SECURITIES
        AND EXCHANGE COMMISSION
 WASHINGTON,
        DC 20549
 
 FORM
        10-QSB
 
 
 QUARTERLY
        REPORT UNDER SECTION 13 OR 15(d)
 OF
        THE
        SECURITIES EXCHANGE ACT OF 1934
 
 
 For
                  the quarter ended March 31, 2007
              
              Commission
                  File No.   0-19944
 
 
 M~WAVE,
        INC.
 
 (Exact
        name of registrant as specified in its charter)
  DELAWARE
              36-3809819(State
                  or other jurisdiction of Incorporation or organization)
              (I.R.S.  Employer
                  identification No.)
  11533
                  Franklin Ave. Franklin Park, Illinois
              60131(Address
                  of principal executive offices)
              (Zip
                  Code)
  Registrant’s
                  telephone number including area code:
              (630)
                  562-5550
  Indicate
        by check mark whether the registrant (1) has filed all reports required to
        be
        filed by Section 13 and 15(d) of the Securities Exchange Act of 1934 during
        the
        preceding 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
  Indicate
                    by check mark whether the Registrant is an
                Yes
                NoAccelerated
                    filer (as defined by rule 12b-6 of the Act)
                 ̈
                x
 Indicate
        by check mark whether the registrant is a shell company (as defined in Rule
        12b-2 of the Exchange Act). Yes  ̈ No x
  The
        registrant has 1,793,150 shares of common stock outstanding at May 11,
        2007.
  
  
  **M-WAVE,
        INC.**
 
 **CONTENTS**
 
 
 PART
                  I.  FINANCIAL INFORMATIONItem
                  1.
              Financial
                  Statements:Consolidated
                  Balance Sheets as of March 31, 2007 and
                  December 31, 2006 (unaudited)
              
              Page
                  3Consolidated
                  Statements of Operations for the Three Months
                  Ended March 31, 2007 and 2006 (unaudited)
              
              Page
                  4Consolidated
                  Statements of Cash Flows for the Three Months
                  Ended March 31, 2007 and 2006 (unaudited)
              
              Pages
                  5Notes
                  to Consolidated Financial Statements
                  (unaudited)
              
              Pages
                  7-13Item
                  2.
              Management’s
                  Discussion and Analysis of Financial
                  Condition and Results of Operations
              
              Pages
                  13-20Item
                  3
              Controls
                  and Procedures
              
              Page
                  21PART
                  II.  OTHER INFORMATIONItem
                  1
              Legal
                  Proceedings
              
              Page
                  22Item
                  2
              Unregistered
                  Sales of Equity Securities and Use of
                  Proceeds
              
              Page
                  22Item
                  3
              Defaults
                  Upon Senior Securities
              
              Page
                  22Item
                  4
              Submission
                  of Matters to a Vote of Security
                  Holders
              
              Page
                  22Item
                  5
              Other
                  Information
              
              Page
                  22Item
                  6
              Exhibits
              
              Page
                  23Signatures
              
              Page
                  23
  2
 ***Contents***
  **Part
        I - Financial Information**
 **Item
        1 - Financial Statements**
 
 **M-Wave,
        Inc.**
 **CONSOLIDATED
        BALANCE SHEETS**
 **(unaudited)**
 
 **March 31,**
              
              
              **December 31,****2007**
              
              
              **2006**ASSETSCURRENT
                  ASSETS:Cash
                  and cash equivalents
              
              $
              1,442,450
              
              
              $
              1,696,340Accounts
                    receivable, net of allowance for doubtful accounts, 2007- $80,000:
                    2006- $80,000
              
              
              892,906
              
              
              
              1,089,021Inventories,
                  net
              
              
              1,408,952
              
              
              
              1,348,004Prepaid
                  expenses and other assets
              
              
              182,916
              
              
              
              115,932Note
                  receivable, net
              
              
              0
              
              
              
              6,836Total
                  current assets
              
              
              3,927,224
              
              
              
              4,256,133EQUIPMENT:Equipment
              
              
              434,156
              
              
              
              434,156Less
                  accumulated depreciation
              
              
              (167,875
              )
              
              
              (145,607
              )Equipment,
                  net
              
              
              266,281
              
              
              
              288,549TOTAL
              
              $
              4,193,505
              
              
              $
              4,544,682LIABILITIES
                  AND STOCKHOLDERS' EQUITY (DEFICIT)CURRENT
                  LIABILITIES:Accounts
                  payable
              
              $
              1,368,510
              
              
              $
              1,449,083Accrued
                  expenses
              
              
              259,688
              
              
              
              277,746Note
                  payable
              
              
              40,000
              
              
              
              58,000Total
                  current liabilities
              
              
              1,668,198
              
              
              
              1,784,829COMMITTMENTS
                  AND CONTINGENCIESSTOCKHOLDERS'
                  EQUITY (DEFICIT):Preferred
                  stock, $100 par value; Series A authorized, 30,000
                  shares;      issued and outstanding: 2007
                  and 2006: 12,500 shares
              
              
              656,800
              
              
              
              656,800Series
                  B authorized, 70,000 shares; issued and
                  outstanding:        2007 and 2006:
                  69,648 shares
              
              
              6,842,797
              
              
              
              6,842,797Common
                  stock, $.005 par value; authorized, 20,000,000 shares;
                  issued      And outstanding 2007 and 2006:
                  1,763,150 shares
              
              
              10,986
              
              
              
              10,986Additional
                  paid-in capital
              
              
              14,291,235
              
              
              
              14,199,062Accumulated
                  deficit
              
              
              (16,991,341
              )
              
              
              (16,664,622
              )Treasury
                  stock, at cost, 2007 and 2006: 433,954 shares
              
              
              (2,285,170
              )
              
              
              (2,285,170
              )Total
                  stockholders' equity (deficit)
              
              
              2,525,307
              
              
              
              2,759,853TOTAL
              
              $
              4,193,505
              
              
              $
              4,544,682
 
 See
        notes
        to consolidated financial statements
  3
 ***Contents***
 
 **M-Wave,
                  Inc.****CONSOLIDATED
                  STATEMENTS OF OPERATIONS****(unaudited)**Three
                  Months Ended March 312007
              
              
              2006NET
                  SALES
              
              $
              2,262,921
              
              
              $
              2,291,843COST
                  OF GOODS SOLD
              
              
              1,700,396
              
              
              
              1,689,841Gross
                  profit
              
              
              562,525
              
              
              
              602,002OPERATING
                  EXPENSES:General
                  and administrative
              
              
              676,178
              
              
              
              1,577,116Selling
                  and marketing
              
              
              213,066
              
              
              
              205,811Total
                  operating expenses
              
              
              889,244
              
              
              
              1,782,927Operating
                  loss from continuing operations
              
              
              (326,719
              )
              
              
              (1,180,925
              )OTHER
                  INCOME (EXPENSE):Interest
                  expense
              
              
              0
              
              
              
