UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q





X
            
            QUARTERLY
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934For
      the quarterly period ended September 30, 2008TRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
  ACT





For the
transition period from __________ to __________





Commission
File Number 000-53167




Millstream Ventures,
Inc.


(Exact
name of registrant as specified in its charter)





Nevada
            
            87-0405708(State
      or other jurisdiction of incorporation or organization)
            
            (IRS
      Employer Identification No.)





P.O.
      Box 581072, Salt Lake City, UT
            
            84158(Address
      of principal executive offices)
            
            (Zip
      Code)





(801)
860-2302


(Registrant’s
telephone number, including area code)





Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
definitions of “large accelerated filer,” “accelerated filer,” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.





Large
      Accelerated filer
            
            
            Accelerated
      filerNon-accelerated
      filer (Do not check if a smaller reporting company)
            
            X
            Smaller
      reporting company





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





Indicate
the number of shares outstanding of each of the issuer’s classes of common
equity, as of the latest practicable date.21,118,203 shares of $0.001
par value common stock on October 27, 2008











Part I -
Financial Information





Item 1 -
Financial Statements





Index
      to Unaudited Financial Statements
            
            PageUnaudited
      Balance Sheets -- September 30, 2008 and March 31, 2008
            
            3Unaudited
      Statements of Operations -- Three months and six months ended September
      30, 2008 and
              2007,
      and from the inception of the development stage (May 26, 2005) through
      September 30, 2008
            
            4Unaudited
      Statements of Cash Flows -- Six months ended September 30, 2008 and 2007,
      and from
              the
      inception of the development stage (May 26, 2005) through September 30,
      2008
            
            5Notes
      to unaudited financial statements
            
            6














Millstream
      Ventures, Inc.(A
      Development Stage Enterprise)Balance
      SheetsSeptember
      30,
            
            
            March
      31,2008
            
            
            2008(unaudited)Current
      Assets:Cash
            
            $
            27
            
            $
            6,467Prepaid
      expense
            
            
            -
            
            
            2,500Total
      Assets
            
            $
            27
            
            $
            8,967Liabilities
      and Stockholders' Equity (Deficit):Current
      Liabilities:Accounts
      payable
            
            $
            510
            
            $
            95Accounts
      payable – related party (note 4)
            
            
            544
            
            
            619Notes
      payable – related party (note 4)
            
            
            10,000
            
            
            -Accrued
      interest, note payable – related party (note 4)
            
            
            495
            
            
            -Contingent
      liability – related party (note 4)
            
            
            20,000
            
            
            -Total
      Liabilities
            
            
            31,549
            
            
            714Stockholders'
      Equity (Deficit) (note 2):Preferred
      stock, $.001 par value, 10,000,000 shares authorized,no
      shares issued and outstanding
            
            
            -
            
            
            -Common
      stock, $.001 par value, 200,000,000 shares authorized,21,118,203
      shares issued and outstanding
            
            
            21,118
            
            
            21,118Paid-in
      capital
            
            
            (8,603)
            
            
            11,397Accumulated
      deficit ($388,919 deficit eliminated on March 31, 2001as
      part of a quasi-reorganization)
            
            
            (4,920)
            
            
            (4,920)Deficit
      accumulated since inception of development stage
            
            
            (39,117)
            
            
            (19,342)Total
      Stockholders' Equity (Deficit)
            
            
            (31,522)
            
            
            8,253Total
      Liabilities and Stockholders' Equity (Deficit)
            
            $
            27
            
            $
            8,967


See
accompanying notes to the financial statements.
 
