**UNITED STATESSECURITIES AND EXCHANGE COMMISSION****Washington,D.C. 20549**

 

**FORM 10-Q**

 

**(Mark One)**

 

**x****      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934**

 

**For the quarterly period ended September 30, 2010**

 

**o****         TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934**

 

**For the transition period from               to               **

 

**Commission file number 333-141690**

 

**KABE EXPLORATION INC.**

(Nameregistrant as specified in its charter)

 

| **NEVADA**                                                      | ** ** | **39-2052145**                        |
|-----------------------------------------------------------------|------------|---------------------------------------|
| (State  or other jurisdiction of incorporation or organization) |       | (I.R.S.  Employer Identification No.) |
|                                                            |       |                                  |
| **5050 Avenida Encinas, Suite 360, Carlsbad, CA**          | ** ** | **92008**                             |
| (Address  of principal executive offices)                       |       | (Zip  Code)                           |

 

Registrant’s telephone number, including area code:  **(760)931-1048**

 

Check whether the issuer (1) filedall reports required to be filed by Section 13 or 15(d) of theExchange Act during the past 12 months (or for such shorter period that theregistrant was required to file such reports), and (2) has been subject tosuch filing requirements for the past 90 days. Yes x  No o

 

Indicate by check markwhether the registrant has submitted electronically and posted on its corporateWeb site, if any, every Interactive Data File required to be submitted andposted pursuant to Rule 405 of Regulation S-T during the preceding 12months (or for such shorter period that the registrant was required to submitand post such files).  Yes  o     No  o

 

Indicateby check mark whether the registrant is a large accelerated filer, anaccelerated filer, a non-accelerated filer, or a smaller reporting company. Seedefinition of “large accelerated filer”, “accelerated filer” and “smallerreporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

| Large accelerated filer o                                          |   | Accelerated filer o               |
|--------------------------------------------------------------------|--------|-----------------------------------|
|                                                               |   |                              |
| Non-accelerated filer o(do not check if smaller reporting company) |   | Smaller reporting company  x |

 

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

 

Number of shares of theregistrant’s common stock outstanding as of November 19,2010: 38,647,250 shares of Common Stock

 

 

 

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**TABLE OFCONTENTS**

 
| **Part I**  |                                                                                       |
|------------------|--------------------------------------------------------------------------------------------|
|             |                                                                                       |
| Item 1.          | Financial Statements                                                                       |
|             |                                                                                       |
| Item 2.          | Management’s Discussion  and Analysis of Financial Condition and Results of Operation |
|             |                                                                                       |
| Item 3.          | Quantitative and  Qualitative Disclosures About Market Risk                                |
|             |                                                                                       |
| Item 4T.         | Controls and Procedures                                                                    |
|             |                                                                                       |
| **Part II** |                                                                                       |
|             |                                                                                       |
| Item 1.          | Legal Proceedings.                                                                         |
|             |                                                                                       |
| Item 2.          | Unregistered Sales of  Equity Securities and Use of Proceeds.                              |
|             |                                                                                       |
| Item 3.          | Defaults Upon Senior  Securities.                                                          |
|             |                                                                                       |
| Item 4.          | Reserved                                                                                   |
|             |                                                                                       |
| Item5.           | Other Information.                                                                         |
|             |                                                                                       |
| Item 6.          | Exhibits.                                                                                  |
|             |                                                                                       |
|             | Signatures                                                                                 |

 

2

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**PART I**

 

**Item 1.**      ** Financial Statements.**

 

**KABEEXPLORATION, INC.**

(A Development Stage Company)

Balance Sheet

as at

 
| ** **                                                                             | ** ** | **September 30** | ** ** | **December 31,** | ** ** |
|----------------------------------------------------------------------------------------|------------|-----------------------|------------|-----------------------|------------|
| ** **                                                                             | ** ** | **2010**              | ** ** | **2009**              | ** ** |
| ** **                                                                             | ** ** | **(Unaudited)**       | ** ** | ** **            | ** ** |
|                                                                                   |       |                  |       |                  |       |
| ASSETS                                                                                 |       |                  |       |                  |       |
| Current Assets                                                                         |       |                  |       |                  |       |
| Cash                                                                                   |       | $                     | —     |                  | $          | 28 |   |
|                                                                                   |       |                  |       |                  |       |
| LIABILITIES AND STOCKHOLDERS’ DEFICIT                                             |       |                  |       |                  |       |
| Current Liabilities                                                                    |       |                  |       |                  |       |
| Bank Overdraft                                                                         |       | 18                    |       | —                |       |
| Accounts Payable                                                                       |       | $                     | 16,509     |                  | $          | 16,509 |   |
| Chapman Industries Loan                                                                |       | 6,576                 |       | 6,066                 |       |
| Loan Payable - EPS                                                                     |       | 12,103                |       | 8,487                 |       |
|                                                                                   |       |                  |       |                  |       |
| Total Liabilities                                                                      |       | 35,206                |       | 31,062                |       |
|                                                                                   |       |                  |       |                  |       |
| Stockholders’ Equity (Deficit)                                                    |       |                  |       |                  |       |
| Common Stock, $0.001 par value; authorized  75,000,000 shares; issued and outstanding: |       |                  |       |                  |       |
| 38,647,250 as at September 30, 2010                                               |       |                  |       |                  |       |
| 38,647,250 as at December 31, 2009                                                |       | 38,647                |       | 38,647                |       |
| Additional Paid-In Capital                                                             |       | 202,578               |       | 202,578               |       |
| Deficit accumulated during the development stage                                       |       | (276,431              | )          | (272,259              | )          |
|                                                                                   |       |                  |       |                  |       |
| Total Shareholders’ Equity                                                        |       | (35,206               | )          | (31,034               | )          |
|                                                                                   |       |                  |       |                  |       |
| Total Liabilities and Shareholders’ Equity                                        |       | $                     | —     |                  | $          | 28 |   |

