----

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

**_____________________**

**FORM      10-Q**

**(Mark      One)**

**ý**
**      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE**

**SECURITIES      EXCHANGE ACT OF 1934**

**For      the quarterly period ended **
**July      31, 2005**

**OR**

** ̈**
**      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE**

**SECURITIES      EXCHANGE ACT OF 1934**

**For      the transition period      from                                to  **

**Commission      File Number **
**000-51132**

**Universal      Capital Management, Inc.**

**(Exact      name of registrant as specified in its charter)**

| **          Delaware**                         | **20-1568059**                                                    |
|--------------------------------------------------------------------------------------------------|-------------------------------------------------------------------|
| (State                or other jurisdiction ofIncorporation                or Organization)      | (I.R.S.                EmployerIdentification                No.) |
|                                                                                             |                                                              |
| **2601                Annand Drive****Suite                16****Wilmington,                DE** | **19808**                                                         |
| (Address                of principal executive offices)                                          | (Zip                Code)                                         |
|                                                                                             |

----

----

----

|                                                                      |   | July                  31, |      | April                  30, |   |
|---------------------------------------------------------------------------|--------|---------------------------|-----------|----------------------------|--------|
|                                                                      |   | 2005                      |      | 2005                       |   |
|                                                                      |   | (Unaudited)               |      | (Audited)                  |   |
| ASSETS                                                                    |   |                      |      |                       |   |
| Investment                  in securities, at fair value (cost: $614,500) |   | $                         | 2,115,601 |                       | $      | 2,782,976 |   |
| Cash                  and cash equivalents                                |   |                      | 105,328   |                       |   | 158,453 |   |
| Miscellaneous                  receivables                                |   |                      | 27,395    |                       |   | 27,095 |   |
| Due                  from affiliates                                      |   |                      | 19,520    |                       |   | 19,820 |   |
| Prepaid                  expenses                                         |   |                      | 8,804     |                       |   | 9,371 |   |
| Property                  and Equipment, net                              |   |                      | 11,246    |                       |   | 12,077 |   |
| Rent                  deposit                                             |   |                      | 1,100     |                       |   | 1,100 |   |
| TOTAL                  ASSETS                                             |   |                      | 2,288,994 |                       |   | 3,010,892 |   |
|                                                                      |   |                      |      |                       |   |   |   |
|                                                                      |   |                      |      |                       |   |   |   |
| LIABILITIES                                                               |   |                      |      |                       |   |   |   |
| Accounts                  payable and accrued expenses                    |   |                      | 81,472    |                       | $      | 61,854 |   |
| Deferred                  income taxes                                    |   |                      | 286,400   |                       |   | 653,000 |   |
| TOTAL                  LIABILITIES                                        |   |                      | 367,872   |                       |   | 714,854 |   |
|                                                                      |   |                      |      |                       |   |   |   |
| NET                  ASSETS                                               |   | $                         | 1,921,122 |                       | $      | 2,296,038 |   |
|                                                                      |   |                      |      |                       |   |   |   |
|                                                                      |   |                      |      |                       |   |   |   |
| ANALYSIS                  OF NET ASSETS:                                  |   |                      |      |                       |   |   |   |
| Net                  capital paid in on shares of capital stock           |   | $                         | 1,486,175 |                       | $      | 1,305,375 |   |
| Distributable                  earnings                                   |   |                      | 434,947   |                       |   | 990,663 |   |
| Net                  assets                                               |   | $                         | 1,921,122 |                       | $      | 2,296,038 |   |
|                                                                      |   |                      |      |                       |   |   |   |
| Equivalent                  per share value based on 4,940,350 shares     |   |                      |      |                       |   |   |   |
| of                  capital stock outstanding as of July 31, 2005    |   |                      |      |                       |   |   |   |
| and                  4,808,200 shares of captial stock outstanding   |   |                      |      |                       |   |   |   |
| as                  of April 30, 2005                                |   | $                         | 0.39      |                       | $      | 0.48 |   |

