SECURITIES ANDEXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-KSB

 

Annual Report Pursuantto Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the fiscal yearended: December 31, 2006

 

Commission File No.333-103986

 

NANO-JET, INC.

(Exact name ofregistrant as specified in its charter)

 

**
Nevada
98-0384073
(State of other    jurisdiction of incorporation or organization)
(IRS Employer    Identification No.)
 

15321 Main Street,Suite 102

PO Box 5000, PMB 152

Duvall, WA 98019

(Address of principalexecutive offices)

 

Issuer's telephonenumber: (425) 788-9823

 

Securities registeredunder Section 12(b) of the Exchange Act:

 

Securities registeredunder Section 12(g) of the Exchange Act:

Common stock

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

Check if there is no disclosure of delinquent filers in response to Item 405or Regulation S-B contained in this form, and no disclosure will be contained,to the best of registrant's knowledge, in definitive proxy or informationstatements incorporated by reference in Part III of this Form 10-KSB or anyamendment to this Form 10-KSB [ ]

Indicate by checkmark whether the registrant is a shell company (as definedin Rule 12b-2 of the Exchange Act). [X] Yes [ ] No

State issuer's revenues for its most recent fiscal year: $0.00

State the aggregate market value of the voting and non-voting common equityheld by non-affiliates computed by reference to the price at which the commonequity was sold, or the average bid and asked price of such common equity, as ofa specified date within the past 60 days. $0.00(1)
State the number of shares outstanding of each of the issuer's classes ofcommon equity, as of the latest practicable date. As of March 16, 2007, theissuer had 40,569,633shares of common stockissued and outstanding.
DOCUMENTS INCORPORATED BY REFERENCE

No documents are incorporated herein by reference.

Transitional Small Business Issuer Format Yes [ ] No [X]

CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION

Certain statements in this annual report on Form 10-KSB contain or maycontain forward-looking statements that are subject to known and unknown risks,uncertainties and other factors which may cause actual results, performance orachievements to be materially different from any future results, performance orachievements expressed or implied by such forward-looking statements. Theseforward-looking statements were based on various factors and were derivedutilizing numerous assumptions and other factors that could cause our actualresults to differ materially from those in the forward-looking statements. Thesefactors include, but are not limited to, our ability to consummate a merger orbusiness combination, economic, political and market conditions andfluctuations, government and industry regulation, interest rate risk, U.S. andglobal competition, and other factors. Most of these factors are difficult topredict accurately and are generally beyond our control. You should consider theareas of risk described in connection with any forward-looking statements thatmay be made herein. Readers are cautioned not to place undue reliance on theseforward-looking statements, which speak only as of the date of this report.Readers should carefully review this annual report in its entirety, includingbut not limited to our financial statements and the notes thereto. Except forour ongoing obligations to disclose material information under the Federalsecurities laws, we undertake no obligation to release publicly any revisions toany forward-looking statements, to report events or to report the occurrence ofunanticipated events. For any forward-looking statements contained in anydocument, we claim the protection of the safe harbor for forward-lookingstatements contained in the Private Securities Litigation Reform Act of 1995.

PART I
**Item 1. Description of Business**
Business Development

Nano-Jet was originally incorporated on November 4, 2002, in the State ofNevada as Can/Am Autosales, Inc. The Company changed its name on August 27, 2004to LFG International, Inc. Upon completion of a merger with Nano-JetCorporation, a Washington corporation,, the Company changed its name to Nano-JetCorporation. The Company has never declared bankruptcy, it has never been inreceivership, and it has never been involved in any legal action or proceedings.

Business of Nano-Jet

Nano-Jet has licensed a proprietary technology and currentlyholds patents for this technology worldwide. The Company's product, ifdeveloped, is anticipated to allow owners and operators of both gasoline anddiesel powered vehicles to potentially increase fuel efficiency while reducingfuel emissions into the environment. 
**Competition

Although there are many companies who claim to have developed fuel-efficientproducts and fuel additives, when tested most of these products have not beenproven. Beijing Ytong Co. Ltd., in cooperation with the Chinese government, hasinvested over $10 million dollars in researching, testing and perfecting Nano-Jet'stechnology. Select companies have attempted to produce similar products, but todate, the Company knows of no other company that has developed a solutionsimilar to that belonging to Nano-Jet.
**Marketing and Sales Plan**
The Company's two-fold marketing and sales strategy is directed towardestablishing immediate technological preeminence, rapid penetration, and marketdominance within five years of market entry. The company will first approachtrucking companies and truck manufacturers, truck, automobile and motorcycledistributors, as well as wholesalers. With the Company's obsolescing impact, asubstantial downturn in competition may be anticipated.
*Employees*
Other than Nano-Jet's Directors and Executive Officer, who is currentlydonating his time to the development of the company, there are no employees ofNano-Jet. 
*Reports to Security Holders*
Nano-Jet will voluntarily make available an annual report including auditedfinancials on Form 10-K or Form 10-KSB to security holders.

The public may read and copy any materials filed with the SEC at the SECsPublic Reference Room at 100 F Street NE, Washington, DC 20549. The public mayobtain information on the operation of the Public Reference Room by calling theSEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports,proxy and information statements, and other information regarding Nano-Jet thatis filed electronically with the SEC at http://www.sec.gov.**Item 2. Description of Property.**
Nano-Jet's principal place of business and corporate offices are located atthe home of its President. We have no intention of finding another office duringthe development stage of Nano-Jet.Nano-Jet will operate from the President's businessoffice at no cost to the Company.
Nano-Jet does not have any investments or interests in any real estate. Nano-Jetdoes not invest in real estate mortgages, nor does it invest in Securities of,or interests in, persons primarily engaged in real estate activities.
**Item 3. Legal Proceedings**
We are not a party to any pending legal proceedings.
**Item 4. Submission of Matters to a Vote of Security Holders.**
No matter was submitted during the fourth quarter of the fiscal year endedDecember 31, 2006, to a vote of security holders, through the solicitation ofproxies or otherwise. 