 

The accompanying notes are an integral part of these financialstatements

 

3

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** **

KABE EXPLORATION, INC.

(A Development Stage Company)

Statement of Operations

(Unaudited)

 
| ** **                                              | ** ** | ** **                                         | ** ** | ** **                                        | ** ** | ** **                           | ** ** | ** ** | ** ** | **For the Period** | ** ** |
|---------------------------------------------------------|------------|----------------------------------------------------|------------|---------------------------------------------------|------------|--------------------------------------|------------|------------|------------|------------------------------|------------|
| ** **                                              | ** ** | ** **                                         | ** ** | ** **                                        | ** ** | ** **                           | ** ** | ** ** | ** ** | **of Inception**        | ** ** |
| ** **                                              | ** ** | **For the Three Months Ended** | ** ** | **For the Nine Months Ended** | ** ** | **from Jan. 1, 2006** | ** ** |
| ** **                                              | ** ** | **September 30,**                             | ** ** | **September 30,**                            | ** ** | **through Sep. 30,**       | ** ** |
| ** **                                              | ** ** | **2010**                                           | ** ** | **2009**                                          | ** ** | **2010**                             | ** ** | **2009**   | ** ** | **2010**                     | ** ** |
|                                                    |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| Revenue                                                 |       | $                                                  | —     |                                              | $          | —                               |       | $          | —     |                         | $          | — |   | $ | — |   |
|                                                    |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| Cost of Sales                                           |       | —                                             |       | —                                            |       | —                               |       | —     |       | —                       |       |
|                                                    |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| Operating Income                                        |       | —                                             |       | —                                            |       | —                               |       | —     |       | —                       |       |
|                                                    |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| General and Administrative Expenses:                    |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| Mineral Lease Fees                                      |       | —                                             |       | —                                            |       | —                               |       | —     |       | 6,713                        |       |
| Professional Fees                                       |       | 906                                                |       | 2,150                                             |       | 4,046                                |       | 4,450      |       | 182,469                      |       |
| Consultant Fees                                         |       | 0                                                  |       |                                              |       |                                 |       | 45,000     |       | 50,000                       |       |
| Other Administrative Expenses                           |       | 42                                                 |       | 378                                               |       | 126                                  |       | 1,125      |       | 32,258                       |       |
| Loss on abandonment of Mineral Leases                   |       | —                                             |       | —                                            |       | —                               |       |       |       | 5,000                        |       |
| Total General and Adminstrative Expenses                |       | 948                                                |       | 2,528                                             |       | 4,172                                |       | 50,575     |       | 276,440                      |       |
|                                                    |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| Other Inocme                                            |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| Interest Income                                         |       | —                                             |       | —                                            |       | —                               |       |       |       | 22                           |       |
| Interest Expense                                        |       | —                                             |       | —                                            |       | —                               |       |       |       | (13                          | )          |
|                                                    |       | —                                             |       | —                                            |       | —                               |       | —     |       | 9                            |       |
|                                                    |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| Net Income (Loss)                                       |       | $                                                  | (948       | )                                                 | $          | (2,528                               | )          | $          | (4,172     | )                            | $          | (50,575 | ) | $ | (276,431 | ) |
|                                                    |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| Income/Loss Per Common Share:                           |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| Basic and Diluted                                       |       | (0.00                                              | )          | (0.00                                             | )          | (0.00                                | )          | (0.00      | )          |                         |       |
|                                                    |       |                                               |       |                                              |       |                                 |       |       |       |                         |       |
| Weighted Average Shares Outstanding Basic and  Diluted: |       | 38,647,250                                         |       | 37,325,000                                        |       | 38,647,250                           |       | 37,155,220 |       |                         |       |

 

The accompanying notes are an integral part of these financialstatements

 

4

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** **

KABE EXPLORATION, INC.

