---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
20549

FORM 10-QSB

(Mark One)

[X] Quarterly report under Section 13 or 15(d) of the
Securities Exchange Act of 1934

for the quarterly period ended September 30,
2006.

[   ] Transition report under Section 13 or 15(d) of
the Securities Exchange Act of 1934

for the transition period from __________________ to
__________________.

Commission file number: 000-27407

MANGAPETS, INC.(Formerly
Newmark Ventures, Inc.)(Exact name of small business issuer as specified
in its charter)

|DELAWARE                        | 98-0187705         
|------------------------------- | -------------------
|(State or other jurisdiction of | (I.R.S. Employer   
|incorporation or organization)  | Identification No.)

2608 Finch Hill , Vancouver, B.C., Canada V7S
3H1(Address of principal executive office) (Postal Code)

(604) 921-2800(Registrants telephone
number)

Check whether the registrant: (1) filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act during the past 12
months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days.Yes [X] No [   ]

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 number of issued and outstanding shares of the registrants
common stock, $0.001 par value (the only class of voting stock), as of
December 21st,006 was 6,304,373.

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TABLE OF CONTENTS

|PART I: FINANCIAL INFORMATION                                       | 3 
|------------------------------------------------------------------- | --
|                                                                    |   
|ITEM 1. FINANCIAL STATEMENTS                                        | 3 
|                                                                    |   
|Unaudited Balance Sheet                                             | 4 
|                                                                    |   
|Unaudited Statements of Operations                                  | 5 
|                                                                    |   
|Unaudited Statement of Stockholders Equity
      (deficit)         | 6 
|                                                                    |   
|Unaudited Statements of Cash Flows                                  | 8 
|                                                                    |   
|Notes to Unaudited Financial Statements                             | 9 
|                                                                    |   
|ITEM 2. MANAGEMENT'S PLAN OF OPERATION                              | 15
|                                                                    |   
|ITEM 3. CONTROLS AND PROCEDURES                                     | 22
|                                                                    |   
|PART II: OTHER INFORMATION                                          | 23
|                                                                    |   
|ITEM 1. LEGAL PROCEEDINGS                                           | 23
|                                                                    |   
|ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES                     | 23
|                                                                    |   
|ITEM 3. DEFAULTS UPON SENIOR SECURITIES                             | 26
|                                                                    |   
|ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF
      SECURITIES HOLDERS | 26
|                                                                    |   
|ITEM 5. OTHER INFORMATION                                           | 26
|                                                                    |   
|ITEM 6. EXHIBITS                                                    | 26
|                                                                    |   
|SIGNATURES                                                          | 27
|                                                                    |   
|INDEX TO EXHIBITS                                                   | 28

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PART
I                
FINANCIAL INFORMATION

ITEM
1.               
FINANCIAL STATEMENTS

As used herein, the term Company refers to MangaPets, Inc. a
Delaware corporation, unless otherwise indicated. In the opinion of management,
the accompanying unaudited consolidated financial statements included in the
Form 10-QSB reflect all adjustments (consisting only of normal recurring
accruals) necessary for a fair presentation of the results of operations for the
periods presented. The results of operation for the periods presented are not
necessarily indicative of the results to be expected for the full year.

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MANGAPETS, INC.(a Development Stage Company)BALANCE SHEETS

|                                                              |   | September 30 |   |   | December 31 |  
|------------------------------------------------------------- | - | ------------ | - | - | ----------- | -
|                                                              |   | 2006         |   |   | 2005        |  
|                                                              |   | (unaudited)  |   |   |             |  
|                                                              |   |              |   |   |             |  
|                                                              |   |              |   |   |             |  
|ASSETS                                                        |   |              |   |   |             |  
|Current Assets                                                |   |              |   |   |             |  
|Cash                                                          | $ | 1,567        |   | $ | 7,118       |  
|Prepaid expenses                                              |   | 3,220        |   |   | 5,121       |  
|Total current assets                                          |   | 4,787        |   |   | 12,239      |  
|                                                              |   |              |   |   |             |  
|Website Development Costs                                     |   | -            |   |   | 170,804     |  
|                                                              |   |              |   |   |             |  
|Total Assets                                                  | $ | 4,787        |   | $ | 183,043     |  
|                                                              |   |              |   |   |             |  
|LIABILITIES AND STOCKHOLDERS EQUITY
      (DEFICIT)          |   |              |   |   |             |  
|Current Liabilities                                           |   |              |   |   |             |  
|Accounts payable and accrued
      expenses                   | $ | 912,158      |   | $ | 738,913     |  
|Accounts payable and accrued expenses, related
      parties  |   | 4,237        |   |   | 39,012      |  
|Notes payable                                                 |   | 32,751       |   |   | 28,486      |  
|Loans payable                                                 |   | 31,540       |   |   | 28,387      |  
|Advances payable, related
      party                         |   | 39,998       |   |   | 27,855      |  
|Deferred revenue                                              |   | -            |   |   | 21,537      |  
|Total current liabilities                                     |   | 1,020,684    |   |   | 884,190     |  
|                                                              |   |              |   |   |             |  
|Stockholders Equity (Deficit)                                |   |              |   |   |             |  
|Common stock, $0.001 par value, 100,000,000
      shares      |   |              |   |   |             |  
|authorized;
      shares issued and outstanding 6,304,373 and |   |              |   |   |             |  
|4,315,623
      respectively                                  |   | 6,304        |   |   | 4,316       |  
|Common stock issuable: 18,750
      shares                    |   | 19           |   |   | 19          |  
|Additional paid-in capital                                    |   | 12,740,509   |   |   | 8,192,929   |  
|Accumulated deficit                                           |   | (8,143,573   | ) |   | (8,143,573  | )
|Deficit accumulated during the development stage              |   | (5,619,156   | ) |   | (754,838    | )
|Total stockholders equity(deficit)                            |   | (1,015,897   | ) |   | (701,147    | )
|                                                              |   |              |   |   |             |  
|Total liabilities and stockholders equity
      (deficit)     | $ | 4,787        |   | $ | 183,043     |  

The accompanying notes are an integral part of these financial
statements.

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MANGAPETS, INC.(a Development Stage Company)
STATEMENTS OF OPERATIONS For the Three and Nine Months Ended September
30, 2006 and 2005 and for the Period From January 1, 2005 (the effective
date of the development stage) to September 30, 2006 (unaudited)

Three months
    
    
    Three months
    
    
    Nine months
    
    
    Nine months
    
    
    Cumulativeended
    
    
    ended
    
    
    ended
    
    
    Ended
    
    
    During theSeptember 30
    
    
      September 30
    
    
      September 30
    
    
      September 30
    
    
    Development2006
    
    
    2005
    
    
    2006
    
    
    2005
    
    
    StageRevenues
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $ExpensesGeneral and administrative
    
    (3,256,939
    )
    
    67,989
    
    
    4,680,010
    
    
    215,942
    
    
    4,961,188Interest expense
    
    3,061
    
    
    -
    
    
    11,287
    
    
    -
    
    
    11,287Website planning costs
    
    -
    
    
    -
    
    
    -
    
    
    139,406
    
    
    144,406Impairment of website
      development costs
    
    173,021
    
    
    -
    
    
    173,021
    
    
    -
    
    
    477,275Total expenses
    
    (3,080,857
    )
    
    67,989
    
    
    4,864,318
    
    
    355,348
    
    
    5,594,156Income (loss) from continuing operations
    
    3,080,857
    
    
    (67,989
    )
    
    (4,864,318
    )
    
    (355,348
    )
    
    (5,594,156
    )Loss from discontinued operations
    
    -
    
    
    (25,000
    )
    
    -
    
    
    (25,000
    )
    
    (25,000
    )Net Income(Loss)
    $
    3,080,857
    
    $
    (92,989
    )
    $
    (4,864,318
    )
    $
    (380,348
      )
    $
    (5,619,156
    )Net Income (Loss) Per Share (Basic and Diluted)Continuing operations
    $
      0.41
      
    $
    (0.01
    )
    $
    (0.80
    )
    $
    (0.08
    )Discontinued operations
    
    -
    
    
    (0.01
    )
    
    -
    
    
    (0.01
    )Net Income (Loss) Per Share
    $
      0.41
      
    $
    (0.02
    )
    $
    (0.80
    )
    $
    (0.09
    )Weighted average number of commonShares used to compute net
      income(loss) per share (basic and diluted)
    
    7,559,753
    
    
      4,214,160
    
    
    6,117,582
    
    
    4,168,972


The accompanying notes are an integral part of these financial
statements.

