U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

             QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                For the Quarterly Period Ended: November 30, 2005

                        Commission File Number: 001-15643

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

       California                                        95-4597370
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)

             936A Beachland Boulevard Suite 13, Vero Beach, FL 32963
                    (Address of principal executive offices)

                                 (772) 231-7544
                           (Issuer'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 |X| No |_|.

As of January 11, 2006, there were 10,119,040 shares of common stock, no par
value, outstanding.

Transitional Small Business Disclosure Format (check one): Yes |_| No |X|.

<PAGE>
<TABLE>
<S>                                                                                                <C>
TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION

Item 1.    Financial Statements

           Condensed Balance Sheet as of November 30, 2005 (unaudited)                               1

           Condensed Statements of Operations for the three month period ended
           November 30, 2005 and the period from August 25, 2005 ("Inception")
           through November 30, 2005
           (unaudited)                                                                               2

           Condensed Statement of Cash Flows for the period from August 25, 2005
           ("Inception") through November 30, 2005
           (unaudited)                                                                               3

           Notes to Condensed Financial Statements (unaudited)                                      4-9

Item 2.    Management's Discussion and Analysis
             or Plan of Operation                                                                  10-22

Item 3.    Controls and Procedures                                                                  23

PART II.OTHER INFORMATION

Item 1.    Legal Proceedings                                                                        24
Item 2.    Changes in Securities                                                                    24

Item 3.    Defaults Upon Senior Securities                                                          24

Item 4.    Submission of Matters to a Vote of Security Holders                                      24

Item 5.    Other Information                                                                        24

Item 6.    Exhibits and Reports on Form 8-K                                                        24-25

Signatures                                                                                          26

Certifications                                                                                     27-29
</TABLE>

<PAGE>

Part I - Financial Information

Item 1. Financial Statements

Statements made in this Form 10-QSB (the "Quarterly Report") that are not
historical or current facts are "forward-looking statements" made pursuant to
the safe harbor provisions of Section 27A of the Securities Act of 1933, as
amended (the "Act"), and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"). These statements often can be identified by the
use of terms such as "may", "will", "expect", "believe", "anticipate",
"estimate", "approximate", or "continue", or the negative thereof. Cyber
Merchants Exchange, Inc. (the "Company") intends that such forward-looking
statements be subject to the safe harbors for such statements. The Company
wishes to caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made. Any
forward-looking statements represent management's best judgment as to what may
occur in the future. However, forward-looking statements are subject to risks,
uncertainties and important factors beyond the control of the Company that could
cause actual results and events to differ materially from historical results of
operations and events and those presently anticipated or projected. These
factors include adverse economic conditions, entry of new and stronger
competitors, inadequate capital and unexpected costs. The Company disclaims any
obligation subsequently to revise any forward-looking statements to reflect
events or circumstances after the date of such statement or to reflect the
occurrence of anticipated or unanticipated events.

<PAGE>

                         CYBER MERCHANTS EXCHANGE, INC.
                        (A Development Stage Enterprise)
                         CONDENSED FINANCIAL STATEMENTS
                     For the period ended November 30, 2005

<PAGE>

                         CYBER MERCHANTS EXCHANGE, INC.
                        (A Development Stage Enterprise)
                             CONDENSED BALANCE SHEET

                                                              November 30, 2005
                                                              -----------------
                                                                 (unaudited)
ASSETS
  Current assets

         Cash                                                     $ 103,699
                                                                  ---------

         Total current assets                                       103,699
                                                                  ---------

                Total assets                                      $ 103,699
                                                                  =========

LIABILITIES AND STOCKHOLDERS' EQUITY

   Current liabilities:
         Accrued management fees - related party                  $   3,500
         Due to former affiliate                                     50,000
                                                                  ---------

          Total current liabilities                                  53,500

    Commitments and contingencies                                        --

    Stockholders' equity:

         Common stock, no par value; 40,000,000
             shares authorized, 10,119,040 shares issued
             and outstanding                                        100,000
         Deficit accumulated during development stage               (49,801)
                                                                  ---------

         Total stockholders' equity                                  50,199
                                                                  ---------

         Total liabilities and stockholders' equity               $ 103,699
                                                                  =========

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


                                        1
<PAGE>
                         CYBER MERCHANTS EXCHANGE, INC.
                          (A Development Stage Company)
                       CONDENSED STATEMENTS OF OPERATIONS
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                                 Period from
                                              Three Months Ended          August 25, 2005 ("Inception")
                                              November 30, 2005             through November 30, 2005
                                              -----------------            --------------------------
<S>                                              <C>                              <C>
Revenue                                          $        --                      $        --

Operating expenses:
   Non-cash compensation                              25,000                           25,000
   Other general and

     administrative expenses                          24,801                           24,801
                                                 -----------                      -----------

Total operating expenses                             (49,801)                         (49,801)
                                                 -----------                      -----------

Net loss                                             (49,801)                         (49,801)
                                                 ===========                      ===========

Net loss per share:
   basic and diluted                                   (0.01)                           (0.01)
                                                 ===========                      ===========

Weighted average number of
  shares outstanding,
  basic and diluted                                6,903,383                        4,517,192
                                                 ===========                      ===========
</TABLE>

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


                                        2
<PAGE>

                         CYBER MERCHANTS EXCHANGE, INC.
                          (A Development Stage Company)
                        CONDENSED STATEMENT OF CASH FLOWS
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                    Period from
                                                          August 25, 2005 ("Inception")
                                                             through November 30, 2005
                                                             -------------------------
<S>                                                                   <C>
CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss                                                              $ (49,801)
Adjustments to reconcile net loss to net
cash flows used in operating activities:
   Stock issued for services                                             25,000
Changes in:

   Accrued expenses                                                       3,500
                                                                      ---------

   Net cash used in operating activities                                (21,301)

CASH FLOWS FROM FINANCING ACTIVITIES:

   Proceeds from issuance of common stock                               490,000
   Cash disbursed to former affiliate                                  (365,000)
                                                                      ---------

Net cash flows from financing activities                                125,000
                                                                      ---------

Net increase in cash                                                    103,699

Cash and cash equivalents, beginning of period                               --
                                                                      ---------

Cash and cash equivalents, end of period                              $ 103,699
                                                                      =========
</TABLE>

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


                                        3
<PAGE>

                         CYBER MERCHANTS EXCHANGE, INC.
                          (A Development Stage Company)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                                November 30, 2005
                                   (Unaudited)

NOTE 1 - BASIS OF PRESENTATION

   The accompanying unaudited condensed financial statements of Cyber Merchants
   Exchange, Inc. (the "Company") are presented in accordance with the
   requirements for Form 10-QSB and Article 10 of Regulation S-X and Regulation
   S-B. Accordingly, they do not include all of the disclosures required by
   accounting principles generally accepted in the United States of America. In
   the opinion of management, all adjustments (all of which were of a normal
   recurring nature) considered necessary to fairly present the financial
   position, results of operations, and cash flows of the Company on a
   consistent basis, have been made. Operating results for the period ended
   November 30, 2005 are not necessarily indicative of the results that may be
   expected for the period ending May 31, 2006.