(A Development Stage Company)

Statement of Shareholders’ Equity

For the period from inception,  January 1, 2006, to September 30,2010

(Unaudited)

 
| ** **                                                               | ** ** | ** **            | ** ** | ** **     | ** ** | ** **          | ** ** | **Deficit**            | ** ** | ** **    | ** ** |
|--------------------------------------------------------------------------|------------|-----------------------|------------|----------------|------------|---------------------|------------|------------------------|------------|---------------|------------|
| ** **                                                               | ** ** | ** **            | ** ** | ** **     | ** ** | ** **          | ** ** | **Accumulated**        | ** ** | **Total**     | ** ** |
| ** **                                                               | ** ** | **Common Stock** | ** ** | **Additional** | ** ** | **during the** | ** ** | **Shareholders’** | ** ** |
| ** **                                                               | ** ** | **Number of**    | ** ** | ** **     | ** ** | **Paid-In**         | ** ** | **Development**        | ** ** | **Equity**    | ** ** |
| ** **                                                               | ** ** | **Shares**            | ** ** | **Amount**     | ** ** | **Capital**         | ** ** | **Stage**              | ** ** | **(Deficit)** | ** ** |
|                                                                     |       |                  |       |           |       |                |       |                   |       |          |       |
| Inception, January 1, 2006                                          |       | —                |       | $              | —     |                | $          | —                 |       | $             | —     |   | $ | — |   |
| Common stock issued for cash, Jan. 16, 2006                         |       | 1,500,000             |       | 1,500          |       | 13500               |       |                   |       | 15,000        |       |
| Common stock issued for cash, Aug.23, 2006                               |       | 250,000               |       | 250            |       | 2250                |       |                   |       | 2,500         |       |
| Common stock issued for cash, Sep. 21, 2006                         |       | 575,000               |       | 575            |       | 10925               |       |                   |       | 11,500        |       |
| Common stock issued for cash, Oct. 31, 2006                         |       | 800,000               |       | 800            |       | 15200               |       |                   |       | 16,000        |       |
| Common stock issued for cash, Nov.30, 2006                               |       | 262,500               |       | 263            |       | 4987                |       |                   |       | 5,250         |       |
| Net loss for the year ended December 31, 2006                       |       |                  |       |           |       |                |       | (226                   | )          | (226          | )          |
| Balances, December 31, 2006                                         |       | 3,387,500             |       | $              | 3,388      |                | $          | 46,862                 |       | $             | (226       | ) | $ | 50,024 |   |
| Net loss for the year ended December 31, 2007                       |       |                  |       |           |       |                |       | (37,753                | )          | (37,753       | )          |
| Balances, December 31, 2007                                         |       | 3,387,500             |       | $              | 3,388      |                | $          | 46,862                 |       | $             | (37,979    | ) | $ | 12,271 |   |
| Common stock issued for cash, Apr. 15, 2008 at  $0.04 per share     |       | 300,000               |       | 300            |       | 11,700              |       |                   |       | 12,000        |       |
| Net loss for the year ended Dec. 31, 2008                           |       |                  |       |           |       |                |       | (50,938                | )          | (50,938       | )          |
| Balances, December 31, 2008                                         |       | 3,687,500             |       | $              | 3,688      |                | $          | 58,562                 |       | $             | (88,917    | ) | $ | (26,667 | ) |
|                                                                     |       |                  |       |           |       |                |       |                   |       |          |       |
| Balances restated for 10-for-1 forward stock split,  April 13, 2009 |       | 36,875,000            |       | $              | 36,875     |                | $          | 25,375                 |       | $             | (88,917    | ) | $ | (26,667 | ) |
| Additional Paid-in Capital January 2009                             |       |                  |       |           |       | 1,750               |       |                   |       | 1,750         |       |
| Common stock issued for services Apr. 13, 2009,  @ $0.10 per share  |       | 450,000               |       | 450            |       | 44,550              |       |                   |       | 45,000        |       |
| Common stock issued for services Apr. 13, 2009,  @ $0.10 per share  |       | 256,000               |       | 256            |       | 25,344              |       |                   |       | 25,600        |       |
| Common stock issued for services Apr. 13, 2009,  @ $0.10 per share  |       | 50,000                |       | 50             |       | 4,950               |       |                   |       | 5,000         |       |
| Common stock issued for services Apr. 13, 2009,  @ $0.10 per share  |       | 1,016,250             |       | 1,016          |       | 100,609             |       |                   |       | 101,625       |       |
| Net loss for the year ended Dec. 31, 2009                           |       |                  |       |           |       |                |       | $                      | (183,342   | )             | $          | (183,342 | ) |
|                                                                     |       |                  |       |           |       |                |       |                   |       |          |       |
| Balances, December 31, 2009                                         |       | 38,647,250            |       | $              | 38,647     |                | $          | 202,578                |       | $             | (272,259   | ) | $ | (31,034 | ) |
|                                                                     |       |                  |       |           |       |                |       |                   |       |          |       |
| Net loss for the 9 mo. ended Sep. 30, 2010                          |       |                  |       |           |       |                |       | (4,172                 | )          | (4,172        | )          |
|                                                                     |       |                  |       |           |       |                |       |                   |       |          |       |
| Balances, September 30, 2010                                        |       | 38,647,250            |       | $              | 38,647     |                | $          | 202,578                |       | $             | (276,431   | ) | $ | (35,206 | ) |

 

The accompnying notes are an integral part of these financialstatements

 

5

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KABE EXPLORATION, INC.