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MANGAPETS,INC.(aDevelopmentStageCompany)STATEMENTS OF STOCKHOLDERS' EQUITY
(DEFICIT) For the Period from January 1, 2005 (the effective date of the
development stage) to September 30, 2006

DeficitAccumulatedAdditional
      
      
      
      
      
      During theCommon
        Stock
      
      
      Common
        Stock Issuable
      
      
      Paid-in
      
      
      Accumulated
      
      
      DevelopmentShares
      
      
      Amount
      
      
      Shares
      
      
      Amount
      
      
      Capital
      
      
      Deficit
      
      
      Stage
      
      
      TotalBalances, December 31, 2004
      
      4,028,914
      
      
      4,029
      
      
      88,594
      
      
      89
      
      
      7,783,096
      
      
      (8,143,573
      )
      
      -
      
      
      (356,359
      )Issuance of common stock forsettlement of accrued expenses and debtJanuary
        2005
      
      15,750
      
      
      16
      
      
      -
      
      
      -
      
      
      13,984
      
      
      -
      
      
      -
      
      
      14,000August 2005
      
      22,365
      
      
      22
      
      
      -
      
      
      -
      
      
      74,528
      
      
      -
      
      
      -
      
      
      74,550September
        2005
      
      22,500
      
      
      23
      
      
      -
      
      
      -
      
      
      29,977
      
      
      -
      
      
      -
      
      
      30,000November 2005
      
      35,000
      
      
      35
      
      
      -
      
      
      -
      
      
      83,965
      
      
      -
      
      
      -
      
      
      84,000Issuance of common stock forcashMay 2005
      
      37,500
      
      
      38
      
      
      -
      
      
      -
      
      
      49,962
      
      
      -
      
      
      -
      
      
      50,000June 2005
      
      -
      
      
      -
      
      
      18,750
      
      
      19
      
      
      24,981
      
      
      -
      
      
      -
      
      
      25,000September
        2005
      
      18,750
      
      
      19
      
      
      -
      
      
      -
      
      
      24,981
      
      
      -
      
      
      -
      
      
      25,000Issuance of common stock
        issuableMay 2005
      
      88,594
      
      
      89
      
      
      (88,594
      )
      
      (891
      )
      
      -
      
      
      -
      
      
      -
      
      
      -Issuance of common stock
        for servicesMay 2005
      
      7,500
      
      
      7
      
      
      -
      
      
      -
      
      
      19,993
      
      
      -
      
      
      -
      
      
      20,000August 2005
      
      3,750
      
      
      4
      
      
      -
      
      
      -
      
      
      9,996
      
      
      -
      
      
      -
      
      
      10,000October
        2005
      
      2,500
      
      
      2
      
      
      -
      
      
      -
      
      
      4,998
      
      
      -
      
      
      -
      
      
      5,000


The accompanying notes are an integral part of these financial
statements.

---

MANGAPETS,INC.(aDevelopmentStageCompany)STATEMENTS OF
STOCKHOLDERS' EQUITY (DEFICIT) For the Period From January 1, 2005 (the
effective date of the development stage) to September 30, 2006

Common
        Stock
      
      
      Common
        Stock Issuable
      
      
      
      
      
      
      
      
      DeficitAccumulatedAdditional
      
      
      
      
      
      During thePaid-in
      
      
      Accumulated
      
      
      DevelopmentShares
      
      
      Amount
      
      
      Shares
      
      
      Amount
      
      
      Capital
      
      
      Deficit
      
      
      Stage
      
      
      TotalNovember 2005
      
      20,000
      
      
      20
      
      
      -
      
      
      -
      
      
      47,480
      
      
      -
      
      
      -
      
      
      47,500December
        2005
      
      12,500
      
      
      12
      
      
      -
      
      
      -
      
      
      24,988
      
      
      -
      
      
      -
      
      
      25,000Net loss
      
      -
      
      
      -
      
      
      -
      
      
      -
      
      
      -
      
      
      -
      
      
      (754,838
      )
      
      (754,838
      )Balances, December 31, 2005
      
      4,315,623
      
      
      4,316
      
      
      18,750
      
      
      19
      
      
      8,192,929
      
      
      (8,143,573
      )
      
      (754,838
      )
      
      (701,147
      )Unaudited:Issuance of common stock and warrants
        forcashFebruary
        2006
      
      50,000
      
      
      50
      
      
      -
      
      
      -
      
      
      49,950
      
      
      -
      
      
      -
      
      
      50,000September 2006
      
      30,000
      
      
      30
      
      
      -
      
      
      -
      
      
      23,970
      
      
      -
      
      
      -
      
      
      24,000Issuance of common stock forMay 2006
      
      37,500
      
      
      37
      
      
      -
      
      
      -
      
      
      90,713
      
      
      -
      
      
      -
      
      
      90,750September
        2006
      
      102,500
      
      
      102
      
      
      -
      
      
      -
      
      
      123,373
      
      
      -
      
      
      -
      
      
      123,475Issuance of common stock
        forbonusApril 2006
      
      50,000
      
      
      50
      
      
      -
      
      
      -
      
      
      91,950
      
      
      -
      
      
      -
      
      
      92,000May 2006
      
      3,125,000
      
      
      3,125
      
      
      -
      
      
      -
      
      
      7,577,500
      
      
      -
      
      
      -
      
      
      7,580,625Cancellation of common
        stock in
      
      
      
      
      
      
      
      -
      
      
      -
      
      
      
      
      
      -
      
      
      -September 2006
      
      (1,406,250
      )
      
      (1,406
      )
      
      
      
      
      
      
      
      (3,406,876
      )
      
      
      
      
      
      
      
      (3,411,282
      )Net loss
      
      -
      
      
      -
      
      
      -
      
      
      -
      
      
      -
      
      
      -
      
      
      (4,864,318
      )
      
      (4,864,318
      )Balances, September 30, 2006
      
      6,304,373
      
      
      6,304
      
      
      18,750
      
      
      19
      
      
      12,740,509
      
      
      (8,143,573
      )
      
      (5,619,156
      )
      
      (1,015,897
      )


The accompanying notes are an integral part of these financial
  statements.

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MANGAPETS, INC.(a Development Stage Company)STATEMENTS OF CASH FLOWS For the Nine Months Ended September 30,
2006 and 2005 and for the Period From January 1, 2005 (the effective date of
the development stage) to September 30, 2006 (Unaudited)

|                                               |   | Nine Months Ended |   |   |              |  
|---------------------------------------------- | - | ----------------- | - | - | ------------ | -
|                                               |   |                   |   |   |              |  
|                                               |   |                   |   |   |              |  
|                                               |   | September 30      |   |   | September 30 |  
|                                               |   | 2006              |   |   | 2005         |  
|                                               |   | $                 |   |   | $            |  
|Cash Flows From Operating Activities           |   |                   |   |   |              |  
|Net loss                                       |   | (4,864,318        | ) |   | (380,348     | )
|Adjustments to reconcile net loss to net       |   |                   |   |   |              |  
|cash provided by (used for ) operating         |   |                   |   |   |              |  
|activities                                     |   |                   |   |   |              |  
|Accrued interest on notes payable and          |   | 7,418             |   |   |              |  
|loans
      payable                            |   |                   |   |   | -            |  
|Impairment of license agreement                |   | -                 |   |   | 25,000       |  
|Impairment
      of website development        |   |                   |   |   |              |  
|costs                                          |   | 173,021           |   |   | -            |  
|Issuance of
      common stock for services    |   | 214,225           |   |   | 10,000       |  
|Issuance of common stock for bonus             |   | 4,261,343         |   |   | -            |  
|Changes in
      operating assets and          |   |                   |   |   |              |  
|liabilities                                    |   |                   |   |   |              |  
|Prepaid expenses                               |   | 1,901             |   |   | -            |  
|Accounts payable and accrued                   |   |                   |   |   |              |  
|expenses                                       |   | 138,470           |   |   | 306,784      |  
|Deferred revenue                               |   | (21,537           | ) |   | 21,537       |  
|Net Cash provided by (used for)operating       |   | (89,477           | ) |   | (17,027      | )
|activities                                     |   |                   |   |   |              |  
|Cash Flows from Investing Activities           |   |                   |   |   |              |  
|Website development costs                      |   | (2,217            | ) |   | (74,894      | )
|                                               |   |                   |   |   |              |  
|Cash Flows from Financing
      Activities     |   |                   |   |   |              |  
|Payments on
      notes payable                |   | -                 |   |   | (14,375      | )
|Proceeds from notes payable                    |   | -                 |   |   | -            |  
|Proceeds
      from advances payable           |   | 12,143            |   |   | -            |  
|Proceeds from issuance of common               |   |                   |   |   |              |  
|stock and
      warrants                       |   | 74,000            |   |   | 100,000      |  
|Net cash provided by(used
      for) financing |   |                   |   |   |              |  
|activities                                     |   | 86,143            |   |   | 85,625       |  
|                                               |   |                   |   |   |              |  
|Net increase (decrease) in cash                |   | (5,551            | ) |   | (6,296       | )
|                                               |   |                   |   |   |              |  
|Cash, beginning of period                      |   | 7,118             |   |   | 6,420        |  
|                                               |   |                   |   |   |              |  
|Cash, end of period                            | $ | 1,567             |   | $ | 124          |  
|Supplemental Disclosures of
      cash flow    |   |                   |   |   |              |  
|Interest Paid                                  | $ |                   |   | $ | -            |  
|Income taxes paid                              | $ | -                 |   | $ | -            |  

The accompanying notes are an integral part of these financial
statements

---

MANGAPETS, INC.(a Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

Note 1. Organization and Going Concern

Organization

MangaPets, Inc. (the Company) (a development stage company)
was incorporated in March 1998. The Company is a holding company that was formed
to acquire both majority and minority interests in various business operations
and assist in their development.