   The Company recommends that the accompanying financial statements for the
   interim period be read in conjunction with the financial statements and notes
   thereto included in the Company's annual report on Form 10-KSB, for the
   period ended May 31, 2005.

   Use of Estimates
   The preparation of financial statements in conformity with accounting
   principles generally accepted in the United States of America requires
   management to make estimates and assumptions that affect the reported amounts
   of assets and liabilities and disclosure of contingent assets and liabilities
   as of the date of the financial statements and the reported amounts of
   revenues and expenses during the reporting period. Actual results could
   differ from those estimates.

   Measurement of non-cash compensation
   The Company values non-cash equity transactions in relation to
   contemporaneous cash sales of equivalent equity securities.

   Indemnities
   The Company indemnifies its directors, officers, employees and agents to he
   maximum extent permitted under the laws of the State of California.

NOTE 2 - ORGANIZATION AND REORGANIZATION

   ORGANIZATION

   Cyber Merchants Exchange, Inc. ("the Company") was incorporated in July 1996,
   under the laws of the State of California. However, based on the nature of
   the Company's reorganization, as discussed below, for accounting purposes
   operations are presented beginning August 25, 2005 ("Inception"). The Company
   is a development stage company.

   Based on the nature of the reorganization discussed below, the Company has no
   substantive operations at November 30, 2005 and the historical operations of
   the Company are presented for the period from Inception. See Accounting
   Treatment section, below.


                                       4
<PAGE>

                         CYBER MERCHANTS EXCHANGE, INC.
                          (A Development Stage Company)
               NOTES TO CONDENSED FINANCIAL STATEMENTS (continued)
                                November 30, 2005
                                   (Unaudited)

NOTE 2 - ORGANIZATION AND REORGANIZATION (continued)

   REORGANIZATION

   The Company's shareholders approved a reorganization of the Company on May
   16, 2005, summarized as follows:

   1. The Company transferred of all of its assets and liabilities (the
      "Transfer") to ASAP Show Inc., a wholly owned subsidiary of the Company
      ("ASAP"), effective May 31, 2005 pursuant to a Transfer and Assumption
      Agreement ("Transfer Agreement");

   2. The Company effected a one for eight and one-half (1-for-8.5) reverse
      stock split of the Company stock (the "Reverse Split") with special
      treatment to preserve round lot stockholders, effective July 18, 2005;

   3. On August 25, 2005, the Company distributed 8,626,480 shares of common
      stock of ASAP, representing all of the outstanding shares of ASAP, to the
      Company's shareholders of record on August 18, 2005 on a pro rata basis
      (the "Distribution"); and

   4. On September 30, 2005, the Company issued 7,104,160 shares of common stock
      to KI Equity Partners II, LLC ("KI Equity") for $415,000, (the
      "Investment") pursuant to a Securities Purchase Agreement ("SPA") dated
      November 19, 2004, and amended August 25, 2005.

   The details of the reorganization transactions above are as follows:

   Securities Purchase Agreement

   On November 19, 2004, the Company entered into a Securities Purchase
   Agreement with Keating Reverse Merger Fund, LLC ("KRM Fund") and Frank Yuan,
   the then current Chairman of the Board and Chief Executive Officer of the
   Company ("Yuan") providing for the investment by KRM Fund of $425,000 in the
   Company in exchange for 7,000,000 shares of the Company's common stock. The
   SPA was amended and restated effective August 25, 2005 to, among other
   things, change the Investment to $415,000, change the number of shares to be
   purchased to 7,104,160, and substitute KI Equity for KRM Fund. The Investment
   by KI Equity was payable to ASAP as a reduction in the purchase consideration
   paid by ASAP under the Transfer Agreement. To the extent certain liabilities
   assumed by ASAP remained unpaid at closing, the funds were to be used to
   satisfy such liabilities with any remaining funds being available to ASAP for
   working capital to grow its trade show business. The Reorganization will
   allow the shareholders of the Company to participate in the growth of the
   trade show business through the spin-off of ASAP, which owns and operates the
   trade show business (see below). Following the Reorganization and spin off of
   ASAP, the Company is majority owned by KI Equity and will seek a business
   combination with an operating company.


                                       5
<PAGE>

                         CYBER MERCHANTS EXCHANGE, INC.
                          (A Development Stage Company)
               NOTES TO CONDENSED FINANCIAL STATEMENTS (continued)
                                November 30, 2005
                                   (Unaudited)

NOTE 2 - ORGANIZATION AND REORGANIZATION (continued)

   REORGANIZATION (continued)

   Reverse Split

   The Company had 8,500,000 shares outstanding at May 31, 2005. The Company
   effected the one-for-eight and one-half share Reverse Split on a record date
   of July 18, 2005. The Reverse Split allows for special treatment of certain
   shareholders to preserve round lot (100 shares or more) shareholders, which
   the Company believes will make it more attractive for a subsequent
   combination with an operating company. Under the terms of the Reverse Split,
   shareholders holding between 100 and 850 shares received 100 shares after the
   Reverse Split. The Reverse Split did not affect shareholders holding less
   than 100 common shares. No special treatment was given to shareholders
   holding more than 850 shares; however, they will receive a full common share
   for any fractional share interest created by the Reverse Split. Upon giving
   effect to the Reverse Split, the Company had 1,014,880 shares outstanding.

   ASAP Show Inc.

   The Company formed ASAP on December 1, 2004. ASAP was a wholly owned
   subsidiary of the Company prior to the Distribution (see below). The officers
   and directors of ASAP are the same as the officers and directors of the
   Company, at that time.

   As a condition of the Investment, the Company and ASAP entered into the
   Transfer Agreement effective May 31, 2005 whereby all of the assets of the
   Company were transferred to ASAP and all liabilities, obligations and
   contracts of the Company (known and unknown, fixed or contingent or
   otherwise) were assumed by ASAP ("Assumed Liabilities"). As part of the
   Transfer Agreement, the Company agreed to pay ASAP $415,000 after the Closing
   of the Investment as a reduction of the purchase consideration paid by ASAP
   under the Transfer Agreement. All third party consents to the assumption of
   the Company's contracts by ASAP were obtained prior to closing of the SPA and
   the Investment. ASAP and Frank Yuan have agreed to indemnify and hold the
   Company harmless from any loss, costs or damages incurred by the Company with
   respect to the Assumed Liabilities ("Indemnity Claims"). As a condition of
   the Investment, the Company must have no liabilities, obligations, debts,
   contracts or agreements of any kind or nature at closing.


                                       6
<PAGE>

                         CYBER MERCHANTS EXCHANGE, INC.
                          (A Development Stage Company)
               NOTES TO CONDENSED FINANCIAL STATEMENTS (continued)
                                November 30, 2005
                                   (Unaudited)

NOTE 2 - ORGANIZATION AND REORGANIZATION (continued)

   REORGANIZATION (continued)

   Distribution

   On August 25, 2005, the Company distributed the 8,626,480 shares of ASAP to
   the Company's shareholders of record on August 18, 2005 on a pro-rata basis
   (see below).