(A Development Stage Company)

Statement of Cash Flows

(Unaudited)

 
| ** **                                                                   | ** ** | ** **                                        | ** ** | ** **                           | ** ** | **For the Period** | ** ** |
|------------------------------------------------------------------------------|------------|---------------------------------------------------|------------|--------------------------------------|------------|------------------------------|------------|
| ** **                                                                   | ** ** | ** **                                        | ** ** | ** **                           | ** ** | **of Inception**        | ** ** |
| ** **                                                                   | ** ** | **For The Nine Months Ended** | ** ** | **from Jan. 1, 2006** | ** ** |
| ** **                                                                   | ** ** | **September 30,**                            | ** ** | **through Sep. 30,**       | ** ** |
| ** **                                                                   | ** ** | **2010**                                          | ** ** | **2009**                             | ** ** | **2010**                     | ** ** |
|                                                                         |       |                                              |       |                                 |       |                         |       |
| Cash flows from operating activities:                                        |       |                                              |       |                                 |       |                         |       |
| Net loss                                                                     |       | $                                                 | (4,172     | )                                    | $          | (50,575                      | )          | $ | (276,431 | ) |
| Adjustments to reconcile net loss to net cash used  by operating activities: |       |                                              |       |                                 |       |                         |       |
| Stock issued for services                                                    |       |                                              |       | 45,000                               |       | 177,225                      |       |
| Change in operating assets and liabilities:                                  |       |                                              |       |                                 |       |                         |       |
| Accounts Payable                                                             |       |                                              |       |                                 |       | 16,509                       |       |
| Net cash (used by) operating activities                                      |       | (4,172                                            | )          | (5,575                               | )          | (82,697                      | )          |
|                                                                         |       |                                              |       |                                 |       |                         |       |
| Cash flows from investing activities                                         |       |                                              |       |                                 |       |                         |       |
| Abandonment of mining leases                                                 |       | —                                            |       | —                               |       | —                       |       |
| Net cash (used by) investing activities                                      |       | —                                            |       | —                               |       | —                       |       |
|                                                                         |       |                                              |       |                                 |       |                         |       |
| Cash flows from financing activities:                                        |       |                                              |       |                                 |       |                         |       |
| Common stock issued for cash                                                 |       |                                              |       | —                               |       | 62,250                       |       |
| Proceeds (repayment) of loans                                                |       | 4,126                                             |       | 3,850                                |       | 18,679                       |       |
| Contibution of capital                                                       |       |                                              |       | 1,750                                |       | 1,750                        |       |
| Bank Overdraft                                                               |       | 18                                                |       |                                 |       | 18                           |       |
| Net cash (used) provided by financing activities                             |       | 4,144                                             |       | 5,600                                |       | 82,697                       |       |
|                                                                         |       |                                              |       |                                 |       |                         |       |
| Net increase (decrease) in cash                                              |       | (28                                               | )          | 25                                   |       | —                       |       |
|                                                                         |       |                                              |       |                                 |       |                         |       |
| Cash, beginning of the period                                                |       | 28                                                |       | —                               |       | —                       |       |
|                                                                         |       |                                              |       |                                 |       |                         |       |
| Cash, end of the period                                                      |       | $                                                 | —     |                                 | $          | 25                           |       | $ | — |   |
|                                                                         |       |                                              |       |                                 |       |                         |       |
| Supplemental cash flow disclosure:                                           |       |                                              |       |                                 |       |                         |       |
| Interest paid                                                                |       | $                                                 | —     |                                 | $          | —                       |       |   |   |
| Taxes paid                                                                   |       | $                                                 | —     |                                 | $          | —                       |       |   |   |

 

The accompanying notes are an integreal part of these financialstatements

 

6

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**Kabe Exploration, Inc.**

**(A Development Stage Company)**

**Notes to Financial Statements**

 

**September 30, 2010**

**(Unaudited)**

 

**1.      Basis of Presentation and Nature of Operations**

 

Theinterim financial statements as of and for the nine months ended Septgember 30,2010 reflect all adjustments which, in the opinion of management, are necessaryto fairly state the Company’s financial position and the results of itsoperations for the periods presented.

 

Theseinterim financial statements should be read in conjunction with the Company’sfinancial statements and notes thereto included in the Company’s December 31,2009 report. The Company assumes that the users of the interim financialinformation herein have read, or have access to, the audited financialstatements for the preceding period, and that the adequacy of additionaldisclosure needed for a fair presentation may be determined in that context.The results of operations for the nine month period ended September 30,2010 are not necessarily indicative of results for the entire year endingDecember 31, 2010.

 

**2.      Organization,  Nature ofBusiness**

 

KabeExploration, Inc. (the “Company”) was incorporated under the laws of theState of Nevada December 16, 2005. The company was originally formed for mineral exploration in the UnitedStates.  The Company abandoned itsMineral Leases in 2008.

 

CurrentBusiness of the Company

 

OnMay 5, 2010,  the Company enteredinto a share exchange agreement with the shareholders of Centiuum Holdings, Inc.,a Delaware public company, whereby the Company was to exchange ten Million(10,000,000) newly issued Company shares for all of the outstanding shares ofCentiuum Holdings, Inc., 1,000 shares, dependent upon certain investmentsby Centiuum into the Company.

 

**3.      Summary of Significant Accounting Policies**

 

Basisof Presentation

 

The financial statements ofthe Company have been prepared using the accrual basis of accounting inaccordance with generally accepted accounting principles in the UnitedStates.  Because a precise determinationof many assets and liabilities is dependent upon future events, the preparationof

 

7

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financialstatements for a period necessarily involves the use of estimates which havebeen made using careful judgment.