In early 2005, the Company decided to discontinue its
operations with respect to their right to promote, sell and deploy the Triton
product line of non-depository, indoor cash dispensers under the license
agreement obtained in 2003. The decision to discontinue this component was made
by management due to the Company's desire to shift its business focus to other
unrelated opportunities. Accordingly, as of December 31, 2004, the Company's
cash dispenser operations were considered discontinued. Since this was the
Company's only operating component, the Company re-entered the development stage
as of January 1, 2005. There are no assets or liabilities associated with this
business component as of December 31, 2005 and September 30, 2006.

In May, 2006, the Board of Directors made the decision to
suspend the development of the Companys MangaPets project. The Company is
currently interviewing new development teams to complete the MangaPets web
portal.

On May 16, 2006, the Company announced that it had entered into
an agreement to purchase 100% of the assets from a limited liability company
organized and incorporated under the laws of the Netherlands Antilles, with the
exception of one copy of the vendors source code used to operate an on-line
gaming processing and marketing engine, for an aggregate purchase price of
$8,000,000.

On September 18, 2006 on the advice of corporate counsel and
events in the United States pertaining to on-line gaming, the Company concluded
not to pursue any on-line gaming ventures.

On both March 14, 2005 and September 29, 2005 the Company effected
  a three (3) for two (2) forward stock splits of its common stock.

The financial statements have been retroactively adjusted to
  reflect these stock splits.

Going Concern

As shown in the financial statements, the Company incurred a
net loss of $4,864,318 in the nine months ended September 30, 2006. Further, the
Company has a net deficiency in capital of $1,015,897 as of September 30, 2006,
and has virtually no working capital. These factors raise concerns about the
Company's ability to continue as a going concern.

The Company has not discontinued the development of an
interactive web portal but is looking for other businesses to acquire as well.
It will need additional working capital to be successful in any future business
activities. Therefore, continuation of the Company as a going concern is
dependent upon engaging in active business operations which produce adequate
cash flow and obtaining additional sources of working capital. Management is
presently engaged in seeking additional working capital from debt and equity
funding and plans to invest in other businesses, with funds obtained. However,
if its efforts are unsuccessful, the Company may have to cease operations.

The accompanying financial statements do not include any
adjustments to the recorded assets or liabilities that might be necessary should
the Company fail in any of the above objectives and is unable to operate for the
coming year.

---

MANGAPETS, INC.
  (a Development Stage Company) 
  NOTES TO FINANCIAL STATEMENTS

Note 2. Significant Accounting Policies

The accompanying unaudited financial statements have been
prepared by management in accordance with accounting principles generally
accepted in the United States and with the instructions in Form 10-QSB and
Regulation S-B and, therefore, do not include all information and footnotes
required by generally accepted accounting principles and should, therefore, be
read in conjunction with the Companys Form 10-KSB for the year ended December
31, 2005, filed with the Securities and Exchange Commission on April 17, 2006.
These statements do include all normal recurring adjustments which the Company
believes necessary for a fair presentation of the statements. The interim
operations are not necessarily indicative of the results to be expected for the
full year ended December 31, 2006.

Stock Based Compensation

Prior to January 1, 2006, the Company accounted for stock-based
awards under the intrinsic value method, which followed the recognition and
measurement principles of APB Opinion No. 25, Accounting for Stock Issued to
Employees, and related Interpretations. The intrinsic value method of
accounting resulted in compensation expense for stock options to the extent that
the exercise prices were set below the fair market price of the Companys stock
at the date of grant.

As of January 1, 2006, the Company adopted SFAS No. 123(R)
using the modified prospective method, which requires measurement of
compensation cost for all stock-based awards at fair value on the date of grant
and recognition of compensation over the service period for awards expected to
vest. The fair value of stock options is determined using the Black-Scholes
valuation model, which is consistent with the Companys valuation techniques
previously utilized for options in footnote disclosures required under SFAS No.
123, Accounting for Stock Based Compensation, as amended by SFAS No. 148,
Accounting for Stock Based Compensation Transition and Disclosure.

Since the Company did not issue stock options to employees
during the nine months ended September 30, 2006 or 2005, there is no effect on
net loss or earnings per share had the Company applied the fair value
recognition provisions of SFAS No. 123(R) to stock-based employee compensation.
When the Company issues shares of common stock to employees and others, the
shares of common stock are valued based on the market price at the date the
shares of common stock are approved for issuance.

Note 3. Software and Website Development Costs

The costs of computer software developed or obtained for
internal use, during the preliminary project phase, as defined under AICPA
Statement of Position 98-1 Accounting for the Costs of Computer Software
Developed or Obtained for Internal Use, will be expensed as incurred. The costs
of website development, during the planning state, as defined under Emerging
Issues Task Force (EITF) No. 00-2 Accounting for Web Site Development Costs,
will also be expensed as incurred.

Computer software and website development costs incurred during
the application and infrastructure development stage, including external direct
costs of materials and services consumed in developing the software, creating
graphics and website content, payroll, and interest costs, will be capitalized
and amortized over the estimated useful life, beginning when the software is
ready for use and after all substantial testing is completed and the website is
operational.

The Company has written off all software and website
development costs to date.

The Company is currently under contractual commitment to
Sygenics Interactive, Inc. (Sygenics), a developer of advanced information
management technology, for the design, development and deployment of their
interactive web portal. The agreement entered into with Sygenics has a twelve
month term with an initial payment due on execution and successive monthly
payments due over the contract term which are tied to the achievement of certain
developmental milestones. The Company is contractually obligated to pay an
aggregate amount of $1,320,000 Canadian Dollars (US$1,130,941 at September 30,
2006) over the term of the agreement, of which approximately

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MANGAPETS, INC.(a Development Stage Company) NOTES TO
FINANCIAL STATEMENTS

Note 3. Software and Website Development Costs (cont)

US$437,428 has been incurred through September 30, 2006.
Hardware and software costs are not included in this amount and are to be paid
separately by the Company.

In the first quarter of 2006, a dispute arose between the
Company and Sygenics. The work of Sygenics is currently suspended and the
Company is in negotiations to invalidate the contract and reach a settlement for
a discount of the remaining amounts due. As of September 30, 2006, the Company
has recorded an obligation to Sygenics of $437,428 (which is included in
accounts payable and accrued expenses) representing the full amount due under
the contract as of September 30, 2006. An impairment loss of $304,254 was
recognized in 2005 to reduce the capitalized website costs to their estimated
fair value of $170,804 at December 31, 2005. The remaining amount was written
off in the three months ended September 30, 2006.

Note 4. License Agreement

The Company owns a license agreement which gives the Company
the right to promote, sell and deploy the Triton product line of non-depository,
indoor cash dispensers. The license agreement has an indefinite useful life. The
cost of this license agreement was treated as a non-amortized intangible asset
and capitalized in accordance with the provisions of Statement of Financial
Accounting Standards (SFAS) No. 142 and was tested for impairment at least
annually.

As part of the Companys decision to discontinue its cash
  dispenser operations, the Company had planned to sell their rights under the
  license agreement to a third-party. Accordingly, the license agreement was classified
  as held for sale and, based on the estimated net proceeds expected to be received
  upon sale of the rights under the license agreement, was written down to its
  net realizable value of $25,000 in 2004. During 2005, management abandoned its
  plans to sell its rights under the license agreement to a third-party and has
  no current plans for this license agreement and thus, does not anticipate any
  future cash flows to be derived from it. Accordingly, the cost of the license
  agreement was written off in 2005. An impairment loss in the amount of $25,000
  was recognized in 2005 related to this write-off, which is reflected in loss
  from discontinued operations.