   On October 3, 2005, ASAP filed a Form 10-SB with the Securities and Exchange
   Commission (the "SEC") to register the shares of ASAP's common stock under
   Section 12(g) of the Securities Exchange Act of 1934, as amended ("Exchange
   Act"), which will subject ASAP to the reporting requirements of the Exchange
   Act. The Distribution was made to U. S. Stock Transfer Corporation as
   depository agent for ASAP's shareholders. The depository agent will hold the
   ASAP shares until such time as the Form 10-SB has become effective and all
   comments from the SEC have been cleared. At that time, the certificates
   representing ASAP shares will be disbursed by the depository agent to ASAP's
   shareholders.

   The distribution will be taxable to the Company's shareholders.

   Investment

   The closing of the transactions contemplated by the SPA and the Investment
   were subject to the completion of the Distribution. Pursuant to the
   Investment, the Company issued 7,104,160 shares of common stock to KI Equity
   for $415,000. The proceeds of the Investment (subject to a $50,000 reserve
   discussed below) were paid to ASAP as a reduction in the purchase
   consideration paid by ASAP under the Transfer Agreement and, pursuant to the
   accounting treatment set forth below, such payment has been treated as a
   reduction of stockholders' equity. The Company retained $50,000 of the above
   payment in reserve for a period of six months following the closing of the
   SPA to satisfy any Indemnity Claims and has included this balance as due to
   former affiliate in the accompanying condensed balance sheet. The closing of
   the SPA and the Investment occurred on September 30, 2005.

   Accounting Treatment

   The Company has accounted for the Reorganization as a reverse spinoff in
   accordance with the Emerging Issues Task Force Issue No. ("EITF") 02-11,
   "Accounting For Reverse Spinoffs." In a reverse spinoff, the legal spinnee
   (ASAP) is treated as though it were the spinnor for accounting purposes.
   Reverse spinoff accounting is appropriate as the treatment of the legal
   spinnee as the accounting spinnor results in the most accurate depiction of
   the substance of the transaction for shareholders and other users of the
   condensed financial statements. Under this treatment, the historical
   financial statements of the Company will be the historical financial
   statements of ASAP. In making its determination, the Company considered the
   following indicators, among others:


                                       7
<PAGE>

                         CYBER MERCHANTS EXCHANGE, INC.
                          (A Development Stage Company)
               NOTES TO CONDENSED FINANCIAL STATEMENTS (continued)
                                November 30, 2005
                                   (Unaudited)

NOTE 2 - ORGANIZATION AND REORGANIZATION (continued)

   REORGANIZATION (continued)

   Accounting Treatment (continued)

      o     The accounting spinnor (legal spinee, ASAP) is larger than the
            accounting spinnee (legal spinnor, the Company);

      o     The fair value of the accounting spinnor (legal spinnee) is greater
            than that of the accounting spinnee (legal spinnor); and

      o     The accounting spinnor (legal spinnee) retains the senior management
            of the formerly combined entity

NOTE 3 - STOCKHOLDERS' EQUITY

   On September 30, 2005, the Company issued 7,104,160 shares of common stock to
   KI Equity for $415,000, pursuant to the SPA described above in Note 2.
   Pursuant to the Transfer Agreement, the Company recorded a reduction in
   stockholders' equity for $415,000 due to ASAP as a reduction of the purchase
   consideration under the Transfer Agreement.

   On October 5, 2005, the Company issued 1,000,000 shares of common stock, in
   restricted form, to KI Equity at a purchase price of $0.05 per share, for an
   aggregate purchase price of $50,000 in order to provide funds for the
   Company's working capital needs. Also on October 5, 2005 for services
   rendered, the Company issued 250,000 shares of common stock to Kevin R.
   Keating, the Company's sole director and officer, and 250,000 shares of
   common stock to a financial consultant. The stock is valued at an aggregate
   price of $25,000, or $0.05 per share, which is the same per share value of
   the cash purchases of common stock in the transactions mentioned above, which
   occurred contemporaneously. The Company considers this to be the best
   estimate of the fair value of the non-cash transaction.

   On October 24, 2005, the Company issued 500,000 shares of common stock to KI
   Equity at a purchase price of $0.05 per share for an aggregate price of
   $25,000.


                                       8
<PAGE>

                         CYBER MERCHANTS EXCHANGE, INC.
                          (A Development Stage Company)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                                November 30, 2005
                                   (Unaudited)

NOTE 4 - GOING CONCERN

   The accompanying financial statements have been prepared assuming that the
   Company will continue as a going concern. The Company has no current
   operations. The Company's success is dependent upon numerous items, certain
   of which are the successful acquisition or merger with a profitable operating
   company. Unanticipated problems, expenses, and delays are frequently
   encountered in negotiating business mergers and acquisitions. No assurance
   can be given that the Company will successfully merge or acquire a profitable
   company.

   The only foreseeable cash requirements during the next twelve months will
   relate to maintaining the corporate entity, complying with the periodic
   reporting requirements of the U.S. Securities and Exchange Commission and
   evaluating and reviewing possible business ventures and opportunities. In
   order to meet these cash requirements, the Company will have to raise funds
   through the issuance of debt and/or equity securities. If new capital is
   required, the Company may not be able to raise it; or the terms of such funds
   may not be acceptable to the Company.

NOTE 5 - RELATED PARTY TRANSACTIONS

   On October 4, 2005, the Company entered into a contract with Vero Management,
   L.L.C. ("Vero") for managerial and administrative services. Vero has not been
   engaged to provide, and Vero does not render, legal, accounting, investment
   banking or capital formation services. Kevin R. Keating, the sole director of
   the Company, is the manager of Vero. In consideration of the services
   provided, Vero will be paid $1,000 for the month of October 2005 and $2,500
   each month thereafter in which services are rendered. As of November 30,
   2005, the Company has accrued $3,500 in management fees.

   Kevin R. Keating is the father of Timothy J. Keating. Timothy J. Keating is
   the managing member of KI Equity, which is the majority shareholder of the
   Company. Timothy J. Keating is also the principal member of Keating
   Investments, LLC, which is a 90% owner of Keating Securities, LLC, a
   registered broker-dealer. KI Equity owns approximately 85% of the outstanding
   shares of the Company's common stock as of January 11, 2006. Kevin R. Keating
   is not affiliated with and has no equity interest in KI Equity, Keating
   Investments, LLC or Keating Securities, LLC and disclaims any beneficial
   interest in the shares of the Company's stock owned by KI Equity . Similarly,
   Keating Investments, LLC, Keating Securities, LLC and KI Equity disclaim any
   beneficial interest in the shares of the Company's common stock currently
   owned by Kevin R. Keating.