              (408,863
              )Total
                  other income (expense)
              
              
              0
              
              
              
              (408,863
              )LOSS
                  FROM CONTINUING OPERATIONS
              
              
              (326,719
              )
              
              
              (1,589,788
              )Income
                  tax expense
              
              
              0
              
              
              
              0Loss
                  from continuing operations
              
              $
              (326,719
              )
              
              $
              (1,589,788
              )Loss

                  from discontinued operations (note 9), net of tax
              
              $
              0
              
              
              $
              (249,390
              )Net
                  loss
              
              $
              (326,719
              )
              
              $
              (1,839,178
              )Preferred
                  stock dividends
              
              $
              0
              
              
              $
              (71,629
              )Net
                  loss attributable to common shareholders
              
              $
              (326,719
              )
              
              $
              (1,910,807
              )BASIC
                  AND DILUTED LOSS PER COMMON SHAREContinuing
                  operations
              
              $
              (0.19
              )
              
              $
              (1.07
              )Discontinued
                  operations
              
              
              -
              
              
              
              (0.16
              )$
              (0.19
              )
              
              $
              (1.23
              )Weighted
                  average shares outstanding
              
              
              1,763,150
              
              
              
              1,550,650
 
 See
        notes
        to consolidated financial statements
  4
 ***Contents***
 
 **M-Wave,
                  Inc.****CONSOLIDATED
                  STATEMENTS OF CASH
                  FLOWS****(unaudited)**Three
                  Months Ended March 312007
              
              
              2006**OPERATING
                  ACTIVITIES:**Net
                  loss
              
              $
              (326,719
              )
              
              $
              (1,839,177
              )Adjustments
                  to reconcile net loss to net cash flows    used in
                  operating activities:Loss
                  on disposal of property, plant, and equipment
              
              
              0
              
              
              
              24,167Depreciation
              
              
              22,268
              
              
              
              20,310Amortization
                  of discount on long-term debt
              
              
              0
              
              
              
              356,787Stock
                  compensation recognized on options and warrants
              
              
              92,173
              
              
              
              569,179Fair
                  value adjustment to common stock warrants
              
              
              0
              
              
              
              (15,158
              )Changes
                  in assets and liabilities:Accounts
                  receivable
              
              
              196,115
              
              
              
              (271,088
              )Inventories
              
              
              (60,948
              )
              
              
              924,769Prepaid
                  expenses and other assets
              
              
              (66,984
              )
              
              
              234,090Accounts
                  payable
              
              
              (80,573
              )
              
              
              (158,009
              )Accrued
                  expenses
              
              
              (18,058
              )
              
              
              (60,310
              )Net
                  cash flows used in operating activities
              
              
              (242,726
              )
              
              
              (214,440
              )**INVESTING
                  ACTIVITIES:**Purchase
                  of equipment
              
              
              0
              
              
              
              (6,500
              )Proceeds
                  from sale of property, plant and equipment
              
              
              0
              
              
              
              5,000Repayments
                  on note receivable
              
              
              6,836
              
              
              
              20,500Net
                  cash flows provided by (used in) investing activities
              
              
              6,836
              
              
              
              19,000**FINANCING
                  ACTIVITIES:**Net
                  borrowings on note payable, bank
              
              
              0
              
              
              
              545,000Payments
                  on short and long term debt
              
              
              (18,000
              )
              
              
              0Proceeds
                  from preferred stock issuance
              
              
              0
              
              
              
              1,777,989Payment
                  of preferred dividends
              
              
              0
              
              
              
              (71,629
              )Net
                  cash flows provided by financing activities
              
              
              (18,000
              )
              
              
              2,251,360**NET
                  INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS**
              
              
              (253,890
              )
              
              
              2,055,920CASH
                  AND CASH EQUIVALENTS:Beginning
                  of period
              
              
              1,696,340
              
              
              
              247,731End
                  of period
              
              $
              1,442,450
              
              
              $
              2,303,651SUPPLEMENTAL
                  SCHEDULES OF NONCASH INVESTING AND FINANCING ACTIVITIES:Reclassification
                  of common stock warrants to stockholders' equity
              
              $
              0
              
              
              $
              270,163Conversion
                  of long-term debt to stockholders' equity
              
              
              0
              
              
              
              4,564,808Accrued
                  interest added to note payable balance
              
              
              0
              
              
              
              20,601
 
 See
        notes to consolidated financial statements
  5
 ***Contents***
  
 **M-WAVE,
                  Inc.**
 **NOTES
                  TO CONSOLIDATED FINANCIAL
                  STATEMENTS**
 (Unaudited)
 
 **1.  Basis
        of Presentation**
 
 The
        accompanying unaudited consolidated financial statements have been prepared
        in
        accordance with generally accepted accounting principles in the United States
        of
        America for interim financial information and with the instructions to Form
        10-QSB.  Accordingly, they do not include all of the information and
        footnotes required by generally accepted accounting principles for complete
        financial statements. In the opinion of management, all adjustments necessary
        for a fair presentation, consisting only of normal recurring adjustments,
        have
        been included.
  Operating
        results for the three months ended March 31, 2007 are not necessarily indicative
        of the results that may be expected for the year ending December 31,
        2007.  For further information, refer to the financial statements and
        footnotes thereto included in the Company’s annual report on Form 10-KSB for the
        year ended December 31, 2006.
  **2.
        Business Product Lines**
 
 Sales
        by
        product line for the three months ended March 31, 2007 and 2006 consisted
        of the
        following:
  2007
              
              
              2006Digital
              
              $
              1,715,104
              
              
              $
              1,976,189Non
                  PCB
              
              
              457,715
              
              
              
              4,211Other
              
              
              90,102
              
              
              
              311,443Total
                  sales
              
              $
              2,262,921
              
              
              $
              2,291,843
 
 Sales
        within the digital product line include ten key customers, which represented
        approximately 95% of sales in the first quarter of 2007 versus approximately
        84%
        of sales in the first quarter of 2006.  Year to date sales for the
        Company’s top ten digital customers were down approximately 2% compared to prior
        year to date sales.
 
 Non
        printed circuit board (“Non PCB”) sales represent sales of new products, other
        than printed circuit boards, to the Company’s existing digital customer
        base.  Sales within the Non PCB product line include three customers,
        which represented approximately 90% of sales in the first quarter of 2007
        versus
        approximately 100% of sales in the first quarter of 2006.
  6
 ***Contents***
  Other
        sales primarily represent tooling charges billed to customers for either
        new
        products or existing products that have gone through a
        revision.  Prior year other sales also include commission revenues
        billed per our October 2005 agreement with American Standard Circuits (“ASC”),
        pursuant to which the Company sold its “RF” (radio frequency) product line, but
        continued to assist ASC in transitioning the RF customers throughout 2006
        as
        well as sales to former RF customers of its remaining
        inventory.  Prior year sales included approximately $74,000 in
        commissions and approximately $129,000 in sales to former RF customers during
        the first quarter of 2006.
 