 3





Millstream
      Ventures, Inc.(A
      Development Stage Enterprise)Unaudited
      Statements of OperationsFrom
      theInception
      of theDevelopmentFor
      the Three Months Ended
            
            For
      the Six Months Ended
            
            Stage
      (May 26,September
      30,
            
            September
      30,
            
            2005)
      through2008
            
            2007
            
            2008
            
            2007
            
            September
      30, 2008Revenue
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -Expenses:Management
      fees – relatedparty
      (note 4)
            
            
            2,344
            
            
            -
            
            
            7,088
            
            
            -
            
            
            9,094Legal
      and accounting fees
            
            2,010
            
            
            1,088
            
            
            10,384
            
            
            1,088
            
            
            21,318Other
      general andadministrative expenses
            
            615
            
            
            750
            
            
            1,808
            
            
            980
            
            
            8,210Total
      Expenses
            
            
            4,969
            
            
            1,838
            
            
            19,280
            
            
            2,068
            
            
            38,622Other
      Expenses:Interest
      expense
            
            
            411
            
            
            -
            
            
            495
            
            
            -
            
            
            495Net
      loss
            
            $
            (5,380)
            
            $
            (1,838)
            
            $
            (19,775)
            
            $
            (2,068)
            
            $
            (39,117)Net
      loss per common share
            
            $
            (0.00)
            
            $
            (0.00)
            
            $
            ($0.00)
            
            $
            (0.00)Weighted-average
      commonshares
      outstanding
            
            
            21,118,203
            
            
            1,118,203
            
            
            21,118,203
            
            
            1,118,203





See
accompanying notes to the financial statements.
 
 4





Millstream
      Ventures, Inc.(A
      Development Stage Enterprise)Unaudited
      Statements of Cash FlowsFrom
      the Inceptionof
      the DevelopmentFor
      the Six Months Ended
            
            Stage
      (May 26,September
      30,
            
            2005)
      through2008
            
            2007
            
            September
      30, 2008Cash
      Flow from Operating Activities:Net
      loss
            
            $
            (19,775)
            
            $
            (2,068)
            
            $
            (39,117)Adjustments
      to reconcile net loss to netcash
      used in operating activities:Common
      stock issued for services
            
            
            -
            
            
            -
            
            
            100Changes
      in assets and liabilities:Prepaid
      expense
            
            
            2,500
            
            
            (2,742)
            
            
            -Accounts
      receivable – related party
            
            
            -
            
            
            344
            
            
            -Accounts
      payable
            
            
            415
            
            
            (534)
            
            
            (6,500)Accounts
      payable – related party
            
            
            (75)
            
            
            -
            
            
            544Accrued
      interest, notes payable – related party
            
            
            495
            
            
            -
            
            
            495Net
      Cash Used in Operating Activities
            
            
            (16,440)
            
            
            (5,000)
            
            
            (44,478)Cash
      Flow from Financing Activities:Cash
      contributed by related party
            
            
            -
            
            
            5,000
            
            
            5,000Proceeds
      from notes payable – related party
            
            10,000
            
            
            -
            
            
            15,000Proceeds
      from issuance of common stock
            
            -
            
            
            -
            
            
            15,000Net
      Cash Provided from Financing Activities
            
            10,000
            
            
            5,000
            
            
            35,000Net
      Decrease in Cash
            
            
            (6,440)
            
            
            -
            
            
            (9,478)Cash
      at Beginning of Period
            
            
            6,467
            
            
            -
            
            
            9,505Cash
      at End of Period
            
            $
            27
            
            $
            -
            
            $
            27Supplemental
      Cash Flow InformationCash
      paid for interest
            
            $
            -
            
            $
            -
            
            $
            -Cash
      paid for income taxes
            
            $
            -
            
            $
            -
            
            $
            -


See
accompanying notes to the financial statements.
 
 5


Millstream
Ventures, Inc.


(a
development stage enterprise)


Notes to
Unaudited Financial Statements


September
30, 2008








Note 1:
Basis of Presentation





The
accompanying unaudited financial statements of Millstream Ventures, Inc. (the
“Company”) were prepared pursuant to the rules and regulations of the United
States Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with accounting principles generally accepted in the United States of America
have been condensed or omitted pursuant to such rules and regulations.
Management of the Company (“Management”) believes that the following
disclosures are adequate to make the information presented not misleading. These
financial statements should be read in conjunction with the audited financial
statements and the notes thereto included in the Company’s Form 10-12G/A
report.





These
unaudited financial statements reflect all adjustments, consisting only of
normal recurring adjustments that, in the opinion of Management, are necessary
to present fairly the financial position and results of operations of the
Company for the periods presented. Certain inconsequential
reclassifications have been made in prior periods presented to conform to
current period presentation.  Operating results for the six months
ended September 30, 2008, are not necessarily indicative of the results that may
be expected for the year ending March 31, 2009.