                                       9
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Forward-Looking Statements

The following discussion may contain certain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Such statements are intended to be covered by
the safe harbors created by such provisions. These statements include the plans
and objectives of management for future growth of the Company, including plans
and objectives related to the consummation of acquisitions and future private
and public issuances of the Company's equity and debt securities. The
forward-looking statements included herein are based on current expectations
that involve numerous risks and uncertainties. Assumptions relating to the
foregoing involve judgments with respect to, among other things, future
economic, competitive and market conditions and future business decisions, all
of which are difficult or impossible to predict accurately and many of which are
beyond the control of the Company. Although the Company believes that the
assumptions underlying the forward-looking statements are reasonable, any of the
assumptions could be inaccurate and, therefore, there can be no assurance that
the forward-looking statements included in this Form 10-QSB will prove to be
accurate. In light of the significant uncertainties inherent in the
forward-looking statements included herein, the inclusion of such information
should not be regarded as a representation by the Company or any other person
that the objectives and plans of the Company will be achieved.

The words "we," "us" and "our" refer to the Company. The words or phrases "would
be," "will allow," "intends to," "will likely result," "are expected to," "will
continue," "is anticipated," "estimate," "project," or similar expressions are
intended to identify "forward-looking statements." Actual results could differ
materially from those projected in the forward looking statements as a result of
a number of risks and uncertainties, including but not limited to: (a) limited
amount of resources devoted to achieving our business plan; (b) our failure to
implement our business plan within the time period we originally planned to
accomplish; (c) because we are seeking to merge with an operating business which
has not yet been identified, you will be unable to determine whether we will
ever become profitable; and (d) other risks that are discussed in this Form
10-QSB or included in our previous filings with the Securities and Exchange
Commission.

Company Background

Cyber Merchants Exchange, Inc. ("the Company") was incorporated in July 1996,
under the laws of the State of California. In July 1999, the Company raised
approximately $3.2 million through its initial public offering. On June 30,
2000, the Company raised an additional $6.3 million in a private placement
offering subscribed by 30 high net-worth Chinese investors. Based on the nature
of the reorganization discussed below, the Company has no substantive operations
at November 30, 2005. As a result of the Company's reorganization, for
accounting purposes, the operations are presented beginning August 25, 2005
("Inception").


                                       10
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

Reorganization

The Company's shareholders approved a reorganization of the Company on May 16,
2005, summarized as follows:

      1.    The Company transferred of all of its assets and liabilities (the
            "Transfer") to ASAP Show Inc., a wholly owned subsidiary of the
            Company ("ASAP"), effective May 31, 2005 pursuant to a Transfer and
            Assumption Agreement ("Transfer Agreement");

      2.    The Company effected a one for eight and one-half (1-for-8.5)
            reverse stock split of the Company stock (the "Reverse Split") with
            special treatment to preserve round lot stockholders, effective July
            18, 2005;

      3.    On August 25, 2005, the Company distributed 8,626,480 shares of
            common stock of ASAP, representing all of the outstanding shares of
            ASAP, to the Company's shareholders of record on August 18, 2005 on
            a pro rata basis (the "Distribution"); and

      4.    On September 30, 2005, the Company issued 7,104,160 shares of common
            stock to KI Equity Partners II, LLC ("KI Equity") for $415,000, (the
            "Investment") pursuant to a Securities Purchase Agreement ("SPA")
            dated November 19, 2004, and amended August 25, 2005.

The details of the reorganization transactions above are as follows:

Securities Purchase Agreement

On November 19, 2004, the Company entered into a Securities Purchase Agreement
with Keating Reverse Merger Fund, LLC ("KRM Fund") and Frank Yuan, the then
current Chairman of the Board and Chief Executive Officer of the Company
("Yuan") providing for the investment by KRM Fund of $425,000 in the Company in
exchange for 7,000,000 shares of the Company's common stock. The SPA was amended
and restated effective August 25, 2005 to, among other things, change the
Investment to $415,000, change the number of shares to be purchased to
7,104,160, and substitute KI Equity for KRM Fund. The Investment by KI Equity
was payable to ASAP as a reduction in the purchase consideration paid by ASAP
under the Transfer Agreement. To the extent certain liabilities assumed by ASAP
remained unpaid at closing, the funds were to be used to satisfy such
liabilities with any remaining funds being available to ASAP for working capital
to grow its trade show business. The Reorganization will allow the shareholders
of the Company to participate in the growth of the trade show business through
the spin-off of ASAP, which owns and operates the trade show business (see
below). Following the Reorganization and spin off of ASAP, the Company is
majority owned by KI Equity and will seek a business combination with an
operating company.


                                       11
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

Reverse Split

The Company had 8,500,000 shares outstanding at May 31, 2005. The Company
effected the one-for-eight and one-half share Reverse Split on a record date of
July 18, 2005. The Reverse Split allows for special treatment of certain
shareholders to preserve round lot (100 shares or more) shareholders, which the
Company believes will make it more attractive for a subsequent combination with
an operating company. Under the terms of the Reverse Split, shareholders holding
between 100 and 850 shares received 100 shares after the Reverse Split. The
Reverse Split did not affect shareholders holding less than 100 common shares.
No special treatment was given to shareholders holding more than 850 shares;
however, they will receive a full common share for any fractional share interest
created by the Reverse Split. Upon giving effect to the Reverse Split, the
Company had 1,014,880 shares outstanding.

ASAP Show Inc.

The Company formed ASAP on December 1, 2004. ASAP was a wholly owned subsidiary
of the Company prior to the Distribution (see below). The officers and directors
of ASAP are the same as the officers and directors of the Company, at that time.

As a condition of the Investment, the Company and ASAP entered into the Transfer
Agreement effective May 31, 2005 whereby all of the assets of the Company were
transferred to ASAP and all liabilities, obligations and contracts of the
Company (known and unknown, fixed or contingent or otherwise) were assumed by
ASAP ("Assumed Liabilities"). As part of the Transfer Agreement, the Company
agreed to pay ASAP $415,000 after the Closing of the Investment as a reduction
of the purchase consideration paid by ASAP under the Transfer Agreement. All
third party consents to the assumption of the Company's contracts by ASAP were
obtained prior to closing of the SPA and the Investment. ASAP and Frank Yuan
have agreed to indemnify and hold the Company harmless from any loss, costs or
damages incurred by the Company with respect to the Assumed Liabilities
("Indemnity Claims"). As a condition of the Investment, the Company must have no
liabilities, obligations, debts, contracts or agreements of any kind or nature
at closing.

Distribution

On August 25, 2005, the Company distributed the 8,626,480 shares of ASAP to the
Company's shareholders of record on August 18, 2005 on a pro-rata basis (see
below).

On October 3, 2005, ASAP filed a Form 10-SB with the Securities and Exchange
Commission (the "SEC") to register the shares of ASAP's common stock under
Section 12(g) of the Securities Exchange Act of 1934, as amended ("Exchange
Act"), which will subject ASAP to the reporting requirements of the Exchange
Act. The Distribution was made to U. S. Stock Transfer Corporation as depository
agent for ASAP's shareholders. The depository agent will hold the ASAP shares
until such time as the Form 10-SB has become effective and all comments from the
SEC have been cleared. At that time, the certificates representing ASAP shares
will be disbursed by the depository agent to ASAP's shareholders. The
distribution will be taxable to the Company's shareholders.