 The
        loss
        of, or a substantial reduction in the orders from, the Company’s major customers
        could have a material effect on the financial statements.
 
 **3.
        Debt**
 
 On
        January 25, 2006, the Company entered into an Agreement with Mercator Momentum
        Fund III, amending the Loan Document Purchase Agreements that Mercator purchased
        from Silicon Valley Bank on November 9, 2005.   Provisions of
        this amendment include elimination of certain provisions and conditions of
        the
        loan originally between the Company and Silicon Valley Bank, including financial
        covenants that existed under the original agreement.  As part of this
        amendment, all previous defaults that had existed under the original agreement
        were waived.
 
 In
        connection with the loan purchase, the principal amount due was amended to
        include interest accrued between November 9 and December 31, 2005 of
        approximately $21,000.  As of March 1, 2006, the balance due on the
        bank notes purchased by MAG Capital was approximately
        $1,620,000.  During the first quarter of 2006, MAG Capital provided
        additional debt financing of approximately $545,000.
 
 On
        March
        1, 2006 the Company entered into an agreement with M.A.G. Capital, LLC to
        convert its debt of approximately $4,565,000 into approximately 45,648 shares
        of
        Series B Convertible Preferred Stock.
  The
        amount of debt converted into the Series B Convertible Preferred Stock was
        comprised of the following amounts:
  Promissory
                  notes issued to MAG Capital
              
              $
              2,400,000Bank
                  notes purchased by MAG Capital
              
              $
              1,619,808MAG
                  debt financing first quarter
              
              $
              545,000Total
                  debt converted to equity
              
              $
              4,564,808
  7
 ***Contents***
  Upon
        the
        conversion of debt to equity described above, the remaining unamortized debt
        discount was recognized as interest expense in the amount of approximately
        $357,000 during the first quarter of 2006.
  On
        October 10, 2006, the Company financed equipment for $70,000 with a note
        payable
        with eleven monthly installments of $6,000 and a final payment of
        $4,000.  Amounts outstanding on the note payable at March 31, 2007 are
        $40,000 and are collateralized by the equipment with a depreciated cost of
        approximately $59,000.
  **4.
        Equity**
 
 During
        the first quarter of 2006 the Company issued an aggregate of 45,648 shares
        of
        Series B Convertible Preferred Stock which are convertible into shares of
        the
        Company’s common stock. The Series B Preferred was issued to Mercator Momentum
        Fund, LP, Mercator Momentum Fund III, LP, and Monarch Pointe Fund, Ltd. in
        exchange for cancellation of indebtedness owed to them by the
        Company.
 
 The
        Company also issued an additional 19,000 shares of Series B Preferred Stock
        in
        exchange for $1,900,000 which will be held in a reserve account to be released
        by a majority of the independent directors as appropriate to fund expenses
        of
        the company.
 
 The
        Company paid fees of approximately $122,000 in connection with the combination
        of debt to equity conversion and additional equity placement.
 
 On
        December 29, 2006 the Company issued an additional 5,000 shares of Series
        B
        Preferred Stock in exchange for $500,000.
 
 The
        Series B stock is non-voting and is entitled to receive monthly dividends
        at an
        annual rate of 15%, subject to reduction to 9% after the Registration Statement
        is declared effective by the Securities and Exchange Commission. The Company
        is
        to use its best efforts to file a registration statement covering the shares
        of
        common stock underlying the Series B Convertible Preferred Stock (the
“Conversion Shares”), the shares of common stock underlying the Warrants (the
“Warrant Shares”), and the shares of common stock underlying the Series A
        Preferred Stock issued by the Company to the Purchasers on June 17,
        2004.  Mercator waived their dividend payments for the three months
        ended March 31, 2007.
 
 During
        the first three months of 2007, Mercator did not convert any shares of their
        preferred stock into common shares. As of March 31, 2007 there are 12,500
        Series
        A preferred shares outstanding and 69,648 Series B preferred shares
        outstanding.
  8
 ***Contents***
  Potentially
        dilutive common shares consist of the incremental common shares issuable
        upon
        conversion of convertible preferred shares, and the exercise of common stock
        options and warrants for all periods.  For all periods ended March 31,
        2007 and 2006, the basic and diluted shares reported are equal because the
        common share equivalents are anti-dilutive due to the net losses for each
        period.  Below is a tabulation of the potentially dilutive
        securities:
  2007
              
              
              2006Weighted
                  average shares outstanding
              
              
              1,763,150
              
              
              
              1,550,650Options
                  in the money, net
              
              
              68,302
              
              
              
              6,081Warrants
                  in the money, net
              
              
              127,026
              
              
              
              17,164Preferred
                  shares convertible to Common
              
              
              2,204,051
              
              
              
              -Total
                  Outstanding and PotentiallyDilutive
                  shares
              
              
              4,162,529
              
              
              
              1,573,895
  On
        February 28, 2006, the Company re-priced all of their warrants issued to
        M.A.G.
        Capital, LLC and related entities.  A total of 532,862 warrants were
        re-priced from between $4.08 and $5.08 per share to $2.48 per share, one
        cent
        above the closing market price on that date.  The Company recorded
        approximately $286,000 of stock compensation expense during 2006 related
        to the
        re-pricing of these warrants.  The fair value of the re-pricing was
        determined using the Black Scholes option pricing model.
 
 **5.
        Litigation**
 
 The
        Company is not a party to any litigation whose outcome is expected to have
        a
        material adverse effect on the financial position or results of operations
        of
        the Company.
 
 **6.
        Share-Based Compensation**
  The
        Company has a stock option plan that authorizes the granting of options to
        officers, key employees and directors to purchase the Company’s common stock at
        prices equal to or above the market value of the stock at the date of
        grant.  Under this plan the Company has 2 shares available for future
        grants as of March 31, 2007.  The exercise price of all employee and
        director options granted in 2007 and 2006 were above fair market
        value.
  Compensation
        expense is recognized only for share-based payments expected to vest. We
        estimate forfeitures at the date of grant based on our historical experience
        and
        future expectations. Estimated forfeitures are expected to be minimal and
        not
        material to the financial statements.
  9
 ***Contents***
  The
        Company recognizes share-based compensation expense in general and
        administrative expenses in the statement of operations.  For the three
        months ended March 31, 2007 and 2006 respectively, the Company issued 11,592
        and
        166,331 options, respectively.  These grants were priced at $3.41 and
        $2.72 respectively.  There were no options exercised or forfeited
        during the three months ended March 31, 2007 and 2006,
        respectively.
  Information
        related to the Company’s share-based compensation plan for the three months
        ended March 31, 2007 and 2006, is as follows:
 
 2007
              
              
              2006Total
                  share-based compensation expense
              
              $
              92,173
              
              
              $
              331,422Weighted
                  average grant date fair value
              
              $
              3.10
              
              
              $
              2.48Unrecognized
                  compensation cost
              
              
              0
              
              
              
              233,733Remaining
                  weighted average period cost will be recognized over
              
              
              0.00
              
              
              
              0.80
  Total
        common stock warrants outstanding at March 31, 2007 were 404,113, and were
        all
        exercisable at March 31, 2007.
 
