---

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 **June 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
[**X**]  No [   ]

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 June
30, 2006 was 15,656,245.

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TABLE OF CONTENTS

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

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PART
I               
FINANCIAL INFORMATION

ITEM
1.               
FINANCIAL STATEMENTS

As used herein, the term Company refers to Mangapets, Inc.
(formerly Newmark Ventures, 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.

---

MANGAPETS, INC. AND SUBSIDIARY (Formerly Newmark Ventures
Inc.) (a Development Stage Company)CONSOLIDATED BALANCE SHEET
JUNE 30, 2006

|                                                             |   | June 30     |  
|------------------------------------------------------------ | - | ----------- | -
|                                                             |   | 2006        |  
|                                                             |   | (Unaudited) |  
|                                                             |   | $           |  
|                                                             |   |             |  
|ASSETS                                                       |   |             |  
|                                                             |   |             |  
|Current Assets                                               |   |             |  
|Cash                                                         |   | 402         |  
|Prepaid expenses                                             |   | 3,122       |  
|                                                             |   |             |  
|Total current assets                                         |   | 3,524       |  
|                                                             |   |             |  
|Website Development Costs                                    |   | 173,021     |  
|                                                             |   |             |  
|Total Assets                                                 | $ | 176,545     |  
|                                                             |   |             |  
|LIABILITIES AND STOCKHOLDERS EQUITY
      (DEFICIT)         |   |             |  
|                                                             |   |             |  
|Current Liabilities                                          |   |             |  
|Accounts payable and accrued expenses                        |   | 810,475     |  
|Accounts payable and
      accrued expenses, related parties |   | 62,843      |  
|Notes payable                                                |   | 31,797      |  
|Loans payable                                                |   | 31,060      |  
|Advances payable, related party                              |   | 51,780      |  
|Deferred revenue                                             |   | 21,537      |  
|                                                             |   |             |  
|Total current liabilities                                    |   | 1,009,492   |  
|                                                             |   |             |  
|Stockholders Equity (Deficit)                               |   |             |  
|Common stock, $0.001 par value,
      100,000,000 shares     |   |             |  
|authorized; 15,156,245 shares issued and outstanding         |   | 15,156      |  
|Common stock issuable; 37,500 shares                         |   | 38          |  
|Additional paid-in
      capital                             |   | 15,995,445  |  
|Accumulated deficit                                          |   | (8,143,573  | )
|Deficit accumulated
      during the development stage       |   | (8,700,013  | )
|                                                             |   |             |  
|Total Stockholders Deficit                                   |   | (832,947    | )
|                                                             |   |             |  
|Total Liabilities and Stockholders Deficit                   | $ | 176,545     |  

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

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MANGAPETS, INC. AND SUBSIDIARY(Formerly Newmark Ventures
Inc.) (a Development Stage Company) CONSOLIDATED STATEMENTS OF
OPERATIONS For the Three and Six Months Ended June 30, 2006 and 2005 and for
the Period From January 1, 2005 (the effective date of the development
stage) to June 30, 2006 (unaudited)

Three Months Ended
    
    
    Six Months EndedCumulativeDuring the30 June
    
    
    30 June
    
    
    June 30
    
    
    June 30
    
    
    Development2006
    
    
    2005
    
    
    2006
    
    
    2005
    
    
    StageRevenues
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    -ExpensesGeneral and administrative
    $
    7,810,859
    
    $
    93,688
    
    $
    7,936,949
    
    $
    147,953
    
    $
    8,218,127Interest expense
    
    7,904
    
    
    -
    
    
    8,226
    
    
    -
    
    
    8,226Website planning costs
    
    -
    
    
    139,406
    
    
    -
    
    
    139,406
    
    
    144,406Impairment of website
      developmentcosts
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    304,254Loss from continuing operations
    
    7,818,763
    
    
    233,094
    
    
    7,945,175
    
    
    287,359
    
    
    8,675,013Discontinued OperationsLoss from operations of
      thediscontinued component, includingimpairment loss of
      $25,000 in 2005-
    
    
    -
    
    
    -
    
    
    -
    
    
    25,000Net Loss
    $
    (7,818,763
    )
    $
    (233,094
    )
    $
    (7,945,175
    )
    $
    (287,359
    )
    $
    (8,700,013
    )Net Loss Per Share (Basic and Diluted)Continuing operations
    $
    (0.60
    )
    $
    (0.03
    )
    $
    (0.73
    )
    $
    (0.04
    )Weighted Average Shares
    