Note 2:
Summary of Significant Accounting Policies





Organization – The
Company was incorporated in the State of Utah on April 7, 1983 as Carbon
Technologies, Inc. for the purpose of engaging in the carbon fiber technology
business. Subsequently, the Company became inactive and on May 26, 2005, as part
of a reorganization and change of control, the Company’s corporate domicile was
moved to Nevada. The Company currently operates as a development stage
enterprise seeking to enter into a reverse acquisition with an existing business
or otherwise acquire an operating entity.





Quasi-reorganization
– During 2001 the Company’s stockholders approved a quasi-reorganization which
resulted in the capital accounts of the Company being adjusted with the effect
that the paid-in capital account was reduced by the balance in the accumulated
deficit account in the amount of $388,919. No other accounts were affected by
this adjustment. Subsequent operating results were recorded in the accumulated
deficit account until the Company’s reorganization on May 26, 2005. Subsequent
thereto, operating results have been recorded in a separate account entitled
deficit accumulated since inception of the development stage.





Net Loss per Common
Share – The computation of net loss per common share is based on the
weighted average number of shares outstanding during the periods presented. No
potentially dilutive securities or derivative instruments are
outstanding.





Income Taxes – The
Company’s net operating loss carry forward at September 30, 2008 of
approximately $33,400 will be applied against future taxable income and expire
in various years through 2028. The Company has no deferred taxes arising from
temporary differences between income for financial reporting and income for tax
purposes. The Company’s utilization of its net operating loss carry forward is
unlikely as a result of its intended development stage activities.





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





6


Millstream
Ventures, Inc.


(a
development stage enterprise)


Notes to
Unaudited Financial Statements (continued)


September
30, 2008








Note 3 –
Going Concern





The
Company’s financial statements have been prepared using accounting principles
generally accepted in the United States of America applicable to a going
concern, which contemplate the realization of assets and liquidation of
liabilities in the normal course of business. Since the inception as a
development stage enterprise on May 26, 2005, the Company has incurred losses
that total $39,117 at September 30, 2008. Through September 30, 2008, the
Company had received $10,000 in loans bearing interest at 18% per annum from its
sole officer and director (“Executive”). In October 2008, the Company received
$16,000 from a stockholder pursuant to a promissory note (“Stockholder Note”)
(see Note 5), proceeds from which were used to repay the Executive’s cash
advances plus interest.  The Company believes that the remaining
Stockholder Note proceeds will be sufficient to fund the Company’s operations
through December 2008. The Company’s ability to continue as a going concern will
depend on receiving addition capital subsequent thereto. Sources of such capital
will most likely come from one or more stockholders of the
Company.  The accompanying financial statements do not include any
adjustments that may result from the outcome of the uncertainty surrounding the
Company’s future need for capital or the need to obtain one or more officers and
directors to manage the affairs of the Company.





Note 4 –
Related Party Transactions





Accounting and Management
Services – The Executive regularly performs accounting and management
services for the Company pursuant to an Employment Agreement.  For the
six months ended September 30, 2008, the Company incurred $7,088 in management
fees of which $544 remain unpaid as of September 30, 2008.





Notes Payable – At
September 30, 2008, the Executive had made cash advances to the Company in the
amount of $10,000, with interest accruing at the rate of 18% per annum. On
September 30, 2008, accrued interest amounted to $495. In October 2008, all
outstanding principal and interest were repaid to the Executive.





Contingent Liability
– The Company entered into an Employment Agreement with the Executive that
provided a “buyout” provision whereby upon termination, the Company could elect
to purchase 20,000,000 shares of its common stock owned by the Executive for
$25,000, and the Executive could require the Company to purchase this same
number of shares for $20,000. The Executive has elected to terminate the
Employment Agreement and both parties have agreed to modify the terms of the
buyout provision to allow the Executive the right to compel the Company to
purchase these shares through March 31, 2009. The Company has recorded a
contingent current liability of $20,000 with an offsetting decrease to paid-in
capital, in accordance with the provisions of Statement of Financial Accounting
Standards No. 150, “Accounting
for Certain Financial Instruments with Characteristics of both Liabilities and
Equity.”