 

Useof Estimates

 

Thepreparation of financial statements in conformity with accounting principlesgenerally accepted in the United States of America requires management to makecertain estimates and assumptions that affect the reported amounts of assetsand liabilities at the date of the financial statements, and reported amountsof revenue and expenses during the reporting period.  Actual results could differ materially fromthose estimates. Significant estimates made by management are, among others,realizability of long-lived assets, deferred taxes and stock option valuation.

 

Thefinancial statements have, in management’s opinion, been properly preparedwithin the reasonable limits of materiality and within the framework of thesignificant accounting.

 

Cashand equivalents

 

Cashand equivalents include investments with initial maturities of three months orless.

 

FairValue of Financial Instruments

 

TheFinancial Accounting Standards Board issued ASC (Accounting StandardsCodification) 820-10 (SFAS No. 157), “Fair Value Measurements and Disclosures”for financial assets and liabilities. FASB ASC 820-10 provides a framework formeasuring fair value and requires expanded disclosures regarding fair valuemeasurements.  FASB ASC 820-10 definesfair value as the price that would be received for an asset or the exit pricethat would be paid to transfer a liability in the principal or mostadvantageous market in an orderly transaction between market participants onthe measurement date.  FASB ASC 820-10also establishes a fair value hierarchy which requires an entity to maximizethe use of observable inputs, where available. The carrying amounts of theCompany’s financial liabilities as at September 30, 2010 were measured againstthe three levels of inputs required by the standard to measure fair value:

 
| Chapman Industries Loan |   | $ | 6,576  |   | Level  2 based on promissory notes |   |
|-------------------------|--------|---|--------|--------|------------------------------------|--------|
| Loan Payable – EPS |   | $ | 12,103 |   | Level  2 based on promissory notes |   |

 

IncomeTaxes

 

TheCompany utilizes FASB ASC 740, “Income Taxes,” which requires the recognitionof deferred tax assets and liabilities for the expected future tax consequencesof events that have been included in the financial statements or taxreturns.  Under this method, deferred taxassets and liabilities are determined based on the difference between the taxbasis of assets and liabilities and their financial reporting amounts based onenacted tax laws and statutory tax rates applicable to the periods in which thedifferences are expected to affect taxable income.  Valuation allowances are established, whennecessary, to reduce deferred tax assets to the amount expected to be realized.The Company generated a deferred tax credit through net operating losscarryforward.  However, a valuation allowanceof 100% has been established, as the realization of the deferred tax credits isnot reasonably certain, based on going concern considerations outlined in thefollowing.

 

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GoingConcern

 

The Company’s financial statements are prepared using accountingprinciples generally accepted in the United States of America applicable to agoing concern, which contemplates the realization of assets and liquidation ofliabilities in the normal course of business. The Company has not yet established an ongoing source of revenuessufficient to cover its operating costs and to allow it to continue as a goingconcern.  The Company incurred a net lossof $4,172 in the nine months ended September 30, 2010 and has a cumulative netloss of $276,431 since inception. The ability of the Company to continue as agoing concern is dependent on the Company obtaining adequate capital to fundoperating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forcedto cease development of operations.

 

Theability of the Company to continue as a going concern is dependent upon itsability to successfully accomplish its plans to exploit or lease mining claims,or engage a working interest partner, in order to eventually secure othersources of financing and attain profitable operations.  The accompanying financial statements do notinclude any adjustments relating to the recoverability and classification ofrecorded asset amounts or the amount and classifications or liabilities orother adjustments that might be necessary should the Company be unable tocontinue as a going concern.

 

Development-Stage Company

 

The Company is considered adevelopment-stage company, with limited operating revenues during the periodspresented, as defined by Financial Accounting Standards Board FASB AccountingStandards Codification ASC 915.  ASC 915requires companies to report their operations, shareholders deficit and cashflows since inception through the date that revenues are generated from management’sintended operations, among other things. Management has defined inception as January 1, 2006. Since inception,the Company has incurred an operating loss of $276,431. The Company’s workingcapital has been generated through the sales of common stock.  Management has provided financial data since January1, 2006, “Inception” in the financial statements, as a means to provide readersof the Company’s financial information to make informed investment decisions.

 

Basicand Diluted Net Loss Per Share

 

Netloss per share is calculated in accordance with FASB ASC 260, Earnings PerShare for the period presented.  Basicnet loss per share is based upon the weighted average number of common sharesoutstanding.  Diluted net loss per shareis based on the assumption that all dilative convertible shares and stockoptions were converted or exercised. Dilution is computed by applying the treasury stock method.  Under this method, options and warrants areassumed exercised at the beginning of the period (or at the time of issuance,if later), and as if funds obtained thereby we used to purchase common stock atthe average market price during the period.

 

TheCompany has no potentially dilutive securities outstanding as of September 30,2010, 2010.