PART II
**Item 5. Market for Common Equity and Related Stockholder Matters.**
Market for Stock.
The Company's common stock is currently traded on the Over-The-Counter Bulletin Board under symbol NNJT.Following is a table showing the high and low ask price of the stock for each quarter in the past two years.*Quarter Ended*High*LowDecember 31, 2006
$5.00

$1.01
September 30, 2006
$15.00

$1.01
June 30, 2006
$1.00

$0.15
March 31, 2006
$1.00

$0.10
December 31, 2005
$1.76

$0.50
September 30, 2005
$0.51

$0.30
June 30, 2005
$0.02

$0.02
March 31, 2005
$0.02

$0.01
December 31, 2004
$4.00

$0.01

Holders.

As of December 31, 2006, Nano-Jet had approximately fifty-six (56)shareholders of record of its common stock.

Stock Option Grants

To date, Nano-Jet has not granted any stock options. 

Registration Rights

Nano-Jet has not granted registration rights to the sellingshareholders or to any other persons.

Dividends.

As of December 31, 2006, Nano-Jet had not paid any dividends to itsshareholder. There are no restrictions which would limit the ability of Nano-Jetto pay dividends on common equity or that are likely to do so in the future.

Recent Sales of Unregistered Securities

None.
**Item 6. Management's Plan of Operation.**
Nano-Jet (formerly Can/Am Autosales, Inc. and LFG International, Inc.) ("Nano-Jet"),is a development stage company with no operations, no revenue, no financialbacking and limited assets. The original plan was to market used cars throughthe internet and auto trade magazines to individuals in the U.S. and Canada. 

The following plan of operation should be read in conjunction with theDecember 31, 2006, audited financial statements and the related notes elsewherein this report. This discussion contains forward-looking statements based uponcurrent expectations that involve risks and uncertainties, such as our plans,objectives, expectations and intentions. Our actual results and the timing ofcertain events could differ materially from those anticipated in theseforward-looking statements as a result of certain factors, including those setforth under "Risk Factors," "Business" and elsewhere in this report. See "RiskFactors." 

As of December 31, 2006, Nano-Jet had no cash on hand. Development stage netloss for the year ended December 31, 2006 was $70,350 compared to $42,175 forthe year ended December 31, 2005. The loss for the year ended December 31, 2006consisted primarily of legal and accounting expenses incident to the company'sdevelopment stage activities. 

Overview

Nano-Jet will market to both the American and International trucking andautomobile parts distribution companies. It is not the intent of the Company tomarket directly to the consumer, but rather through distribution channels in thetruck, automobile and motorcycle industry. The Company will educate these groupsabout the benefits of a Nano-Jet fuel saving device. Nano-Jet expects to formlicensing arrangements with Original Equipment Manufacturers (OEMs) having highbrand recognition in the automobile marketplace.

Marketing Strategies

a. Nano-Jet's primary market is the American trucking companies andautomobile manufacturers and international trucking and automobile makers. Nano-Jetexpects that the success of its products will depend, in part, upon the Companyincreasing the speed and effectiveness with which it educates the consumer inorder to capture more market share. The Company plans to do this by attemptingto implement one or more of the following strategies:

*    Producing commercials that demonstrate the superior performance and      fuel efficiency of Nano-Jet products;

*    Enlisting a well-known high performance automobile driver, who can be      the marketing face of the company to both the recreational and commercial      automotive user;

*    Implementing a concurrent advertising campaign using both web and print      versions of major publishers like *Motor Trend*, *Road and Track*      and national newspapers and trucking magazines.

*    Seek to get product evaluators at automobile, truck and motorcycle      magazines to evaluate and write articles about Nano-Jet and its multiple      lines of products.

*    Intentionally form relationships with reporters interested in      automobile fuel efficiency with the goal of increasing the media      examination of the issues associated with traditional fossil fuel      consumption;

*    Increasing the direct response to Nano-Jet's website by strategic      search engine registrations, increased links, and an email marketing      campaign;

*    Adding video content to Nano-Jet's commercial website so visitors      experience a educational video presentation on the fuel efficiency and      performance benefits of Nano-Jet products as well as testimonials from      consumers;

*    Training a sales staff whose mission will be to educate trucking      companies, automobile parts distributors and motorcycle manufacturers of      the benefits of Nano-Jet for its customers;

*    Create strategic alliances with major automotive manufacturing      companies like Kenworth, Peterbuilt, Volvo, Mercedes, General Motors,      Ford, Toyota, Nissan, and Chrysler.

 

b. In addition to marketing techniques that effectively educate and lead thetrucking and automobile companies to buy Nano-Jet products, Nano-Jet will alsopursue strategic alliances with one or more major OEMs via licensing agreements.These OEMs should have wide brand recognition, excellent financial health andresources, an established presence in international markets, and a track recordof honoring its licensing agreements. The benefits of forming a licensingrelationship with a major OEM include:

*    Lower financial risk due to shared costs;

*    Lower business risk because of the prior success;

*    Immediate brand recognition and acceptance;

*    Facilitates acceptance of Nano-Jet's new technology;

*    Access to new distribution channels;

*    Ease of entry into international markets of the OEM's; 

*    Platform for ease of entry of future Nano-Jet products;

*    Ability to focus on R&D of future products; 

*    Provides greater protection of intellectual property; 

*    Quickens the pace toward becoming a market standard.