----

|                  Common                  Stocks - United States - 100% |   | Business                                                      |   | %                    ofPortfolio |   | Number                    ofShares |   | Fair                  Value |   |
|-----------------------------------------------------------------------------|--------|---------------------------------------------------------------|--------|----------------------------------|--------|------------------------------------|--------|-----------------------------|--------|
|                                                                        |   |                                                |   |                             |   |                               |   |                        |   |
| BF                  Acquisition Group III, Inc.                             |   | Inactive                company                               |   |                             | 0.1    | %                                  |   | 75,000                      |   | $ | 1,625 |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        |   |   |   |   |   |   |   |   |
| BF                  Acquisition Group V, Inc.                               |   | Inactive                company                               |   |                             | 0.1    | %                                  |   | 100,000                     |   |   | 1,625 |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        |   |   |   |   |   |   |   |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        | 0.2    | % |   | 175,000 |   |   | 3,250 |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        |   |   |   |   |   |   |   |   |
| FundraisingDirect.com,                  Inc.                                |   | Sales                and distribution of fundraising products |   |                             | 0.4    | %                                  |   | 5,000                       |   |   | 8,333 |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        |   |   |   |   |   |   |   |   |
| Gelstat                  Corporation                                        |   | Consumer                health care company                   |   |                             | 6.8    | %                                  |   | 221,429                     |   |   | 143,929 |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        |   |   |   |   |   |   |   |   |
| Neptune                  Industries, Inc.                                   |   | Seafood                production                             |   |                             | 1.2    | %                                  |   | 47,619                      |   |   | 25,714 |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        |   |   |   |   |   |   |   |   |
| PSI-TEC                  Corporation                                        |   | Plastcis                engineering                           |   |                             | 81.9   | %                                  |   | 587,500                     |   |   | 1,733,125 |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        |   |   |   |   |   |   |   |   |
| Theater                  Extreme Entertainment Group, Inc.                  |   | Home                theater sales and installation            |   |                             | 9.5    | %                                  |   | 575,000                     |   |   | 201,250 |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        |   |   |   |   |   |   |   |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        |   |   |   |   |   |   |   |   |
| Total                  (aggregate cost $614,500)                            |   |                                                          |   |                             |   |                               |   |                        | 100.0  | % |   |   |   | $ | 2,115,601 |   |
|                                                                        |   |                                                          |   |                             |   |                               |   |                        |   |   |   |   |   |   |   |   |

----

| Income                                                                |   |   |     |
|-----------------------------------------------------------------------|--------|--------|----------|
| Management                  services                                  |   | $      | -        |   |
|                                                                  |   |   |     |   |
| Expenses                                                              |   |   |     |   |
| Depreciation                                                          |   |   | 831      |   |
| Dues                  and subscriptions                               |   |   | 135      |   |
| Fees                  and commission                                  |   |   | 4,203    |   |
| Interest                  expense                                     |   |   | 463      |   |
| Insurance                                                             |   |   | 16,147   |   |
| Marketing                                                             |   |   | 400      |   |
| Office                  expenses and supplies                         |   |   | 2,399    |   |
| Payroll                                                               |   |   | 107,308  |   |
| Payroll                  taxes                                        |   |   | 7,587    |   |
| Postage,                  delivery and shipping                       |   |   | 996      |   |
| Professional                  fees                                    |   |   | 94,854   |   |
| Rent                                                                  |   |   | 3,900    |   |
| Telephone                                                             |   |   | 1,133    |   |
| Travel                  and entertainment                             |   |   | 13,780   |   |
| Utilities                                                             |   |   | 805      |   |
|                                                                  |   |   | 254,941  |   |
|                                                                  |   |   |     |   |
| Loss                  From Operations                                 |   |   | (254,941 | ) |
|                                                                  |   |   |     |   |
| Unrealized                  Depreciation on Investments               |   |   | (667,375 | ) |
|                                                                  |   |   |     |   |
| Income                  Tax Benefit - Deferred                        |   |   | 366,600  |   |
|                                                                  |   |   |     |   |
| Net                  Decrease in Net Assets Resulting from Operations |   | $      | (555,716 | ) |
|                                                                  |   |   |     |   |

