced the management of our internal
information systems, billable services infrastructure, software code base,
customer support and reseller channel management to Built Right Networks under
our September 30, 2002 Information Management Services Agreement (the
"Outsourced Services Agreement"). The principals of Built Right Networks are all
former MangoSoft employees. Our contract represents a large majority of Built
Right Networks' revenue. We can provide no assurance that Built Right Networks
will remain solvent or can retain their key personnel. Built Right Network's
inability to retain key personnel or to remain solvent would have a material and
adverse effect on our business, financial condition and results of operations.

Our High-Yield Investments Could Become Impaired.

      We have approximately $3,000 invested in a high-yield, secured corporate
note with related parties. Investments in high-yield corporate notes entail a
higher risk of delinquency or even complete loss. No assurance can be given that
we will not experience any losses or that our debtors will timely remit on the
maturity of these notes. If we experience any loss or impairment on these
investments, our business, financial condition and results of operations will be
materially and adversely affected.

We Have Limitations On The Effectiveness Of Our Internal Controls.

      We have one (1) full-time employee engaged in general and administrative
capacities. A complete set of internal controls is not possible in an
organization of this size. Management does not expect that its disclosure
controls or its internal controls will prevent all errors and intentional
misrepresentations. A control system, no matter how well conceived and operated,
can provide only reasonable, not absolute, assurance that the objectives of the
control system are met. Further, the design of a control system must reflect the
fact that there are resource constraints and the benefits of controls must be
considered relative to their costs. Because of the inherent limitations in all
control systems, no evaluation of controls can provide absolute assurance that
all control issues, if any, within the organization have been detected.


                                       14
<PAGE>

SEC Rules Concerning Sales Of Low-Priced Securities May Hinder Re-Sales Of Our
Common Stock

      Because our common stock has a market price that is less than ten dollars
per share, our common stock is not listed on an exchange or quoted on Nasdaq and
is traded on the OTC Bulletin Board. Brokers and dealers who handle trades in
our common stock are subject to certain SEC disclosure rules when effecting
trades in our common stock, including disclosure of the following: the bid and
offer prices of our common stock, the compensation of the brokerage firm and the
salesperson handling a trade and legal remedies available to the buyer. These
requirements may hinder re-sales of our common stock and may adversely affect
the market price of our common stock.

There Is Limited Liquidity In Our Common Stock And Its Price May Be Subject to
Fluctuation.

      Our common stock is currently traded on the OTC Bulletin Board and there
is only a limited market for our common stock. We can provide no assurances that
we will be able to have our common stock listed on an exchange or quoted on
Nasdaq in the future or that it will continue to be quoted on the OTC Bulletin
Board. If there is no trading market for our common stock, the market price of
our common stock will be materially and adversely affected.

Our Performance Depends On Market Acceptance Of Our Products.

      Due to our small size and need to conserve capital, our selling and
marketing activities for our products and services is limited. If markets for
our products fail to develop, develop more slowly than expected, are subject to
substantial competition or react negatively to Bank of America's (formerly
FleetBoston) termination of its February 2002 enterprise license agreement with
us, our business, financial condition and results of operations will be
materially and adversely affected.

We Depend On Strategic Marketing Relationships.

      We expect our future marketing efforts will focus in part on developing
business relationships with technology companies that seek to augment their
businesses by offering our products to their customers. Our inability to enter
into and retain strategic relationships, or the inability of such technology
companies to effectively market our products, could materially and adversely
affect our business, operating results and financial condition.

Rapidly Changing Technology And Substantial Competition May Adversely Affect
Our Business.

      Our business is subject to rapid changes in technology. We can provide no
assurances that research and development by competitors will not render our
technology obsolete or uncompetitive. We compete with a number of computer
hardware and software design companies that have technologies and products
similar to those offered by us and have greater resources, including more
extensive research and development, marketing and capital than us. We can
provide no assurances that we will be successful in marketing our existing
products and developing and marketing new products in such a manner as to be
effective against our competition. If our technology is rendered obsolete or we
are unable to compete effectively, our business, operating results and financial
condition will be materially and adversely affected.

Litigation Concerning Intellectual Property Could Adversely Affect Our Business.

      We rely on a combination of trade secrets, copyright and trademark law,
contractual provisions, confidentiality agreements and certain technology and
security measures to protect our trademarks, patents, proprietary technology and
know-how. However, we can provide no assurance that our rights in our
intellectual property will not be infringed upon by competitors or that
competitors will not similarly make claims against us for infringement. If we
are required to be involved in litigation involving intellectual property
rights, our business, operating results and financial condition will be
materially and adversely affected. See also discussion below under Part II, Item
1 "LEGAL PROCEEDINGS."

                                       15
<PAGE>

Defects In Our Software Products May Adversely Affect Our Business.

      Complex software such as the software developed by MangoSoft may contain
defects when introduced and also when updates and new versions are released. Our
introduction of software with defects or quality problems may result in adverse
publicity, product returns, reduced orders, uncollectible or delayed accounts
receivable, product redevelopment costs, loss of or delay in market acceptance
of our products or claims by customers or others against us. Such problems or
claims may have a material and adverse effect on our business, financial
condition and results of operations.


                                       16
<PAGE>

ITEM 3.     CONTROLS AND PROCEDURES

      We have significantly reduced our work force on several occasions during
2001 and 2002. At September 30, 2005 we had one (1) employee, Mr. Dale Vincent,
our President, Chief Executive Officer and sole director. A complete set of
internal controls including segregation of duties is not possible in an
organization of this size. However, we have implemented control procedures
surrounding the maintenance of our accounting and financial systems and the
safeguarding of our assets. Further, all transactions entered into outside the
normal course of our day-to-day operations must be approved by Mr. Vincent.