    13,006,65
    
    
    8,265,9
    
    
    10,869,02
    
    
    8,172,677


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

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MANGAPETS,INC. ANDSUBSIDIARY(FormerlyNewmarkVenturesInc.)(aDevelopmentStageCompany)CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) For the
Three and Six Months Ended June 30, 2006 and 2005 and for the Period From
January 1, 2005 (the effective date of the development stage) to June 30, 2006

|                                              |  |              |  |   |                       |  |   |          |   |   |             |   |   |             |  |   |            |   |   | Deficit     |   |   |          |  
|--------------------------------------------- |  | ------------ |  | - | --------------------- |  | - | -------- | - | - | ----------- | - | - | ----------- |  | - | ---------- | - | - | ----------- | - | - | -------- | -
|                                              |  |              |  |   |                       |  |   |          |   |   |             |   |   |             |  |   |            |   |   | Accumulated |   |   |          |  
|                                              |  |              |  |   |                       |  |   |          |   |   |             |   |   | Additional  |  |   |            |   |   | During the  |   |   |          |  
|                                              |  | Common Stock |  |   | Common Stock Issuable |  |   | Paid-in  |   |   | Accumulated |   |   | Development |  |   |            |  
|                                              |  | Shares       |  |   | Amount                |  |   | Shares   |   |   | Amount      |   |   | Capital     |  |   | Deficit    |   |   | Stage       |   |   | Total    |  
|                                              |  |              |  |   | $                     |  |   |          |   |   | $           |   |   | $           |  |   | $          |   |   | $           |   |   | $        |  
|Balances, December 31, 2004                   |  | 8,057,828    |  | $ | 8,058                 |  | $ | 177,187  |   | $ | 177         |   | $ | 7,778,979   |  | $ | (8,143,573 | ) | $ | -           |   | $ | (356,359 | )
|Issuance of common stock
      for            |  |              |  |   |                       |  |   |          |   |   |             |   |   |             |  |   |            |   |   |             |   |   |          |  
|settlement of
      accrued expenses and debt |  |              |  |   |                       |  |   |          |   |   |             |   |   |             |  |   |            |   |   |             |   |   |          |  
|January 2005                                  |  | 31,500       |  |   | 32                    |  |   | -        |   |   | -           |   |   | 13,968      |  |   | -          |   |   | -           |   |   | 14,000   |  
|August 2005                                   |  | 44,730       |  |   | 45                    |  |   | -        |   |   | -           |   |   | 74,505      |  |   | -          |   |   | -           |   |   | 74,550   |  
|September 2005                                |  | 45,000       |  |   | 45                    |  |   | -        |   |   | -           |   |   | 29,955      |  |   | -          |   |   | -           |   |   | 30,000   |  
|November 2005                                 |  | 70,000       |  |   | 70                    |  |   | -        |   |   | -           |   |   | 83,930      |  |   | -          |   |   | -           |   |   | 84,000   |  
|Issuance of common stock
      for cash       |  |              |  |   |                       |  |   |          |   |   |             |   |   |             |  |   |            |   |   |             |   |   |          |  
|May 2005                                      |  | 75,000       |  |   | 75                    |  |   | -        |   |   | -           |   |   | 49,925      |  |   | -          |   |   | -           |   |   | 50,000   |  
|June 2005                                     |  | -            |  |   | -                     |  |   | 37,500   |   |   | 38          |   |   | 24,962      |  |   | -          |   |   | -           |   |   | 25,000   |  
|September 2005                                |  | 37,500       |  |   | 37                    |  |   | -        |   |   | -           |   |   | 24,963      |  |   | -          |   |   | -           |   |   | 25,000   |  
|Issuance of common stock
      issuable       |  |              |  |   |                       |  |   |          |   |   |             |   |   |             |  |   |            |   |   |             |   |   |          |  
|May 2005                                      |  | 177,187      |  |   | 177                   |  |   | (177,187 | ) |   | (177        | ) |   | -           |  |   | -          |   |   | -           |   |   | -        |  
|Issuance of common stock
      for services   |  |              |  |   |                       |  |   |          |   |   |             |   |   |             |  |   |            |   |   |             |   |   |          |  
|May 2005                                      |  | 15,000       |  |   | 15                    |  |   | -        |   |   | -           |   |   | 19,985      |  |   | -          |   |   | -           |   |   | 20,000   |  
|August 2005                                   |  | 7,500        |  |   | 7                     |  |   | -        |   |   | -           |   |   | 9,993       |  |   | -          |   |   | -           |   |   | 10,000   |  
|October 2005                                  |  | 5,000        |  |   | 5                     |  |   | -        |   |   | -           |   |   | 4,995       |  |   | -          |   |   | -           |   |   | 5,000    |  
|November 2005                                 |  | 40,000       |  |   | 40                    |  |   | -        |   |   | -           |   |   | 47,460      |  |   | -          |   |   | -           |   |   | 47,500   |  
|December 2005                                 |  | 25,000       |  |   | 25                    |  |   | -        |   |   | -           |   |   | 24,975      |  |   | -          |   |   | -           |   |   | 25,000   |  
|Net loss                                      |  |              |  |   |                       |  |   |          |   |   |             |   |   |             |  |   |            |   |   | (754,838    | ) |   | (754,838 | )
|Balances, December 31, 2005                   |  | 8,631,245    |  |   | 8,631                 |  |   | 37,500   |   |   | 38          |   |   | 8,188,595   |  |   | (8,143,573 | ) |   | (754,838    | ) |   | (701,147 | )