*    An effective OEM licensing relationship will result in higher      marketplace visibility for Nano-Jet, reduce the Company's costs of      marketing, and speed up marketing for world consumption. 

3. Website

The Nano-Jet website will actas a centerpiece to operations and in thefuture Nano-Jet will further build out their website which will be accessed bymember password for trucking companies and distributors such as Napa Auto Parts.The website will form a hub for its Internet community which will also includemotorcycle parts distributors. The website will be technically viewed as aportal to all of Nano-Jet's product lines. The site will also provide an arenafor ongoing communication among users, testimonials, etc. Online informationwill be available to members in a highly intuitive format. 
4. Projected Revenues/Projections

Over the next twelve (12) months, Nano-Jet has forecast potential sales ofits large unit, priced at $500 per unit, of 17,620 units, for potential grosssales of $8,810,000. It has forecast sales of its smaller unit, at $215 perunit, of 11,593, for gross proceeds of $2,492,495. This forecast is based ondiscussions with potential purchasers and distributors.

In addition, Nano-Jet has formed Nano Jet Racing Team, a division of Nano-Jet,and will be distributing units that can be installed on motor cycle unitsthrough this division, as well as various motorcycle dealerships. The projectedsales forecast incorporates a portion of this potential market.

Nano-Jet will be required to raise funds through equity and/or debt financingin order to purchase the units for resale. The Company does not expect toencounter any delays with the production of the units after the orders areplaced. Nano-Jet believes it will need to secure between $500,000 and $1,000,000in financing to pre-pay for its order of large and small units.

Although purchasers and potential distributors have indicated to managementof NanoJet that they will purchase the units when received by the Company, it ispossible that those orders may not materialize, or may not all materialize, andthe sales forecast may not be met. 
**Item 7. Financial Statements**
 

 
*** ******NANO-JET, CORP ***(Formerly LFG INTERNATIONAL, INC.) ***(A development stage enterprise) ** 

Report of Independent Registered Public Accounting Firm                                                                                 F-2
**Balance Sheet:**
    December 31, 2006                                                                                                                                              F-3
** 

Statements of Operations:**
    For the periods ended December 31, 2006 and 2005                                                                                            F-4
** 

Statements of Stockholders' Deficit:**
    For the periods ended December 31, 2006 and 2005                                                                                            F-5
** 

Statements of Cash Flows:**
    For the periods ended December 31, 2006 and 2005                                                                                            F-6

 
**Notes to Financial Statements:**
    December 31, 2006 and 2005                                                                                                                              F-7

 

 

 

 

 

 

F-1
****THOMAS J. HARRIS

CERTIFIED PUBLIC ACCOUNTANT

3901 STONE WAY N., SUITE 202

SEATTLE, WA 98103

206.547.6050****REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
 

To the Board of Directors

Nano-Jet, Corp (formerly LFG International, Inc.) 

I have audited the accompanying balance sheets of Nano-Jet,Corp (formerly LFG International, Inc.) (A Development Stage Company) as ofDecember 31, 2006, and the related statements of operations, stockholders'equity and cash flows for the year then ended, and the period November 4,2002(inception) to December 31, 2006. The statements for the year ended December31, 2005 were audited by other accountants and are included for comparisonpurposes only. These financial statements are the responsibility of theCompany's management. My responsibility is to express an opinion on thesefinancial statements based on my audit.

I conducted my audit in accordance with the standards of thePublic Company Accounting Oversight Board (United States). Those standardsrequire that I plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free of material misstatement. An auditincludes examining, on a test basis, evidence supporting the amounts anddisclosures in the financial statements. An audit also includes assessing theaccounting principles used and significant estimates made by management, as wellas evaluating the overall financial statement presentation. I believe that myaudit provides a reasonable basis for my opinion.

In my opinion, the financial statements referred to abovepresent fairly, in all material respects, the financial position of Nano-Jet,Corp (formerly LFG International, Inc.) , (A Development Stage Company) as ofDecember 31, 2006 and the results of its operations and cash flows for the yearended December 31, 2006 and November 4, 2002(inception), to December 31, 2006 inconformity with generally accepted accounting principles in the United States ofAmerica.

The accompanying financial statements have been preparedassuming the Company will continue as a going concern. As discussed in Note #4to the financial statements, the Company has had no operations and has noestablished source of revenue. This raises substantial doubt about its abilityto continue as a going concern. Management's plan in regard to these matters isalso described in Note # 4. The financial statements do not include anyadjustments that might result from the outcome of this uncertainty.

 

Seattle, Washington

April 16, 2007

F-2

 
*** 

 

 ******NANO-JET, CORP ***(Formerly LFG INTERNATIONAL, INC.) ***(A development stage enterprise) 
***Notes to Financial Statements***
***December 31, 2006 and 2005*****Note 1 - Organization and summary of significant accountingpolicies:**
Following is a summary of the Company's organization andsignificant accounting policies: 
**Organization and nature of business - Nano-Jet Corp,    formerly LFG International, Inc ("We," or "the Company") is a Nevada    corporation incorporated on November 4, 2002. Effective August 27, 2004, we    changed our name to LFG International, Inc. We were based in Vancouver,    British Columbia, Canada, but in 2004 moved our base to Bellevue,    Washington. On September 30, 2006 the Company acquired Nano-Jet Corp in a    purchase transaction. 