 **7.
        Taxes**
  In
        July
        2006, the FASB issued FASB Interpretation No. 48 (FIN 48) "Accounting for
        Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109,
        Accounting for Income Taxes". FIN 48 clarifies the accounting for income
        taxes
        by prescribing the minimum recognition threshold a tax position is required
        to
        meet before being recognized in the financial statements. FIN 48 also provides
        guidance on derecognition, measurement, classification, interest and penalties,
        accounting in interim periods, disclosure and transition. The interpretation
        applies to all tax positions related to income taxes subject to FASB Statement
        No. 109.
  FIN
        48 is
        effective for fiscal years beginning after December 15, 2006. Differences
        between amounts recognized in the statements of financial position prior
        to the
        adoption of FIN 48 and the amounts reported after adoption should be accounted
        for as cumulative-effect adjustment recorded to the beginning balance of
        retained earnings. The adoption of FIN 48 did not have a material impact
        on our
        loss from continuing operation, net loss, or earnings per share.
  The
        Company currently has not developed a policy on classification of interest
        and
        penalties.  The Company has no unrecognized tax benefits, accrued
        interest, or penalties as of the date of adoption.  The Company has no
        tax positions at the date of adoption in which it is reasonably possible
        that
        the total amounts of unrecognized tax benefits will significantly increase
        within one year of the adoption of FIN 48.  Tax years 2004 through
        2006 remain subject to examination by major tax jurisdictions upon the adoption
        of FIN 48.
  10
 ***Contents***
  **8.
        Reclassifications**
 
 Certain
        items in the 2006 consolidated financial statements have been reclassified
        to
        conform to the 2007 presentation.
 
 **9.
        Discontinued Operations**
 
 The
        Company follows the provisions of SFAS 144 to identify and account for
        discontinued operations.  The Company carried assets and liabilities
        related to its discontinued operations on its balance sheet.  These
        assets were carried at their net book value which approximated its estimated
        net
        realizable value less estimated costs to sell the assets, and were included
        with
        assets from continuing operations in the accompanying consolidated balance
        sheet.  These liabilities are carried at their net book value which
        approximated the full amount of consideration necessary to settle these
        obligations.  The approximate carrying value of these assets and
        liabilities at March 31, 2007 and December 31, 2006 is below:
 
 2007
              
              
              2006Accounts
                  Receivable
              
              $
              60,000
              
              
              $
              65,000Inventory
              
              
              0
              
              
              
              0Prepaid
                  Expenses
              
              
              0
              
              
              
              0Total
                  assets
              
              $
              60,000
              
              
              $
              65,000Accounts
                  Payable
              
              $
              0
              
              
              $
              0Accrued
                  Expenses
              
              
              0
              
              
              
              0Total
                  Liabilities
              
              $
              0
              
              
              $
              0
 
 On
        January 9, 2006, the Company announced it had taken steps to liquidate its
        M-Wave DBS, Inc (DBS) assets it previously acquired in February
        2005.  In connection with that activity, the Company announced that it
        had terminated all but its logistics and warehousing DBS personnel and
        discontinued current operations.
 
 The
        Company entered into an agreement in October 2006 to complete the liquidation
        of
        all remaining inventory by the end of the year at a selling price which
        approximated the carrying value of approximately $169,000 at September 30,
        2006.
        The Company also settled all of its remaining obligations to DBS inventory
        suppliers for nominal value.  Based on these vendor settlements, the
        Company recorded approximately $324,000 in vendor debt forgiveness during
        the
        second quarter of 2006, which are included in the results from discontinued
        operations.
  11
 ***Contents***
  The
        net
        loss from discontinued operations for the three months ended March 31, 2007
        and
        2006 are as follows:
 
 2007
              
              
              2006Net
                  sales
              
              $
              0
              
              
              $
              748,665Cost
                  of goods sold
              
              
              0
              
              
              
              941,830Gross
                  (loss)/profit
              
              
              0
              
              
              
              (193,165
              )Operating
                  expenses
              
              
              0
              
              
              
              56,225Loss
                  from discontinued operations
              
              $
              0
              
              
              $
              (249,390
              )
 
 
 The
        loss
        from discontinued operations resulted in an increase to the basic and diluted
        loss per common share of approximately $0.00 and $0.16 for the three months
        ended March 31, 2007 and 2006 respectively.
 
 **10.  New
        Accounting Pronouncements**
 
 In
        February 2007, the FASB issued SFAS 159, *The Fair Value Option for Financial
        Assets and Financial Liabilities*.  SFAS 159 permits entities to choose
        to measure many financial instruments and certain other items at fair value
        at
        specified election dates. Under SFAS 159, a business entity shall report
        unrealized gains and losses on items for which the fair value option has
        been
        elected in earnings (or another performance indicator if the business entity
        does not report earnings) at each subsequent reporting date.  SFAS 159 also
        establishes presentation and disclosure requirements designed to facilitate
        comparisons between entities that choose different measurement attributes
        for
        similar types of assets and liabilities.  This Statement is effective for
        fiscal years beginning after November 15, 2007.   The Company does not
        believe that adoption of SFAS 159 will have a material effect on its financial
        statements.
 
 **Item
        2:**
 
 **MANAGEMENT'S
        DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
        OPERATIONS**
  We
        are a
        value added service provider of high performance printed circuit boards used
        in
        a variety of digital and high frequency communications applications for a
        variety of telecommunications and industrial electronics applications. We
        satisfy our customers’ requirements for telecommunications and industrial
        electronics printed circuit boards, either rigid, flexible or bonded, by
        directly booking orders, supervising and inspecting outsourced manufacture
        of
        such boards through our global base of production partners located in China
        and
        Southeast Asia, and domestically, through pre-screened production
        partners.
  12
 ***Contents***
  Our
        business model is referred to as Virtual Manufacturing. Through Virtual
        Manufacturing we contractually supply a wide range of printed circuit board
        needs of our customers, creating a “pipeline” between those customers and
        production that covers early prototypes and pilot production, directly into
        mass
        production, offering one seamless source. We deliver products when our customers
        need them through consignment inventory control, demand pull, just in time,
        in
        plant storehouses, supplier or vendor managed inventory and other supply-chain
        programs.
  We
        began
        Virtual Manufacturing during 2000 by developing subcontracting relationships
        with predominately Asian global manufacturers, from our base in Singapore.
        In
        virtual manufacturing, we assume many of the pre and post-production services
        of
        a manufacturer, while outsourcing the physical processes either adjunct to
        our
        personnel or in relatively close proximity to assure the highest quality
        fulfillment.
  Our
        manufacturing partners maintain most certificates for quality, environmental
        and
        safety, including ISO, QS, UL, CE and others. We believe our manufacturing
        partners have a reputation for timely fulfillment of orders that are
        competitively priced, shipped from modern plants operating with the highest
        standards of worker and environmental safety both within and outside of the
        United States.
  We
        market
        our products through regional sales managers supported by independent sales
        organizations.  Our base of approximately 50 customers represents a
        highly sophisticated group of purchasers.
  In
        2005,
        we started to solicit new orders and extend our product lines to include
        custom
        or engineered electronic products sourced from Asia on behalf of existing
        accounts. These products are sourced and imported on a pan-Asian basis and
        cover
        a broad range of components that include LED’s, wire bonding services,
        harnesses, extruded housing products, and other customer specific
        products.  This effort has been geared toward diversifying and
        increasing our overall margins. Initially, we solicited existing customers,
        but
        we also intend to solicit new accounts.  Our niche focuses in a higher
        mix of products at lower volumes that larger scale distributors or brokers
        fail
        to address.  Our customers tend to be smaller middle market companies
        through midsize firms with little presence or capability in Asia that elect
        us
        as their procurement partners.
 