----

| DECREASE                  IN NET ASSETS FROM OPERATIONS               |   |   |      |
|-----------------------------------------------------------------------|--------|--------|-----------|
| Loss                  from operations                                 |   | $      | (254,941  | ) |
| Unrealized                  depreciation on investments, net of taxes |   |   | (300,775  | ) |
|                                                                  |   |   |      |   |
| NET                  DECREASE IN NET ASSETS RESULTING FROM            |   |   |      |   |
| OPERATIONS                                                            |   |   | (555,716  | ) |
|                                                                  |   |   |      |   |
| CAPITAL                  SHARE TRANSACTIONS                           |   |   | 180,800   |   |
|                                                                  |   |   |      |   |
| TOTAL                  DECREASE                                       |   |   | (374,916  | ) |
|                                                                  |   |   |      |   |
| NET                  ASSETS, BEGINNING OF YEAR                        |   |   | 2,296,038 |   |
|                                                                  |   |   |      |   |
| NET                  ASSETS, END OF PERIOD                            |   | $      | 1,921,122 |   |
|                                                                  |   |   |      |   |

----

| CASH                FLOWS FROM OPERATING ACTIVITIES                     |   |   |     |
|-------------------------------------------------------------------------|--------|--------|----------|
| Net                decrease in net assets resulting from operations     |   | $      | (555,716 | ) |
| Adjustments                to reconcile net decrease in net assets from |   |   |     |   |
| operations                to net cash used in operating activities:     |   |   |     |   |
| Depreciation                expense                                     |   |   | 831      |   |
| Net                unrealized depreciation on investments               |   |   | 667,375  |   |
| Deferred                income taxes                                    |   |   | (366,600 | ) |
| Net                changes in miscellaneous receivables                 |   |   | (300     | ) |
| Net                changes in due from affiliates                       |   |   | 300      |   |
|                                                                    |   |   |     |   |
| Prepaid                expenses                                         |   |   | 567      |   |
| Net                changes in accounts payable and accrued expenses     |   |   | 19,618   |   |
| Net                cash used in operating activities                    |   |   | (233,925 | ) |
|                                                                    |   |   |     |   |
| CASH                FLOWS FROM INVESTING ACTIVITIES                     |   |   |     |   |
| Purchase                of property and equipment                       |   |   | -        |   |
| Lease                deposit                                            |   |   | -        |   |
| Decrease                (Increase) in notes receivable                  |   |   | -        |   |
| Net                cash used in investing activities                    |   |   | -        |   |
|                                                                    |   |   |     |   |
| CASH                FLOWS FROM FINANCING ACTIVITIES                     |   |   |     |   |
| Proceeds                from issuance of common stock                   |   |   | 180,800  |   |
|                                                                    |   |   |     |   |
| NET                DECREASE IN CASH                                     |   |   | (53,125  | ) |
|                                                                    |   |   |     |   |
| CASH,                BEGINNING OF YEAR                                  |   |   | 158,453  |   |
|                                                                    |   |   |          |   |
| CASH,                END OF PERIOD                                      |   | $      | 105,328  |   |
|                                                                    |   |   |     |   |

----

**NOTE      1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

|   | **Basis of                Presentation** |
|--------|------------------------------------------|

|   | The accompanying interim period financial statements                of                Universal Capital Management, Inc. (the “Company”) are unaudited, pursuant                to certain rules and regulations of the Securities and Exchange                Commission, and include, in the opinion of management, all adjustments                (consisting of only normal recurring accruals) necessary for a fair                statement of the results for the period indicated. Such results,                however,                are not necessarily indicative of results that may be expected for                the                full year. Certain information and footnote disclosures normally                included                in the financial statements prepared in accordance with accounting                principles generally accepted in the United States have been condensed                or                omitted pursuant to such rules and regulations. The financial statements                should be read in conjunction with the financial statements and notes                thereto included in the Company’s annual report on Form 10-K and                amendments thereto as filed with the Securities and Exchange                Commission. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

|   | **Nature                  of Business** |
|--------|-----------------------------------------|

|   | The                Company is a newly organized (inception date of August 16, 2004),                closed-end, non-diversified management investment company that has                elected                to be treated as a business development company under the Investment                Company Act of 1940. The Company is primarily engaged in the business                of                furnishing capital and making available managerial assistance to                companies                that do not have ready access to capital through conventional channels.                The Company refers to companies in which it invests as “portfolio                companies.” |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Security                Valuations** |
|--------|----------------------------------------|