Note 5 –
Subsequent Events





Notes Payable – In
October 2008, the Company received $16,000 from a stockholder pursuant to a
promissory note (“Stockholder Note”). The Stockholder Note is not collateralized
by any assets of the Company, is not convertible into any equity interest in the
Company, bears interest at the rate of 18% per annum, and is due upon 15 days
written notice by the holder of the Stockholder Note. Proceeds from the loan
were subsequently used to repay $10,000 principal and $564 in interest due to
the Executive.





Employment Agreement
– In October 2008, the Executive gave notice to the Company of his intent to
terminate a month –to-month Employment Agreement, replacing it with a Service
Agreement to provide the Company accounting services on an as-needed
basis.  The Executive also entered into an agreement with the Company
to modify the terms of the buyout provision to allow the Executive the right to
compel the Company to purchase 20,000,000 shares of its common stock through
March 31, 2009.


7


Item 2 -
Management’s Discussion and Analysis of Financial Condition and Results of
Operations





Special Note Regarding
Forward-Looking Statements





ThisForm 10-Q Report contains
certain forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 with respect to the Plan of Operations provided
below, including information regarding the Company’s financial condition,
results of operations, business strategies, operating efficiencies or synergies,
competitive positions, growth opportunities, and the plans and objectives of
management. The statements made as part of the Plan of Operations that are not
historical facts are hereby identified as "forward-looking
statements."





Plan of
Operations





Overview:





Millstream
Ventures, Inc. (the “Company”) was originally incorporated in the State of Utah
on April 7, 1983 as Carbon Technologies, Inc. for the purpose of engaging in the
carbon fiber technology business. Subsequently, the Company became inactive and
on May 26, 2005, as part of a reorganization and change of control, the
Company’s corporate domicile was moved to Nevada. The Company currently operates
as a development stage enterprise seeking to enter into a reverse acquisition
with an existing business or otherwise acquire an operating entity.





The
Company has now focused its efforts on seeking to acquire a foreign or domestic
private business opportunity (“Target Company”). The Company will attempt to
locate and negotiate with a Target Company for the merger of that entity into
the Company. In certain instances, a Target Company may wish to become a
subsidiary of the Company or may wish to contribute assets to the Company rather
than merge. No assurances can be given that the Company will be successful in
locating or negotiating with a Target Company. The Company will provide a method
for a Target Company to become a reporting (“public”) company whose securities
are qualified for trading in the United States secondary market.





The
acquisition of a Target Company will normally involve the transfer to the
stockholders of the Target Company of the majority of the issued and outstanding
common stock of the Company, and the substitution by the Target Company of its
own management and board of directors.





The
Company's plan of operations is subject to numerous risk factors including, but
not limited to the following:





1-
            The
      Company will, in all likelihood, sustain operating expenses without
      corresponding revenues. This will result in the Company incurring a net
      operating loss which will increase continuously until the Company can
      consummate a business combination with a Target Company. There is no
      assurance that the Company can identify such a Target Company and
      consummate such a business combination. There is also no assurance that
      the Company will be able to finance its operations while it searches for a
      Target Company.





2-
            The
      Company is in competition with a large number of established and
      well-financed entities, including venture capital firms that are active in
      the merger and acquisition of a Target Company. Nearly all such entities
      have significantly greater financial resources, technical expertise, and
      managerial capabilities than the Company. Moreover, the Company will also
      compete with numerous other small public companies in seeking merger or
      acquisition candidates.





3-
            At
      the present time, the Company has not identified any particular industry
      or specific business within an industry for evaluation and there is no
      assurance that the Company will be able to negotiate a business
      combination on terms favorable to the Company. The Company has not
      established any criteria with respect to the Target Company’s length of
      operating history or a specified level of earnings, assets, net worth or
      other criteria. Accordingly, the Company may enter into a business
      combination with a Target Company having no significant operating history
      and no potential for immediate
earnings.