                                       12
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

Investment

The closing of the transactions contemplated by the SPA and the Investment were
subject to the completion of the Distribution. Pursuant to the Investment, the
Company issued 7,104,160 shares of common stock to KI Equity for $415,000. The
proceeds of the Investment (subject to a $50,000 reserve discussed below) were
paid to ASAP as a reduction in the purchase consideration paid by ASAP under the
Transfer Agreement. The Company retained $50,000 of the above payment to ASAP in
reserve for a period of six months following the closing of the SPA to satisfy
any Indemnity Claims. The closing of the SPA and the Investment occurred on
September 30, 2005.

Liquidity and Capital Resources

The Company's total assets as of November 30, 2005 are $103,699, which is
comprised of cash. The Company's current liabilities are $53,500, of which
$50,000 represents the reserve for Indemnity Claims that is payable to ASAP, the
Company's former affiliate, on March 30, 2006 to the extent not used to cover
Indemnity Claims. The other foreseeable cash requirements during the next twelve
months will relate to maintaining the corporate entity, complying with the
periodic reporting requirements of the U.S. Securities and Exchange Commission
and evaluating and reviewing possible business ventures and opportunities. In
order to meet these cash requirements, the Company may have to raise funds
through the issuance of debt and/or equity securities. If new capital is
required, the Company may not be able to raise it; or the terms of such funds
may not be acceptable to the Company.

On September 30, 2005, the Company issued 7,104,160 shares of common stock to KI
Equity for $415,000, pursuant to the SPA. Pursuant to the Transfer Agreement,
the Company paid $365,000 to ASAP as a reduction of the purchase consideration
under the Transfer Agreement. The Company retained $50,000 payable to ASAP in
reserve for a period of six months following the closing of the SPA to satisfy
any Indemnity Claims.

On October 5, 2005, the Company issued 1,000,000 shares of common stock, in
restricted form, to KI Equity at a purchase price of $0.05 per share, for an
aggregate purchase price of $50,000 in order to provide funds for the Company's
working capital needs. Also on October 5, 2005 for services rendered, the
Company issued 250,000 shares of common stock to Kevin R. Keating, the Company's
sole director and officer, and 250,000 shares of common stock to a financial
consultant. The stock is valued at an aggregate price of $25,000, or $0.05 per
share, which is the same per share value of the cash purchases of common stock
in the transactions mentioned above, which occurred contemporaneously. The
Company considers this to be the best estimate of the fair value of the non-cash
transaction.

On October 24, 2005, the Company issued 500,000 shares of common stock to KI
Equity at a purchase price of $0.05 per share for an aggregate price of $25,000.


                                       13
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

The following is a summary of the Company's cash flows provided by (used in)
operating, investing, and financing activities:

                                                    Period from August 25, 2005
                                                     through November 30, 2005

        Operating activities                          $         (21,301)
        Investing activities                                          -
        Financing activities                                    125,000
                                                      -----------------

        Net effect on cash                            $         103,699
                                                      =================

Results of Operations

For the period from August 25, 2005 ("Inception") through November 30, 2005 the
Company had no activities that produced revenues from operations. Operating
expenses for the period from Inception through November 30, 2005 were $49,801,
of which $25,000 consisted of non-cash compensation paid to our sole officer and
a financial consultant.

Going Concern

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company has no current operations.
The Company's success is dependent upon numerous items, certain of which are the
successful acquisition or merger with a profitable operating company.
Unanticipated problems, expenses, and delays are frequently encountered in
negotiating business mergers and acquisitions. No assurance can be given that
the Company will successfully merge or acquire a profitable company.

The only foreseeable cash requirements during the next twelve months will relate
to maintaining the corporate entity, complying with the periodic reporting
requirements of the U.S. Securities and Exchange Commission and evaluating and
reviewing possible business ventures and opportunities. In order to meet these
cash requirements, the Company will have to raise funds through the issuance of
debt and/or equity securities. If new capital is required, the Company may not
be able to raise it; or the terms of such funds may not be acceptable to the
Company.

Critical accounting estimates

In preparing the financial statements, management is required to make estimates
and assumptions that affect the reported amounts of assets and liabilities as of
the date of the statements of financial condition.

Measurement of non-cash compensation
On October 5, 2005, the Company issued an aggregate of 500,000 shares of its
common stock in lieu of compensation for services to two individuals. The stock
was valued at $0.05 per share, which is the same value per share as KI Equity
paid in cash for a purchase of 500,000 shares. The Company values non-cash
equity transactions in relation to contemporaneous cash sales of equivalent
equity securities.


                                       14
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

Plan of Operations

Risk Factors

An investment in our common stock involves investment risks and the possibility
of the loss of an investor's entire investment. A prospective investor should
evaluate all information about us and the risk factors discussed below in
relation to his financial circumstances before investing in us.

         1. No Current Operating Business. We currently have no relevant
operating business, revenues from operations or assets. Our business plan is to
seek a merger or business combination with an operating business. We face all of
the risks inherent in the investigation, acquisition, or involvement in a new
business opportunity. An investor's purchase of any of our securities must be
regarded as placing funds at a high risk in a new or "start-up" venture with all
of the unforeseen costs, expenses, problems, and difficulties to which such
ventures are subject.

         2. No Assurance of Success or Profitability. There is no assurance that
we will acquire a suitable and favorable business opportunity in a reverse
merger transaction. In addition, even if we become involved in a business
opportunity, there is no assurance that the business we acquire will generate
revenues or profits, or that the value of our common stock will increase as a
result of the acquired business opportunity.

         3. Possible Business - Not Identified and Highly Risky. We have not
identified and have no commitments to enter into or acquire a specific business
opportunity and therefore we can disclose the risks and hazards of a business or
opportunity that we acquire only in a general manner, and cannot disclose the
risks and hazards of any specific business or other opportunity that we may
enter into. An investor can expect a potential business opportunity to be quite
risky. Our acquisition of or participation in a business opportunity could
result in a total loss to our investors and stockholders if the target business
is unsuccessful. Further, any investment in us may continue to be highly
illiquid.

         4. Type of Business Acquired. The type of business that may be acquired
is not identified. Therefore, our investors and stockholders have to rely on our
management to determine which target business to pursue. There are no
controlling parameters of the business to be acquired. Thus, ultimately an
investment will depend on the target business and therefore investors in us will
be subject to all the risks that would be associated with that selected
business. Our management may have the right to approve and authorize a reverse
merger transaction with a target company without obtaining the vote of the
majority of our stockholders.

         5. Impracticability of Exhaustive Investigation. We have limited funds
and lack full-time management which will likely make it impracticable to conduct
a complete and exhaustive investigation and analysis of a business opportunity
before we commit our limited capital and other resources to acquire a target
business. Management decisions, therefore, likely will be made without detailed
feasibility studies, independent analysis, market surveys, and the like which,
if we had more funds available to us, would be desirable. We will be
particularly dependent in making decisions upon information provided by the
promoter, owner, sponsor, or others associated with the business opportunity
seeking to be acquired by us.