Note 5. Notes Payable

Notes Payable consists of :

September 30,
    
    
    December 31,2006
    
    
    2005(unaudited)Note payable due on demand, including
      interest at 6% accruedmonthly
    $
    22,208
    
    $
    40,000Note payable to an individual, due on demand , includinginterest at 6% accrued monthly
    
    8,235
    
    
    7,000Note payable to an individual, due on demand
        , includinginterest at 6% accrued monthly
    
    2,208
    
    
    1,486Total
    $
    32,751
    
    $
    28,486


Note 6. Capital Stock

In February 2006, the Company completed the sale of two
investment units (unit or units), yielding gross proceeds to the Company of
$50,000. Each unit consists of 25,000 shares of common stock and one warrant.
The warrant entitles the holder to purchase 25,000 shares of common stock on or
before February 27, 2007 at an exercise price of $1.50 per share.

---

MANGAPETS, INC.
  (a Development Stage Company) 
  NOTES TO FINANCIAL STATEMENTS

Note 6. Capital Stock (cont)

In April 2006, 50,000 shares were issued to management of the
Company as a bonus.

In May 2006, the 3,125,000 shares were issued to certain directors
  and officers of the Company as a signing bonus. The 3,125,000 shares were issued
  as follows:

Rene Hamouth  President, CEO and CFO
    
    1,250,000Paul Weinstock  Director
    
    468,750Brian Wood  Director
    
    468,750Joseph LaCascia  Director
    
    937,500Total
    
    3,125,000


Also in May 2006, 37,500 shares were issued to two former
consultants to the Company in consideration for investor relations services
provided to the Company.

In September 2006, the Company completed the sale of three
investment units (unit or units), yielding gross proceeds to the Company of
$24,000. Two units consist of 12,500 shares of common stock, par value $0.001
and one warrant. The warrant entitles each holder to purchase 12,500 shares of
common stock on or before September 21, 2008 at an exercise price of $1.00 per
share. One unit consists of 5,000 shares of common stock, par value $0.001 and
one warrant. The warrant entitles the holder to purchase 5,000 shares of common
stock on or before September 21, 2008 at an exercise price of $1.00 per
share.

Also in September 2006, 102,500 shares were issued to two
former consultants to the Company in consideration for investor relations
services provided to the Company.

As a result of the change in focus of the Company and the
resignation of Paul Weinstock, Brian Wood and Joseph LaCascia from the board of
directors, the Company has cancelled the shares that were issued to them as a
signing bonus in May 2006. As of September 30, 2006 1,406,250 shares had been
returned to the Companys treasury.

Earnings Per Share

Basic loss per share is computed by dividing net income or loss
available to common stockholders by the weighted average number of common shares
outstanding in the period. Diluted earnings per share takes into consideration
common shares outstanding (computed under basic earnings per share) and
potentially dilutive common shares. The weighted average number of shares was
7,559,753 and 4,214,160 for the three month periods ended September 30, 2006 and
2005, respectively and 6,117,582 and 4,168,972 for the nine month periods ended
September 30, 2006 and 2005, respectively. Warrants and debt convertible into
common shares were not included in the computation of diluted earnings per share
for all periods presented because they were anti-dilutive due to the Companys
net losses. For purposes of earnings per share computations, shares associated
with common stock issuable are included as outstanding as of the date of the
receipt of cash for the shares.

Warrants

At September 30, 2006, there are warrants outstanding to
purchase 162,500 shares of the Company's common stock at prices ranging from
$1.00 to $4.00 per share. The warrants were exercisable on issuance and expire
at various dates from February 2007 through September 2008.

Note 7. Loans and Advances Payable

The Company had various loans payable at September 30, 2006,
all of which are unsecured and due on demand and bear interest at 12%.

---

MANGAPETS, INC.
  (a Development Stage Company) 
  NOTES TO FINANCIAL STATEMENTS

Note 7. Loans and Advances Payable (cont)

The Company has advances payable to a company owned by a
stockholder of the Company. The advances were provided for short-term cash needs
of the Company and are due on demand. The advances do not bear interest.

Note 8. Related Party Transactions

During 2005, the Company issued a total of 70,000 shares of its
common stock to two officers and directors of the Company for settlement of
amounts owed to them totalling $84,000 under employment agreements. The fair
market value of the Company's common stock on the date of settlement was $1.50
per share. The shares issued were recorded at their estimated fair value, which
was less than the fair market value of the common stock on the date of
settlement due to the restrictive nature of the common stock issued.

During the nine month periods ended September 30, 2006 and
2005, the Company incurred approximately $22,247 and $24,233, respectively, for
consulting services to a stockholder which is included in general and
administrative expenses. Additionally, the Company issued shares to certain
directors and officers during the nine months ended September 30,2006 which had
a value of $7,580,625. Subsequently, a number of the shares were returned,
resulting in a $3,411.282 reduction in the amount that was previously expensed.
This amount is included in general and administrative expenses.

Note 9. Legal Proceedings

In October 2000, a former employee of the Company filed a claim
asking for approximately CDN$22,600 (US$19,363 at September 30, 2006) for unpaid
expenses and salary and vacation pay, and CDN$40,000 (US$34,271 at September 30,
2006) in general damages based upon a claim of unreasonable termination of
employment. The Company's management is of the opinion that the claims are
without merit and the Company has not been contacted by the former employee
since 2000, so the consolidated financial statements do not include a liability
for this claim.

On January 5, 2005, Integrity Securities, LLC (the Claimant)
initiated an arbitration action over the terms of a Financial Consulting
Services Agreement (the Agreement), dated December 6, 2002. The purpose of the
arbitration was to determine whether the 250,000 shares issued to the Claimant
pursuant to the Agreement could be cancelled for failure to provide consulting
services. On February 16, 2006, the International Centre for Dispute Resolution
provided the Company with a copy of the Award of Arbitrator in the matter with
the Claimant, which concluded that (a) the Claimant was owed nothing on any of
its claims against the Company, (b) that we were entitled to cancel and rescind
the issuance of certain shares to the claimant, and (c) that each side would
bear its own attorney fees.

Note 10. Contingent Liability

In addition to the $437,428 account payable recorded to
Sygenics as of September 30, 2006, there are additional amounts aggregating
$285,000 that were invoiced during the nine month period. As the work of
Sygenics has been suspended, the Company does not feel the charges are valid.
The consolidated financial statements do not include a liability for this
claim.

Note 11. Subsequent Events

On December 4, 2006, the Company signed a Letter of Intent with
Intrepid World Communications to merge one hundred percent (100%) of their
Entertainment and Medical assets (the Assets) as well as documentation of its
product licenses, agreements, office leases, patents, copyrights, trade secrets,
technology licenses and agreements with vendors and customers, from a limited
liability company organized and incorporated under the laws of Delaware, in
exchange for 20,000,000 shares of MangaPets, Inc. restricted common stock.

---

ITEM
2.               
MANAGEMENTS PLAN OF OPERATION

This Management's Plan of Operation and Results of Operations
and other parts of this report contain forward-looking statements that involve
risks and uncertainties. Forward-looking statements can also be identified by
words such as "anticipates," "expects," "believes," "plans," "predicts," and
similar terms. Forward-looking statements are not guarantees of future
performance and our actual results may differ significantly from the results
discussed in the forward-looking statements. Factors that might cause such
differences include, but are not limited to, those discussed in the subsections
entitled "Forward-Looking Statements and Factors That May Affect Future Results
and Financial Condition" below. The following discussion should be read in
conjunction with our financial statements and notes thereto included in this
report. All information presented herein is based on the period ended September
30, 2006. Our fiscal year end is December 31.

Readers are also urged to carefully review and consider the
various disclosures made by the Company that attempt to advise interested
parties of the factors which affect the Company's business, in this report, as
well as the Company's periodic reports on Forms 10-KSB, 10-QSB, and 8-K filed
with the Securities and Exchange Commission.

Business

The Company decided in early 2005 to discontinue its operations
with respect to the sale and deployment of the Triton product line of
non-depository, indoor cash dispensers in connection with a license agreement
acquired from Net Cash Services, Inc. in 2003. The Companys operations have
since focused on the development of an interactive web portal containing games,
merchandise, and activities inspired by the Manga theme, which describes
Japanese comic books and animated cartoons.

In addition to completing the Manga themed web portal, the
Company no longer intends to establish a U.K. based subsidiary company which
will pursue acquisitions in the gaming sector.

Subsequently on the advice of counsel, and recent unfavourable
events in the United States pertaining to on-line gaming, the Company has
concluded that it would not be in the best interest of our shareholders to
pursue on-line gaming ventures at this time.