8





4-
            The
      Company's sole officer and director, Denny Nestripke, (“Executive”) has
      given notice to the Company of his intent to terminate a written month to
      month employment agreement with the Company at the end of October 2008.
      The Executive has however, agreed to continue to provide accounting and
      similar services to the Company. Consequently, the Company is seeking to
      find one or more individuals to serve in the capacity of director and as
      the president, secretary and treasurer. The Company believes that a
      replacement for the Executive is likely, but no individual or individuals
      have been identified and no assurance can be given that someone will
      accept such positions. At the present time the Company is contacting its
      stockholders to determine if anyone is interested in holding such a
      position.





5-
            The
      Company's Executive is under no restriction and it is highly unlikely that
      any successor will be limited in their participation in other business
      ventures which may compete directly with the Company. The Company has
      adopted a policy that it will not seek to acquire a Target Company in
      which any member of its management serves as an officer, director or
      partner, or in which they or their family members own or hold any
      ownership interest.





6-
            A
      business combination involving the issuance of the Company's common stock
      will, in all likelihood, result in stockholders of the Target Company
      obtaining a significant and substantial controlling interest in the
      Company. The issuance of previously authorized and unissued common stock
      of the Company would result in a reduction in the percentage of shares
      owned by the present stockholders of the
  Company.





7-
            The
      Company entered into an employment agreement with the Executive that
      provided a “buyout” provision whereby upon termination, the Company could
      elect to purchase 20,000,000 shares of its common stock from the Executive
      for $25,000 and the Executive could require the Company to purchase this
      same number of shares for $20,000. The Company does not have the capital
      to make payment of either amount and therefore, both parties have agreed
      to modify the terms of the buyout provision to extend through March 31,
      2009.





8-
            There
      is no assurance that as a result of the acquisition of a Target Company, a
      viable trading market for the Company’s common stock will develop. If no
      market develops, stockholders of the Company’s common stock will not be
      able to sell their shares publicly, making an investment of limited or
      little, if any, value.





9-
            The
      selection of a Target Company will be at the sole discretion of management
      of the Company. The Executive has given notice to the Company of his
      intent to terminate at the end of October 2008. Future management of the
      Company has not been identified. The Company’s Executive does not have
      expertise in investment banking activities and there is no assurance that
      future management will have any expertise in this area either. Regardless
      of this fact, stockholder approval will not be sought in the selection of
      a Target Company.





Liquidity and Capital
Resources:





During
the Company’s fiscal year ended March 31, 2008, the Company issued 20,000,000
shares of its common stock to its Executive for $15,000 cash and in payment of a
$5,000 obligation. During the six months ended September 30, 2008, the Company’s
Executive provided an additional $10,000 to the Company. During October 2008,
the Company obtained a $16,000 loan from a stockholder pursuant to note
(“Stockholder Note).  The Stockholder Note is not collateralized by
any assets of the Company, is not convertible into any equity interest in the
Company, bears interest at the rate of 18% per annum and is due upon 15 days
written notice by the holder of the Stockholder Note. Proceeds from the
Stockholder Note were used to repay Executive $10,000 in principal plus $564 in
interest owed to him for cash advances made to the Company during the six months
ended September 30, 2008. The Company believes that the remaining proceeds from
the Stockholder Note will be sufficient to fund the Company’s operations through
December 2008.





In order
for the Company to continue its plan of operations to seek a Target Company,
capital beyond that obtained through the Stockholder Note, will be required.
“Recurring Costs” will include management fees, accounting fees, legal fees,
auditor fees (including fees to review interim financial information),
stockholder related cost, and fees associated with maintaining the Company’s
current standing with regulatory agencies. The Company estimates the Recurring
Costs to be approximately $5,000 every three months. Additional costs will be
incurred as the Company searches for a Target Company and engages professionals
in that effort. Inasmuch as management for the Company will soon change, present
management is hesitant to make any estimate as to the amount of such
costs.





9


The
Company will aggressively seek to obtain additional capital, either through
loans or through the issuance of shares of its common or preferred stock. At the
present time, the terms, conditions, amounts, price, and other particulars
relating to these potential sources of capital cannot be determined.
Furthermore, the actual success achieved by the Company in its capital raising
activities, cannot be assured or the likelihood thereof determined.