                                       15
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

         6. Lack of Diversification. Because of our limited financial resources,
it is unlikely that we will be able to diversify our acquisitions or operations.
The inability to diversify our activities into more than one area will subject
our investors and stockholders to economic fluctuations within a particular
business or industry and therefore increase the risks associated with the
investment. We only intend to acquire a single business opportunity and thus
your investment will lack diversification.

         7. Possible Reliance upon Unaudited Financial Statements. We will
require audited financial statements from target companies that we propose to
acquire. No assurance can be given, however, that audited financials will be
available at the closing of the reverse merger transaction. In cases where
audited financials are unavailable, we will have to rely upon unaudited
information received from target companies' management that has not been
verified by outside auditors. We, at the time of acquisition, will be subject to
the reporting provisions of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and thus will be required to furnish certain information about
significant acquisitions, including audited financial statements for any
business that the shell company acquires. Consequently, acquisition prospects
that do not have or are unable to obtain the required audited statements may not
be appropriate for acquisition so long as the reporting requirements of the
Exchange Act are applicable. But, in cases where we have completed a reverse
merger transaction in reliance on unaudited financial statements and audited
statements cannot subsequently be obtained, the continued ability of the
post-transaction company to remain a reporting company and publicly trading will
be in jeopardy and may significantly reduce the value of your investment.

         8. Investment Company Regulation. We do not intend to become classified
as an "investment company" under the Investment Company Act of 1940 (the
"Investment Act"). We believe that we will not become subject to regulation
under the Investment Act because (i) we will not be engaged in the business of
investing or trading in securities, and (ii) any acquisition undertaken will
result in the target company obtaining a majority interest in us. Should there
be a requirement to register as an investment company, it would cause
significant registration and compliance costs. Any violation of the Investment
Act will subject us to materially adverse consequences. Should the SEC find that
we are subject to the Investment Act, and order registration under the
Investment Act, we would resist such finding and take steps to avoid such
registration. Irrespective of whether the SEC or we were to prevail in such
dispute about whether or not we are an investment company, however, the damages
and delays would be costly.

         9. Other Regulation. Any acquisition made by us may be of a business
that is subject to regulation or licensing by federal, state, or local
authorities. Foreign companies may also be considered, and be subject to similar
business regulations as are applicable in the United States and also may be
subject to limitations on ownership by foreign persons and entities. Compliance
with such regulations and licensing can be expected to be a time-consuming,
expensive process and may limit our other investment opportunities. We intend to
pursue potential business opportunities in foreign countries, including China,
and as such, such opportunities will be subject to foreign country laws and
regulations affecting foreign investment, business operations, currency
exchange, repatriation of profits, and taxation, which will increase the risk of
your investment.


                                       16
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

         10. Dependence upon Management. We will be heavily dependent upon the
skills, talents, and abilities of our management to implement our business plan.
Our management may devote limited time to our affairs, which may be inadequate
for our business, and may delay the acquisition of any business opportunity
considered. Furthermore, management has little experience in seeking,
investigating, and acquiring businesses and will depend upon its limited
business knowledge in making decisions regarding our acquisition of a business
opportunity. Because investors will not be able to evaluate the merits of
possible business acquisitions by us, they should critically assess the
information concerning the management.

         11. Dependence upon Outside Advisors. To supplement the business
experience of management, we may be required to employ accountants, technical
experts, appraisers, attorneys, or other consultants or advisors. Some of these
outside advisors may be our affiliates or their affiliated entities. The
selection of any such advisors will be made by our management without any input
from stockholders.

         12. Conflicts of Interest. Our management has other business interests
to which they will devote primary attention. As a result, conflicts of interest
may arise that can be resolved only through the exercise by them of their
judgment as may be consistent with their fiduciary duties. Our management will
try to resolve conflicts to the best advantage of all concerned, but there may
be times when an acquisition opportunity is given to another entity to the
disadvantage of our stockholders and for which there will be no recourse. It is
also expected that we will engage Keating Securities, LLC, an affiliate of
Keating Investments, LLC, the managing member of our controlling stockholder, to
act as a financial advisor in connection with the reverse merger transaction for
which it may earn a cash and/or equity fee.

         13. Need for Additional Financing. In all likelihood we will need
additional funds to take advantage of any available acquisition business
opportunity. Even if we were to obtain sufficient funds to acquire an interest
in a business opportunity, we may not have sufficient capital to fully exploit
the opportunity. Our ultimate success will depend upon our ability to raise
additional capital at the time of the acquisition and thereafter. When
additional capital may be needed, there can be no assurance that funds will be
available from any source or, if available, that they can be obtained on
acceptable terms.

         14. Borrowing Transactions. There is a possibility that any acquisition
of a business opportunity by us will require borrowing against the assets of the
business opportunity to be acquired, or against the projected future revenues or
profits of the business opportunity. This leverage could increase our exposure
to larger losses. There is no assurance that any business opportunity acquired
through borrowing and leverage will generate sufficient revenues to cover the
related debt and expenses.

         15. No Foreseeable Dividends. We do not intend to pay any dividends. We
do not foresee making any cash distributions in the manner of a dividend or
otherwise.


                                       17
<PAGE>
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

         16. Loss of Control by Present Management and Stockholders. It is
likely that any acquisition of an operating company will result in a change in
control of the then current directors, officers and the stockholders. Therefore,
our management prior to the acquisition will be changed to those of the target
company and its stockholders, who will then control the combined company. At
that time, our stockholders will be at investment risk for the decisions about
the business by persons that they may not know or have any ability to influence
through a board seat or by the voting mechanism of stockholders.

         17. Dilutive Effects of Issuing Additional Common Stock. In any reverse
merger transaction, for tax reasons and management reasons, the owners of the
target company will be issued a large number of shares of common stock which
will dilute the ownership interest of our current stockholders. In addition, at
the time of the reverse merger, it will be likely that there will be additional
authorized but unissued shares that may be later issued by the then new
management for any purpose without the consent or vote of the stockholders. The
acquisition issuance and additional issuances that may occur will dilute the
interests of our stockholders after the reverse merger transaction.

         18. Thinly-traded Public Market. Our securities will be very thinly
traded, and the price if traded may not reflect the value of the company.
Moreover, there may be a reverse split of the shares which may not reflect the
value of the company either. There can be no assurance that there will be an
active market for our shares either now or after we complete the reverse merger.
The market liquidity will be dependant on the perception of the operating
business and any steps that its management might take to bring the company to
the awareness of investors. There can be no assurance given that there will be
any awareness generated. Consequently investors may not be able to liquidate
their investment or liquidate it at a price that reflects the value of the
business. If a more active market should develop, the price may be highly
volatile. Because there may be a low price for our securities, many brokerage
firms may not be willing to effect transactions in the securities. Even if an
investor finds a broker willing to effect a transaction in the securities, the
combination of brokerage commissions, transfer fees, taxes, if any, and any
other selling costs may exceed the selling price. Further, many lending
institutions will not permit the use of such securities as collateral for any
loans.