Current Operations

After the signing of a letter of intent on April 14, 2005, the
Company entered into a Portal Development Agreement (Agreement) on July 15,
2005 with Sygenics Interactive Inc., (Sygenics), a developer of advanced
information management technology located in Montreal, Quebec, Canada, and an
authorized licensee of Sygenics Inc. The Agreement provided for the design,
development and deployment of an online virtual pet portal/website with highly
interactive two-dimensional graphical interfaces and a powerful multi-layered
back end engine to enable the building of a worldwide virtual community.

The web portal was to be designed by integrating a combination
of technologies previously developed and owned by Sygenics Inc., as well as
third party software, and new software to be developed specifically for the
Company by Sygenics.

Sygenics was expected to complete the first stage of the portal
by December of 2005 and complete the final stage in August of 2006.

However, in 2006, a dispute arose between the Company and
Sygenics. The work of Sygenics is currently suspended and the Company is in
negotiations to invalidate the contract and reach a settlement for a discount of
the remaining amounts due.

The Company is currently interviewing new development teams to
complete the MangaPets web portal.

---

The Company accepted the resignations from each of Mr. Woods,
Mr. Weinstock and Mr. LaCascia on September 25th and October
3rd respectively as a result of the decision discontinue attempts to
acquire internet gaming sites.

On December 4, 2006 the Company signed a Letter of Intent with
Intrepid World Communications to merge one hundred percent (100%) of their
Entertainment and Medical assets (the Assets) as well as documentation of its
product licenses, agreements, office leases, patents, copyrights, trade secrets,
technology licenses and agreements with vendors and customers, from a limited
liability company organized and incorporated under the laws of Delaware, In
exchange for 20,000,000 shares of MangaPets, Inc. restricted common stock.

Intrepid World Communications is a 3D Product Developer and
Licensor, Intrepid was incorporated in Delaware in 1994, and has been in pure
development since its inception. The company has offices in Birmingham,
Michigan. The Companys product, LifeVision is source neutral. Information can
be sent from live stereo cameras, stereo videotape, or computer. Source
information is projected through the holographic screen volumetrically with
images appearing to float up to 30 inches in front of the viewing screen. The
system requires no special glasses or eyewear and the image is seen clearly
regardless of the surrounding light.

The MangaPets web portal

The portal will contain games, merchandizing, and activities
inspired by the Manga theme. The term Manga has come to describe Japanese
comic books and animated cartoons. Included on the site will be:

| | 1 | interactive, engaging, and interesting Manga inspired
      characters, pets, species and avatars who the users will be able to
      identify;                                                                                                                                                                                                                                                                                                  
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 2 | games and situations where users can accumulate virtual
      points which they can use to trade with other users or exchange for items
      for their pets, species or avatars;                                                                                                                                                                                                                                                                
| | 3 | several different settings or environments which blend
      and join together to create one complete community or world through which
      users can traverse;                                                                                                                                                                                                                                                                                 
| | 4 | storylines and narratives, names and profiles for the
      characters, names and descriptions for the different
  environments;                                                                                                                                                                                                                                                                                                                 
| | 5 | a virtual shopping mall where national and international
      chain stores can rent web site space for the purpose of showcasing their
      goods and providing them with an advertising opportunity and where users
      will be able to use their virtual points to purchase virtual goods for
      their pets, species and avatars, as well as exchange them for discount
      purchase vouchers for "real" items for their personal use;
| | 6 | an integrated back end e-commerce engine that will allow
      for the merchandising and licensing of products associated with the site;
      and                                                                                                                                                                                                                                                                                               
| | 7 | Japanese, Chinese, Korean, French, Spanish, German,
      Italian and Portuguese translations of the site
content.                                                                                                                                                                                                                                                                                                                               

Online Communities

Since its widespread adoption in the mid-1990s, the world-wide
web has developed a large number of communities of people who share an interest
in a common set of cultural symbols and activities. Foremost among these are
gaming and role-playing communities. Advances in communications technologies,
and the concomitant rise in bandwidth and decrease in connection costs, have
caused these communities to increase rapidly in both size and activity in the
last five years.

A number of these communities, which are loyal to one or a few
web sites which cater to their interests, have generated substantial business
for the site owners. The sources of revenue vary, but the sites are largely
characterized by offering free access to a number of services (games,
information, chat rooms, email and so on), and charge only for the sale of
community-related merchandise. Click-through advertising revenues are the second
major source of revenue. Advertising sales may, in some cases, be the only or
the main source of revenue.

The Companys Approach

We will connect advertisers to consumers through a variety of
online marketing properties integrated throughout our services. Our advertising
and e-commerce products will include a broad range of targeting techniques for
online advertising, email campaigns, start-page placements and channel
sponsorship opportunities. We will also provide

---

consumers convenient access to third party Internet search services throughout many of our Web properties and services and generate a significant portion of our advertising and commerce revenues from our users utilizing such search services

The MangaPets web portal is aimed at establishing an international community of interest focused around a very popular and diverse form of cultural expression, highly popular in a number of Asian countries, and with rapidly growing popularity in
North America. This community is not, thus far, well-served in web sites catering to people whose languages and cultural milieu originate from Europe.

Plan of Operations

During the next twelve months, the Company intends to continue its attempts to develop an interactive web portal and explore other ventures in the technology sector.

The Company does not have sufficient capital to operate over the next fiscal year without a substantial infusion of operating capital. It will be necessary for the Company to either borrow funds to operate or generate operating funds through the
sale of equity in the Company or its subsidiaries. There can be no assurance that the Company will be able to generate sufficient income from either borrowing, the sale of equity, or a combination thereof to allow it to operate its business during
the coming year. Unless the Company is successful in raising additional operating capital, it will not have sufficient funds to operate during the balance of the fiscal year.

Results of Operations

Revenue

During the nine month period ended September 30, 2006, the Company paused on the development of the MangaPets web portal.

The Company, as of September 30, 2006, is in the development stage and is yet to realize revenues. The Company does not expect to realize revenues before the completion of the first stage of its interactive web portal.

The Company expects to continue to operate at a loss through fiscal 2006 and may continue to operate at a loss until the web portal defined fully operational. Further, due to the developmental nature of its business operations, the Company cannot
determine whether it will ever generate revenues from operations.

Losses

For the period from January 1, 2005 (date upon which the Company re-entered the development stage) to September 30, 2006, the Company recorded an operating loss of $5,619,156. The majority of the Companys operating losses are attributable
to general and administrative expenses of $4,961,188 and costs in connection with the planning and impairment of the web portal of $621,681. The Company did not generate any revenues during this period. The Company expects to continue to
incur net losses in future periods until such time as it can generate revenue. However, there is no assurance that the Company will ever generate sufficient revenues to fund operations.

Income Tax Expense (Benefit)

The Company has an income tax benefit resulting from net operating losses to offset any future operating profit. The Company has not recorded this benefit in the financial statements as it does not meet the accounting criteria to do so.

Capital Expenditures

The Company has written off a further $173,021 in capital expenditures for the period from January 1, 2005 (date upon which the Company re-entered the development stage) to September 30, 2006 in connection with the development of the web
portal.

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Liquidity and Capital Resources

The Company is in the development stage and, since inception, has experienced significant changes in liquidity, capital resources and shareholders equity. The Company had current and total assets of $4,787 as of September 30, 2006. These
assets consist of cash on hand of $1,567 and $3,220 in prepaid expenses. Net stockholders deficiency in the Company was $1,015,897 at September 30, 2006.

Cash flow used in operating activities was $89,477 for the nine month period ended September 30, 2006 as compared to cash used in operating activities of $17,027 for the nine month period ended September 30, 2005. The decrease of cash flow
used in operating activities was due in large part to the increase in net losses.

Cash flow used in investing activities was $2,217 for the nine month period ended September 30, 2006 as compared to cash flow used in investing activities of $74,894 for the nine month period ended September 30, 2005. The decrease was
related to the investment in the development of the Companys website.

Cash flow provided from financing activities was $86,143 for the nine month period ended September 30, 2006 as compared to cash flow provided from financing activities of $85,625 for the nine month period ended September 30, 2005. Funds
realized from financing activities in the current nine month period can be attributed primarily to the sale of our common stock and proceeds from advances.

The Companys current assets are not sufficient to conduct its plan of operation over the next twelve months. Website development costs associated with the completion of the web portal alone exceed current assets. The Company will have to seek
debt or equity financing to fund costs attendant to the Manga themed project, in addition to obtaining sufficient capital to meet operating expenses. However, the Company has no current commitments or arrangements with respect to funding
or immediate sources of funding. Further, no assurances can be given that funding would be available or available to the Company on acceptable terms. Although, the Companys major shareholders would be the most likely source of new funding in
the form of debt or equity placements none have made any commitment for future investment and the Company has no agreement formal or otherwise.