It was originally our intent is to become an automobile    vendor to export pre-owned Canadian vehicles for sale in the United States    and Canada. A website was developed and was intended to be the core    component of our marketing and advertising strategy. However, on August 16,    2004, we signed a Letter of Intent with London Finance Group, Ltd., a    British company (London), for a share exchange of all of the shares of    London for common and preferred stock of CanAm (now renamed LFG    International, Inc.). London has several subsidiaries, including two    European banks and a software trading platform. At the time of the    agreement, existing officers and directors resigned, and new officers and    directors were elected. 

However, conditions that were required to be met in    connection with the agreement were not met. Accordingly, the agreement was    canceled by mutual consent on December 15, 2004. There were no significant    penalties incurred by us as a result of the cancellation. 

Because of the termination of the agreement, we are not    now engaged in any business and are seeking other business opportunities. We    have abandoned our plan to export pre-owned automobiles. 

Since inception, our activities have been limited to    formation and the raising of equity capital, and searching for business    opportunities. In our current development stage, management anticipates    incurring substantial additional losses as additional capital is raised and    the business plan is implemented. 

Subsequent to the acquisition of Nano-Jet the company has secured    additional financing and has begun operations in the field of importing    devices to be used in automobile and truck engines.
**Basis of presentation - Our accounting and reporting    policies conform to U.S. generally accepted accounting principles applicable    to development stage enterprises. Changes in classification of 2003 amounts    have been made to conform to current presentations. 
**Use of estimates -The preparation of financial    statements in conformity with generally accepted accounting principles    requires management to make estimates and assumptions that affect the    reported amounts of assets and liabilities and disclosure of contingent    assets and liabilities at the date of the financial statements and the    reported amount of revenues and expenses during the reporting period. Actual    results could differ from those estimates. 
**Cash and cash equivalents -For purposes of the    statement of cash flows, we consider all cash in banks, money market funds,    and certificates of deposit with a maturity of less than three months to be    cash equivalents. 
**Funds held in trust, Attorney - Our attorney holds    funds for our account from time to time, and uses them to pay corporate    expenses. We do not have a bank account. We consider such funds to be a    current asset, but do not consider them to be cash equivalents. 
**Website development costs - We follow Emerging Issues    Task Force Issue No. 00-2, ***Accounting for Website Development Costs***,    ("EITF Issue No. 00-2"), which provides that for specific website    development costs, the accounting should be based generally on AICPA    Statement of Position 98-1, ***Accounting for the Costs of Computer    Software Developed or Obtained for Internal Use.*** Under SOP 98-1,    development costs are capitalized and amortized to income over the estimated    useful life of the website. We amortized our costs over a period ending in    November, 2004, at which time our domain registration expired. Amortization    expense recorded was $0 (2005) and $2,174 (2004). 
**Fair value of financial instruments and derivative    financial instruments - We have adopted Statements of Financial    Accounting Standards regarding *Disclosure About Derivative Financial    Instruments and Fair Value of Financial Instruments*. The carrying    amounts of cash, accounts payable, accrued expenses, and other current    liabilities approximate fair value because of the short maturity of these    items. These fair value estimates are subjective in nature and involve    uncertainties and matters of significant judgment, and, therefore, cannot be    determined with precision. Changes in assumptions could significantly affect    these estimates. We do not hold or issue financial instruments for trading    purposes, nor do we utilize derivative instruments in the management of    foreign exchange, commodity price or interest rate market risks. 
**Federal income taxes - Deferred income taxes are    reported for timing differences between items of income or expense reported    in the financial statements and those reported for income tax purposes in    accordance with Statements of Financial Accounting Standards regarding *Accounting for Income Taxes*, which requires the use of the    asset/liability method of accounting for income taxes. Deferred income taxes    and tax benefits are recognized for the future tax consequences attributable    to differences between the financial statement carrying amounts of existing    assets and liabilities and their respective tax bases, and for tax loss and    credit carryforwards. Deferred tax assets and liabilities are measured using    enacted tax rates expected to apply to taxable income in the years in which    those temporary differences are expected to be recovered or settled.    Deferred taxes are provided for the estimated future tax effects    attributable to temporary differences and carryforwards when realization is    more likely than not. 
**Net income per share of common stock - We have    adopted Statements of Financial Standards regarding *Earnings per Share*,    which requires presentation of basic and diluted EPS on the face of the    income statement for all entities with complex capital structures and    requires a reconciliation of the numerator and denominator of the basic EPS    computation to the numerator and denominator of the diluted EPS computation.    In the accompanying financial statements, basic earnings per share of common    stock is computed by dividing net income by the weighted average number of    shares of common stock outstanding during the period. We do not have a    complex capital structure requiring the computation of diluted earnings per    share. 
**Note 2 - Uncertainty, going concern:**
At December 31, 2005, we were not currently engaged in abusiness and had suffered losses from development stage activities to date. Inaddition, current liabilities exceed current assets, and we have no operatingfunds. Although management is currently attempting to identify businessopportunities and is seeking additional sources of equity or debt financing,there is no assurance these activities will be successful. Accordingly, we mustrely on our officers to perform essential functions without compensation until abusiness operation can be commenced. No amounts have been recorded in theaccompanying financial statements for the value of officers' services, as it isnot considered material. 