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

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MANGAPETS,INC. ANDSUBSIDIARY(FormerlyNewmarkVenturesInc.)(aDevelopmentStageCompany)CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) For the
Three and Six Months Ended June 30, 2006 and 2005 and for the Period From
January 1, 2005 (the effective date of the development stage) to June 30,
2006 (Unaudited)

|                                                     |  | Common Stock |  |   | Common Stock Issuable |  |  |        |  |   |        |  |   | Deficit    |  |   |             |  
|---------------------------------------------------- |  | ------------ |  | - | --------------------- |  |  | ------ |  | - | ------ |  | - | ---------- |  | - | ----------- | -
|                                                     |  |              |  |   |                       |  |  |        |  |   |        |  |   |            |  |   |             |  
|                                                     |  |              |  |   |                       |  |  |        |  |   |        |  |   | Additional |  |   |             |  
|                                                     |  |              |  |   |                       |  |  |        |  |   |        |  |   | Paid-in    |  |   | Accumulated |  
|                                                     |  | Shares       |  |   | Amount                |  |  | Shares |  |   | Amount |  |   | Capital    |  |   | Deficit     |  
|                                                     |  |              |  |   | $                     |  |  |        |  |   | $      |  |   | $          |  |   | $           |  
|Issuance
      of common stock and warrants for cash |  |              |  |   |                       |  |  |        |  |   |        |  |   |            |  |   |             |  
|February 2006                                        |  | 100,000      |  |   | 100                   |  |  | -      |  |   | -      |  |   | 49,900     |  |   | -           |  
|Issuance
      of common stock for services          |  |              |  |   |                       |  |  |        |  |   |        |  |   |            |  |   |             |  
|May 2006                                             |  | 75,000       |  |   | 75                    |  |  | -      |  |   | -      |  |   | 90,675     |  |   | -           |  
|Issuance
      of common stock for bonus             |  |              |  |   |                       |  |  |        |  |   |        |  |   |            |  |   |             |  
|April 2006                                           |  | 100,000      |  |   | 100                   |  |  | -      |  |   | -      |  |   | 91,900     |  |   | -           |  
|May 2006                                             |  | 6,250,000    |  |   | 6,250                 |  |  | -      |  |   | -      |  |   | 7,574,375  |  |   | -           |  
|Net loss                                             |  | -            |  |   | -                     |  |  | -      |  |   | -      |  |   | -          |  |   | -           |  
|Balances, June 30, 2006                              |  | 15,156,245   |  | $ | 15,156                |  |  | 37,500 |  | $ | 38     |  | $ | 15,995,445 |  | $ | (8,143,573  | )

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

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MANGAPETS, INC. AND SUBSIDIARY (Formerly Newmark Ventures
Inc.) (a Development Stage Company)CONSOLIDATED STATEMENTS OF CASH
FLOWS For the Three and Six Months Ended June 30, 2006 and 2005 and for the
Period From January 1, 2005 (the effective date of the development stage) to
June 30, 2006

Three Months Ended
    
    
    Six Months EndedCumulativeDuring theJune 30
    
    
    June 30
    
    
    June 30
    
    
    June 30
    
    
    Development2006
    
    
    2005
    
    
    2006
    
    
    2005
    
    
    Stage$
    
    
    $
    
    
    $
    
    
    $
    
    
    $Cash Flows From Operating ActivitiesNet loss
    
    (7,818,763
    )
    
    (233,094
    )
    