|   | Investments                  in securities traded on a national securities exchange (or reported                  on the                  NASDAQ national market) are stated at the last reported sales price                  on the                  day of valuation; other securities traded in the over-the-counter                  market                  (such as OTC BB, Pink Sheets, etc.) and listed securities for which                  no                  sale was reported on that date are stated at the last quoted bid                  price.                  Restricted securities and other securities (small, privately-held                  companies) for which quotations are not readily available are valued                  at                  fair value as determined by the board of                  directors. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Investment                securities are exposed to various risks, such as overall market                volatility. Due to the level of risk associated with the securities                of                certain portfolio companies, it is likely that changes in their values                will occur in the near term and that such changes could materially                affect                the amounts reported in the statement of assets and liabilities at                future                dates. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Use                of Estimates** |
|--------|-------------------------------------|

|   | The                preparation of financial statements in conformity with generally                accepted                accounting principles in the United States 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 amounts of revenues                and                expenses during the reported period. Actual results could differ                from                those estimates. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **Cash                and Equivalents** |
|--------|-----------------------------------------|

|   |   | For                purposes of the statement of cash flows, the Company considers all                investment instruments purchased with maturity of three months or                less to                be cash and cash equivalents. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**NOTE      1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED**

|   |   | **Property                and Equipment** |
|--------|--------|-------------------------------------------|

|   |   | Property                and equipment are stated at cost, net of accumulated depreciation.                For                financial accounting purposes, depreciation is generally computed                by the                straight-line method over the following useful                lives: |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Furniture                and fixtures        | 5                to 7 years |
|--------|----------------------------------------------|-----------------------------|
|   | Computer                and office equipment | 3                to 7 years |

|   |   | **Income                Taxes** |
|--------|--------|---------------------------------|

|   |   | Deferred                tax assets and liabilities are computed annually for differences                between                the financial statement and tax bases of assets and liabilities that                will                result in taxable or deductible amounts in the future based on enacted                tax                laws and rates applicable to the periods in which the differences                are                expected to affect taxable income. Deferred income taxes arise principally                from the recognition of unrealized gains or losses from appreciation                in                investment value for financial statement purposes, while for income                tax                purposes, gains or losses are only recognized when realized (disposition).                When unrealized gains and losses result in a net unrealized loss,                provision is made for a deferred tax asset. When unrealized gains                and                losses result in a net unrealized gain, provision is made for a deferred                tax liability. Valuation allowances are established when necessary                to                reduce deferred tax assets to the amount expected to be realized.                Income                tax expense is the tax payable or refundable for the period plus                or minus                the change during the period in deferred tax assets or                liabilities. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   | **Concentrations                of Credit Risk** |
|--------|--------|--------------------------------------------------|

|   |   | Financial                  instruments which potentially subject the Company to concentrations                  of                  credit risk consist of cash and cash equivalents. At times, the                  Company’s                  balances with financial institutions may exceed the insured amount                  provided by the Federal Deposit Insurance                  Corporation. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |   |
|--------|--------|--------|

|   |   | **Recently Issued Accounting                Pronouncements** |
|--------|--------|--------------------------------------------------------------|

|   |   | In                December 2004, the FASB revised SFAS 123, *“Accounting                for Stock-Based Compensation”*to                require all companies to expense the fair value of employee stock                options.                SFAS 123R is effective at the beginning of the next fiscal year that                begins after December 15, 2005 for a small business                issuer. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**NOTE      2 - INVESTMENTS**