These factors raise substantial doubt about the ability ofthe Company to continue as a going concern. The financial statements do notinclude any adjustments that might result from the outcome of this uncertainty.
**Note 3 - Expenses in connection with securities offerings:**
In early, 2003, we filed with the SEC a Form SB-2 to registercommon stock to be offered for sale. The Form became effective in October, 2003.In that connection, we incurred $18,229 in legal and accounting fees, which weredeferred and included in Prepaid Expenses at December 31, 2003. These costs werecharged against Capital In Excess of Par Value in 2004 when the securities weresold. 
**Note 4 - Related party transactions:**
A company related to our controlling shareholder, DieterBehring, advanced funds to the Company during 2004 to finance operations. Theadvances are not evidenced by a promissory note, do not bear interest, and aredue upon demand. Such advances totaled $20,000 at December 31, 2004 and 2005.

Included in accounts payable and accrued expenses is theamount of $17,000 for accrued management fees payable to our president forservices rendered in managing the company during 2005and 2006. In additionamounts have been loaned to the Company by Kenneth Martin in the amount of$115,411. These amounts are not secured by any written documents.
**Note 4- Advance from Lantz Financial, Inc.:**
On March 6, 2006, April 20, 2005 and November 28, 2005, weobtained loans of $10,000, $8,500 and $6,000 respectively from Lantz Financial,Inc., a Panamanian company. Lantz is a non-affiliate of the Company (notassociated with any officer, director, or 5% shareholder). The loans are notevidenced by a note, do not bear interest, and are unsecured. They are due ondemand. The lender has indicated that it may want to convert the debt intoshares in the future, but there is no agreement to that effect, and nounderstanding as to any other terms. 
**Note 5 - Federal income tax:**
We follow Statements of Financial Accounting Standardsregarding *Accounting for Income Taxes*. Deferred income taxes reflect thenet effect of (a) temporary difference between carrying amounts of assets andliabilities for financial purposes and the amounts used for income tax reportingpurposes, and 

(b) net operating loss carryforwards. No net provision forrefundable Federal income tax has been made in the accompanying statement ofloss because no recoverable taxes were paid previously. Similarly, no deferredtax asset attributable to the net operating loss carryforward has beenrecognized, as it is not deemed likely to be realized. 

The provision for refundable Federal income tax consists of the following:
 **2006****2005**Refundable Federal income tax attributable to:  Current operations $(23,919) $(14,400) 
Less, Nondeductible expenses 
-0- 3,400 
-Less, Change in valuation allowance 
23,919 11,000 Net refundable amount - -
The cumulative tax effect at the expected rate of 34% of significant itemscomprising our net deferred tax amount is as follows: 
 **2006****2005**
Deferred tax asset attributable to: 
  
Net operating loss carryover 
$71,700 $44,500 
Less, Valuation allowance 
(71,700) (44500)Net deferred tax asset  - -
At December 31, 2006, an unused net operating loss carryover approximating$210,923 is available to offset future taxable income; it expires beginning in2022. Due to the change of control of the Company, the use of the net operatingloss may be limited in the future. 
**Note 6 - Cumulative sales of stock:**
Since its inception, we have issued shares of common stock as follows: 
** ****Date **Description****Price Per    
Shares **Share **Amount 
11/22/02 Shares issued for    cash 
300,000 
$0.01 
$3,000 
01/13/03 Shares issued for    cash 
300,000 
0.01 
3,000 
01/14/03 Shares issued for    cash 
275,000 
0.01 
2,750 
01/18/03 Shares issued for    cash 
150,000 
0.01 
1,500 
01/20/03 Shares issued for    cash 
300,000 
0.01 
3,000 
01/25/03 Shares issued for    cash 
100,000 
0.01 
1,000 
02/04/03 Shares issued for    cash 
50,000 
0.01 
500 
02/17/03 Shares issued for    cash 
275,000 
0.01 
2,750 
02/24/03 Shares issued for    cash 
100,000 
0.01 
1,000 
02/25/03 Shares issued for    cash 
200,000 
0.01 
2,000 
02/26/03 Shares issued for    cash 
250,000 
0.01 
2,500 
02/27/03 Shares issued for    cash 
50,000 
0.01 
500 
03/01/03 Shares issued for    cash 
100,000 
0.01 
1,000 
03/03/03 Shares issued for    cash 
100,000 
0.01 
1,000 
03/11/03 Shares issued for    cash 
900,000 
0.05 
45,000 
03/25/04 Shares issued for    cash 
15,000 
0.10 
1,500 
03/29/04 Shares issued for    cash 
25,000 
0.10 
2,500 
03/30/04 Shares issued for    cash 
10,000 
0.10 
1,000 
03/31/04 Shares issued for    cash 
45,000 
0.10 
4,500 
04/01/04 Shares issued for    cash 
10,000 
0.10 
1,000 
04/06/04 Shares issued for    cash 
15,000 
0.10 
1,500 
04/21/04 Shares issued for    cash 
10,000 
0.10 
1,000 
04/23/04 Shares issued for    cash 
10,000 
0.10 
1,000 
05/04/04 Shares issued for    cash 
10,000 
0.10 
1,000 
05/05/04 Shares issued for    cash 
10,000 
0.10 
1,000 
05/10/04 Shares issued for    cash 
7,500 
0.10 
750 
05/10/04 Shares issued for    cash 
10,000 
0.10 
1,000 
05/11/04 Shares issued for    cash 
25,000 
0.10 
2,500Cumulative total    
3,652,500 
$90,750.00 Effect of 5 for 1    split 
14,610,000 Effect of 16.5 for 1    split 
283,068,750 Effect of 1 for 300    reverse split 
(300,326,724) Cumulative total    after all splits 
1,004,526 
On June 19, 2004, our Directors approved a 5 for 1 forwardsplit of the company's common stock. All shareholders of record as of July 13,2004 received a new certificate for 5 shares for each share they owned as of theclose of business on that date. After the common stock split, the equivalentnumber of issued and outstanding shares of the Company outstanding increasedfrom 3,652,000 to 18,262,500. Total shares authorized of 100 million and parvalue of $0.001 per common share remain unchanged. 