 **Significant
        Event**
  On
        January 26, 2007, the Company entered into a Merger Agreement with SunFuels,
        Inc. and Blue Sun Biodiesel, LLC (SunFuels).
  13
 ***Contents***
  SunFuel’s
        primary business is the acquisition and distribution of canola oils refined
        into
        a biodiesel blend that can operate in both commercial and passenger vehicles.
        The primary marketing of SunFuel’s products focuses on the branded Blue Sun
        FusionTM that is a blend of premium Blue Sun Biodiesel (20%) with petroleum
        diesel fuel (80%), along with Blue Sun's proprietary additive package
        specifically tailored for regional climates and seasons.  Blue Sun
        indicates that it will also refine biodiesel products from the plant it intends
        to break ground on early in 2007 located in Los Cruces, New Mexico
  The
        transaction is expected to close in 2007, pending satisfaction of conditions
        to
        closing. When the transaction closes, certain directors and the officers
        of
        SunFuels will assume control of the Company, which will change its name to
        Blue
        Sun Holdings, Inc.  The Company’s operating subsidiary will be renamed
        Blue Sun Biodiesel, Inc.  The Company is expected to be a publicly traded
        and reporting company following the closing of the transaction.
 
 As
        consideration for the merger transaction, the outstanding equity securities
        of
        SunFuels will be exchanged for equity securities of
        M-Wave.  Specifically, outstanding SunFuels Common Stock, Series A
        Convertible Preferred Stock, options and warrants will be exchanged for Company
        Common Stock, Series C Convertible Preferred Stock, options and warrants,
        respectively.  As a result, the holders of such SunFuels equity
        securities will own approximately 87.2% of the Common Stock of the Company,
        on a
        fully-diluted basis, assuming (i) the completion of the SunFuels Series A
        Convertible Preferred Stock financing described below and (ii) conversion
        or
        exercise of all convertible or exercisable securities of the Company that
        will
        be outstanding after the completion of the merger.  Similarly, all of
        the outstanding Blue Sun membership interests not already owned by SunFuels
        will
        be exchanged for shares of Company Common Stock.  As a result, the
        holders of such Blue Sun membership interests will own approximately 3.8%
        of the
        Common Stock of the Company, as so calculated on a fully-diluted
        basis.  The currently outstanding shares of M-Wave Common Stock will
        remain outstanding and, following the exchange of SunFuels and Blue Sun equity
        securities for M-Wave equity securities, the currently outstanding shares,
        warrants and options of M-Wave will represent approximately 9.0% of the
        outstanding shares, warrants, and options of the Company, as so calculated
        on a
        fully-diluted basis.
 
 The
        merger transaction is subject to the approval by the stockholders of M-Wave
        and
        SunFuels and the members of Blue Sun, receipt of all required consents, receipt
        of all regulatory approvals, and other customary closing
        conditions.  Holders of a majority of the outstanding shares of each
        class of stock of SunFuels and holders of approximately 48% of the outstanding
        shares of Common Stock of M-Wave and 100% of the outstanding shares of each
        class of preferred stock of M-Wave have agreed to vote in favor of the
        mergers.  SunFuels, which holds 94.4% of the outstanding Blue Sun
        membership interests, has agreed to the Blue Sun merger.  In addition,
        the merger transaction is subject to the receipt of the remaining $10.125
        million in SunFuels Series A Convertible Preferred Stock. There can be no
        assurances that SunFuels will receive the remaining $10.125 million or that
        the
        merger transaction will be completed as contemplated.
  14
 ***Contents***
  Because
        the holders of the equity securities of SunFuels will acquire a majority
        of
        M-Wave’s shares of capital stock as a result of the merger transaction, the
        merger transaction will be treated as a reverse merger for accounting purposes,
        and SunFuels will be deemed to be the acquirer in the reverse merger.
        Consequently, the historical financial statements of the Company will be
        the
        historical financial statements of SunFuels rather than the historical financial
        statements of M-Wave, and the assets and liabilities of SunFuels will be
        recorded at their historical cost basis to SunFuels, and the assets and
        liabilities of M-Wave will be recorded as if they were purchased on the closing
        date at their fair market value on that date.
  **RESULTS
        FOR THE THREE MONTHS ENDED March 31, 2007 COMPARED TO THE THREE MONTHS March
        31,
        2006**
 
 **Net
        Sales**
 
 Net
        sales
        were approximately $2,263,000 for the three months ended March 31, 2007 versus
        approximately $2,292,000 during the three months ended March 31, 2006, a
        decrease of approximately $29,000 or 1.3%.  Sales within our digital
        product line decreased approximately $261,000 during the first quarter of
        2007,
        a decrease of approximately 13% of prior year first quarter
        sales.   Primary factor was lower sales amongst our smaller
        customers of approximately $234,000.  Sales to our top ten digital
        customers was approximately $1,636,000 during the three months ended March
        31,
        2007, a decrease of approximately $29,000 compared to the three months ended
        March 31, 2006.  Sales amongst our top ten digital customers
        represented approximately 95% of sales within this product line for the three
        months ended March 31, 2007 compared to approximately 84% of sales within
        this
        product line for the three months ended March 31, 2006.
 