|                                             |   | Number                  of        |    |   |   |                           |   |                         |      |
|--------------------------------------------------|--------|-----------------------------------|---------|--------|--------|--------------------------------|--------|------------------------------|-----------|
|                                             |   | Shares                  Held      |    |   |   | Value                  at      |   | Unrealized                   |      |
|                                             |   | at                  July 31, 2005 |    | Cost   |   | July                  31, 2005 |   | Gain                  (Loss) |      |
| Affiliated                  Securities*          |   |                              |    |   |   |                           |   |                         |      |
| BF                  Acquisition Group III, Inc.  |   |                              | 75,000  |   | $      | 1,625                          |   | $                            | 1,625     |   | $ | - |   |
| BF                  Acquisition Group V, Inc.    |   |                              | 100,000 |   |   | 1,625                          |   |                         | 1,625     |   |   | - |   |
| Total                  Affiliated Securities     |   |                              |    |   |   | 3,250                          |   |                         | 3,250     |   |   | - |   |
|                                             |   |                              |    |   |   |                           |   |                         |      |   |   |   |   |
| Non-affiliated                  Securities       |   |                              |    |   |   |                           |   |                         |      |   |   |   |   |
| FundraisingDirect.com,                  Inc.     |   |                              | 5,000   |   |   | 5,000                          |   |                         | 8,333     |   |   | 3,333 |   |
| Gelstat                  Corporation             |   |                              | 221,429 |   |   | 350,000                        |   |                         | 143,929   |   |   | (206,071 | ) |
| Neptune                  Industries, Inc.**      |   |                              | 47,619  |   |   | 20,000                         |   |                         | 25,714    |   |   | 5,714 |   |
| PSI-TEC                  Corporation             |   |                              | 587,500 |   |   | 35,000                         |   |                         | 1,733,125 |   |   | 1,698,125 |   |
| Theater                  Extreme Entertainment   |   |                              |    |   |   |                           |   |                         |      |   |   |   |   |
| Group,                  Inc.                     |   |                              | 575,000 |   |   | 201,250                        |   |                         | 201,250   |   |   | - |   |
| Total                  Non-affiliated Securities |   |                              |    |   |   | 611,250                        |   |                         | 2,112,351 |   |   | 1,501,101 |   |
|                                             |   |                              |    |   |   |                           |   |                         |      |   |   |   |   |
| Total                  Securities                |   |                              |    |   | $      | 614,500                        |   | $                            | 2,115,601 |   | $ | 1,501,101 |   |

----

**NOTE      3 - INCOME TAXES**

|   | As an investment company organized as a corporation**,**the                Company is taxable as a corporation. As discussed in Note 1, the                Company                utilizes the assets and liability method of accounting for income                taxes in                accordance with Statement                of Financial Accounting Standards No. 109 (SFAS                109). |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

|   | The                  deferred income tax benefit consists of the                  following: |
|--------|----------------------------------------------------------------------------------------------|

|   Current:            |   |   |   |
|---------------------------------|--------|--------|--------|
| Federal                         |   |   |   |   | $ | - |   |
| State                           |   |   |   |   |   | - |   |
|                            |   |   |   |   |   |   |   |
| Total                  Current  |   |   |   |   | $ | - |   |
|                            |   |   |   |   |   |   |   |
| Deferred:                       |   |   |   |   |   |   |   |
| Federal                         |   |   |   |   | $ | (286,300 | ) |
| State                           |   |   |   |   |   | (80,300 | ) |
|                            |   |   |   |   |   |   |   |
| Total                  Deferred |   |   |   |   | $ | (366,600 | ) |
|                            |   |   |   |   |   |   |   |

| Income                  tax at statutory rate             |   | $      | (313,600 | )      |
|-----------------------------------------------------------|--------|--------|----------|--------|
| State                  income taxes, net of federal taxes |   |   | (53,000  | )      |
|                                                      |   |   |     |   |
|                                                      |   | $      | (366,600 | )      |
|                                                      |   |   |     |   |

| Unrealized                  gains   |   | $      | (596,600 | )      |
|-------------------------------------|--------|--------|----------|--------|
| Net                  operating loss |   |   | 310,200  |   |
|                                |   |   |     |   |
| Total                               |   | $      | (286,400 | )      |
|                                |   |   |     |   |

----

**NOTE      4 - DUE FROM AFFILIATES**

| Due                  from BF Acquisition Group V, Inc   |   | $      | 10,170 |   |
|---------------------------------------------------------|--------|--------|--------|--------|
| Due                  from BF Acquisition Group III, Inc |   |   | 9,350  |   |
|                                                    |   |   |   |   |
| Total                                                   |   | $      | 19,520 |   |

**NOTE      5 - CAPITAL SHARE **
**TRANSACTIONS**

|   | During                the three months ended July 31, 2005, 132,150 shares were issued                for                proceeds of $180,800. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------|