         19. Possible Rule 144 Sales. The majority of our shares currently
outstanding are "restricted securities" within the meaning of Rule 144 under the
Securities Act of 1933, as amended (the "Act"). As restricted shares, these
shares may be resold only pursuant to an effective registration statement or
under the requirements of Rule 144 or other applicable exemption from
registration under the Act and as required under applicable state securities
laws. Rule 144 provides in essence that a person who has held restricted
securities for a period of one year may, under certain conditions, sell every
three months, in brokerage transactions, a number of shares that does not exceed
the greater of 1.0% of a company's outstanding common stock or the average
weekly trading volume during the four calendar weeks prior to the sale. There is
no limit on the amount of restricted securities that may be sold by a
non-affiliate after the restricted securities have been held by the owner for a
period of two years. Current stockholders who own 10% or more of our shares will
likely be deemed an affiliate until 90 days after a reverse merger is completed
with a target company. After such 90-day period, and assuming said shares have
been held for more than two years, these stockholders may be able to sell their
shares without volume restrictions. A sale under Rule 144 or under any other
exemption from the Act, if available, or pursuant to subsequent registrations of
our shares, may have a depressive effect upon the price of our shares in any
market that may develop.


                                       18
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

General Business Plan

Our plan of operation is to seek a target company with which to merge or to
complete a business combination. In any transaction, we will be the surviving
entity, and our stockholders will retain a percentage ownership interest in the
post-transaction company. The amount of the retained equity ownership by our
stockholders will be negotiated by our management and the target company. We may
also be required to pay cash and/or equity fees to third parties that advise us
in connection with the merger or business combination, commonly refereed to as a
reverse merger. These third party advisors may include certain affiliates of
ours and their affiliated entities.

Typically in connection with the reverse merger transaction involving us and the
target company, there will be a capital funding event for the target business on
a combined basis either at the time of the reverse merger or shortly thereafter.
This may be a private placement by either us or the target company, if the
funding event is contingent on the closing of the reverse merger. If the funding
event is after the reverse merger, it will likely be a public offering or
private placement of our securities. It will often be the case that the
liquidity opportunity for our existing stockholders will be tied to the ability
of the old and new investors of the target enterprise to have liquidity in the
market for their financial investment. Therefore, our stockholders may have to
continue to hold their investment or may face competition in being able to sell
their shares in the post-transaction business in the public market, which may
depress the price for such a volume of securities.

We will not restrict our search to any specific business, industry or geographic
location, and we may participate in a business venture of virtually any kind or
nature. This discussion of our plan for acquiring an operating business is
purposefully general, and it is not meant to be restrictive of the virtually
unlimited discretion to search for and enter into potential business
opportunities. We anticipate that we will be able to participate in only one
potential business venture because of our nominal assets and limited financial
resources.

We may seek a business opportunity with entities which have recently commenced
operations, or that desire to utilize the public marketplace in order to raise
additional capital in order to expand into new products or markets, to develop a
new product or service, or for other corporate purposes. We may acquire assets
and establish wholly owned subsidiaries in various businesses or acquire
existing businesses as subsidiaries.


                                       19
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

We expect that the selection of a business opportunity will be complex and
risky. Due to general economic conditions, rapid technological advances being
made in some industries and shortages of available capital, we believe that
there are numerous potential targets with either sound business ideas or
operations seeking the benefits of a shell company that has complied with the
federal reporting requirements for public companies and is publicly trading.
Such benefits may include facilitating or improving the terms on which
additional equity financing may be sought, providing liquidity for incentive
stock options or similar benefits to key employees, providing liquidity (subject
to restrictions of applicable statutes) for all stockholders and other factors.
Potentially, available business opportunities may occur in many different
industries and at various stages of development, all of which will make the task
of comparative investigation and analysis of such business opportunities
extremely difficult and complex. We have, and will continue to have, limited
capital with which to provide the owners of business opportunities with any
significant cash or other assets. We will, however, be able to offer owners of
target candidates the opportunity to acquire a controlling ownership interest in
an issuer who has complied with the reporting requirements under federal
securities laws without incurring the cost and time required to conduct an
initial public offering.

The analysis of new business opportunities will be undertaken by, or under the
supervision of, our management who will likely engage outside advisors to assist
us in this analysis. Some of these outside advisors may be affiliates of ours or
their affiliated entities. We intend to concentrate on identifying preliminary
prospective business opportunities which may be brought to our attention through
present associations of our officers and directors, or by our advisors. In
analyzing prospective business opportunities, we will consider such matters as
(i) available technical, financial and managerial resources; (ii) working
capital and other financial requirements; (iii) history of operations, if any
and prospects for the future; (iv) nature of present and expected competition;
(v) quality, experience and depth of management services; (vi) potential for
further research, development or exploration; (vii) specific risk factors not
now foreseeable but that may be anticipated to impact the proposed activities of
the company; (viii) potential for growth or expansion; (ix) potential for
profit; (x) public recognition and acceptance of products, services or trades;
(xi) name identification; and (xii) other factors that we consider relevant. As
part of our investigation of the business opportunity, we or our advisors expect
to meet personally with or interview management and key personnel.

We may also have to compensate certain advisors, finders and investment banking
firms for services rendered in connection with the identification of target
operating companies and the negotiation and completion of the transaction. Due
to our limited resources, it is expect that all or a portion of this
compensation will be in the form of our common stock or from cash provided by
the target company or the funding event. Additional issuance of our common stock
will have a further dilutive effect on the percentage of shares held our
stockholders. Keating Securities, LLC, an affiliate of Keating Investments, LLC,
the managing member of our controlling stockholder, will also act as a financial
advisor in connection with the reverse merger transaction and will be paid a
cash and/or equity fee upon the successful closing of the reverse merger.

We will not acquire or merge with any company for which audited financial
statements cannot be obtained within a reasonable period of time after closing
of the proposed transaction.


                                       20
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

Acquisition Opportunities

In implementing a structure for a particular business acquisition, we may become
a party to a merger, consolidation, reorganization, joint venture, or licensing
agreement with another company or entity. We may also acquire stock or assets of
an existing business. Our management may have the right to approve and authorize
a reverse merger transaction with a target company without obtaining the vote of
the majority of our stockholders. Further, upon consummation of a reverse merger
transaction, it is probable that our present management and stockholders will no
longer be in control of us. In addition, our management, as part of the terms of
the reverse merger transaction, may resign and may be replaced by new directors
without a vote of our stockholders. Any and all sales of shares of our common
stock may only be made in compliance with the securities laws of the United
States and any applicable state.