Then, on August 17, 2004, our Directors approved a 16.5 for 1forward split of the company's common stock. All shareholders of record as ofAugust 17, 2004 received a new certificate for 16.5 shares for each share theyowned as of the close of business on that date. After the common stock split,the equivalent number of issued and outstanding shares of the Companyoutstanding increased from 18,262,500 to 301,331,250. Total shares authorizedwere increased from 100,000,000 to 1,000,000,000, and par value of $0.001 percommon share remained unchanged. 

Then, effective March 21, 2005, Directors approved a 1 for300 reverse split of our common stock. All shareholders of record as of February4, 2005 received a new certificate for 1 share for every 300 shares they ownedas of the close of business on that date. After the common stock split, theequivalent number of shares issued and outstanding decreased from 301,331,250 to1,004.526. Total shares authorized of 1,000,000,000 and par value of $0.001 percommon share remained unchanged. 

The effect of the splits has been retroactively reflected inthe accompanying financial statements. 

As a result of the forward splits in 2004, the increasednumber of shares outstanding and the resulting increase in the common stockaccount caused a deficit in the capital in excess of par value account atDecember 31, 2004. The negative balance of $229,264 in capital in excess of parvalue was charged to deficit accumulated during the development stage during theDecember 31, 2004 quarter. Then, the reverse split during the quarter endingMarch 31, 2005 resulted in a positive balance in the capital in excess of parvalue account. Accordingly, the $229,264 entry recorded during the December 31,2004 quarter was reversed during the March 31, 2005 quarter. 

On August 12, 2004, our Directors authorized the issuance of50,000,000 shares of preferred stock, to be issued from time to time by amajority of the members of the Board of Directors on such terms as areestablished by the Board, and may be issued in one or more series, each withseparate terms and conditions as set by the Board, including, but not limitedto, the authority to provide voting rights for each series. At December 31,2005, no preferred shares had been issued. 
**Note 7 - Subsequent events:**
On December 22, 2005, our Board of Directors approved a 1 for15 reverse split of our common shares. The effective date will be January 2,2006 for shareholders of record January 2, 2006. No fractional shares will beissued; the number of shares for each shareholder will be rounded up to thenearest number of whole shares. After the reverse split, our shares outstandingwill decrease from 1,004,526 to 67,133, after adjustment for rounding offractional shares. The effect of the reverse split has been retroactivelyreflected in the accompanying financial statements. 
**Note 8- Merger with Nano-Jet Corp, Inc.:**
Effective September 30, 2006 the Company issued 40,502,500 shares of itscommon stock as part of the merger with Nano-Jet Corporation (Nano-Jet). Themerger is being accounted for as a purchase as required by FASB 141. At the timeof the merger the assets and liabilities of Nano-Jet consisted of the following:
    Cash    $ 447    Accounts receivable    3,500
Inventory

9,870
    Goodwill      172,652
Total
      $186,469      Liabilities    $145,967    Value of 40,502,500 shares of stock    40,502
Total
      $186,469**Note 9 - New accounting pronouncements:**
The following recent accounting pronouncements: 

* FASB Statements 

    * Number 145, *Rescission of FASB Statements No. 4, 44, and 64, Amendmentof FASB Statement No. 13, and Technical Corrections*
    * Number 146, *Accounting for Costs Associated with Exit or DisposalActivities,*
    * Number 147, *Acquisitions of Certain Financial Institutions - anamendment of FASB Statements No. 72 and 144 and FASB Interpretation No. 9,*
    * Number 148, *Accounting for Stock-Based Compensation - Transition andDisclosure - an amendment of FASB Statement No. 123*, 

    * Number 149, *Amendment of Statement 133 on Derivative Investments andHedging Activities,*
    * Number 150, *Financial Instruments with Characteristics of BothLiabilities and Equity,*
    * Number 151, *Inventory Costs - an amendment of ARB 43, Chapter 4*
    * Number 152, *Accounting for Real Estate Time-Sharing Transactions - anamendment of FASB Statements No. 66 and 67*
    * Number 153, *Exchanges of Nonmonetary Assets - an amendment of APBOpinion No. 29*
    * Number 154, *Accounting for Changes and Error Corrections - areplacement of APB Opinion No. 20 and FASB Statement No. 3*

*** and FASB Interpretations 

    * Number 45, *Guarantor's Accounting and Disclosure Requirements forGuarantees, Including Indirect Guarantees of Indebtedness of Others - andInterpretation of FASB Statements No. 5, 57, and 107 and rescission of FASBInterpretation No. 34*
    * Number 46(R), *Consolidation of Variable Interest Entities - anInterpretation of ARB No. 51*
    * Number 47, *Accounting for Conditional Asset Retirement Obligations*
are not currently expected to have a material effect on our financialStatements. 
**Item 8. Changes in and Disagreements with Accountants on Accounting andFinancial Disclosure.