**NOTE      6 - **
**SUBSEQUENT      EVENTS**

|   | During                the month of August, 2005, the Company raised capital of $227,500                through                the issuance of 113,750 shares of its common stock.                . |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**NOTE      7 - FINANCIAL HIGHLIGHTS**

|   | Per                  Share Operating Performance                     |   |   |   |   |
|--------|----------------------------------------------------------------------|--------|--------|--------|--------|
|   | Net                  asset value, beginning of period                |   | $      | 0.48   |   |
|   |                                                                 |   |   |   |   |
|   | Loss                  from operations, net of tax benefit            |   |   | (0.03  | )      |
|   | Unrealized                  depreciation on investment, net of taxes |   |   | (0.09  | )      |
|   |                                                                 |   |   | (0.12  | )      |
|   | Add                  capital share transactions                      |   |   | 0.03   |   |
|   |                                                                 |   |   |   |   |
|   | Net                  asset value, end of period                      |   | $      | 0.39   |   |
|   |                                                                 |   |   |   |   |
|   | Total                  Return                                        |   |   | -26.40 | %      |
|   |                                                                 |   |   |   |   |
|   | Average                  Net Assets as a percentage of:              |   |   |   |   |
|   | Expenses                  (annualized)                               |   |   | 48.40  | %      |
|   | Management                  income (annualized)                      |   |   | 0.0    | %      |
|   |                                                                 |   |   |   |   |

----

**Item      2.    Management's Discussion and Analysis of Financial Condition      and Results of Operations. **

**For      the three months ended July 31, 2005**

----

**Financial      Condition**

**Results      of Operations **

----

**Liquidity      and Capital Resources**

----

|                                  | August                31, 2005  | July                31, 2005  | April                30,2005  |
|---------------------------------------|--------------------------------------|------------------------------------|------------------------------------|
|                                  |                                 |                               |                               |
| Number                of shares  | 305,100                         | 191,350                       | 142,700                       |
| Proceeds                of sale  | $610,200                        | $382,700                      | $285,400                      |

**Critical      Accounting Estimates**

**Item      3.    Quantitative and Qualitative Disclosures About Market      Risk**

**Item      4.    Controls and Procedures.**

----

**PART      II**

**OTHER      INFORMATION**

**Item      2.**
**Unregistered      Sale of Equity Securities and Use of Proceeds**

| **Date                of Sale**                                 | **Number                of****Shares                Sold****(a)** |   **Purchasers**       | **Consideration                Paid per****Share****(b)** | **Securities                Act Exemption****Claimed** |
|-----------------------------------------------------------------|-------------------------------------------------------------------|----------------------------------|-----------------------------------------------------------|--------------------------------------------------------|
|                                                            |                                                              |                             |                                                      |                                                   |
| May                1, 2005 through June 30, 2005                | 83,500                                                            |  4                Investors | $1.00                                                     | §                4(2)                             |
|                                                            |                                                              |                             |                                                      |                                                   |
| May                1, 2005 through July                31, 2005 | 48,650                                                            | 77                Investors      | $2.00                                                     | § 3(b)                and (c)                |
| **TOTAL**                                                       | **132,150**                                                       |                             |                                                      |                                                   |

| (a) | No                underwriter or broker-dealer participated in the                sale. |
|-----|-----------------------------------------------------------------------------------------|

| (b) | All                proceeds were used to invest in portfolio companies or to pay routine                operating expenses. |
|-----|-----------------------------------------------------------------------------------------------------------------------------|

**Item      6.            **
**Exhibits.**

**The      following exhibits are included herein:**

| 31.1  | Certification                pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934,                as                amended, executed by the Principal Executive Officer of the                Company.                             |
|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 31.2  | Certification                pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934,                as                amended, executed by the Principal Financial Officer of the                Company.                             |
| 32.1  | Certification                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section                906 of                the Sarbanes-Oxley Act of 2002, executed by the Principal Executive                Officer of the Company.  |
| 32.2  | Certification                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section                906 of                the Sarbanes-Oxley Act of 2002, executed by the Principal Financial                Officer of the Company.  |

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**SIGNATURES**

|   |                              | Universal                Capital Management, Inc. |
|--------|-----------------------------------|---------------------------------------------------|
|   |                              |                                              |   |
|   |                              |                                              |   |
|   |                              |                                              |   |
| Date:  | September                14, 2005 | By:                                               | /s/                Michael D. Queen |
|   |                              |                                              | Michael                D. Queen, President |
|   |                              |                                              |   |
|   |                              |                                              |   |
| Date:  | September                14, 2005 | By:                                               | /s/                Joseph T. Drennan |
|   |                              |                                              | Joseph                T. Drennan, Treasurer |

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