The
Company has not negotiated the terms of any capital raising activity except for
the Stockholder Note. Future capital raising activity may be substantially
limited given current market conditions and will in all likelihood be restricted
to existing stockholders or other individuals or entities knowledgeable of the
reverse acquisition marketplace. Even though the Company’s common stock is
currently listed on the Over the Counter Bulletin Board, its trading activity is
virtually nonexistent. Inasmuch as the Company’s common stock does not have an
established market value, the ability of the Company to obtain financing will be
limited and will be on terms less favorable than if an established market for
its common stock existed.





In its
capital raising activities, the Company may also provide additional incentives
such as stock options, warrants, or registration rights. The Company may
obligate itself contractually with respect to such incentives or may agree to
such incentives on a non-obligatory basis. Regardless of the terms agreed upon
between the Company and any investor, the need for future capital to continue
its plan of operations is inevitable.





The
Company has contingently obligated itself to purchase 20,000,000 shares of its
common stock owned by the Executive for $20,000. The Company also has the right
to purchase 20,000,000 shares of its common stock from the Executive for
$25,000. These dollar and share amounts were not negotiated at arm’s length and
may not be indicative of transactions in the Company’s common stock between
independent parties.





Current
unsettled economic conditions will impact the Company’s ability to locate any
investors. Changes in national as well as global economic conditions, including
changes in financial and equity markets, interest rates, and the perception by
investors, real or imaginary, may impede our Company’s access to, or increase
the cost of, financing operations. The Company’s lack of operations and assets
does not bode well when compared to other entities that have identifiable assets
and liquidity.





The
financial statements contained in this interim report have been prepared
assuming that the Company will continue as a going concern. However, the Company
has not engaged in any revenue producing activities and is dependent on debt
financing or the sale of its equity securities for capital. As a result, the
possibility exists that the Company will not be able to continue as a going
concern. Nevertheless, management believes that sufficient funding is available
to meet its operating needs during the next twelve months. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.





The
acquisition of a Target Company will result in substantial dilution for the
Company's current stockholders. Inasmuch as the Company only has its equity
securities, consisting of common and preferred stock, as a capital resource to
provide consideration for the acquisition of a Target Company, the issuance of a
substantial portion of the Company’s equity securities is the most likely method
for the Company to consummate a business combination. The issuance of any shares
of the Company's common stock will dilute the ownership percentage that current
stockholders have in the Company.





Results of
Operations:





During
the three months ended September 30, 2007, the Company was not undertaking those
measures that would make the Company a desirable candidate for a Target Company.
Consequently, a comparison of the results of operations for the three months
ended September 30, 2007 with the three months ended September 30, 2008, is not
meaningful. During its current fiscal year, ending March 31, 2009, the Company
has aggressively sought to establish itself as a public shell
company.





The
Company’s current Executive accepted his position on February 25, 2008 and on
April 1, 2008 signed an employment agreement with the Company. Since that time,
the Company has taken an aggressive posture in furthering its ability to enter
into a business combination with a Target Company. The steps taken included the
restructuring of the capitalization of the Company; in filing a Form 10
registration statement with the Securities and Exchange Commission and a
subsequent quarterly report; and in locating a FINRA firm to make a market in
the Company’s common stock. These efforts required approximately substantially
less capital during the three months ended September 30, 2008 when compared to
the three months ended June 30, 2008 (approximately $5,000 compared to $14,000,
respectively).





10


In
February 2008, Denny W. Nestripke accepted the position of the Company's sole
officer and director and entered into an employment agreement whereby he agreed
to serve in those positions through June 30, 2008 and on a month to month basis
thereafter. In October 2008, Mr. Nestripke gave notice to the Company of his
intent to terminate the employment agreement and he has notified certain
stockholders of those intentions. Subsequent to October 30, 2008, Mr. Nestripke
will serve in management of the Company on a day-to-day basis until a yet
unidentified individual or individuals is(are) found willing to serve in those
capacities. Expenses relating to the search of new management are thought to be
minimal; however, a realistic estimate of such costs cannot be made at the
present time.