 Sales
        within our non-PCB product line were approximately $458,000 for the three
        months
        ended March 31, 2007, approximately $454,000 above sales for the first three
        months offended March 31, 2006. As this line grows, we expect to achieve
        long-term revenues to approach those currently experienced within our digital
        product line.  The non-PCB sales recorded in the first quarter were
        the result of our ongoing efforts to effectively grow our core business into
        other products that we initiated during the latter half of 2005.  We
        continue to focus our efforts on growing our core business and customer base,
        primarily by concentrating efforts on expanding our customer base within
        our
        digital product line.  In addition, we are expanding our global
        sourcing efforts beyond printed circuit boards into other product lines such
        as
        extrusions, wire harnesses, castings, spinning’s, etc. Sourcing of these
        additional product lines, initially to our existing customer base, we believe
        will improve our operating results by providing increased profits on these
        products than we experienced with our former radio frequency (“RF”) product
        line.
  15
 ***Contents***
  Other
        revenues for the three months ended March 31, 2007 were approximately $90,000,
        approximately $221,000 below other revenues recorded in the three months
        ended
        March 31, 2006.  Other revenues primarily consist of tooling charges
        for new and redesigned products, freight charges billed, and cash discounts
        taken by customers for early payments, which are recorded as a reduction
        of
        sales.  Other sales for the prior year also included sales of our
        remaining RF inventory during the first half of the year and commissions
        received on providing sales assistance after the sales of our RF product
        line in
        late 2005.  Those commissions were received throughout 2006, and
        concluded on December 31, 2006.  Primary drivers in the decrease were
        prior year sales of our remaining RF product of approximately $129,000 and
        a
        decrease in commissions of approximately $57,000.  Tooling revenues
        decreased by approximately $24,000 in the first quarter of 2007 versus prior
        year sales.
  **Gross
        Profit and Cost of Goods Sold**
 
 The
        Company’s gross profit for the first three months ended March 31, 2007 was
        approximately $563,000, or 24.9% of net sales, compared to a gross profit
        of
        approximately $602,000, or 26.3% of net sales, for the three months ended
        March
        31, 2006.  Primary driver in the reduced margin dollars and percentage
        were commissions received during the prior year.  Margins within our
        digital product line increased by approximately 0.7% over the prior year
        as we
        continue to focus sales efforts on our higher margin customers.
 
 **Operating
        Expenses**
 
 General
        and administrative expenses were approximately $676,000 or 29.9% of net sales
        in
        the first quarter of 2007 compared to approximately $1,577,000 or 68.8% of
        net
        sales in the first quarter of 2006, a decrease of approximately
        $901,000.
 
 General
        and administrative expenses consist primarily of salaries and benefits,
        professional services, depreciation of office, equipment and computer systems
        and occupancy expenses. In comparison to the first quarter of 2006, payroll
        related expenses decreased approximately $12,000.   Professional
        services, which include legal, auditing, and consulting fees, increased
        approximately $43,000 in 2007 compared to prior year expenses.  Public
        company related costs such as investor relations, Sarbanes-Oxley expenses,
        and
        board and committee fees were approximately $124,000 in the first quarter
        of
        2007 compared to approximately $483,000 during the first quarter of 2006,
        a
        decrease of approximately $359,000.  We recorded stock compensation
        expenses during the first quarter of 2007 of approximately $92,000 compared
        to
        approximately $569,000 for the first quarter of 2006, a decrease of
        approximately $477,000.  Stock compensation expense is primarily
        related to Board of Director and employee stock option grants issued during
        the
        first three months of 2007 and 2006, respectively.  Prior year stock
        compensation expense also includes expenses of approximately $238,000 recorded
        when we re-priced warrants in connection with our debt to equity conversion
        in
        the first quarter of 2006.  Other operating expenses decreased
        approximately $96,000 during the first quarter of 2007 compared to the first
        quarter of 2006, primarily due to a refund on prior year workers compensation
        premium of approximately $24,000, loss on the sale of assets in the prior
        year
        of approximately $24,000, and a reduction of miscellaneous operating expenses
        of
        approximately $48,000.
  16
 ***Contents***
  Selling
        and marketing expenses were approximately $213,000 or 9.4% of net sales in
        the
        first quarter of 2007 compared to approximately $206,000 or 9.0% of net sales
        in
        the first quarter of 2006.  Selling and marketing expenses include the
        cost of salaries, advertising and promotion of the Company’s products, and
        commissions paid to independent sales organizations. In comparison to the
        first
        quarter of 2006, commission paid to independent sales organizations decreased
        by
        approximately $5,000; payroll-related expenses increased by approximately
        $15,000. Costs related to our Singapore office increased by approximately
        $6,000; other sales expenses, including travel related expenses decreased
        by
        approximately $9,000 in the first quarter of 2007 versus 2006.
 
 **Operating
        Loss**
 
 Operating
        loss from continuing operations was approximately $327,000 in the first quarter
        of 2007 compared to an operating loss of approximately $1,181,000 in the
        first
        quarter of 2006. The decrease in operating loss of approximately $854,000
        was
        primarily related to lower administrative expenses of approximately $901,000
        described above.
 
 **Interest
        Income**
 
 We
        recorded no interest income during the first quarter of 2007 or
        2006.
 
 **Interest
        Expense**
  We
        recorded no interest expense during the first quarter of 2007, compared to
        approximately $404,000 during the first quarter of
        2006.   Primary factor in the decrease in interest expense
        related to our conversion of our debt to equity in March 2006, whereby we
        expensed the remaining unamortized debt discount as interest expense in the
        amount of approximately $357,000 for the period ended March 31,
        2006.  We paid approximately $62,000 in interest expenses related to
        interest on our promissory notes during the first quarter of 2006. We recorded
        a
        reduction of interest expense of approximately $15,000 related to the
        re-valuation of warrants during the first quarter of 2006.
  17
 ***Contents***
  **Preferred
        Stock Dividends**
 
 We
        did
        not record any preferred stock dividends in the first quarter of 2007, primarily
        due to the waiver of dividend payments by our preferred
        stockholder.  The Company recorded approximately $72,000 in preferred
        dividend expense during the first quarter of 2006 related to the issuance
        of
        Series B preferred stock to M.A.G. Capital, LLC, and its affiliates, in March
        2006.
 
 **Liquidity
        and Capital Resources**
 
 Net
        cash
        used by operations was approximately $243,000 for the first three months
        of 2007
        compared to approximately $214,000 used by operations for the first three
        months
        of 2006.
 
 Accounts
        Receivable decreased approximately $196,000 due to improved collections.
        Inventories decreased approximately $61,000 related to normal monitoring
        of
        inventory levels. Accounts Payable decreased approximately $81,000 primarily
        due
        to the payments to suppliers in the normal course of business.
 
 Net
        cash
        provided by investing activities was approximately $7,000 for the first three
        months of 2007 compared to approximately $19,000 in the first three months
        of
        2006.   Capital expenditures were $0 in the three months of 2007
        compared to approximately $7,000 in the first three months of 2006.
 
 Net
        cash
        used in financing activities was approximately $18,000 during the first three
        months of 2007, primarily through payments on our note payable for equipment
        acquired in the prior year. Net cash provided by financing activities in
        the
        first three months of 2006 was approximately $2,251,000 related to borrowings
        of
        approximately $545,000 and issuance of preferred stock of approximately
        $1,778,000.
 