    (7,945,175
    )
    
    (287,359
    )
    
    (8,700,013
    )Adjustments to reconcile net loss to netcash flowsAccrued interest
    
    2,673
    
    
    -
    
    
    2,673
    
    
    -
    
    
    2,673Impairment of license
      agreement
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    25,000Impairment of website developmentcosts
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    304,254Issuance of common stock for services
    
    90,750
    
    
    -
    
    
    90,750
    
    
    -
    
    
    169,639Issuance of common
      shares for bonus
    
    7,672,625
    
    
    -
    
    
    7,672,625
    
    
    -
    
    
    7,672,625Changes in operating assets andliabilitiesPrepaid
      expenses
    
    2,500
    
    
    -
    
    
    1,999
    
    
    -
    
    
    (3,122
    )Accounts payable and accruedexpenses
    
    47,302
    
    
    147,315
    
    
    95,393
    
    
    187,861
    
    
    322,474Deferred revenue
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    21,537Net cash used in operating activities
    
    (2,913
    )
    
    (85,779
    )
    
    (81,735
    )
    
    (99,498
    )
    
    (184,933
    )Cash Flows from Investing ActivitiesWebsite development costs
    
    -
    
    
    -
    
    
    (2,217
    )
    
    -
    
    
    (11,801
    )Cash Flows from FinancingActivitiesPayments on notes
      payable
    
    3,311
    
    
    -
    
    
    3,311
    
    
    -
    
    
    (30,131
    )Proceeds from notes payable
    
    -
    
    
    10,000
    
    
    -
    
    
    18,267
    
    
    19,067Proceeds from advances
      payable
    
    -
    
    
    -
    
    
    23,925
    
    
    -
    
    
    51,780Proceeds from issuance of commonstock and warrants
    
    -
    
    
    75,000
    
    
    50,000
    
    
    75,000
    
    
    150,000Net cash provided by financing
    
    3,311
    
    
    85,000
    
    
    77,236activites
    
    
    
    
    
    
    
    
    
    
    93,267
    
    
    190,716Net increase (decrease) in cash
    
    398
    
    
    (779
    )
    
    (6,716
    )
    
    (6,231
    )
    
    (6,018
    )Cash, beginning of period
    
    4
    
    
    968
    
    
    7,118
    
    
    6,420
    
    
    6,420Cash, end of period
    
    402
    
    
    189
    
    
    402
    
    
    189
    
    
    402


Supplemental non-cash transactions:

- During the six months ended June 30, 2005, the Company issued 31,500
  shares in settlement of $14,000 in accrued expenses.

The accompanying notes are an integral part of these financial
statements

---

MANGAPETS, INC. AND SUBSIDIARY (Formerly Newmark Ventures
Inc.) (a Development Stage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS(Unaudited)

Note 1. Organization and Going Concern

Organization

MangaPets, Inc. and Subsidiary (the Company) (formerly
Newmark Ventures, Inc.) (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 the
discontinued business component as of December 31, 2005 and June 30, 2006.

On May 5, 2006, the Board of Directors made the decision to
relegate Mangapets to a back seat position to its acquisition of internet gaming
sites. As such, the board approved a resolution authorizing a change in the
Companys name from MangaPets, Inc. to Global Corporations Inc. The Company
intends to seek shareholder approval to amend the Companys certificate of
incorporation to reflect the name change as well as approval to consolidate the
Companys issued and outstanding common shares on a two (2) old common shares to
one (1) new common share basis. The company intends to continue to develop the
Mangapets site at the appropriate time in the future.

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 a processing
and marketing engine, for an aggregate purchase price of $8,000,000. After
completing due diligence and reviewing other internet gaming opportunities, the
Company has determined that it can deploy its funds more profitably elsewhere in
the gaming industry.

Going Concern

As shown in the consolidated financial statements, the Company
incurred a net loss of $7,945,175 for the period ended June 30, 2006. Further,
the Company has a net deficiency in capital of $832,947 as of June 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, likely in the gaming sector,
with funds obtained. However, if its efforts are unsuccessful, the Company may
have to cease operations.

The accompanying consolidated 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. AND SUBSIDIARY (Formerly Newmark
Ventures Inc.) (a Development Stage Company) NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS**(Unaudited)

Note 2. Significant Accounting Policies

The accompanying unaudited consolidated 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.

Basis of Consolidation

The accompanying consolidated financial statements include the
accounts of the Company and its wholly-owned subsidiary. Investments in entities
where the Company owns at least a 20% interest, but does not have control, are
accounted for under the equity method of accounting. All significant
intercompany accounts and transactions have been eliminated.