 

On November 9, 2006, the Company's independent accountants, Bateman &Company, were dismissed from their position as accountants for the Company. Theaccountant's report for the previous two years, and the interim periods fromJanuary 1, 2006 through November 9, 2006, did not contain an adverse opinion ordisclaimer of opinion and was not modified as to uncertainty, audit scope oraccounting principles, except that the auditor's report was modified for anuncertainty regarding the ability of the Company to continue as a going concern.During the previous two years, and through November 9, 2006, there were nodisagreements with the former independent accountants on any matter ofaccounting principles or practices, financial statement disclosure, or auditingscope or procedure. The Board of Directors approved a change in accountants onNovember 9, 2006. The Company has provided a copy of the disclosures made inthis Amended Form 8-K to the former accountant no later than the day of filingwith the SEC, and has requested that the accountant furnish a letter addressedto the Commission stating whether it agrees with the statements made herein, andif not, stating the respects in which it does not agree. Said letter will beattached as an exhibit to this filing upon receipt, or an amendment thereof.

On November 9, the Company retained the services of Thomas J. Harris, CPA, asindependent accountants for the Company. The Company did not consult with thenew accountants prior to this date regarding the application of accountingprinciples or the type of audit that might be rendered on its financialstatements. 
**Item 8A. Controls and Procedures.

As of the end of the period covered by this report, the Company carried outan evaluation of the effectiveness of the Company's disclosure controls andprocedures (as defined by Rule 15(d)-15(e) under the Securities Exchange Act of1934) under the supervision and with the participation of the Company's chiefexecutive officer and chief financial officer (or persons performing similarfunctions). Based on and as of the date of such evaluation, the aforementionedofficers have concluded that the Company's disclosure controls and procedureswere effective. 

The Company also maintains a system of internal accounting controls that isdesigned to provide assurance that assets are safeguarded and that transactionsare executed in accordance with management's authorization and properlyrecorded. This system is continually reviewed and is augmented by writtenpolicies and procedures, the careful selection and training of qualifiedpersonnel and an internal audit program to monitor its effectiveness. During theyear ended December 31, 2006, there were no significant changes to this systemof internal controls over financial reporting or in other factors that couldsignificantly affect those controls. 
**Item 8B. Other Information.

None.

 
**PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons andCorporate Governance; Compliance with Section 16(a) of the Exchange Act**
 

Set forth below is the name and age of each individual who was a director orexecutive officer of Nano-Jet as of December 31, 2006, together with allpositions and offices of the Company held by each and the term of office and theperiod during which each has served: 
**Directors:**
Name of Director 
Age
Ken Martin 
Xiao Lin 
Harry Harts **Executive Officers:**
Name of Officer
Age
Office
Ken Martin 
Chief Executive Officer   
All directors serve for a period of one year, or until asuccessor is duly elected at the next annual shareholders meeting.
**Ken Martin is the Director and Chief Executive Officer of Nano-JetCorporation, a Nevada Corporation. Mr. Martin, founder of International TelcomSolutions, Inc. (ITS) has an extensive international background in the telephonyindustry spanning fifteen years. Through a vast global network Mr. Martinnegotiates government level contracts for VOIP (Voice over the InternetProtocol). To date he has initialized contracts for Russia, Germany, Poland,Ukraine, Italy and Malta. Current negotiations underway include Thailand, VietNam, Lebanon, Turkey, Jordan, France, Cyprus, China, and former Russian States.He is also the owner of a telecommunications company and the founder of anInternational telecommunications company since 1992. He has negotiatedmulti-million dollar contracts with governments and major companies. 
**Xiao Lin is the Managing Director Nano-Jet Corp. He is also the ManagingDirector and shareholder of KangHe Handels GmbH, Hanseatic ProMotion GmbH,Managing Director of Firma Pan American Handels GmbH, also executive directorEurope International Holdings Group Ltd; Hong Kong. Mr. Lin has negotiated majormanufacturing contracts throughout Europe and Asia with such companies asMercedes Benz, Airbus, Repower, and China Shipbuilding and is well connected tonumerous manufacturers of automobiles, trucks, and motorcycles throughout Europeand Asia.
**Harry Hartz is the Managing Director Nano-Jet Corporation in Germany. Mr.Hartz has traveled extensively in Eastern European block countries and lived inAsia. He has many high-ranking contacts throughout the world and in particularChina, Poland, Baltic States and Germany. Mr. Hartz was formerly employed as aninspector and manager of ORO Frucht -Import GmbH. Mr. Hartz will lead theCompany's sales effort in the European market through a network of establishedrepresentatives.

None of Nano-Jet's Directors or executive officers have been involved, duringthe past five years, in any bankruptcy proceeding, conviction or criminalproceedings; has not been subject to any order, judgment, or decree, notsubsequently reversed or suspended or vacated, of any court of competentjurisdiction, permanently or temporarily enjoining, barring, suspending orotherwise limiting his involvement in any type of business, securities orbanking activities; and has not been found by a court of competent jurisdiction,the Commission or the Commodity Futures trading Commission to have violated afederal or state securities or commodities law.
**Employment Agreements**
N/A
**Significant Employees**
Nano-Jet has no significant employees other than the officers and directorsdescribed above.
**Code of Ethics**
The Company has not adopted a Code of Ethics as of the year ended December31, 2006.
**Corporate Governance**
There have been no changes to the procedures by which security holders mayrecommend nominees to the Company's Board of Directors. The Company does notcurrently have an audit committee.

 
**Item 10. Executive Compensation.

The Company's directors have not and currently do not receive anycompensation from the Company for their service as corporate directors.

Summary Compensation Table
     
Long-Term Compensation 
Annual Compensation
Awards
Payouts Name    and principal positionFiscal YearSalaryBonusOther    annual compensation    Restricted stock award(s)    Securities underlying options/ SARsLTIP    payoutsAll    other compensation
Lyle Durham 

CEO

2004

2005

2006
0

0

0
0

0

0
0

$10,000

$65,000
0

0

150,000*
0

0

0
0

0

0
0

0

0

Ken Martin, CEO
2006
There has been no cash payment paid to the executive officers for servicesrendered in all capacities to us for the fiscal period ended December 31, 2006.Except as noted above, there has been no compensation awarded to, earned by, orpaid to the executive officers by any person for services rendered in allcapacities to us for the fiscal period ended December 31, 2006. 