 

The following is a reconciliation of the numerator and denominator ofthe basic and diluted earnings per share computations for the nine months endedSeptember 30, 2010 and 2009:

 
| ** **                                                       | ** ** | **2010**   | ** ** | **2009**   | ** ** |
|------------------------------------------------------------------|------------|------------|------------|------------|------------|
| Numerator:                                                       |       |       |       |       |       |
|                                                             |       |       |       |       |       |
| Basic and diluted net loss per share:                            |       |       |       |       |       |
|                                                             |       |       |       |       |       |
| Net Loss                                                         |       | $          | (4,172     | )          | $          | (50,575 | ) |
|                                                             |       |       |       |       |       |
| Denominator                                                      |       |       |       |       |       |
|                                                             |       |       |       |       |       |
| Basic and diluted weighted average number of  shares outstanding |       | 38,647,250 |       | 37,155,220 |       |
|                                                             |       |       |       |       |       |
| Basic and Diluted Net Loss Per Share                             |       | $          | (0.00      | )          | $          | (0.00 | ) |

 

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RecentAccounting Pronouncements

 

InJune, 2009, the FASB issued their final SFAS, No. 168, “FASB AccountingStandards Codification ( “ASC”) and the Hierarchy of Generally AcceptedAccounting Principles”.  This wasreflected in the codification as FASB ASC 105, Generally Accepted AccountingPrinciples.  “ASC” is the single sourceof authoritative US generally accepted accounting principles recognized by theFASB to be applied to nongovernmental entities. It is effective for financial statements issued for interim and annualperiods ending after September 15, 2009. It will not have an impact on the Company’s financial position, resultsof operations or cash flows.

 

InMay, 2009, the FASB issued ASC 855, (formerly SFAS 165) Subsequent Events,which established general standards of accounting and disclosure for eventsthat occur after the balance sheet date, but before financial statements areissued or available to be issued.  Inaccordance with ASC 855, the Company has evaluated subsequent events throughthe date the financial statements were filed.

 

**4.****                  ****CapitalStructure**

 

Asof September 30, 2010 the Company has authorized 75,000,000 of $ 0.001 parcommon stock, of which 38,647,250 shares were issued and outstanding.

 

**5.****                  ****Contigencies,Litigation**

 

Therewere no loss contingencies or legal proceedings against the Company withrespect to matters arising in the ordinary course of business. Neither theCompany nor any of its officers or directors is involved in any otherlitigation either as plaintiffs or defendants, and have no knowledge of anythreatened or pending litigation against them or any of the officers ordirectors.

 

**6.****                  ****SubsequentEvents**

 

Eventssubsequent to September 30, 2010 have been evaluated through November 19, 2010,the date these statements were available to be issued, to determine whetherthey should be disclosed to keep the financial statements from beingmisleading.  On October 29, 2010, theCompany, Centiuum Holdings, Inc. and the shareholders of Centiuum entered intoan Agreement of Termination and Release with respect to the Share ExchangeAgreement dated as of May 5, 2010.

 

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**Item 2.**                                   **Management’sDiscussion and Analysis of Financial Condition and Results of Operations.**

 

*Except asotherwise required by the context, all references in this prospectus to “we”, “us”,“our”, or “Company” refer to the operations of Kabe Exploration Inc., a Nevadacorporation.*

 

**Forward-LookingStatements and Associated Risks**

 

*ThePrivate Securities Litigation Reform Act of 1995 provides a “safe harbor” forcertain forward-looking statements. Some of the statements contained in thisannual report of the Company discuss future expectations, contain projectionsof our operations or financial condition or state other forward-lookinginformation. Some statements contained in this annual report on Form 10-Q thatare not historical facts (including without limitation statements to the effectthat we “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” orother similar expressions) and are forward-looking statements. Theseforward-looking statements are based on our current expectations and beliefsconcerning future developments and their potential effects on us. There can beno assurance that future developments affecting us will be those anticipated byus. All comments concerning our expectations for future revenue and operatingresults are based on our forecasts of our plan of operation and do not includethe potential impact of any future acquisitions or operations. Theseforward-looking statements involve significant risks and uncertainties (some ofwhich are beyond our control) and assumptions. Should one or more of theserisks or uncertainties materialize, or should any of our assumptions proveincorrect, actual results may vary in material respects from those projected inthe forward-looking statements.*

 

**Overview**

 

We are a “shell company”defined in Rule 405 under the Securities Act of 1933 and Rule 12b-2 under theSecurities Exchange Act of 1934, since we have only conducted nominaloperations and have only nominal assets.

 

During 2007, we were anexploration stage company engaged in the acquisition and exploration of mineralproperties. We entered into a lease agreement with George J. Eliopuloseffective March 31, 2006, granting us the exclusive right to explore, develop,and mine the property for gold, silver, copper and other valuable minerals.  The property consisted of one unpatentedmining claim located in section 12, Township 16 North, Range 20 East, Mt.Diablo Baseline & Meridian, Storey County, Nevada, USA, owned by Mr. Eliopulos.

 

On December 18, 2007, ErikUlsteen entered into an agreement with Antony Claydon, our former President anda director and Rory Moss, a director, to purchase 1,500,000 and 250,000 sharesof common stock, respectively, for an aggregate purchase price of $50,000. Thetransaction closed on February 14, 2008 at which time, Mr. Claydon resigned asPresident, Chief Financial Officer and Secretary and Mr. Ulsteen was appointedPresident, Chief Financial Officer, Secretary and director.  On January 28, 2008, we terminated our leaseagreement with Mr. Eliopulos.