Furthermore,
the operations conducted by the Company through the end of September 2008 have
been primarily procedural. In the future the Company’s search for a Target
Company will result in expenses being incurred that are different in nature
inasmuch as they will require an assessment of the Target Company, which may
include travel and other means of extensive investigative research. There can be
no assurance that the Company will receive any benefits from these expenses. The
Company may also incur fees from third parties retained to investigate a Target
Company. In the event that a Target Company is located, a mutually beneficial
agreement may not be reached between the Company and the Target Company.
Regardless of the manner in which expenses are incurred, until such time as an
acquisition agreement is entered into with a Target Company, the Company does
not anticipate generating any revenue. If and when such an agreement is reached,
still no assurance exists that any income will accrue to the Company or that a
revenue stream will develop.





The
current uncertainty in the financial markets may make the ability for the
Company to locate a Target Company substantially more difficult. The Company
does not propose to restrict its search for a business opportunity to any
particular industry or geographical area and may, therefore, attempt to acquire
any business in any industry. Nevertheless, even this broad range of possible
business activities may not be sufficient to attract a Target Company during
times of uncertainty and financial liquidity concerns. If and when a business
opportunity is selected, such business opportunity may not be in an industry
that is following general business trends.





Off-balance sheet
arrangements:





The
Company does not have any off-balance sheet arrangements and it is not
anticipated that the Company will enter into any off-balance sheet
arrangements.





Item 3 -
Quantitative and Qualitative Disclosures About Market Risk.





Not
required by smaller reporting company.





Item 4T -
Controls and Procedures.





Evaluation of Disclosure
Controls and Procedures





Our
management, consisting of our president and chief financial officer, evaluated
the effectiveness of our disclosure controls and procedures as of the end of the
period covered by this report. Based on that evaluation, management concluded
that our disclosure controls and procedures as of the end of the period covered
by this report were effective such that the information required to be disclosed
by us in reports filed under the Exchange Act (i) is recorded, processed,
summarized and reported within the time periods specified in the SEC’s rules and
forms and (ii) is accumulated and communicated to our management, including
our president and chief financial officer, as appropriate to allow timely
decisions regarding disclosure. A controls system cannot provide absolute
assurance, however, that the objectives of the controls system are met, and no
evaluation of controls can provide absolute assurance that all control issues
and instances of fraud, if any, within the Company have been
detected.





Changes in Internal Control
over Financial Reporting





There
have been no changes in our internal controls over financial reporting that
occurred during the period covered by the report.





11


PartII - Other
Information





Item 5 –
Other Information





On
October 14, 2008, Millstream Ventures, Inc. (the “Company”) borrowed $16,000
from 1st Orion
Corp., a stockholder of the Company, and issued a promissory note for the
repayment of this amount.  The note bears interest at 18% per annum
and principal and interest are due and payable upon demand, but not later than
March 31, 2010.





On
October 22, 2008, the Company entered into an amendment to the Employment
Agreement with Mr. Nestripke, which converted the employment agreement into a
part-time service agreement in which Mr. Nestripke would be an independent
contractor providing accounting and related services for the Company on an
as-needed basis.  The amended agreement will be effective November 1,
2008, and may be terminated by either party upon 30 days’ notice, or immediately
in the event of a reverse acquisition with an operating business.  The
amendment provides that the option of Mr. Nestripke to require the Company to
purchase his stock will not be exercised by him until the earlier of the
following:  (i) March 31, 2009; (ii) the termination of the amended
agreement by the Company; or (iii) the closing of a reverse acquisition
transaction with an operating business.





Item6 - Exhibits





Exhibit
      Table
            
            Title
      of Document
            
            Locaton10.1
            
            18%
      Promissory Note
            
            This
      filing10.2
            
            Amendment
      to Employment Agreement
            
            This
      filing31.1
      and 31.2
            
            Rule
      13a-14(a)/15d-14a(a) Certification -- CEO & CFO
            
            This
      filing32.1
      and 32.2
            
            Section
      1350 Certification -- CEO & CFO
            
            This
      filing











SIGNATURES





Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.








Millstream
      Ventures, Inc.(Registrant)Dated:
            
            October
      27, 2008
            
            By:
            /s/
      Denny W. NestripkeDenny
      W. NestripkeChief
      Executive OfficerChief
      Financial Officer





12