On September 8, 2006, the Board of Directors approved the issuance of 150,000shares of restricted stock, at a price of $.50 per share, to L&D Enterprises, acompany controlled by Lyle Durham, the former CEO, as compensation for past andfuture services to the Company.

Stock Option Grants

The Company did not grant any stock options to the executive officers duringthe most recent fiscal period ended December 31, 2006. The Company has also notgranted any stock options to the executive officers since incorporation,November 4, 2002.
**Director Compensation**
The Directors of the Company do not receive compensation at this time,but are paid consulting fees for specific services as incurred. 
**Item 11. Security Ownership of Certain Beneficial Owners and Management.

 

The following table sets forth the beneficial ownership of the Company'sofficers, directors, and persons who own more than five percent of the Company'scommon stock as of the date of this filing. Under relevant provisions of theSecurities and Exchange Act of 1934 (the "Exchange Act"), a person is deemed tobe a "beneficial owner" of a security if he or she has or shares the power tovote or direct the voting of the security or the power to dispose or direct thedisposition of the security. A person is also deemed to be a beneficial owner ofany securities of which that person has the right to acquire beneficialownership in 60 days. More than one person may be deemed to be a beneficialowner of the same securities. The percentage ownership of each stockholder iscalculated based on the total number of outstanding shares of our common stockof 40,569,633 as of the date of this filing. 

The table is based upon information provided by our directors and executiveofficers.

Amount and Nature of Beneficial Ownership as of the date of this filing.
Name of Beneficial    Owner of Common SharesAddress of    Beneficial Owner
of common SharesNumber of Common    
Shares OwnedPercentage of    Issued and Outstanding Common SharesKen Martin, CEO,    Director13221 Redmond Way,    Redmond, WA 98052
10,200,000
25.14%Harald Hartz,    Director22299 Hamburg,    Sierichstrasse 129a, Telefon 004049345611, Germany
2,500,000
18.12%Lin Xiao, DirectorSachsen Weg 37-C    22455 Hamburg
2,500,000
18.12%Port Mercantile    Capital, Inc.401 Field Road,    London SW 10 9AA
2,000,000
14.5%Arthur Brian Bage54a church Square,    Guisborough, Cleveland, TS14 6BX UK
1,750,000
12.69%Lucy Walsh2 Smith's Dock Park    Road, Normandy, Middlesbrough
1,500,000
10.87%Marion Walsh9 Belmont, South    Bank, Middlebrough, TS6 0AY
1,500,000
10.87%Bari ChohanSouth Lodge Acklam    Road Middlesbrough TS5 7HD UK
1,750,000
12.59%Khurram Bri Chohan43 Malvem Drive,    Brookfield, Middlesbrough TS5 8JD UK
1,950,000
14.14%Mussarat Hanif    Chohan43 Malvern Drive,    Brookfield, Middlesbrough TS5 8JD UK
1,250,000
9.06%Paul Walsh79 Fairhaven House,    The Spinnakers, Rinversdale Road, Liverpool L19 3RY
1,750,000
12.32%Christopher Walsh9 Belmont Ave.,    South Bank, Middlebrough, TS6 0AY
1,500,000
10.87%Nicola Hayes7 Corbar Road,    Christchurch, Bournemouth Dorset
1,600,000
11.60%John Darmarin41 Triq Giovanni    mamo, Birkkara, BKR 14, Malta
1,600,000
11.60%Gerard Walsh2 Smith's Dock park    Road, Normandy, Middlesbrough
1,500,000
10.87%Robert Terence    Harron1 West Blaneme    Cottages, Duns, Berwickshire, TD11 3BQ
1,800,000
13.05%Officers and    Directors as a Group (3) 
15,200,000
37.47%
 
**Item 12. Certain Relationships and Related Transactions, and DirectorIndependence.

No persons who may, in the future, be considered a promoter will receive orexpect to receive assets, services or other consideration from us. No assetswill be or are expected to be acquired from any promoter on behalf of ourcompany. We have not entered into any agreements that require disclosure to ourshareholders.

None of the Directors of the Company are independent.
**Item 13. Exhibits**
 
Exhibit No.DocumentLocation3.1Articles of    IncorporationPreviously Filed3.2BylawsPreviously filed31Rule    31a-14(a)/15d-14(a) CertificationIncluded32Section 1350Included**Item 14. Principal Accountant Fees and Services**
                                                                    2005                 2006
Audit Fees:                            $ 4,935              $ 

Audit-Related Fees:                $ 5,786              $

Tax Fees:                              $ 0                    $ 0 

All Other Fees:                      $ 0                    $ 0

 

 
** 

Signatures**
In accordance with Section 13 or 15(d) of the Exchange Act, the registrantcaused this report to be signed on its behalf by the undersigned, thereunto dulyauthorized.

NANO-JET, INC.

 

 

***/s/ Ken Martin                                           ***
Ken Martin
President, Chief Executive Officer, Director

 

In accordance with the Exchange Act, this report has been signed below by thefollowing persons on behalf of the registrant and in the capacities and on thedates indicated.

 

***/s/ Ken Martin                   ***

Ken Martin

Chief Executive Officer,

Chief Accounting Officer,

Director

 

 
*************************************************************************

**