 

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On May 5, 2010, we enteredinto a Share Exchange Agreement with Centiuum Holdings Inc. and itsstockholders whereby Centiuum’s stockholders will exchange all of their sharesof common stock of Centiuum for 10,000,000 newly issued shares of our commonstock.  In addition, our principalstockholder, Erik Ulsteen has agreed to deposit 10,000,000 shares of our commonstock owned by him (the “Escrow Shares”) into escrow upon closing of theexchange.  At any time within 120 daysafter closing of the exchange, the Escrow Shares will be released to Centiuumupon a cash investment of a minimum of $500,000 invested in Kabe or Kabe entersinto executed contracts aggregating a minimum of $500,000 in cash flow toKabe.  The closing of the transactionsare subject to customary closing conditions including due diligence.  Centiuum Holdings is a provider of consultingservices, environmental engineering, clean development mechanism and projectmanagement services worldwide.  On October29, 2010, we entered into an Agreement of Termination and Release with Centiuumand the shareholders of Centiuum with respect to the Share Exchange Agreementdated as of May 5, 2010.

 

The following factors raisesubstantial doubt regarding the ability of our business to continue as a goingconcern: (i) the losses we have incurred since our inception; (ii) our failureto generate revenues since our inception; and (iii) our dependence on the saleof our equity securities and on the receipt of capital from outside sources tocontinue our operations. Our auditors have issued a going concern opinionregarding our business. The financial statements do not include any adjustmentsthat might result from the uncertainty about our ability to continue inbusiness. As such we may have to cease operations and you could lose yourinvestment.

 

**Plan ofOperation**

 

We have redirected our focus towards identifying and pursuing optionsregarding the development of a new business plan and direction. We areexploring various business opportunities that have the potential to generatepositive revenue, profits and cash flow in order to financially accommodate thecosts of being a publicly held company.

 

**Results ofOperations**

 

*ThreeMonths Ended September 30, 2010 Compared to Three Months Ended September 30,2009*

 

**Revenues**

 

We have generated nooperating revenues from operations from our inception.

 

**Costs andExpenses**

 

From our inception through September30, 2010, we have incurred cumulative losses of $276,431.  Professional fees decreased to $906 for thethree months ended September 30, 2010 from $2,150 for the three months ended September30, 2009.  Other Administrative expenses

 

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decreased to $42 for thethree months ended September 30, 2010 from $378 for the three months ended September30, 2009.

 

*NineMonths Ended September 30, 2010 Compared to Nine Months Ended September 30,2009*

 

**Revenues**

 

We have generated nooperating revenues from operations from our inception.

 

**Costs andExpenses**

 

Professional fees decreasedto $4,046 for the nine months ended September 30, 2010 from $4,450 for the ninemonths ended September 30, 2009 primarily as a result of cutbacks in ourbusiness in order to conserve cash. Consulting fees decreased to $0 for thenine months ended September 30, 2010 from $45,000 for the nine months ended September30, 2009.

 

**Liquidity and Capital Resources**

 

As of September 30, 2010, wehad a working capital deficit of $35,206 as compared to a working capitaldeficit of $31,034 as of December 31, 2009. Our cash position was $0 as of September 30, 2010 compared to $28 as of December31, 2009.  We have financed our companyprincipally through the private placement of our common stock.  As of September 30, 2010, we have no longterm debt.

 

**Summary ofSignificant Accounting Policies**

 

Basisof Presentation

 

Ourfinancial statements have been prepared using the accrual basis of accountingin accordance with generally accepted accounting principles in the UnitedStates.  Because a precise determinationof many assets and liabilities is dependent upon future events, the preparationof financial statements for a period necessarily involves the use of estimateswhich have been made using careful judgment.

 

Useof Estimates

 

Thepreparation of financial statements in conformity with accounting principlesgenerally accepted in the United States of America requires management to makecertain estimates and assumptions that affect the reported amounts of assetsand liabilities at the date of the financial statements, and reported amountsof revenue and expenses during the reporting period.  Actual results could differ materially fromthose estimates. Significant estimates made by management are, among others,realizability of long-lived assets, deferred taxes and stock option valuation.

 

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Thefinancial statements have, in management’s opinion, been properly preparedwithin the reasonable limits of materiality and within the framework of thesignificant accounting.

 

IncomeTaxes

 

Weutilize SFAS No. 109, “Accounting for Income Taxes,” which requires therecognition of deferred tax assets and liabilities for the expected future taxconsequences of events that have been included in the financial statements ortax returns.  Under this method, deferredtax assets and liabilities are determined based on the difference between thetax basis of assets and liabilities and their financial reporting amounts basedon enacted tax laws and statutory tax rates applicable to the periods in whichthe differences are expected to affect taxable income.  Valuation allowances are established, whennecessary, to reduce deferred tax assets to the amount expected to be realized.We generated a deferred tax credit through net operating loss carryforward.  However, a valuation allowance of 100% hasbeen established, as the realization of the deferred tax credits is notreasonably certain, based on going concern considerations outlined as follows.