Should the Company be unsuccessful in completing debt or equity placements in connection with the obligations created by its Agreement with the developer, and the anticipated development of the Manga inspired online virtual pet
portal/website. Accordingly, the Companys inability to obtain funding would have a material adverse effect on its plan of operation.

The Company has no current plans for the purchase or sale of any plant or equipment. The Company has no current plans to make any changes in the number of employees. The Company has no defined benefit plan with any of its officers or directors.

Critical Accounting Policies

In the notes to the audited consolidated financial statements for the year ended December 31, 2005 and in our Annual Report on Form 10-KSB filed with the Securities and Exchange Commission. The Company discusses those accounting policies that are
considered to be critical in determining the results of operations and its financial position. We believe that the accounting principles it uses conform to accounting principles generally accepted in the United States of America.

Forward Looking Statements and Factors That May Affect Future Results and Financial Condition

The statements contained in sections titled Plan of Operation, with the exception of historical facts, are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which reflect our current
expectations and beliefs regarding our future results of operations, performance, and achievements. These statements are subject to risks and uncertainties and are based upon assumptions and beliefs that may or may not materialize. These forward
looking statements include, but are not limited to, statements concerning:

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| | 1  | Our ability to successfully implement our business
      strategies;                          
| | -- | ----------------------------------------------------------------------------------------------
| | 2  | The success or failure of our the business opportunities
      that we are pursuing;          
| | 3  | Our anticipated financial performance;                                                        
| | 4  | The sufficiency of existing capital resources;                                                
| | 5  | Our ability to raise additional capital to fund cash
      requirements for future operations;
| | 6  | uncertainties related to the Companys future business
      prospects;                       
| | 7  | The ability of the Company to generate revenues to fund
      future operations;              
| | 8  | changes in the laws and government regulations applicable
      to us;                        
| | 9  | The volatility of the stock market and;                                                       
| | 10 | General economic conditions.                                                                  

We wish to caution readers that the Companys operating results
are subject to various risks and uncertainties that could cause our actual
results to differ materially from those discussed or anticipated, including the
factors set forth in the section entitled Risk Factors. We also wish to advise
readers not to place any undue reliance on the forward looking statements
contained in this report, which reflect our beliefs and expectations only as of
the date of this report. We assume no obligation to update or revise these
forward looking statements to reflect new events or circumstances or any changes
in our beliefs or expectations, other that is required by law.

RISK FACTORS

Our future operating results are highly uncertain. Before
deciding to invest in us or to maintain or increase your investment, you should
carefully consider the risks described below, in addition to the other
information contained in this annual report. If any of these risks actually
occur, our business, financial condition or results of operations could be
seriously harmed. In that event, the market price for our common stock could
decline and you may lose all or part of your investment.

Risks Related to our Developing Operations

Our business model is unproven.

Our business model depends upon our ability to implement and
successfully execute our business and marketing strategy, which includes the
following: develop, deploy, and enhance the technology and systems which will
underlie the interactive web portal; attract users of the web portal at a
reasonable cost; reliably process transactions through the web portal; locate,
develop and maintain strategic relationships with advertisers who wish to target
the demographic groups which use the Companys web portal.

As our business model is unproven, we cannot be certain that
our business strategy will be successful or that we will ever be profitable.

We might not be able to establish and strengthen a brand
identity.

We believe that establishing a strong brand loyalty is critical
to achieving acceptance of the web portal. Promoting and positioning our brand
will depend largely on the success of our marketing efforts and our ability to
provide consistent, high-quality experiences on the web portal. Our brand
promotion activities might not be successful or, even if successful, result in
enough revenues to offset the expenses incurred.

We might not be able to determine or design features and
functionality that Web Portal users and advertisers require or prefer.

We are designing and developing the web portal based upon
existing web sites and the experience and insights of our management. Our
success will depend in part upon our ability to accurately determine the
features and functionality that the web portal users and advertisers require or
prefer, and our ability to successfully design and implement solutions that
include these features and functionality. We cannot be certain that the features
and functionality that we plan to offer in the web portal will satisfy the
requirements or preferences of our current or potential customers.

---

We will depend on third parties to provide reliable software, systems, and services.

We currently have no technology assets or resources to build the web portal. We plan to rely substantially upon third-party service providers to help us build, maintain, and house key components of our web portal. These services might not be
available in a timely manner or on commercially reasonable terms. Failure to obtain the necessary services to enable us to build, maintain, and house our web portal could have a materially adverse effect on our business, financial condition, results
of operations, and prospects.

In addition, several of the third-parties upon whom we plan to depend upon have a limited operating history, have relatively immature technology, and are themselves dependent on reliable delivery of services from others. As a result, our ability to
deliver various services to our users might be adversely affected by the failure of these third parties to provide reliable software, systems, and related services to us.

The online web services markets are intensely competitive.

Many different companies are positioned to emerge as competitors in this marketplace. Many of our potential competitors have longer operating histories, significantly greater financial, technical, marketing, and other resources than we have, a
significantly greater name recognition, a larger installed base of potential customers, and more extensive knowledge of our industry. Such competitors might be able to spend more aggressively on marketing and advertising for their brands, products,
and services. They also might adopt more aggressive pricing policies and make more attractive offers to employees.

There are minimal barriers to entry in our market, and competitors can launch web-enabled products and service at relatively low cost. Other companies may develop products and services that are less expensive and more useful to the hard goods
industry. These companies might be more successful in their marketing efforts and thereby limit our ability to gain market share.

Our ability to protect the intellectual property to be developed is uncertain.

We believe that intellectual property will be critical to our success. We will rely on trademark, copyright, and trade secret protection to protect our intellectual property. The measures we take to protect our intellectual property might not be
successful, which could have a materially adverse effect on our business. The United States or foreign jurisdictions might not grant us any copyrights, trademarks, or other protection for our intellectual property. There also can be no assurance
that our intellectual property rights will not be challenged, invalidated, or circumvented, by others or that our intellectual property rights will provide us with a competitive advantage.

If other parties assert infringement claims against us, the defense of any such claim, whether with or without merit, could be time-consuming, result in substantial litigation expenses, and diversion of technical management personnel. If any such
claims are adversely determined, we might be required to develop non-infringing technology or enter into licensing agreements. These licensing agreements, if required, might not be available on terms acceptable to us, or at all. In the event a claim
of infringement is successfully asserted against us and our failure or inability to develop non-infringing technology or license the infringed or similar technology on a timely basis, would be likely to materially and adversely affect our business,
financial condition, results of operations, and prospects.

General Risks

We have a history of significant operating losses and such losses may continue in the future.

Since our inception in 1998, our expenses have substantially exceeded our revenue, resulting in continuing losses and an accumulated deficit of $8,898,411 at December 31, 2005. During fiscal 2005, we recorded a net loss of $754,838. We will
continue to incur operating losses as we maintain our search for a suitable business opportunity and satisfy our ongoing disclosure requirements with the Securities and Exchange Commission ("Commission"). Our only expectation of future profitability
is dependent upon our ability to fully develop our anticipated web portal, which can in no way be assured. Therefore, we may never be able to achieve profitability.

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We anticipate that we will incur operating losses for the foreseeable future.

We expect to incur substantial operating losses for the foreseeable future. We intend to increase our operating expenses substantially as we increase our product development, marketing, and brand building activities. We will increase our general and
administrative functions to support our growing operations. We will need to generate significant revenues to achieve profitability, and we might not be able to sustain or increase profitability in the future. We will be dependent upon our ability to
obtain additional capital form borrowing and the sale of securities to fund our operations. There is no assurance that additional capital can be obtained or that it can be obtained on terms that are favourable to the Company and its existing
stockholders.

The market for our stock is limited and our stock price may be volatile.

The market for our common stock has been limited due to low trading volume and the small number of brokerage firms acting as market makers. Because of the limitations of our market and volatility of the market price of our stock, investors may face
difficulties in selling shares at attractive prices when they want to. The average daily trading volume for our stock has varied significantly from week to week and from month to month, and the trading volume often varies widely from day to day.

We may incur significant expenses as a result of being quoted on the Over the Counter Bulletin Board, which may negatively impact our financial performance.

We may incur significant legal, accounting and other expenses as a result of being listed on the Over the Counter Bulletin Board. The Sarbanes-Oxley Act of 2002, as well as related rules implemented by the Commission, have required changes in
corporate governance practices of public companies. We expect that compliance with these laws, rules and regulations, including compliance with Section 404 of the Sarbanes-Oxley Act of 2002 as discussed in the following risk factor, may
substantially increase our expenses, including our legal and accounting costs, and make some activities more time-consuming and costly. As a result, there may be a substantial increase in legal, accounting and certain other expenses in the future,
which would negatively impact our financial performance and could have a material adverse effect on our results of operations and financial condition.