It is anticipated that certain securities issued by us in connection with the
reverse merger would be issued in reliance upon exemptions from registration
under application federal and state securities laws. In some circumstances, as a
negotiated element of the reverse merger transaction, we will be asked to agree
to register all or a part of such securities immediately after the transaction
is consummated or at specified times thereafter. In such a case, we will attempt
to negotiate the registration of some or all of our current outstanding shares
which are restricted, but there is no guarantee that this will be accomplished
or, if accomplished, that the registration rights identical. If such
registration occurs, it will be undertaken by the surviving entity after it has
successfully consummated a reverse merger and is no longer considered an
inactive company. The issuance of substantial additional securities by us in
connection with the reverse merger and their potential sale into any trading
market which may develop in our securities may have a depressive effect on the
value of our securities in the future. There is no assurance that such a trading
market will develop.

While the actual terms of a reverse merger transaction cannot be predicted, it
is expected that the parties to any business transaction will find it desirable
to avoid the creation of a taxable event and thereby structure the business
transaction in a so-called "tax-free" reorganization under Sections 368(a)(1) or
351 of the Internal Revenue Code (the "Code"). In order to obtain tax-free
treatment under the Code, it may be necessary for the owners of the acquired
business to own 80 percent or more of the voting stock of the surviving entity.
In such event, the equity interest retained by our current stockholders would be
less than 20 percent of the issued and outstanding shares of the surviving
entity. This would result in significant dilution in the equity interests of our
stockholders.

In addition to the tax considerations discussed above, it is likely that in any
reverse merger, and depending upon, among other things, the target company's
assets and liabilities, the equity interests of our stockholders after the
transaction will be a small percentage of the post-transaction company. The
percentage ownership may be subject to significant reduction in the event we
acquire a target company with significant assets and expectations of growth.


                                       21
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (continued)

We will participate in a business opportunity only after the negotiation and
execution of appropriate written agreements. Although the terms of the
acquisition agreements cannot be predicted, generally such agreements will (i)
require specific representations and warranties by all of the parties; (ii)
specify certain events of default and remedies therefor; (iii) detail the terms
of closing and the conditions which must be satisfied by each of the parties
prior to and after closing; (iv) outline the manner of bearing costs, including
costs associated with our attorneys and accountants; (v) set forth
indemnification provisions; and (vi) include miscellaneous other terms.

As stated above, we will not acquire or merge with any entity which cannot
provide independent audited financial statements within a reasonable period of
time after closing of the proposed transaction. Included in these requirements
is the affirmative duty to file independent audited financial statements as part
of a Current Report on Form 8-K, required to be filed with the SEC upon
consummation of a merger or acquisition, as well as audited financial statements
included in an Annual Report on Form 10-K (or Form 10-KSB, as applicable). If
such audited financial statements are not available at closing, or within time
parameters necessary to insure compliance with the reporting requirements under
federal securities laws, or if the audited financial statements provided do not
conform to the representations made by the business to be acquired, we will
attempt to negotiate a provision in the definitive closing documents to void the
transaction. However, there is no guarantee that we will be successful in
including such a provision and, in such case, the continued ability of the
post-transaction company to remain a reporting company and publicly trading may
be in jeopardy.

We are an insignificant participant among the firms which engage in the reverse
merger of shell companies into an operating business. There are many established
venture capital and financial concerns that have significantly greater financial
and personnel resources and technical expertise than we have. In view of our
limited financial resources and limited management availability, we will
continue to be at a significant competitive disadvantage compared to our
competitors. As a result, we may not be able to find suitable target companies
with which to complete a reverse merger transaction.

We are an insignificant participant among the firms which engage in the reverse
merger of shell companies into an operating business. There are many established
venture capital and financial concerns that have significantly greater financial
and personnel resources and technical expertise than we have. In view of our
limited financial resources and limited management availability, we will
continue to be at a significant competitive disadvantage compared to our
competitors. As a result, we may not be able to find suitable target companies
with which to complete a reverse merger transaction.


                                       22
<PAGE>

ITEM 3. CONTROLS AND PROCEDURES

As of the end of the period covered by this report, the Company conducted an
evaluation, under the supervision and with the participation of the Chief
Executive Officer and Chief Financial Officer, of the Company's disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the
1934 Act. Based on this evaluation, the Chief Executive Officer and Chief
Financial Officer concluded that the Company's disclosure controls and
procedures are effective to ensure that information required to be disclosed by
the Company in reports that it files or submits under the 1934 Act is recorded,
processed, summarized and reported within the time periods specified in
Securities and Exchange Commission rules and forms. There was no change in the
Company's internal control over financial reporting during the Company's most
recently completed fiscal quarter that has materially affected, or is reasonably
likely to materially affect, the Company's internal control over financial
reporting.


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<PAGE>

PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings

          None

Item 2.   Changes in Securities

            On September 30, 2005, the Company issued 7,104,160 shares of common
            stock to KI Equity for $415,000, pursuant to the Amended SPA.

            On October 5, 2005, the Company issued 1,000,000 shares of common
            stock, in restricted form, to KI Equity at a purchase price of $0.05
            per share, for an aggregate purchase price of $50,000. Also on
            October 5, 2005, the Company issued an aggregate of 500,000 shares
            of its common stock in lieu of compensation for services to two
            individuals. The stock was valued at $0.05 per share, which is the
            same value per share as KI Equity paid in cash for a purchase of
            500,000 shares.

            On October 24, 2005, the Company issued 500,000 shares of common
            stock to KI Equity at a purchase price of $0.05 per share for an
            aggregate price of $25,000.

Item 3.   Defaults Upon Senior Securities

          None

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

          None

Item 5.   Other Information

          None

Item 6.   Exhibits and Reports of Form 8-K

         (a) Exhibits

         31  Certification pursuant to Rule 13a-14(a) or 15d-14(a) under the
             Securities Exchange Act of 1934, as amended.

         32  Certification of Chief Executive Officer and President of the
             Company, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
             Section 906 of the Sarbanes-Oxley Act of 2002.


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<PAGE>

         (b) Reports on Form 8-K

         On September 19, 2005, the Company filed a Current Report on Form 8-K
         dated August 25, 2005 announcing the distribution of shares of ASAP
         Show Inc. to shareholders of record on August 18, 2005.

         On October 4, 2005, the Company filed a Current Report on Form 8-K
         dated September 30,2005 announcing the execution of the Amended SPA,
         the Change in Control, the Change in Officers and Directors, and the
         Change in Shell Status.

         On October 6, 2005, the Company filed a Current Report on Form 8-K
         dated October 5, 2005 announcing the unregistered sale of 1,000,000
         shares of common stock for $50,000, or $0.05 per share, and the
         issuance of 500,000 shares of common stock for services valued at
         $25,000, or $0.05 per share. The Company also announced the appointment
         of three Directors.

         On October 25, 2005, the Company filed a Current Report on Form 8-K
         dated October 24, 2004 announcing the unregistered sale of 500,000
         shares of common stock for $ 25,000, or $0.05 per share.


                                       25
<PAGE>
                                   Signatures

In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                        CYBER MERCHANTS EXCHANGE, INC.

                                        By: /s/ Kevin R. Keating
                                        ---------------------------------
                                            Principal Executive Officer
                                            Principal Financial Officer

Date: January 17, 2006


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