 

GoingConcern

 

Ourfinancial statements are prepared using accounting principles generallyaccepted in the United States of America applicable to a going concern, whichcontemplates the realization of assets and liquidation of liabilities in thenormal course of business.  We have notyet established an ongoing source of revenues sufficient to cover our operatingcosts and to allow us to continue as a going concern.  Our ability to continue as a going concern isdependent on us obtaining adequate capital to fund operating losses until webecome profitable.  If we are unable toobtain adequate capital, we could be forced to cease operations.

 

Ourability to continue as a going concern is dependent upon our ability tosuccessfully accomplish our plan to develop a new business plan, or mergercandidate in order to eventually secure other sources of financing and attainprofitable operations.  The accompanyingfinancial statements do not include any adjustments relating to therecoverability and classification of recorded asset amounts or the amount andclassifications or liabilities or other adjustments that might be necessaryshould we be unable to continue as a going concern.

 

Development-StageCompany

 

Weare considered a development-stage company, with limited operating revenuesduring the periods presented, as defined by Statement of Financial AccountingStandards (“SFAS”) No. 7.  SFAS.  No. 7 requires companies to report theiroperations, shareholders deficit and cash flows since inception through thedate that revenues are generated from management’s intended operations, amongother things.  Management has definedinception as January 1, 2006. Since inception until September 30, 2010, we haveincurred an operating loss of $276,431. Our working capital has been generated through sales of common stock.  Management has provided financial data since January1, 2006, “Inception” in the financial statements, as a means to provide readersof our financial information to make informed investment decisions.

 

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Basicand Diluted Net Loss Per Share

 

Netloss per share is calculated in accordance with FASB ASC 260, Earnings PerShare for the period presented.  Basicnet loss per share is based upon the weighted average number of common sharesoutstanding.  Diluted net loss per shareis based on the assumption that all dilative convertible shares and stockoptions were converted or exercised.  Dilution is computed by applying the treasurystock method.  Under this method, optionsand warrants are assumed exercised at the beginning of the period (or at thetime of issuance, if later), and as if funds obtained thereby we used topurchase common stock at the average market price during the period.

 

Wehad no potentially dilutive securities outstanding as of September 30, 2010.

 

Off-BalanceSheet Arrangements

 

We have no significant off-balancesheet arrangements that have or are reasonably likely to have a current orfuture effect on our financial condition, changes in financial condition,revenues or expenses, results of operations, liquidity, capital expenditures orcapital resources that is material to our stockholders.

 

**Item 3.**                                   **Quantitative and Qualitative Disclosures About Market Risk.**

 

N/A

 

**Item 4(T)****                     ****Controls and Procedures.**

 

*Evaluation of Disclosure Controls and Procedures*.  Under the supervision and with theparticipation of our management, including our President, Chief FinancialOfficer and Secretary, we evaluated the effectiveness of the design andoperation of our disclosure controls and procedures (as defined in Rule 13a-15(e)and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”))as of the end of the period covered by this report.  Based upon that evaluation, our President, ChiefFinancial Officer and Secretary concluded that our disclosure controls and proceduresas of the end of the period covered by this report were effective such that theinformation required to be disclosed by us in reports filed under the SecuritiesExchange Act of 1934 is (i) recorded, processed, summarized and reported withinthe time periods specified in the SEC’s rules and forms and (ii) accumulatedand communicated to our management to allow timely decisions regarding disclosure.  A controls system cannot provide absoluteassurance, however, that the objectives of the controls system are met, and noevaluation of controls can provide absolute assurance that all control issuesand instances of fraud, if any, within a company have been detected.

 

*Changes in Internal Control Over Financial Reporting.*  During the most recent quarter ended September30, 2010, there has been no change in our internal control over financial reporting(as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) ) that hasmaterially affected, or is reasonably likely to materially affect, our internalcontrol over financial reporting.

 

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**PART II**

 

**Item 1.****                                  ****Legal Proceedings.**

 

We are not a party to anypending legal proceeding, nor is our property the subject of a pending legalproceeding, that is not in the ordinary course of business or otherwise materialto the financial condition of our business.

 

**Item 2.****                                  ****Unregistered Sales of Equity Securities and Use of Proceeds.**

 

N/A

 

**Item 3.****                                  ****Defaults Upon Senior Securities.**

 

N/A

 

**Item 4.**                                   **Reserved.**

 

**Item 5.****                                  ****Other Information.**

 

None.

 

**Item 6.****                                  ****Exhibits.**

 
| **Exhibit No.** | ** ** | **Title of Document**                                                                                                                               |
|-----------------|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------|
|            |       |                                                                                                                                                |
| 31.1            |       | Certification of Chief  Executive Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act  of 1934                                        |
|            |       |                                                                                                                                                |
| 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 |

 

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**SIGNATURES**

 

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

 
|   | **KABE  EXPLORATION, INC.** |
|--------|-----------------------------|
|   |                        |   |
|   | By:                         | /s/ Erik Ulsteen |
|   |                        | Erik Ulsteen |
|   |                        | President, Chief Financial  Officer,  Secretary |
|   |                        |   |
|   | Date:                       | November 22, 2010 |

 

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