      Our principal executive and financial officer has evaluated the
effectiveness of our disclosure controls and procedures (as defined in Rules
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended
(the "Exchange Act")), as of the end of the period covered by this Quarterly
Report on Form 10-QSB. Based on such evaluation, our principal executive and
financial officer has concluded that as of such date, our disclosure controls
and procedures were designed to ensure that information required to be disclosed
by us in reports that we file or submit under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in
applicable SEC rules and forms and were effective.

      There was no change in our internal control over financial reporting (as
defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred
during the quarter ended September 30, 2005 that has materially affected, or is
reasonably likely to materially affect, our internal control over financial
reporting.


                                       17
<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

      On December 6, 2002, the Company filed a notification on Form 8-K that on
November 22, 2002, it filed a complaint in the United States District Court of
New Hampshire, against Oracle Corporation for infringement of U.S. Patent No.
6,148,377 and U.S. Patent No. 5,918,229.

      On June 4, 2003, the Company filed a notification on Form 8-K that on May
15, 2003, Oracle Corporation filed a complaint in the United States District
Court, Northern District of California, against the Company and Built Right
Networks for infringement of a patent held by Oracle Corporation. The complaint
seeks unspecified monetary damages and injunctive relief and awards for
interest, costs and attorneys' fees.

      On July 17, 2003, the Company filed notification on Form 8-K that on July
2, 2003, it filed a complaint in the United States District Court, Northern
District of California, against Oracle Corporation, Sun Microsystems, Inc., Dell
Computer Corporation and Electronic Arts, Inc. for infringement of U.S. Patent
No. 6,148,377 and U.S. Patent No. 5,918,229.

      Other than the matter listed above, there are no material pending legal
proceedings, other than the routine litigation occurring in the normal course of
operations, to which we are party or of which any of our properties are subject.


                                       18
<PAGE>

ITEM 6.       EXHIBITS AND REPORTS ON FORM 8-K

(A)   EXHIBITS:

   NUMBER                  DESCRIPTION OF EXHIBIT
      2.1     Agreement and Plan of Merger by and among First
              American Clock Co., MangoSoft Corporation and
              MangoMerger Corp., dated as of August 27,1999.
              (1)
      3.1     Articles of Incorporation, as amended. (2)
      3.2     By-laws. (2)
      4.1     Rights Plan. (6)
       10     Lease of Westborough Office Park, Building Five,
              dated November 10, 1995. (3)
       14     Code of Ethics. (7)
       21     Subsidiary of the Registrant. (2)
     31.1     Certification of Principal Executive Officer required by Rule 13a
              14(a) or Rule 15-d14 (a) of the Securities Exchange Act of 1934,
              as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
              2002.
     32.1     Certification of Chief Executive Officer pursuant to 18 U.S.C.
              Section 1350, as adopted pursuant to Section 906 of the
              Sarbanes-Oxley Act of 2002.
     99.1     1999 Incentive Compensation Plan, as amended and
              restated on May 1, 2000. (1)
     99.2     Form of Subscription Agreement for purchase of
              common stock, dated as of March 20, 2000. (1)
     99.3     Form of Warrant Agreement. (1)
     99.4     Asset Purchase Agreement, dated February 11,
              2002, between MangoSoft, Inc. and Fleet National
              Bank. (4)
     99.5     Warrant Agreement, dated February 11, 2002,
              between MangoSoft, Inc. and Fleet National Bank.
              (4)
     99.6     Information Management Services Agreement, dated
              September
              30, 2002, between MangoSoft, Inc. and Built
              Right Networks LLC. (5)
     99.7     Rights Agreement, dated March 14, 2003, between
              MangoSoft, Inc. and Interwest Transfer Co., Inc.
              (6)
(1)   Filed as an exhibit to our Current Report on Form 8-K for an event dated
      September 7, 1999 and hereby incorporated by reference thereto.
(2)   Filed as an exhibit to our Registration Statement on Form 10-SB, filed
      June 9, 2000, and hereby incorporated by reference thereto.
(3)   Filed as an exhibit to our Quarterly Report filed November 9, 1999 for the
      quarter ended September 30, 1999 and hereby incorporated by reference
      thereto.
(4)   Filed as an exhibit to our Quarterly Report filed August 14, 2002 for the
      quarter ended June 30, 2002 and hereby incorporated by reference thereto.
(5)   Filed as an exhibit to our Current Report on Form 8-K for an event dated
      September 30, 2002 and hereby incorporated by reference thereto.
(6)   Filed as an exhibit to our Current Report on Form 8-K for an event dated
      March 21, 2003, as amended on July 25, 2003, and hereby incorporated by
      reference thereto.
(7)   Filed as an exhibit to our Annual Report filed on March 26, 2004 for the
      year ended December 31, 2003 and hereby incorporated by reference thereto
(b)   REPORTS ON FORM 8-K:


                                       19
<PAGE>

                                   SIGNATURES

      In accordance with the requirements 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.

November 14, 2005                       MANGOSOFT, INC.

                                        /s/  DALE VINCENT
                                        -----------------------------------
                                             Dale Vincent
                                             Chief Executive Officer
                                             (Principal Financial and
                                             Accounting Officer)


                                       20
<PAGE>