 Currently
        the Company is committed to growing its core business, as it relates to the
        continuing operations of its digital product line and other non-PCB components
        and assemblies. The Company also announced a merger agreement with SunFuels,
        Inc. and Blue Sun Biodiesel LLC on January 26th that
        expects to
        close during 2007.  However, if the Company is unable to secure adequate
        financing to grow its core business, or if the merger agreement is not
        consummated, the Company may be forced to modify its business and strategic
        plan.
  18
 ***Contents***
  Based
        upon the current level of operations and anticipated growth, restructuring
        of
        its business focusing on higher margin product lines, placement of follow
        on
        equity financing during the past year, we believe that future cash flows
        from
        operations will be adequate to meet our anticipated liquidity requirements
        through this fiscal year.
 
 **Inflation**
 
 Management
        believes inflation has not had a material effect on the Company’s operations or
        on its financial position.  However, expected supplier price increases
        averaging approximately 4% may have a material effect on the Company’s
        operations and financial position in the remainder of 2007, if the Company
        is
        unable to pass through those increases under its present contracts.
 
 **Foreign
        Currency Transactions**
 
 All
        of
        the Company’s foreign transactions are negotiated, invoiced and paid in United
        States dollars.
 
 **Risk
        Factors Affecting Business and Results of Operations**
 
 This
        report, as well as our other reports filed with the SEC, our press releases,
        and
        other communications contain forward-looking statements made pursuant to
        the
        safe harbor provisions of the Securities Litigation Reform Act of 1995.
        Forward-looking statements include all statements regarding our expected
        financial position, results of operations, cash flows, dividends, financing
        plans, strategy, budgets, capital and other expenditures, competitive positions,
        growth opportunities, benefits from new technology, plans and objectives
        of
        management, and markets for stock. These forward-looking statements are based
        largely on our expectations and, like any other business, are subject to
        a
        number of risks and uncertainties, many of which are beyond our control.
        The
        risks include those stated in the section entitled "Risk Factors Affecting
        Business and Results of Operations" at the end of Item 6 of our Annual Report
        on
        Form 10-KSB and economic, competitive and other factors affecting our
        operations, markets, products and services, expansion strategies and other
        factors discussed elsewhere in this report, our Annual Report on Form 10-KSB
        and
        the other documents we have filed with the Securities and Exchange Commission.
        In light of these risks and uncertainties, there can be no assurance that
        the
        forward-looking information contained in this report will in fact prove
        accurate, and our actual results may differ materially from the forward-looking
        statements.
  19
 ***Contents***
  **Item
        3:Controls and Procedures**
  ***a)
        Disclosure controls and procedures***.  As of the end of
        the period covered by this report, the Company carried out an evaluation,
        under
        the supervision and with the participation of the Company's management,
        including the Company's Chief Executive Officer and the Company's Chief
        Financial Officer, of the effectiveness of the design and operation of the
        Company's disclosure controls and procedures (as defined in Rules 13a-15(e)
        and
        15d-15(e) under the Securities and Exchange Act of 1934, as
        amended).
 
 Based
        on
        this evaluation, our Chief Executive Officer and Chief Financial Officer
        concluded that our disclosure controls and procedures were effective, except
        as
        discussed in the next paragraph below, and in timely alerting them to material
        information relating to the Company required to be included in our periodic
        filings with the Securities and Exchange Commission. It should be noted that
        in
        designing and evaluating the disclosure controls and procedures, management
        recognized that any controls and procedures, no matter how well designed
        and
        operated, can provide only reasonable assurance of achieving the desired
        control
        objectives, and management necessarily was required to apply its judgment
        in
        evaluating the cost-benefit relationship of possible controls and procedures.
        The Company has designed its disclosure controls and procedures to reach
        a level
        of reasonable assurance of achieving desired control objectives and, based
        on
        the evaluation described above, the Company’s Chief Executive Officer and Chief
        Financial Officer concluded that the Company’s disclosure controls and
        procedures were effective at reaching that level of reasonable assurance,
        except
        as discussed in the next paragraph below.
 
 As
        previously reported in the Company’s annual report on Form 10-KSB for the year
        ended December 31, 2006, the Company has a material weakness within its internal
        control framework relating to the preparation and timeliness of financial
        reporting, in connection with the adequacy of segregation of
        duties.  The Company attributes this material weakness to limited
        personnel resources. Though the Company has implemented levels of supervisory
        reviews from time to time, and employs a temporary workforce from time to
        time,
        there can be no assurance that these measures can definitively prevent
        transactional errors from occurring or provide the necessary accounting and
        financial reporting support to the Company’s accounting and finance
        department.
 
 **(b)*****Changes in internal
        controls*****.** There was no change in the Company's
        internal control over financial reporting during the three months ended March
        31, 2007 that has materially affected, or is reasonably likely to materially
        affect, its internal control over financial reporting.
  20
 ***Contents***
  **Part
        II - Other Information**
 
 **Item
        1:  Legal Proceedings**
 
 None
 
 **Item
        2:  Unregistered Sales of Equity Securities and Use of Proceeds**
 
 None
 
 **Item
        3:  Defaults Upon Senior Securities**
 
 None
 
 **Item
        4:  Submission of Matters to a Vote of Security Holders**
 
 None
 
 **Item
        5:  Other Information**
 
 None
 
 **Item
        6: Exhibits**
 
 (a)
              Exhibits
 
 31.1
              Certification
                  of the CEO pursuant to Section 302 of the Sarbanes-Oxley
                  Act.
 
 31.2
              Certification
                  of the CFO pursuant to Section 302 of the Sarbanes-Oxley
                  Act.
 
 32.1
              Certification
                  pursuant to 18 U.S.C. Section 135O, as adopted pursuant to section
                  906 of
                  the Sarbanes-Oxley Act of 2002.
 
 **SIGNATURE**
 
 Pursuant
        to the requirements of the
        Securities and Exchange Act of 1934, the registrant has duly caused this
        report
        to be signed on its behalf by the undersigned thereunto duly
        authorized.
 
 **M~WAVE,
                  Inc.**Date:
                  May 15, 2007
              /s/    Jeff
                  FiglewiczJeff
                  FiglewiczChief
                  Financial Officer
  21
 ***Contents***
 
 **Exhibit
                  Index****Exhibit****No.**
              
              **Description**
              
              **Location**2.1
              
              Agreement
                  and Plan of Merger, dated January 26, 2007, by and between M-Wave,
                  Inc.,
                  Ocean Merger Sub Inc., Sunfuels Inc., and Blue Sun Biodiesel
                  LLC
              
              123.1
              
              Certificate
                  of Incorporation of the Company
              
              13.2
              
              Bylaws
                  of the Company
              
              13.3
              
              Certificate
                  of Designations for Series A Convertible Preferred Stock
              
              43.4
              
              Certificate
                  of Designations for Series B Convertible Preferred Stock
              
              104.1
              
              Specimen
                  Common Stock Certificate
              
              310.1
              
              2003
                  Stock Incentive Plan
              
              210.2
              
              Warrant
                  to Purchase Stock dated March 31, 2004 by and between the Company
                  and
                  Silicon Valley Bank
              
              210.3
              
              Employment
                  Agreement dated July 28, 2004 between the Company and Jim
                  Mayer
              
              310.4
              
              Employment
                  Agreement dated July 28, 2004 between the Company and Joe
                  Turek
              
              310.5
              
              Employment
                  Agreement dated May 1, 2004 between the Company and Robert
                  Duke
              
              310.6
              
              Subscription
                  Agreement date June 28, 2004 between the Company and Mercator Advisory
                  Group
              
              310.7
              
              Stock
                  Registration Rights Agreement date June 28, 2004 between the Company
                  and
                  Mercator Advisory Group
              
              310.8
              
              Non-statutory
                  Stock Option Agreement date July 28, 2004 between the Company and
                  Jim
                  Mayer
              
              3
 
 22
 ***Contents***
 10.9
              
              Asset
                  Purchase Agreement, dated February 25, 2005 by and between Jayco
                  Ventures,
                  Inc. and M-Wave DBS, Inc.
              