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 six months ended June 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.

---

**MANGAPETS, INC. AND SUBSIDIARY (Formerly Newmark
Ventures Inc.) (a Development Stage Company) NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS**(Unaudited)

Recently Adopted Accounting Standards, continued

In February 2006, the FASB issued SFAS No. 155, Accounting
for Certain Hybrid Financial Instruments, an amendment of FASB Statements No.
133 and 140. This statement permits fair value re-measurement for any
hybrid financial instrument that contains an embedded derivative that otherwise
would require bifurcation. It establishes a requirement to evaluate interests in
securitized financial assets to identify interests that are freestanding
derivatives or that are hybrid financial instruments that contain an embedded
derivative requiring bifurcation. In addition, SFAS 155 clarifies which
interest-only strips and principal-only strips are not subject to the
requirements of Statement 133. It also clarifies that concentrations of credit
risk in the form of subordination are not embedded derivatives. SFAS 155 amends
Statement 140 to eliminate the prohibition on a qualifying special-purpose
entity from holding a derivative financial instrument that pertains to a
beneficial interest other than another derivative financial instrument. This
Statement is effective for all financial instruments acquired or issued after
the beginning of an entitys first fiscal year that begins after September 15,
2006. The adoption of this standard is not expected to have a material effect on
the Companys results of operations or financial position.

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 capitalized $173,021 in software and website
development costs to date. Because the website is not yet operational, no
estimated useful life has been determined and these costs are not being
amortized as of yet. Costs to be incurred when the website and related software
are in the operating stage will be expensed as incurred.

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 June 30, 2006)
over the term of the agreement, of which approximately US$437,428 has been
incurred through June 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 June 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 June 30, 2006. The Company is of the opinion that the related
capitalized website costs as of June 30, 2006 are greater than the fair value of
the website at that date. 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 Company plans to attempt to negotiate the
contractual amounts due to Sygenics to an amount representing this estimated
fair value of the website. The Company plans to enter into an agreement with
another website developer to complete the web portal.

---

**MANGAPETS, INC. AND SUBSIDIARY (Formerly Newmark
Ventures Inc.) (a Development Stage Company) NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS**(Unaudited)

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
recognized in loss from operations of the discontinued component.

Note 5. Notes Payable

Note payable to a company, due on demand,
      including interest at 6% accruedmonthly, unsecured
    $
    21,879Note payable to an individual, due on demand, including
      interest at 6% accruedmonthly, secured by all assets and revenues
      of the Company
    
    7,919Note payable to a company, due on demand, including
      interest at 6% accruedmonthly, secured by all assets and revenues
      of the Company
    
    1,999$
    31,797


Note 6. Capital Stock

During the six month period ended June 30, 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 50,000 shares of
common stock, par value $.001 and one warrant. The warrant entitles the holder
to purchase 50,000 shares of common stock on or before February 27, 2007 at an
exercise price of $.75 per share.

In April, 100,000 shares were issued to management of the
Company as a bonus.

In May, the 6,250,000 shares were issued to certain directors
and officers of the Company as a signing bonus. A total of 6,250,000 shares were
issued as follows:

Rene Hamouth  President, CEO and CFO
    
    2,500,000Paul Weinstock  Director
    
    937,500Brian Wood  Director
    
    937,500Joseph LaCascia
    
    1,875,0006,250,000


---

**MANGAPETS, INC. AND SUBSIDIARY (Formerly Newmark
Ventures Inc.) (a Development Stage Company) NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS**(Unaudited)

Also in May, 75,000 shares were issued to two former
consultants to the Company in consideration for investor relations services
provided to the Company. These shares were valued at $90,750.

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
13,006,657 and 8,265,945 for the three month periods ended June 30, 2006 and
2005, respectively and 10,869,021 and 8,172,677 for the six month periods ended
June 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 their effect was 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 June 30, 2006, there are warrants outstanding to purchase
265,000 shares of the Company's common stock at prices ranging from $.75 to
$2.00 per share. The warrants were exercisable on issuance and expire at various
dates from May 2006 through September 2007.

WarrantsBalance, December 31, 2005
    
    390,000Issued
    
    100,000Exercised
    
    0Expired
    
    225,000Balance, June 30, 2006
    
    265,000


Note 8. Loans and Advances Payable

The Company had various loans payable of $31,060 at June 30,
2006, all of which are unsecured and due on demand and bear interest at 12%.