Our internal controls over financial reporting may not be considered effective, which could result in a loss of investor confidence in our financial reports and in turn have an adverse effect on our stock price.

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, beginning with our annual report for the year ending December 31, 2007, we may be required to furnish a report by our management on our internal controls over financial reporting. Such
report will contain, among other matters, an assessment of the effectiveness of our internal controls over financial reporting as of the end of the year, including a statement as to whether or not our internal controls over financial reporting are
effective. This assessment must include disclosure of any material weaknesses in our internal controls over financial reporting identified by management. The report will also contain a statement that our independent registered public accounting firm
has issued an attestation report on management's assessment of internal controls. If we are unable to assert that our internal controls are effective as of December 31, 2007 or if our independent registered public accounting firm is unable to attest
that our management's report is fairly stated or they are unable to express an opinion on our management's evaluation or on the effectiveness of our internal controls, investors could lose confidence in the accuracy and completeness of our financial
reports, which in turn could cause our stock price to decline.

Going Concern

The Companys independent auditors have modified their report on the Companys 2005 financial statements to indicate that there is substantial doubt as to the Companys ability to continue as a going concern as a result of a net loss
of $754,838 and $224,152 in 2005 and 2004, respectively, a discontinuation of its only operating component as of December 31, 2004, and a net deficiency in capital of $701,147 as of December 31, 2005. The Companys ability to
continue as a going concern is subject to the ability of the Company to realize a profit and /or obtain funding from outside sources. Managements plan to address the Companys ability to continue as a going concern includes: (1) obtaining
funding from private placement sources; (2) obtaining additional funding from the sale of the Companys securities; (3) establishing revenues from prospective business opportunities; (4) obtaining loans and grants from various financial
institutions where possible. Although management believes that it will be able to obtain the

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necessary funding to allow the Company to remain a going
concern through the methods discussed above, there can be no assurances that
such methods will prove successful.

ITEM
3.               
CONTROLS AND PROCEDURES

Our president acts both as the chief executive officer and the
chief financial officer and is responsible for establishing and maintaining
disclosure controls and procedures.

a) Evaluation of disclosure controls and procedures.

Under the supervision and with the participation of our
management, including our principal executive officer and principal financial
officer, we evaluated the effectiveness of the design and operation of our
disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as of March 31, 2006. Based on this
evaluation, our principal executive officer and our principal financial officer
concluded that, as of the end of the period covered by this report, our
disclosure controls and procedures were effective and adequately designed to
ensure that the information required to be disclosed by us in the reports we
file or submit under the Securities Exchange Act of 1934 is recorded, processed,
summarized and reported within the time periods specified in applicable rules
and forms.

(b) Changes in internal controls over financial reporting.

During the quarter ended September 30, 2006 there has been no
change in our internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting.

Our management, including our chief executive officer and chief
financial officer, does not expect that our disclosure controls or our internal
controls will prevent all error and all fraud. A control system, no matter how
well conceived and operated, can provide only reasonable, not absolute,
assurance that the objectives of the control system are met. In addition, the
design of a control system must reflect the fact that there are resource
constraints, and the benefits of controls must be considered relative to their
costs. Because of the inherent limitations in all control systems, no evaluation
of controls can provide absolute assurance that all control issues and instances
of fraud, if any, within a company have been detected. These inherent
limitations include the realities that judgments in decision-making can be
faulty, and that breakdowns can occur because of simple error or mistake.

Additionally, controls can be circumvented by the individual
acts of some persons, by collusion of two or more people or by managements
override of the control. The design of any systems of controls is based in part
upon certain assumptions about the likelihood of future events, and there can be
no assurance that any design will succeed in achieving its stated goals under
all potential future conditions. Over time, control may become inadequate
because of changes in conditions, or the degree of compliance with the policies
or procedures may deteriorate. Because of these inherent limitations in a
cost-effective control system, misstatements due to error or fraud may occur and
not be detected.

Individual persons perform multiple tasks which normally would
be allocated to separate persons and therefore extra diligence must be exercised
during the period these tasks are combined. It is also recognized the Company
has not designated an audit committee and no member of the board of directors
has been designated or qualifies as a financial expert. The Company should
address these concerns at the earliest possible opportunity.

PART
II               
OTHER INFORMATION

ITEM
1.               
LEGAL PROCEEDINGS

On January 5, 2005, Integrity Securities, LLC (the Claimant)
initiated an arbitration action over the terms of a Financial Consulting
Services Agreement (the Agreement), dated December 6, 2002. The purpose of the
arbitration was to determine whether the 250,000 shares issued to the Claimant
pursuant to the Agreement could be cancelled for failure to provide consulting
services. On February 16, 2006, the International Centre for Dispute Resolution
provided the Company with a copy of the Award of Arbitrator in the matter with
the Claimant, which

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concluded that (a) the Claimant was owed nothing on any of its
claims against the Company, (b) that we were entitled to cancel and rescind the
issuance of certain shares to the claimant, and (c) that each side would bear
its own attorney fees.

ITEM
2.               
UNREGISTERED SALES OF EQUITY SECURITIES

On September 10, 2006, the Company issued 12,500 shares of
common stock, par value $0.001, to Scott McArthur, as a payment for providing
services to the Company. The Company relied upon the exemption from securities
registration pursuant to Section 4(2) and Regulation S promulgated by the
Commission pursuant to the Securities Act.

The Company made this offering based on the following factors:
(1) the issuance was an isolated private transaction by the Company which did
not involve a public offering; (2) there was only one offeree who was issued the
Companys stock as a bonus for providing services to the Company; (3) the
offeree stated an intention not to resell the stock; (4) there were no
subsequent or contemporaneous public offerings of the stock; (5) the stock was
not broken down into smaller denominations; and (6) the negotiations that lead
to the issuance of the stock took place directly between the offeree and the
Company.

The Company complied with the requirements of Regulation S by
having no directed offering efforts made in the United States, by offering to
only to an offeree who was outside the United States at the time the agreement
originated, and ensuring that the entity to whom the stock and warrants were
issued was a non-U.S. person with an address in a foreign country.

On September 10, 2006, the Company issued 25,000 shares of
common stock, par value $0.001, to Michael Pound, as a payment for providing
services to the Company. The Company relied upon the exemption from securities
registration pursuant to Section 4(2) and Regulation S promulgated by the
Commission pursuant to the Securities Act.

The Company made this offering based on the following factors:
(1) the issuance was an isolated private transaction by the Company which did
not involve a public offering; (2) there was only one offeree who was issued the
Companys stock as a bonus for providing services to the Company; (3) the
offeree stated an intention not to resell the stock; (4) there were no
subsequent or contemporaneous public offerings of the stock; (5) the stock was
not broken down into smaller denominations; and (6) the negotiations that lead
to the issuance of the stock took place directly between the offeree and the
Company.

The Company complied with the requirements of Regulation S by
having no directed offering efforts made in the United States, by offering to
only to an offeree who was outside the United States at the time the agreement
originated, and ensuring that the entity to whom the stock and warrants were
issued was a non-U.S. person with an address in a foreign country.

On September 21, 2006, the Company issued 12,500 shares of
common stock, par value $0.001and 12,500 warrants to Kevin Desai for cash at
$0.80 per share. Each warrant entitles the shareholder to purchase 12,500 shares
of common stock on or before October 21, 2008 at an exercise price of $1.00 per
share. The Company relied upon the exemption from securities registration
pursuant to Section 4(2) and Regulation S promulgated by the Commission pursuant
to the Securities Act.

The Company made this offering based on the following factors:
(1) the issuance was an isolated private transaction by the Company which did
not involve a public offering; (2) there was only one offeree who was issued the
Companys stock as a bonus for providing services to the Company; (3) the
offeree stated an intention not to resell the stock; (4) there were no
subsequent or contemporaneous public offerings of the stock; (5) the stock was
not broken down into smaller denominations; and (6) the negotiations that lead
to the issuance of the stock took place directly between the offeree and the
Company.

The Company complied with the requirements of Regulation S by
having no directed offering efforts made in the United States, by offering to
only to an offeree who was outside the United States at the time the agreement
originated, and ensuring that the entity to whom the stock and warrants were
issued was a non-U.S. person with an address in a foreign country.

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On September 21, 2006, the Company issued 12,500 shares of common stock, par value $0.001and 12,500 warrants to William Donovan for cash at $0.80 per share. Each warrant entitles the shareholder to purchase 12,500 shares of common stock on
or before October 21, 2008 at an exercise price of $1.00 per share. The Company relied upon the exemption from securities registration pursuant to Section 4(2) and Regulation S promulgated by the Commission pursuant to the Securities Act.