              510.10
              
              Promissory
                  Note dated February 23, 2005 issued by M-Wave, Inc. to Mercator
                  Momentum
                  Fund, L.P.
              
              510.11
              
              Promissory
                  Note dated February 23, 2005, issued by M-Wave, Inc. to Monarch
                  Pointe
                  Fund, L.P.
              
              510.12
              
              Warrant
                  , dated February 23, 2005 issued by M-Wave, Inc. to Mercator Momentum
                  Fund, L.P.
              
              510.13
              
              Warrant
                  to dated February 23, 2005 issued by M-Wave, Inc, to Monarch Pointe
                  Fund,
                  L.P.
              
              510.14
              
              Warrant
                  dated February 23, 2005, issued by M-Wave, Inc. to M.A.G. Capital,
                  LLC
              
              510.15
              
              Non-statutory
                  Stock Option Agreement dated December 31, 2004 between Company
                  and Gordhan
                  Patel
              
              610.16
              
              Amendment
                  to 2003 Stock Incentive Plan
              
              710.17
              
              Sale
                  of real property located at 215 Park Street Bensenville,
                  Illinois
              
              810.18
              
              Asset
                  sale and transition agreement dated October 21, 2005 between the
                  Company
                  and American Standard Circuits
              
              810.19
              
              Agreement
                  with the Mercator Momentum Fund III amending Loan Document Purchase
                  Agreements it acquired from Silicon Valley Bank on November 9,
                  2005
              
              910.20
              
              Subscription
                  Agreement by and among: M-Wave, Inc.; Mercator Momentum Fund,
                  LP;  Mercator Momentum Fund III, LP; Monarch Pointe Fund, Ltd.;
                  and M.A.G. Capital, LLC dated March 1, 2006.
              
              1010.21
              
              Registration
                  Rights Agreement by and among: M-Wave, Inc.; Mercator Momentum
                  Fund,
                  LP;  Mercator Momentum Fund III, LP; Monarch Pointe Fund, Ltd.;
                  and M.A.G. Capital, LLC dated March 1, 2006.
              
              10
  23
 ***Contents***
 10.22
              
              Amendment
                  modifying the terms of existing warrants held by Mercator Momentum
                  Fund,
                  LP; Mercator Momentum Fund III, LP; Monarch Pointe Fund, Ltd.;
                  and M.A.G.
                  Capital, LLC, dated March 1, 2006.
              
              1010.23
              
              Sale
                  of real property located at 544 Pine Street Bensenville,
                  Illinois
              
              1310.24
              
              Subscription
                  Agreement by and among: M-Wave, Inc.; Mercator Momentum Fund,
                  LP;  Mercator Momentum Fund III, LP; Monarch Pointe Fund, Ltd.;
                  and M.A.G. Capital, LLC dated December 29, 2006.
              
              1110.25
              
              Registration
                  Rights Agreement by and among: M-Wave, Inc.; Mercator Momentum
                  Fund, LP;
                  Mercator
                  Momentum Fund III, LP; Monarch Pointe Fund, Ltd.; and M.A.G. Capital,
                  LLC
                  dated
                  December 29, 2006.
              
              1110.26
              
              Exercise
                  Agreement, dated January 26, 2007, between M-Wave, Inc. and MAG
                  Capital,
                  LLC, Mercator Momentum Fund, LP, Mercator Momentum Fund III, LP,
                  and
                  Monarch Pointe Fund, Ltd.
              
              1210.27
              
              Form
                  of Voting Agreement between SunFuels, Inc. and certain of the shareholders
                  of M-Wave, Inc.
              
              1231.1
              
              Certification
                  of the CEO Pursuant to Sections 302 of the Sarbanes-Oxley
                  Act
              
              FiledHerewith31.2
              
              Certification
                  of the CFO Pursuant to Sections 302 of the Sarbanes-Oxley
                  Act
              
              FiledHerewith32.1
              
              Certification
                  pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                  906 of
                  the Sarbanes-Oxley Act
              
              FiledHerewith(1)
              
              Incorporated
                  herein by reference to the applicable exhibit to Registrants Registration
                  Statement on Form S-1 (Registration No. 33-45499)
  24
 ***Contents***
 (2)
              
              Incorporated
                  herein by reference to the applicable exhibit to the Registrant's
                  Annual
                  Report on Form 10K for the year ended December 31, 2003(3)
              
              Incorporated
                  herein by reference to the applicable exhibit to the Registrant's
                  Quarterly Report on Form 10-QSB for the quarter ended June 30,
                  2004(4)
              
              Incorporated
                  herein by reference to Appendix B to the Registrant's Definitive
                  Proxy
                  Statement filed July 6, 2004(5)
              
              Incorporated
                  herein by reference to the applicable exhibit to the Registrant's
                  form 8-K
                  filed March 2, 2005(6)
              
              Incorporated
                  herein by reference to the applicable exhibit to the Registrant's
                  Annual
                  Report on Form 10-KSB for the year ended December 31, 2004(7)
              
              Incorporated
                  herein by reference to Appendix A  to the Registrant's Proxy
                  Statement filed April 29, 2005(8)
              
              Incorporated
                  herein by reference to the applicable exhibit to the Registrant's
                  form 8-K
                  filed October 5, 2005(9)
              
              Incorporated
                  herein by reference to the applicable exhibit to the Registrant's
form
                  8-K filed February 2, 2006(10)
              
              Incorporated
                  herein by reference to the applicable exhibit to the Registrant's
                  form 8-K
                  filed March 7, 2006(11)
              
              Incorporated
                  herein by reference to the applicable exhibit to the Registrant's
                  form 8-K
                  filed January 4, 2007(12)
              
              Incorporated
                  herein by reference to the applicable exhibit to the Registrant's
                  form 8-K
                  filed February 1, 2007(13)
              
              Incorporated
                  herein by reference to the applicable exhibit to the Registrant's
                  Annual
                  Report on Form 10-KSB for the year ended December 31, 2006






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