The Company has advances payable of $51,780 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 9. Related Party Transactions

During the six month periods ended June 30, 2006 and 2005, the
Company incurred cost of 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 six month period which had a value of
$7,580,625. This amount is included in general and administrative expenses.

---

**MANGAPETS, INC. AND SUBSIDIARY (Formerly Newmark
Ventures Inc.) (a Development Stage Company) NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS**(Unaudited)

Note 10. Legal Proceedings

In October 2000, a former employee of the Company filed a claim
asking for approximately CDN$22,600 (US$19,363 at June 30, 2006) for unpaid
expenses and salary and vacation pay, and CDN$40,000 (US$34,271 at June 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. As of June 30, 2006 the company has not cancelled
the shares and they are included as common shares outstanding.

Note 11. Contingent Liability

In addition to the $437,428 account payable recorded to
Sygenics as of June 30, 2006, there are additional amounts aggregating $285,000
that were invoiced during the three 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.

---

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 June 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 intends to establish a U.K. based subsidiary company which will pursue
acquisitions in the gaming sector. The U.K. subsidiary will embark on an
aggressive strategy to acquire internet on-line casino, sportbook and on-line
poker properties.

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 is also currently attempting to aquire internet
gaming sites.

---

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 is now in the process of establishing a UK based subsidiary company which will pursue acquisitions in the gaming sector. The UK
subsidiary will embark on an aggressive strategy to acquire internet casino, sport-book and on-line poker properties.

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 six month period ended June 30, 2006, the Company focused on the development of the MangaPets web portal.

The Company, as of June 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 June 30, 2006, the Company recorded an operating loss of $8,700,013. The majority of the Companys operating losses are attributable to
general and administrative expenses of $8,218,127 and website planning costs in connection with the development of the web portal $144,406. 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 made $173,021 in capital expenditures for the period from January 1, 2005 (date upon which the Company re-entered the development stage) to June 30, 2006 in connection with the development of the web portal.

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 assets of $3,524 and total assets of $176,545 as of June

---

30, 2006. These assets consist of cash on hand of $402, $3,122 in prepaid expenses and $173,021 of computer software developed and obtained for the purposes of developing the Companys website. Net stockholders deficiency in the
Company was $832,947 at June 30, 2006.

Cash flow used in operating activities was $81,735 for the three month period ended June 30, 2006 as compared to cash flow used in operating activities of $99,498 for the three month period ended June 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 six month period ended June 30, 2006 as compared to cash flow provided by investing activities of $0 for the six month period ended June 30, 2005. The increase was related to the
investment in the development of the Companys website.

Cash flow provided from financing activities was $77,236 for the six month period ended June 30, 2006 as compared to cash flow provided from financing activities of $93,267 for the six month period ended June 30, 2005.  Funds realized from
financing activities in the current six 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 and plans to pursue gaming opportunities in the UK, 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, both the anticipated development of the Manga inspired online virtual pet
portal/website and the intended introduction to the UK gaming sector may not be realized. 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:

| | 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.

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 favorable 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

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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 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 June 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

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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 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 April 29, 2006, the Company issued 100,000 shares of common
stock, par value $0.001, to Kent Carasquero, a related party, as a bonus 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 April 30, 2006, the Company issued 500,000 shares of common
stock, par value $0.001, to Brantridge Holdings, Ltd. for providing services in
relation to European ventures. 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 for 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 May 2, 2006, Subsequent to the issuance of 500,000 shares of common stock, par value $0.001, to Brantridge Holdings Ltd. The company cancelled the shares due to misrepresentation made by Brantridge Holdings Ltd and it's agents.

On May 2, 2006, the Company authorized the issuance of 2,500,000 shares of common stock, par value $0.001, to Rene Hamouth as consideration for acting as the Companys chief executive officer and chief financial officer. 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 for
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 May 2, 2006, the Company authorized the issuance of 937,500 shares of common stock, par value $0.001, to Paul Weinstock as consideration for joining the Companys board of directors. 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 for
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 May 2, 2006, the Company authorized the issuance of 937,500 shares of common stock, par value $0.001, to Brian Woods as consideration for joining the Companys board of directors. 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 for
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 May 2, 2006, the Company authorized the issuance of 1,875,000 shares of common stock, par value $0.001, to Joseph LaCascia as consideration for joining the Companys board of directors. 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 for
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 May 5, 2006, the Company issued 25,000 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 May 5, 2006, the Company issued 50,000 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.

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

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.

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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 1st day of September 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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