The Company made this offering based on the following factors: (1) the issuance was an isolated private transaction by the Company which did not involve a public offering; (2) there was only one offeree who was issued the Companys stock as a
bonus for providing services to the Company; (3) the offeree stated an intention not to resell the stock; (4) there were no subsequent or contemporaneous public offerings of the stock; (5) the stock was not broken down into smaller denominations;
and (6) the negotiations that lead to the issuance of the stock took place directly between the offeree and the Company.

The Company complied with the requirements of Regulation S by having no directed offering efforts made in the United States, by offering to only to an offeree who was outside the United States at the time the agreement originated, and ensuring that
the entity to whom the stock and warrants were issued was a non-U.S. person with an address in a foreign country.

On September 21, 2006, the Company issued 5,000 shares of common stock, par value $0.001and 5,000 warrants to Hazelmere Logging Inc a British Columbia corporation for cash at $0.80 per share. Each warrant entitles the shareholder to purchase
5000 shares of common stock on or before October 21, 2008 at an exercise price of $1.00 per share. The Company relied upon the exemption from securities registration pursuant to Section 4(2) and Regulation S promulgated by the Commission
pursuant to the Securities Act.

The Company made this offering based on the following factors: (1) the issuance was an isolated private transaction by the Company which did not involve a public offering; (2) there was only one offeree who was issued the Companys stock as a
bonus for providing services to the Company; (3) the offeree stated an intention not to resell the stock; (4) there were no subsequent or contemporaneous public offerings of the stock; (5) the stock was not broken down into smaller denominations;
and (6) the negotiations that lead to the issuance of the stock took place directly between the offeree and the Company.

The Company complied with the requirements of Regulation S by having no directed offering efforts made in the United States, by offering to only to an offeree who was outside the United States at the time the agreement originated, and ensuring that
the entity to whom the stock and warrants were issued was a non-U.S. person with an address in a foreign country.

On September 29, 2006, the Company issued 65,000 shares of common stock, par value $0.001, to Richard Specht, as a payment for providing services to the Companys president and CEO. The Company relied upon the exemption from securities
registration pursuant to Section 4(2) and Regulation S promulgated by the Commission pursuant to the Securities Act.

The Company made this offering based on the following factors: (1) the issuance was an isolated private transaction by the Company which did not involve a public offering; (2) there was only one offeree who was issued the Companys stock as a
bonus for providing services to the Company; (3) the offeree stated an intention not to resell the stock; (4) there were no subsequent or contemporaneous public offerings of the stock; (5) the stock was not broken down into smaller denominations;
and (6) the negotiations that lead to the issuance of the stock took place directly between the offeree and the Company.

The Company complied with the requirements of Regulation S by having no directed offering efforts made in the United States, by offering to only to an offeree who was outside the United States at the time the agreement originated, and ensuring that
the entity to whom the stock and warrants were issued was a non-U.S. person with an address in a foreign country.

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The Company complied with the requirements of Regulation S by
having no directed offering efforts made in the United States, by offering to
only to an offeree who was outside the United States at the time the agreement
originated, and ensuring that the entity to whom the stock and warrants were
issued was a non-U.S. person with an address in a foreign country.

ITEM
3.               
DEFAULTS UPON SENIOR SECURITIES

None.

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

None.

ITEM
5.               
OTHER INFORMATION

On September 20, 2006, the Companys board of directors
approved a two (2) for one (1) reverse stock split. The quoted price of the
Companys stock reflected the stock split on September 21, 2006.

ITEM
6.               
EXHIBITS

Exhibits required to be attached by Item 601 of Regulation S-B
are listed in the Index to Exhibits on page 30 of this Form 10-QSB, and are
incorporated herein by this reference.



SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the
  registrant caused this report to be signed on its behalf by the undersigned,
  thereunto duly authorized this 21th day of December 2006.

| | MangaPets, Inc.                                                                         | 
| | --------------------------------------------------------------------------------------- | 
| |                                                                                         | 
| | /s/ Rene Hamouth                                                                        | 
| | By: Rene Hamouth                                                                        | 
| | Chief Executive Officer, Chief
      Financial Officer and Principal Accounting Officer | 

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INDEX TO EXHIBITS

|Exhibit  | Page |                                                                                                                                                                                                                              
|-------- | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|No.      | No.  | Description                                                                                                                                                                                                                  
|         |      |                                                                                                                                                                                                                              
|3(i)(a)  | *    | Articles of
        Incorporation dated March 4, 1998. (Incorporated by reference from Form
        10SB filed with the SEC on January 5, 2000.)                                                                             
|3(i)(b)  | *    | Amended Articles
        of Incorporation dated April 23,1998. (Incorporated by reference from
        Form 10SB filed with the SEC on January 5, 2000.)                                                                     
|3(i)(c)  | *    | Amended Articles
        of Incorporation dated January 4, 2002. (Incorporated by reference from
        Form 10KSB filed with the SEC on May 21, 2003.)                                                                     
|3(i)(d)  | *    | Amended Articles
        of Incorporation dated December 19, 2003. (Incorporated by reference from
        Form 10KSB filed with the SEC on May 20, 2004.)                                                                   
|3(i)(e)  | *    | Amended Articles
        of Incorporation dated November 4, 2004. (Incorporated by reference from
        Form 10KSB filed with the SEC on April 15,2005)                                                                    
|3(i)(f)  | *    | Amended Articles
        of Incorporation dated September 7,2005. (Incorporated by reference from
        Form 10QSB filed with the SEC on November 16, 2005)                                                                
|3(ii)    | *    | By-Laws dated
        April 23, 1998. (Incorporated by reference from Form 10SB filed with the
        SEC on January 5, 2000.)                                                                                              
|10(i)    | *    | The 2003 Benefit
        Plan of Delta Capital Technologies, Inc. dated August 20, 2003 (Incorporated
        by reference from Form S-8 filed with the SEC on August 26, 2003)                                              
|10(ii)   | *    | Employee Agreement
        dated April 30, 2004 between the Company and Kent Carasquero. (Incorporated
        by reference from Form 10KSB filed with the SEC on May 20, 2004                                               
|10(iii)  | *    | Employee Agreement
        dated April 30, 2004 between the Company and Martin Tutschek. (Incorporated
        by reference from Form 10KSB filed with the SEC on May 20, 2004)                                              
|10(iv)   | *    | Employee Agreement
        dated October 1, 2004 between the Company and Roderick Shand (Incorporated
        by reference from Form 10KSB filed with the SEC on April 15, 2005)                                             
|10(v)    | *    | Employee Agreement
        dated October 1, 2004 between the Company and Mr. Paul Bains (Incorporated
        by reference from Form 10KSB filed with the SEC on April 15, 2005)                                             
|10(vi)   | *    | Consulting Agreement
        dated October 1,2004 between the Company and Mr. Carasquero. (Incorporated
        by reference from Form 10KSB filed with the SEC on April 15, 2005)                                           
|10(vii)  | *    | Portal Development
        Agreement dated July 15, 2005 between the Company and Sygenics Interactive
        Inc. (Incorporated by reference from Form 8-K filed with the SEC on August
        9, 2005)                    
|10(viii) | *    | Debt Settlement
        Agreement dated August 3, 2005 between the Company and Rajesh Vadavia
        and Sygenics Interactive, Inc. (Incorporated by reference from Form 10KSB
        filed with the SEC on April 17, 2006)
|10(ix)   | *    | Debt Settlement
        Agreement dated September 30, 2005 between the Company and Leslie Lounsbury.
        (Incorporated by reference from Form 10QSB filed with the SEC on November
        16, 2005)                     
|10(x)    | *    | Debt Settlement
        Agreement dated November 9,2005 between the Company and Roderick Shand.
        (Incorporated by reference from Form 10KSB filed on April 17,2006)                                                   
|10(xi)   | *    | Debt Settlement
        Agreement dated November 9, 2005 between the Company and Paul Bains. (Incorporated
        by reference from Form 10KSB filed on April 17, 2006)                                                     
|14       | *    | Code of Ethics
        (Incorporated by reference from Form 10KSB filed with the SEC on April
        15, 2005)                                                                                                              
|31       | 31   | Certification
        Pursuant to Rule 13a-14(A) 15d-14(A) of the Securities Act of 1934 as
        amended, as adopted pursuant to section 302 of the Sarbanes-Oxley Act
        of 2002                                    
|32       | 32   | Certification
        Pursuant to 18 U.S.C. Section 1350, Section 906 of the Sarbanes-Oxley
        Act of 2002.                                                                                                             

|* | Incorporated by reference from previous filings of the
      Company
|- | --------------------------------------------------------------------

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